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A BILL TO BE ENTITLED
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AN ACT
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relating to the creation of the small business disaster recovery |
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loan program. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 403, Government Code, is amended by |
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adding Subchapter R to read as follows: |
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SUBCHAPTER R. SMALL BUSINESS DISASTER RECOVERY LOAN PROGRAM |
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Sec. 403.501. DEFINITIONS. In this subchapter: |
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(1) "Disaster declaration" means a declaration by the |
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governor of a state of disaster under Section 418.014. |
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(2) "Fund" means the small business disaster recovery |
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revolving fund created under Section 403.506. |
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(3) "Small business" has the meaning assigned by |
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Section 481.401. |
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(4) "Trust company" means the Texas Treasury |
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Safekeeping Trust Company. |
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Sec. 403.502. SMALL BUSINESS DISASTER RECOVERY LOAN |
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PROGRAM. (a) The comptroller by rule shall establish a loan |
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program to use money from the fund established under this |
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subchapter to provide financial assistance to small businesses |
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affected by a disaster. |
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(b) The comptroller may provide financial assistance from |
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the fund only: |
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(1) in the form of a loan to an eligible small business |
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that is located in an area under a disaster declaration; and |
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(2) during the period for which the disaster |
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declaration is in effect. |
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(c) The comptroller shall credit to the fund all principal |
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and interest payments on a loan from the fund. |
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Sec. 403.503. ELIGIBILITY FOR LOAN. The comptroller by |
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rule shall establish the eligibility requirements for a loan to a |
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small business under this subchapter. The requirements must include |
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that the small business: |
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(1) is in good standing under the laws of this state; |
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(2) does not owe delinquent taxes to a taxing unit of |
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this state; |
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(3) has suffered physical damage or economic injury as |
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a result of the event leading to the disaster declaration; and |
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(4) has paid in full any previous loans received under |
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this subchapter. |
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Sec. 403.504. USES OF LOAN. An eligible small business may |
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only use a loan received under this subchapter to pay the small |
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business's payroll costs, including costs related to the |
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continuation of health care benefits for the small business's |
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employees. |
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Sec. 403.505. APPLICATION FOR LOAN. The comptroller shall |
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develop and implement an application process for an eligible small |
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business to receive a loan under this subchapter. |
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Sec. 403.506. SMALL BUSINESS DISASTER RECOVERY REVOLVING |
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FUND. (a) The small business disaster recovery revolving fund is a |
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special fund outside the state treasury to be used by the |
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comptroller, without further legislative appropriation, for the |
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purpose of providing financial assistance to small businesses in |
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response to a disaster declaration as provided by this subchapter. |
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The comptroller shall administer the fund. The comptroller may |
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establish separate accounts in the fund. The fund and the fund's |
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accounts are kept and held by the trust company in escrow and in |
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trust for and in the name of the comptroller. The comptroller has |
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legal title to money and investments in the fund until money is |
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disbursed from the fund as provided by this subchapter and |
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comptroller rules. |
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(b) Money deposited to the credit of the fund may be used |
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only as provided by this subchapter. |
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(c) The fund consists of: |
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(1) money transferred or deposited to the credit of |
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the fund by law, including money from any source transferred or |
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deposited to the credit of the fund at the comptroller's discretion |
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as authorized by law; |
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(2) the proceeds of any fee or tax imposed by this |
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state that by statute is dedicated for deposit to the credit of the |
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fund; |
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(3) any other revenue that the legislature by statute |
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dedicates for deposit to the credit of the fund; and |
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(4) investment earnings and interest earned on amounts |
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credited to the fund. |
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Sec. 403.507. MANAGEMENT AND INVESTMENT OF FUND. (a) The |
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trust company shall hold and invest the fund, and any accounts |
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established in the fund, for and in the name of the comptroller, |
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taking into account the purposes for which money in the fund may be |
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used. The fund may be co-invested with the state treasury pool. |
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(b) The overall objective for the investment of the fund is |
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to maintain sufficient liquidity to meet the needs of the fund while |
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striving to preserve the purchasing power of the fund. It is the |
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intent of the legislature that the fund remain available in |
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perpetuity for the purposes of this subchapter. |
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(c) The trust company has any power necessary to accomplish |
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the purposes of managing and investing the assets of the fund. In |
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managing the assets of the fund, through procedures and subject to |
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restrictions the trust company considers appropriate, the trust |
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company may acquire, exchange, sell, supervise, manage, or retain |
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any kind of investment that a prudent investor, exercising |
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reasonable care, skill, and caution, would acquire or retain in |
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light of the purposes, terms, distribution requirements, and other |
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circumstances of the fund then prevailing, taking into |
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consideration the investment of all the assets of the fund rather |
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than a single investment. |
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(d) The trust company may recover the costs incurred in |
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managing and investing the fund only from the earnings of the fund. |
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(e) The trust company annually shall report to the |
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comptroller with respect to the investment of the fund. The trust |
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company shall contract with a certified public accountant to |
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conduct an independent audit of the fund annually and shall present |
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the results of each annual audit to the comptroller. This |
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subsection does not affect the state auditor's authority to conduct |
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an audit of the fund under Chapter 321. |
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(f) The trust company shall adopt an investment policy that |
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is appropriate for the fund. The trust company shall present the |
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investment policy to the investment advisory board established |
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under Section 404.028. The investment advisory board shall submit |
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to the trust company recommendations regarding the policy. |
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(g) The comptroller annually shall provide to the trust |
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company a forecast of the cash flows into and out of the fund. The |
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comptroller shall provide updates to the forecasts as appropriate |
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to ensure that the trust company is able to achieve the objective |
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specified by Subsection (b). |
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(h) The trust company shall disburse money from the fund as |
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directed by the comptroller. |
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Sec. 403.508. RULES. The comptroller shall adopt rules |
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necessary to implement this subchapter. |
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Sec. 403.509. REPORT. Not later than December 1 of each |
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even-numbered year, the comptroller shall prepare and submit to the |
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governor, the lieutenant governor, and each member of the |
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legislature a report that includes: |
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(1) the balance of the fund as of the date of the |
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report; |
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(2) the total dollar amount of disbursements from the |
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fund during the two-year period preceding that date; and |
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(3) a general description of each small business for |
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which an applicant was awarded a loan from the fund during the |
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two-year period preceding that date. |
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SECTION 2. This Act takes effect September 1, 2021. |