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History
- Referred to finance
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Sponsor's memo
BILL NUMBER:S2603
Title of bill
An act to amend the executive law, in relation to creating the New York state community service loan board and making an appropriation therefor
Summary
This bill would add a new Article 26-c to the New York State Community Loan Board. The Board, chaired by the Secretary of state, would be empowered to make zero interest loans. The loans are made to those groups who do business with the State of New York and have experienced financial problems because of the failure of the appropriate state agency to fund the group in a timely manner. The Board would be empowered to provide such groups with a zero interest loan, with the expectation that the loan would be repaid when the grant becomes available. In order to apply for such a loan, groups would be required to produce proof of a pending contract with a state agency. Loans are restricted to not-for-profit organizations whose total annual budget is not greater than 1.5 million dollars.
The Board would have the authority to promulgate additional rules and regulations, with the agreement that the application form is not to exceed two pages. In the event an organization fails to repay a loan, the balance would be collected by the Board and the amount would be deducted from the grant itself. Any organization that fails to repay its loan would be prevented from receiving additional grants from the state for a period of two years.
Justification
Organizations doing business with New York state, particularly not-for-profit corporations, routinely run into serious funding problems. These problems almost always occur at the end of one contract year and the beginning of a new contract year. Problems also occur in delivering checks to these groups during the regular course of the contract period. The nature of these organizations often is such that these funds may be one of few, or the sole source of income for the organization. Payless paydays frequently result when this situation occurs.
Fiscal implication
$100,000 from the State Treasury.
Effective date
This act shall take effect on the first of October next succeeding the date on which it shall have become a law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.