SP0578, LD 1480, item 1, An Act To Create and Sustain High-quality Maine Jobs

An Act To Create and Sustain High-quality Maine Jobs

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 10 MRSA §1026-U is enacted to read:

§ 1026-U. Maine Capital Investment Program

1. Definitions. As used in this section, unless the context otherwise indicates, the following terms have the following meanings.

A. "Business development project" means a project that involves the construction, development, rehabilitation, modernization or acquisition of a building, a structure, a system, machinery, equipment or a facility that has a projected cost of at least $50,000,000 or is projected to result in the creation or retention of a least 250 full-time employment positions that pay at least 125% of the annual average weekly wage under Title 26, section 1043, subsection 1-A.

B. "Fund" means the Maine Capital Investment Fund established in subsection 4.

C. "Program" means the Maine Capital Investment Program established pursuant to subsection 2.

2. Program established. The authority shall create and oversee the Maine Capital Investment Program to increase the availability of capital to eligible business development projects as provided under this section.

3. Authority assets; obligation. This section may not be construed to place the assets of the authority at risk. This section may not be construed to create an obligation of the State or of any political subdivision of the State.

4. Maine Capital Investment Fund. The Maine Capital Investment Fund is established as a nonlapsing revolving loan and equity fund administered by the authority to support the capital needs of business development projects under the program. The fund is capitalized by sums that are appropriated or allocated by the Legislature or transferred to the fund from time to time by the State Controller, interest earned from the investment of fund balances, state bond issues, state employee pension funds, institutional endowments and other funds from any public or private source received for use for any of the purposes for which the fund has been established. The authority may charge the fund reasonable fees for the cost of implementing and administering the program and any loans or bonds authorized by this section.

5. Criteria to qualify for financial support. The authority shall provide financial support to an applicant to support a business development project under the program based in part but not solely on the following criteria:

A. The creditworthiness of the applicant, including factors such as the applicant's historical financial performance, management ability, plan to market the applicant's product or service and whether the applicant meets or exceeds industry average financial performance ratios commonly accepted in determining creditworthiness in the applicant's industry;

B. The sufficiency of collateral pledged by the applicant;

C. The sufficiency of projected revenues from the business development project or other sources to repay the financial support received under and meet the requirements of subsection 6 for the term of the obligation;

D. The extent to which financial support from the authority enhances the employment and wage benefits projected to be created by the business development project;

E. The duration of the employment and wage benefits projected to be created by the business development project; and

F. Demonstration that the financial support from the authority is necessary due to the reduced cost and increased flexibility of the financial support and not due to the applicant's inability to obtain financing from another source.

6. Financial support. The authority may provide the following financial support to an applicant determined to be qualified under subsection 5:

A. A direct loan of up to $50,000,000 from the fund for a single business development project, which must be matched by an amount that is equal to at least 25% of the loan amount and that is obtained from a source other than the fund; or

B. Up to $100,000,000 in bond funding for a single business development project and up to $200,000,000 in bond funding to the same applicant for multiple business development projects.

The authority may require other terms or conditions of financial support under this subsection as the authority determines necessary and reasonable.

7. Seed capital investment tax credit. Investments into the fund qualify for the seed capital investment tax credit under Title 36, section 5216-B, within the limitations specified by that section.

8. Requirements of recipient. In addition to repayment of the financial support received under subsection 6 pursuant to the terms set by the authority, within 5 years after the completion of the business development project the recipient shall pay to the fund an amount equal to 10% of the amount of the financial support received under subsection 6 pursuant to terms determined by the authority.

9. Rules. The authority may adopt rules as necessary to implement this section. Rules adopted pursuant to this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A.

Sec. 2. Contingent effective date. This Act takes effect only upon the receipt by the Finance Authority of Maine for the Maine Capital Investment Fund under the Maine Revised Statutes, Title 10, section 1026-U of an appropriation or allocation by the Legislature or funds from another funding source in the amount of at least $250,000,000. The Finance Authority of Maine shall notify the Secretary of State, the Secretary of the Senate, the Clerk of the House of Representatives and the Revisor of Statutes when the funds are received pursuant to this section.

summary

This bill creates the Maine Capital Investment Program within the Finance Authority of Maine to provide loans or bond funding to eligible business development projects that have projected costs of at least $50,000,000 or are projected to result in the creation or retention of at least 250 full-time employment positions that pay at least 125% of the state annual average weekly wage. The bill does not take effect until the authority receives funds for the program in the amount of at least $250,000,000.

SP0578 LD 1480	Session - 127th Maine Legislature		LR 2196 Item 1
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