PRIOR PRINTER'S NOS. 1014, 1126 PRINTER'S NO. 1221
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 830
Session of
2021
INTRODUCED BY YUDICHAK, SCAVELLO, COSTA, TARTAGLIONE, J. WARD,
FONTANA, SANTARSIERO AND ROBINSON, JULY 26, 2021
AS AMENDED ON THIRD CONSIDERATION, NOVEMBER 9, 2021
AN ACT
1 Amending Title 64 (Public Authorities and Quasi-Public
2 Corporations) of the Pennsylvania Consolidated Statutes, in
3 Commonwealth Financing Authority, establishing the Veteran-
4 owned Business Loan Guarantee Program.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Title 64 of the Pennsylvania Consolidated
8 Statutes is amended by adding a section to read:
9 § 1553.1. Veteran-owned Business Loan Guarantee Program.
10 (a) Establishment.--The Veteran-owned Business Loan
11 Guarantee Program is established. The program shall provide loan
12 guarantees to commercial lending institutions that make loans to
13 veteran-owned businesses.
14 (b) Application for enrollment.--A commercial lending
15 institution may apply for enrollment in the program authorized
16 under this section. The application shall be on the form
17 prescribed by the board and shall include or demonstrate all of
18 the following:
19 (1) The name and address of the commercial lending
 1 institution and the name and title of the individual who will
2 serve as the point of contact for the commercial lending
3 institution.
4 (2) A statement defining the service area of the
5 commercial lending institution.
6 (3) A statement describing the commercial lending
7 activities engaged in by the commercial lending institution
8 and how the commercial lending institution intends to expand
9 the activities as a result of its participation in the
10 program authorized by this section.
11 (4) Any other information required by the board.
12 (c) Enrollment approval.--Upon being satisfied that all
13 requirements have been met, the board may enroll the commercial
14 lending institution in the program authorized under this section
15 and, if enrolled, the authority shall execute a master guarantee
16 agreement in favor of the commercial lending institution. In
17 addition to any other terms and conditions required by the
18 board, the master guarantee agreement shall provide for the
19 following:
20 (1) The procedure for the submission of a claim for
21 payment by the commercial lending institution. The procedure
22 shall require that the commercial lending institution
23 demonstrate that it has exhausted all available remedies
24 against the borrower, other guarantors and collateral for the
25 loan before seeking payment under the agreement.
26 (2) A requirement that a percentage of any money
27 recovered by the commercial lending institution subsequent to
28 any payment made under the master guarantee agreement by the
29 authority be remitted to the authority.
30 (3) Periodic reporting requirements by the commercial
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 1 lending institution regarding itself and regarding the loans
2 for which guarantee certificates have been issued under this
3 section.
4 (d) Application for guarantee.--A commercial lending
5 institution enrolled in the program authorized under this
6 section may submit an application to the authority for the
7 guarantee of a proposed loan. The application shall be on the
8 form prescribed by the board and shall include or demonstrate
9 all of the following:
10 (1) The name and address of the borrower, the type of
11 business the borrower conducts, the location and age of the
12 business and the names and addresses of the principals of the
13 borrower.
14 (2) The number of projected new or retained employees of
15 the borrower as a result of the loan.
16 (3) A copy of the borrower's last two years of financial
17 statements prepared or reported on by an independent
18 certified public accountant, if available.
19 (4) A statement describing the purpose of the loan, the
20 requested amount of the loan, a copy of the commercial
21 lending institution's commitment letter and applicable credit
22 underwriting that supports the repayment of the loan,
23 including the collateral and other guarantees offered by the
24 borrower to support the loan.
25 (5) Any other information required by the board.
26 (e) Application review.--
27 (1) The board shall review the application to determine
28 all of the following:
29 (i) That the borrower owns and operates a veteran-
30 owned business, AS DEFINED IN 62 PA.C.S. § 2201 (RELATING <--
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 1 TO DEFINITIONS).
2 (ii) That the borrower is financially responsible
3 and has the ability to repay the loan.
4 (iii) That the use of loan proceeds by the borrower
5 will result in jobs being created or retained within this
6 Commonwealth.
7 (iv) That the borrower's business is located within
8 the commercial lending institution's service area and
9 within this Commonwealth.
10 (v) That the borrower and the commercial lending
11 institution have met all other requirements established
12 by the board.
13 (2) Upon being satisfied that all requirements have been
14 met, the board may approve the guarantee and, if approved,
15 the authority shall issue a guarantee certificate for the
16 loan to the commercial lending institution stating the terms
17 and amount of the guarantee.
18 (3) The board may establish a subcommittee composed of
19 one or more members of the board and staff of the department
20 to review and approve applications for guarantees under this
21 section.
22 (f) Limitations.--
23 (1) A guarantee may not exceed 50% of the outstanding
24 principal amount of a loan during the term of a loan for
25 which a guarantee certificate has been issued.
26 (2) A guarantee may not exceed $250,000 for any one
27 loan.
28 (g) Allocation.--Subject to the limitation in section
29 1543(b)(8) (relating to indebtedness), the sum of $5,000,000
30 shall be allocated from the Second Stage Loan Program under
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1 section 1553 (relating to Second Stage Loan Program) for loan
2 guarantees under this section.
3 Section 2. This act shall take effect in 60 days.
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