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A02063 Summary:

A02063 Actions:

A02063 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
 submitted in accordance with Assembly Rule III, Sec 1(f)



 
BILL NUMBER: A2063B
 
SPONSOR: Quart (MS)

 
TITLE OF BILL:
 
An act to amend the economic development law, in relation to microenter-
prise development
 
 
PURPOSE OR GENERAL IDEA OF BILL:
 
Establishes the microenterprise development act to assist very small
businesses and low-income entrepreneurs.
 
 
SUMMARY OF SPECIFIC PROVISIONS:
 
Section 1: Short Title
 
Section 2: Legislative Findings and Purpose
 
Section 3: Adds a new article 9-B, Section 217 to the economic develop-
ment law. This article would:
 

* require the commissioner of the department of economic development to
establish a grant program for microenterprise technical assistance;
 
* establish that the organizations receiving funding shall use the
grants to provide training and technical assistance to the microenter-
prise entrepreneurs.
 
* provide that not less than fifty percent of the funds made available
are used to benefit person whose income is not more than 150% of the
poverty line;
 
* require the training organizations to have received at least one
dollar in matching funds for every dollar received from the state.
 
Section 4: Rules and Regulations
 
Section 5: Effective Date
 
 
JUSTIFICATION:
 
Development and expansion of businesses in economically distressed
communities in both rural and urban areas can assist residents who are
unemployed, underemployed or in low-income jobs. Microenterprises can
address this need for development. However, many low-income entrepre-

neurs lack access to capital, training and technical assistance. This
legislation will provide vital funding to local support organizations
that can leverage charitable foundation and private sector support, to
provide these entrepreneurs with vital assistance. An estimated 22
million microenterprises operate throughout the country and provide 18%
of all private U.S.  employment. This legislation will strengthen the
state economy by enabling new businesses and giving them the tools need-
ed to succeed.
 
 
PRIOR LEGISLATIVE HISTORY:
 
2015: Re-referenced to Small Business Committee, Passed Assembly
2014: Referred to Economic Development
2012: Reported from Economic Development, referred to Ways and Means
2011: Referred to Economic Development
2010: Referred to Economic Development
2008: Referred to Economic Development
 
 
FISCAL IMPLICATIONS:
 
None noted.
 
 
EFFECTIVE DATE:
This act shall take effect on the July 1, 2017.

A02063 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         2063--B
                                                                 Cal. No. 99
 
                               2015-2016 Regular Sessions
 
                   IN ASSEMBLY
 
                                    January 15, 2015
                                       ___________
 
        Introduced  by  M. of A. QUART, BLAKE, JOYNER, COLTON, MOSLEY, ROBINSON,
          RODRIGUEZ --  Multi-Sponsored  by  --  M.  of  A.  BRENNAN,  BRINDISI,
          GUNTHER,  HOOPER, JAFFEE, KEARNS, LAVINE, LUPARDO, ROSENTHAL, SCHIMEL,
          SEAWRIGHT, SIMANOWITZ, TITONE, TITUS, WEPRIN -- read once and referred
          to the Committee on Economic Development -- reference changed  to  the
          Committee  on  Small  Business  -- committee discharged, bill amended,
          ordered reprinted as amended and  recommitted  to  said  committee  --
          advanced  to a third reading, amended and ordered reprinted, retaining
          its place on the order of third reading
 
        AN ACT to amend the economic development law, in relation to microenter-
          prise development
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  Short  title. This act shall be known and may be cited as
     2  the "microenterprise development act".
     3    § 2. Legislative findings and purpose. (a) The  legislature  finds  as
     4  follows:
     5    1.  Development and expansion of businesses in economically distressed
     6  communities in both rural and urban areas can assist residents  who  are
     7  unemployed, underemployed or in low-income jobs.
     8    2.  Microenterprises  are important elements of New York's economy and
     9  play an essential role in job creation, entrepreneurial  skill  develop-
    10  ment, and enhancing the ability of low-income households to become self-
    11  sufficient.    Microenterprises provide a means for unemployed, underem-
    12  ployed or low-income individuals to find and  sustain  productive  work,
    13  and  they  provide opportunities for economically distressed communities
    14  to thrive.
    15    3. Microentrepreneurs, especially those with low incomes, often do not
    16  have access to commercial credit because of lack of business  experience
    17  or  training, collateral to secure business loans, or lack of history of
    18  business records to demonstrate their loan repayment potential.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04471-04-6
        A. 2063--B                          2
 
