Bill Text: IN SB0435 | 2011 | Regular Session | Introduced
Bill Title: Capital access program and agency evaluations.
Spectrum: Partisan Bill (Democrat 13-0)
Status: (Introduced - Dead) 2011-01-20 - Senators Arnold, Breaux, Broden, Lanane, Mrvan, Rogers, Simpson, Skinner, Tallian, Taylor and R. Young added as coauthors [SB0435 Detail]
Download: Indiana-2011-SB0435-Introduced.html
Citations Affected: IC 2-5-21; IC 4-4; IC 5-28-29.
Synopsis: Capital access program and agency evaluations. Provides
that the legislative evaluation and oversight policy committee shall
evaluate various state agencies and programs on a schedule beginning
in 2011 and ending in 2025. Provides that in 2011 the committee shall
evaluate agencies and programs with commerce matters as their major
function, including the Indiana economic development corporation
(IEDC). Provides that any savings resulting from a committee
recommendation regarding a commerce agency or program must be
used for the capital access program. Moves the administration of the
capital access program from the Indiana economic development
corporation to the Indiana finance authority.
Effective: July 1, 2011.
January 12, 2011, read first time and referred to Committee on Commerce & Economic
Development.
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or
A BILL FOR AN ACT to amend the Indiana Code concerning state
offices and administration.
(1) Agencies and programs with highway or transportation matters as their major function during
(2) Agencies and programs with occupational licensing as their major function during
(3) Agencies and programs with commerce matters as their major function during
(4) Agencies and programs with agricultural matters as their major function during
(5) Agencies and programs with human resources or economic
security as their major function during 1998. 2015.
(6) Agencies and programs with management or administration
as their major function during 1999. 2016.
(7) Agencies and programs with corrections or judicial matters as
their major function during 2000. 2017.
(8) Agencies and programs with public safety matters as their
major function during 2001. 2018.
(9) Agencies and programs with education matters as their major
function during 2002. 2019.
(10) Agencies and programs with human services as their major
function during 2003. 2020.
(11) Agencies and programs with labor matters as their major
function during 2004. 2021.
(12) Agencies and programs with taxation or finance as their
major function during 2005. 2022.
(13) Agencies and programs with business regulation as their
major function during 2006. 2023.
(14) Agencies and programs with health matters as their major
function during 2007. 2024.
(15) Agencies and programs with natural resources or recreation
as their major function during 2008. 2025.
(b) The committee shall be appointed before July 1 of the year the
agencies and programs are required to be evaluated under this section.
(c) The council by resolution may do any of the following with
respect to agencies and programs evaluated under this section:
(1) Require evaluation of agencies and programs in an order
different from the order specified in subsection (a).
(2) Assign specific topics or issues for audit and evaluation by
staff and a committee.
(3) Assign areas for audit and evaluation in classifications
different from the areas described in subsection (a).
(1) Review audit reports.
(2) Take testimony regarding audit reports and other areas the committee considers related to the committee's work.
(3) Make recommendations for legislation.
(4) Make recommendations for administrative changes.
(b) With respect to an agency or program with commerce
matters as a major function, including the Indiana economic
development corporation established by IC 5-28-3-1, the committee
shall include with any recommendation for legislation or
administrative change, an estimate of the amount of state fund
savings that would result from implementing the recommendation.
If such a recommendation results in any savings to a state fund, as
determined by the state budget agency, the amount of the savings
shall be transferred from the state fund to which the savings are
attributable to the capital access account referred to in
IC 5-28-29-4.
(1) There are currently numerous bodies corporate and politic of the state, with separate decision making and borrowing authority, that may issue bonds, notes, and obligations, and otherwise access the financial markets.
(2) Consolidation of this decision making and borrowing authority may provide economic efficiencies and management synergies and enable the state to communicate, with a single voice, with the various participants in the financial markets, including credit rating agencies, investment bankers, investors, and municipal bond insurers and other credit enhancers.
(b) In addition to the purposes set forth in section 2 of this chapter, the authority is established for the purpose of permitting the consolidation of certain bodies in a single body of decision making concerning access to the capital and financial markets in the name of, or for the benefit of, the state. The authority is also best suited to administer the capital access program under IC 5-28-29 because of the authority's expertise in the financial markets.
(c) The authority is authorized to carry out the public purposes provided for in the affected statutes through a single entity in order to achieve the purposes of this section.
(1) Administer the program.
(2) Market the program to businesses and other persons in Indiana in cooperation with financial institutions and statewide associations representing financial institutions.
(3) If the reserve funds are not maintained in an account with the lender, upon execution of an agreement between the lender and the
establish a reserve fund account at the corporation authority for
the lender for the purpose of receiving all required premium
charges to be paid by the lender and the borrower and transfers
made by the corporation authority under this chapter. If the
reserve funds are maintained in an account with the lender, upon
execution of an agreement between the lender and the corporation
authority, the corporation authority shall establish a reserve
fund account with the lender in the name of the corporation
authority for the purpose of receiving all required premium
charges to be paid by the lender and the borrower and transfers
made by the corporation authority under this chapter.
