OLR Bill Analysis

sHB 5568

AN ACT CONCERNING TARGETED HEALTH AREAS.

SUMMARY:

This bill requires the public health commissioner to designate up to 10 municipalities as targeted health areas (THAs) and specifies that physicians and physician offices there are eligible for loans and grants under the Small Business Express Program (Express).

EFFECTIVE DATE: Upon passage

DESIGNATING THAs

The bill requires the public health commissioner to designate, by December 1, 2013, and within available appropriations, up to 10 municipalities as THAs, in consultation with the social services commissioner and a representative of the Connecticut State Medical Society. The commissioner may designate a municipality as a THA if it has a (1) medically underserved population or (2) high chronic disease rate. Further, she and the parties with whom she must consult must identify any medical specialty needed in the THAs.

EXPRESS ASSISTANCE

Eligibility

The bill specifies that licensed physicians and physician offices in THAs qualify for Express financing if they meet one of two sets of criteria. Under the first set, a physician or physician offices qualify if they practice medicine in a THA and actively provide (1) primary care for adults or children or (2) any medical specialty the commissioner determines the THA needs. The physician must also be current on all state and local taxes and be in good standing with the Public Health Department.

As under existing law, a physician qualifies for Express financing if she or he:

1. employs no more than 100 people during the prior 12 months,

2. is based and operates in Connecticut,

3. has been registered to do business here for at least 12 months,

4. is current on all state and local taxes, and

5. is in good standing with all state agencies.

Types of Assistance

Licensed physicians and physician offices qualify for financing under the Department of Economic and Community Development's (DECD's) Express Program, which provides revolving loans, job creation incentive loans, and matching grants. Table 1 outlines the program's features, including eligible expenditures and terms and conditions.

Table 1: Express Program

Characteristic

Financial Assistance

Revolving Loans

Job Creation Incentives

Matching Grants

Type of Assistance

Loan

Deferrable or forgivable loans for borrowers that increase and maintain jobs

Matching grants for capital

Purpose

Support small business growth

Support hiring goals

Provide capital

Component-Specific Priority

Businesses creating new jobs lasting at least 12 consecutive months

Economic-base industries

Economic-base businesses

Economic-base businesses

Businesses likely to use grants to maintain job growth

Eligible expenditures

Acquiring machinery and equipment

Construction or leasehold improvements

Relocation costs

Working capital

Other commissioner-approved business expenses

Training

Marketing

Working capital

Other commissioner-approved expenses that support job creation

New or ongoing training

Working capital

Acquiring machinery and equipment

Construction or leasehold improvements

Relocation within the state

Other commissioner-approved business- related expenses

Terms or conditions

$10,000 to $100,000 loans

Up to 4% interest

Maximum 10-year term

DECD reviews and approves loan terms, conditions, and collateral requirements to prioritize job growth and retention

$10,000 to $300,000 forgivable loans

Commissioner may defer loan payments based on her assessment of the business' attainment of job creation goals

Commissioner may also forgive all or part of a loan based on a business (1) attaining job creation goals or (2) maintaining an increased number of jobs for at least 12 consecutive months

DECD reviews and approves loan terms, conditions, and collateral requirements to prioritize job creation and retention

$10,000 to $100,000 grants

Business must match state grant

DECD prioritizes based on likelihood of applicant maintaining job growth

COMMITTEE ACTION

Commerce Committee

Joint Favorable Substitute

Yea

19

Nay

0

(03/14/2013)