HB 6015

HOUSE BILL NO. 6015
A bill to amend 1984 PA 270, entitled
"Michigan strategic fund act,"
by amending section 9 (MCL 125.2009), as amended by
2024 PA 117, and by adding chapter 8F.
the people of the state of michigan enact:
Sec. 9. (1) The fund shall transmit to
each member of the legislature, the governor, the clerk of the house of
representatives, the secretary of the senate, and the senate and house fiscal
agencies annually a report of its activities. The report must be transmitted
not later than April 10 of each year for activities in the immediately
preceding state fiscal year. The report must not include information exempt
from disclosure under section 5. The report must include, but is not limited
to, all of the following for each program operated under this act:
(a) A list of
entities that received financial assistance.
(b) The type of
project or product being financed.
(c) The amount and
type of financial assistance.
(d) For each
separate form of financial assistance, all of the following:
(i) The number of new jobs committed or
projected when the financial assistance was applied for.
(ii) The number of retained jobs committed or
projected when the financial assistance was applied for.
(iii) The actual number of new jobs created
that are not temporary employees.
(iv) The actual number of retained jobs that
are not temporary employees.
(v) The average annual salary of the new
jobs created that are not temporary employees.
(vi) The average annual salary of the
retained jobs that are not temporary employees.
(e) The duration of
the financial assistance.
(f) The amount of
financial support other than state resources.
(g) Money or other
revenue or property returned to the fund, including any repayments through a
clawback provision in the agreement.
(h) The status of
all loans of the fund.
(i) A list of all
entities that are in bankruptcy, of which the fund has received actual notice,
filed by a direct recipient of an active single incentive of not less than
$500,000.00. In addition, the fund shall, within 120 days after the fund
receives notice, provide a report of the notice of bankruptcy on its website
and forward the report to each of the following:
(i) The senate majority leader and the
senate minority leader.
(ii) The speaker of the house and the house
minority leader.
(iii) The members of the house commerce and tourism committee.senate and house of
representatives standing committees that have jurisdiction over matters
relating to economic development.
(iv) The members of the house appropriations
subcommittee on general government.
(v) The members of the senate economic and
small business development committee.
(iv) (vi) The members
of the senate and house of representatives appropriations
subcommittee on general government.subcommittees that have jurisdiction over the fund's budget.
(j) A summary of
the approximate administrative costs used to administer the programs and
activities authorized under this act.
(k) Any other
information as required by this section.
(2) The auditor
general or a certified public accountant appointed by the auditor general
annually shall conduct and remit to the legislature an audit of the fund and,
in the conduct of the audit, shall have access to all records of the fund at
any time, whether or not confidential. Each audit required by this section must
include a determination of whether the fund is likely to be able to continue to
meet its obligations, including a report on the status of outstanding loans and
agreements made by the fund.
(3) The fund shall
also transmit the audit described in subsection (2) to the chairperson and
minority vice-chairperson of the senate appropriations
subcommittee on general government and the house
of representatives appropriations subcommittee on general
government. subcommittees that have
jurisdiction over the fund's budget. The fund shall make the report and
audit available to the public on the fund's website.
(4) The report
described in subsection (1) must also contain all of the following that are
related to a 21st century investment made by the fund board under chapter 8A:
(a) The amount of
qualified venture capital fund investments, qualified mezzanine fund
investments, and qualified private equity fund investments under management in
this state, including year-to-year growth.
(b) The value of
loan enhancement program investments, qualified private equity fund
investments, qualified mezzanine fund investments, and qualified venture
capital investments in qualified businesses, including year-to-year growth.
(c) A statement of
the amount of money in each loan reserve fund established under the small
business capital access program required under chapter 8A.
(5) The report
described in subsection (1) must also include, but is not limited to, all of
the following for all actions under section 88r:
(a) The total
actual amount of qualified investment attracted under section 88r as reported
to the fund.
(b) The total
actual number of new jobs created under section 88r as reported to the fund.
(c) The actual
amount of the grant, loan, or other economic assistance made under section 88r
separately for each qualified business verified by the fund.
(d) For each
qualified business, whether it is a new business, whether it is an expansion of
an existing business, or whether it relocated from outside of this state.
(e) An evaluation
of the aggregate return on investment that this state realizes on the actual
qualified new jobs and actual qualified investment made by qualified
businesses.
(6) The report
described in subsection (1) must also include, but is not limited to, all of
the following for all actions under chapter 8B:
(a) For tourism
promotion efforts, all of the following:
(i) An itemized list, by market, of how much
was spent, types of media purchased, and target of the tourism promotion
campaign.
(ii) The return on investment analysis that
utilizes existing baseline data and compares results with prior outcome
evaluations funded by Travel Michigan.
(b) For business
development efforts, all of the following:
(i) An itemized list, by market, of how much
was spent, types of media purchased, and target of the business promotion
campaign.
(ii) A performance analysis that compares the
program or campaign objectives and outcome of the campaign or program.
(7) The report
described in subsection (1) must also include, but is not limited to, all of
the following for all actions under section 90d:
(a) The total
actual amount of private investment attracted under section 90d as reported to
the fund.
(b) The actual
amount of the community revitalization incentives made under chapter 8C
separately for each project.
(c) The total
actual amount of square footage revitalized or added for each project approved
under section 90d as reported to the fund. When reporting square footage, the
person must report the square footage by category, including, but not limited
to, commercial, residential, or retail.