(4) Develop the program, in cooperation with financial
institutions and statewide associations representing financial
institutions, so that the degree of flexibility for the corporation
authority and the participating lenders is maximized, the state
oversight of individual loans is minimized, and the fiscal integrity
of the program is maintained.
(5) Enter into any contracts necessary to carry out the program.
(6) Take any action reasonably necessary to ensure compliance
with the program.
lender must file a completed loan enrollment form with the corporation.
authority. The lender must also certify the following to the corporation
authority as part of the filing:
(1) The lender has no substantial reason to believe that the loan
is being made to a borrower who does not meet the requirements
of section 3 of this chapter.
(2) The lender has received from the borrower a written
representation, warranty, pledge, and waiver stating that the
borrower has no legal, beneficial, or equitable interest in the
nonrefundable premium charges or any other funds credited to the
reserve fund established to cover losses sustained by the lender on
enrolled loans.
(3) The loan being filed for enrollment is an eligible loan under
section 17 of this chapter.
(4) Premium charges required of the borrower and lender under
this chapter have been deposited in the reserve fund.
(b) The lender shall file the loan enrollment form within ten (10)
business days after the lender makes the loan. The date on which the
lender makes a loan is the earlier of the date on which the lender first
disburses proceeds of the loan to the borrower or the date on which the
loan documents have been executed and the lender has obligated itself
to disburse proceeds of the loan. The filing date of a loan enrollment
form is the date on which the lender does any of the following:
(1) Delivers the required documentation to the corporation.
authority.
(2) Delivers the document to a professional courier service for
delivery to the corporation. authority.
(3) Mails the document to the corporation authority by certified
mail.
JULY 1, 2011]: Sec. 23. Upon execution of an agreement between the
lender and the corporation, authority, the corporation authority shall
establish a reserve fund account with the lender in the name of the
corporation authority for the purpose of receiving all required
premium charges to be paid by the lender and the borrower and
transfers made by the corporation authority under this chapter.
(1) If the amount of a loan, plus the amount of loans previously enrolled by the lender, is less than two million dollars ($2,000,000), the premium amount transferred must be equal to one hundred fifty percent (150%) of the combined premiums paid into the reserve fund by the borrower and the lender for each enrolled loan.
(2) If, before the enrollment of the loan, the amount of loans previously enrolled by the lender is equal to or greater than two million dollars ($2,000,000), the premium amount transferred must be equal to the combined premiums paid into the reserve fund by the borrower and the lender for each enrolled loan.
(3) If the total amount of all loans previously enrolled by the lender is less than two million dollars ($2,000,000), but the enrollment of a loan will cause the total amount of all enrolled loans made by the lender to exceed two million dollars ($2,000,000), the
reserve fund an amount equal to a percentage of the combined
premiums paid into the reserve fund by the lender and the
borrower. The percentage is determined as follows:
STEP ONE: Multiply by one hundred fifty (150) that part of
the loan that when added to the total amount of all loans
previously enrolled by the lender totals two million dollars
($2,000,000).
STEP TWO: Multiply the remaining balance of the loan by
one hundred (100).
STEP THREE: Add the STEP ONE product to the STEP TWO
product.
STEP FOUR: Divide the STEP THREE sum by the total
amount of the loan.
The corporation authority may transfer two (2) times the amount
determined under this section to the reserve fund if the borrower is a
disadvantaged business enterprise (as defined in IC 5-16-6.5-1). The
corporation authority may transfer three (3) times the amount
determined under this section to the reserve fund if the borrower is a
high growth company with high skilled jobs (as defined in
IC 5-28-30-4). The corporation authority may transfer to the reserve
fund three (3) times the amount determined under this section if the
borrower is a child care facility. Unless money is paid out of the
reserve fund according to the specific terms of this chapter, all money
paid into the reserve account by the lender must remain in that account.
(b) If money in the reserve fund is not deposited by the
(1) Direct obligations of the United States, the principal and interest of which are unconditionally guaranteed by the United States.
(2) A deposit account at a depository institution whose deposits are insured by the Federal Deposit Insurance Corporation or National Credit Union Administration.
(c) All interest earned in a reserve fund account shall be credited to that account. Fifty percent (50%) of the interest earned may be withdrawn by the
any purpose.
(1) The money in the reserve fund will be available to pay claims under section 29 of this chapter.
(2) The lender will have a first security interest in the money in the reserve fund to pay the claims.
(3) The
(1) The balance in the reserve fund.
(2) Payments and transfers into the reserve fund.
(3) Withdrawals from the reserve fund.
(4) Interest or income earned on money credited to the reserve fund.