     1    4. Local community-based microenterprise  support  organizations  have
     2  demonstrated  cost-effective  delivery  methods for providing financial,
     3  business, and technical  assistance,  including  microloans,  mentoring,
     4  physical space and other essential services to microenterprises.
     5    5.  Charitable foundation support, federal program funding and private
     6  sector support can be leveraged by a statewide program  for  development
     7  of microenterprises.
     8    (b)  The  purpose  of  this act is to strengthen the state economy and
     9  enable low-income residents to  become  self-sufficient  by  encouraging
    10  microenterprise development.
    11    §  3.  The economic development law is amended by adding a new article
    12  9-B to read as follows:
    13                                 ARTICLE 9-B
    14                         MICROENTERPRISE DEVELOPMENT
    15  Section 217. Microenterprise development.
    16    § 217. Microenterprise development. (a) There is hereby established  a
    17  microenterprise  development program under the purview of the department
    18  of economic development.   Such program shall  provide  microenterprises
    19  with  financial,  business,  or technical assistance, including, but not
    20  limited to, access to financing, mentoring, training or acquiring  phys-
    21  ical space.
    22    (b)  As  used  in  this  section,  the  following terms shall have the
    23  following meanings:
    24    1. "Commissioner" means the commissioner of the department of economic
    25  development.
    26    2. "Microenterprise" means any business, whether new or existing, that
    27  is a sole proprietorship, partnership, or corporation which has five  or
    28  less employees.
    29    3.  "Microenterprise development organization" means a community-based
    30  organization, or social service organization, or other nonprofit  entity
    31  that has developed a program to provide microenterprises with financial,
    32  business, or technical assistance, including, but not limited to, access
    33  to financing, mentoring, training, or acquiring physical space.
    34    4.  "Training  and  technical  assistance"  means services and support
    35  provided to  microenterprises,  especially  those  that  are  low-income
    36  owners,  for  enhancing  business  planning,  marketing  management, and
    37  improving financial management skills,  for  the  purpose  of  accessing
    38  financial services, such as loans, microloans and grants.
    39    5.  "Low-income person" means a person with income adjusted for family
    40  size that does not exceed:
    41    a. For metropolitan areas, eighty percent  of  median  income  of  the
    42  metropolitan area; or
    43    b.  For  nonmetropolitan  areas,  the greater of eighty percent of the
    44  area median income or eighty percent of  the  statewide  nonmetropolitan
    45  area median income.
    46    (c)  1.  The commissioner is authorized to establish a microenterprise
    47  technical assistance and capacity  building  grant  program  to  provide
    48  assistance  in  the  form  of  grants  of up to five thousand dollars to
    49  microenterprise development organizations to use  as  provided  in  this
    50  subdivision from available appropriations.
    51    2.  A  microenterprise  development organization shall use grants made
    52  under this program to provide training and technical assistance to  low-
    53  income entrepreneurs operating microenterprises.
    54    3.  The  commissioner shall ensure that not less than fifty percent of
    55  the funds made available are  used  to  benefit  persons  whose  income,
        A. 2063--B                          3

     1  adjusted  for family size, is not more than one hundred fifty percent of
     2  the poverty line as defined in 42 U.S.C. 9902(2).
     3    4.  A  microenterprise  development organization must provide at least
     4  one dollar in matching funds for every dollar of state financial assist-
     5  ance. Fees, grants, and gifts from public or private sources may be used
     6  to comply with the matching funds requirement.
     7    5. The commissioner shall assist microenterprises to  access  existing
     8  grants,  loans, and other programs and services currently available from
     9  any state entity. Further,  the  commissioner  shall  actively  seek  to
    10  encourage  private  financial  institutions to make loans to microenter-
    11  prises.
    12    § 4. Rules and regulations. The commissioner of  economic  development
    13  is authorized to promulgate rules and regulations in accordance with the
    14  state  administrative  procedure  act  that are necessary to fulfill the
    15  purposes of this act. Such rules  and  regulations  shall  be  completed
    16  within one hundred eighty days after the effective date of this act.
    17    § 5. This act shall take effect July 1, 2017.