(b) The records of the
(1) payments and transfers into the reserve fund;
(2) withdrawals from the reserve fund; and
(3) interest or income earned on the money credited to the reserve fund;
are available to the lender at the offices of the
(b) The lender's claim may include, in addition to the amount of principal charged off plus accrued interest, one-half (1/2) of the reasonable documented out-of-pocket expenses incurred in pursuing collection efforts, including preservation of collateral. The amount of principal included in the claim may not exceed the principal amount covered under the program. The amount of accrued interest included in the claim may not exceed the accrued interest attributable to the covered principal amount.
(c) The lender shall determine when and how much to charge off on an enrolled loan in a manner consistent with the lender's normal method for making these determinations on similar loans that are not enrolled loans.
(d) If the lender files two (2) or more claims contemporaneously and there are insufficient funds in the reserve fund at that time to cover the entire amount of the claims, the lender may designate the order of priority in which the
(1) the information provided by the lender to the
(2) the lender is not otherwise in substantial compliance with this chapter or the agreement with the
(b) If there is insufficient money in the reserve fund to cover the entire amount of the lender's claim, the
(1) If the enrolled loan for which the claim has been filed is not an early loan, the payment fully satisfies the claim, and the lender has no right to receive any further amount from the reserve fund with respect to that claim.
(2) If the enrolled loan for which the claim has been filed is an early loan, the
(A) the partial payment has not satisfied the lender's claim; and
(B) the remaining balance of the claim is not greater than seventy-five percent (75%) of the balance in the reserve fund at the time the request for payment by the lender is received by the
authority, the lender recovers from a borrower any amount for which
payment of the claim was made, the following apply:
(1) If the recovered amount, when added to the claim previously
paid by the corporation authority in connection with an enrolled
loan, exceeds the lender's loss on that enrolled loan, the lender
shall promptly pay to the corporation authority for deposit in the
reserve fund the amount of the excess.
(2) For purposes of this section and section 32 of this chapter, the
lender's loss on an enrolled loan shall be the amount of principal
charged off by the lender plus accrued interest plus one-half (1/2)
of the reasonable and documented out-of-pocket expenses
incurred by the lender in pursuing collection efforts.
(b) If an assignment has been made under subsection (a), the
(c) If the
program or not included in the lender's claim. Upon making a payment
under this subsection, the corporation authority is subrogated to the
rights of the lender in accordance with subsection (a).
(d) Notwithstanding any other provision of this section, the
corporation authority may not exercise the right of subrogation unless
the corporation authority determines, in the corporation's authority's
discretion, that the lender has not exercised reasonable care and
diligence in collection activities with respect to the loan, or that there
is a reasonable basis for believing that the lender will not exercise
reasonable care and diligence in the future with respect to those
collection activities.
(b) If a year-end report filed under this section indicates that, for the immediately preceding twelve (12) calendar month period ending June 30, the balance in the reserve fund continuously exceeded fifty percent (50%) of the total outstanding balance of all enrolled loans, including unfunded parts of enrolled loans that are lines of credit, the
(c) If a year-end report is not filed within thirty (30) days after the original due date of the report, the
credit. The amount of the withdrawal may not be greater than the
minimum amount of any excess as continuously maintained over the
immediately preceding twelve (12) calendar month period ending June
30. Withdrawals of excess reserve funds by the corporation authority
under this section may be used for any purpose.
(d) The right of the corporation authority to make a withdrawal
from the reserve fund under subsection (b) or (c) is subject to the
following provisions:
(1) If a year-end report is filed by July 16 or not more than thirty
(30) days after July 16, the corporation authority has the right of
withdrawal for a period of ninety (90) days from the date of the
filing of the report with the corporation. authority.
(2) If a year-end report is not filed by July 16 or not more than
thirty (30) days after July 16, the corporation authority has the
right of withdrawal for a period of ninety (90) days from the date
the corporation authority determines from an inspection of the
lender's files that the corporation authority is entitled to make a
withdrawal from the reserve fund under this section.
(1) appropriated by the general assembly;
(2) transferred by the
development guaranty fund; or
(3) transferred by the corporation authority from the general
funds of the corporation. authority.
(b) The expenses of the corporation authority attributable and
allocated by the corporation authority to the capital access program
shall be paid from the capital access account.
(b) On July 1, 2011, all records and property of the corporation with respect to the capital access program, including appropriations and other funds under the corporation's control or supervision, are transferred to the authority.
(c) After June 30, 2011, any amounts owed to the corporation under the capital access program before July 1, 2011, are considered to be owed to the authority.
(d) After June 30, 2011, a reference to the corporation in a statute, rule, or other document concerning the capital access program is considered a reference to the authority.
(e) On July 1, 2011, all powers, duties, and liabilities of the corporation with respect to agreements entered into or obligations issued in connection with the capital access program are transferred to the authority. The rights of a party to such an agreement or the holder of such an obligation remain unchanged, although the powers, duties, and liabilities described in this subsection have been transferred to the authority.