(d) The aggregate
increase in taxable value of all property subject to a written agreement under
chapter 8C when established and recorded by the local units of government and
as reported to the fund.
(e) The total
actual number of residential units revitalized or added for each project
approved under section 90d as reported to the fund.
(f) Each project
that received a community revitalization incentive outside the fund program
standards and guidelines and why the variance was given.
(8) Beginning on
and after January 1, 2012, on a monthly basis the fund shall provide exact
copies of all information regarding all actions under chapter 8C that is
provided to board members of the fund for the purpose of monthly board
meetings, subject to confidentiality under section 5, to each of the following
and post that information on the fund's website:
(a) The chairperson
and minority vice-chairperson of the house commerce
and tourism committee.senate and house of
representatives standing committees that have jurisdiction over matters
relating to economic development.
(b) The chairperson
and minority vice-chairperson of the house
appropriations subcommittee on general government.senate and house of
representatives appropriations subcommittees that have jurisdiction over the
fund's budget.
(c) The chairperson and minority vice-chairperson of the
senate economic and small business development committee.
(d) The chairperson and minority vice-chairperson of the
senate appropriations subcommittee on general government.
(9) The report
described in subsection (1) must also include a summary of the approximate
administrative costs used to administer the programs and activities authorized
in the following sections:
(a) Section 88b.
(b) Section 88h.
(c) Section 90b.
(10) The report
described in subsection (1) must also include, but is not limited to, all of
the following for all actions for business incubators approved by the fund
after January 14, 2015:
(a) The number of
new jobs created and projected new job growth by current clients of the
business incubator.
(b) Amounts of
other funds leveraged by current clients of the business incubator.
(c) Increases in
revenue for current clients of the business incubator.
(11) The report
described in subsection (1) must also include the actual repayments received by
the fund for failure to comply with clawback provisions of the written
agreement under all of the following:
(a) Section 78.
(b) Section 88d.
(c) Section 88k.
(d) Section 88q.
(e) Section 88r.
(f) Section 90b.
(12) Beginning on
July 1, 2015, the fund shall post on the fund's website a list of each
contract, agreement, or other written loan or grant documentation for financial
assistance under sections 88r and 90b that the fund entered into or modified in
the immediately preceding fiscal year.
(13) Beginning on
July 1, 2015, the fund shall post and update periodically all of the following
on its website for all loans made under sections 88r and 90b:
(a) A description
of the project for which the loan was made.
(b) The total
amount of the loan.
(c) Whether
payments on the loan balance are current or delinquent.
(d) The interest
rate of the loan.
(14) Beginning July
1, 2015, the report described in subsection (1) must also contain all of the
following for each program that provides financial assistance under this act
that requires a site visit:
(a) A copy of the
site visit guidelines for that program.
(b) The number of
site visits conducted under that program.
(c) The chief
compliance officer shall review and evaluate compliance with the site visit
guidelines.
(15) The fund shall
post on its website and update periodically all of the information described in
subsection (14).
(16) The report
described in subsection (1) must also include, but is not limited to, all of
the following for all written agreements related to the good jobs for Michigan
program created under chapter 8D:
(a) The name of the
authorized business.
(b) The number of
certified new jobs required to be maintained.
(c) The amount and
duration of the withholding tax capture revenues.
(17) The report
described in subsection (1) must also include the activities of the critical
industry program described in section 88s.
(18) The report
described in subsection (1) must also include the activities of the Michigan
strategic site readiness program described in section 88t.
(19) The report described in subsection (1) must also include the
activities of the small business program under chapter 8F, including, but not
limited to, all of the following information:
(a) A list of eligible applicants that received a grant under the small
business program.
(b) For each person listed under subdivision (a), all of the following
information:
(i) The amount of the grant.
(ii) A description of the activities funded
by the grant.
(iii) The number of small businesses served.
(c) The number of small business jobs created as a result of the small
business program.
(20) (19) The
fund shall cooperate with the department of treasury and assist in preparing
the report required under section 718 of the income tax act of 1967, 1967 PA
281, MCL 206.718.
(21) (20) As
used in this section, "financial assistance" means grants, loans,
other economic assistance, and any other incentives or assistance under this act.
CHAPTER 8F
Sec. 90t. As used
in this chapter:
(a)
"Community development financial institution" means that term as
defined in 12 USC 4702.
(b)
"Eligible applicant" means any of the following:
(i) A community development financial institution.
(ii) A nonprofit organization whose mission includes providing
support for small businesses and entrepreneurs.
(iii) A local economic development corporation.
(iv) A regional planning commission.
(v) An institution of higher education.
(c)
"Institution of higher education" means that term as defined in
section 88a.
(d) "Program"
means the small business program created under section 90u.
(e) "Small
business" means a business concern incorporated or doing business in this
state, including the affiliates of the business concern, that is independently
owned and operated and that employs fewer than 500 full-time employees.
(f) "Small
business fund" means the small business fund created by section 90v.
(g)
"Technical assistance" includes, but is not limited to, guidance
regarding any of the following:
(i) Licensing requirements.
(ii) Compliance with federal, state, and local laws, rules,
and regulations.
(iii) Business organization and planning.
(iv) Capital access.
(v) Financial management.
(vi) Marketing.
(vii) Operating a business.
Sec. 90u. (1) The
fund shall create the small business program to award grants to eligible
applicants to facilitate the creation, growth, and retention of small
businesses in this state. The fund shall use money transferred from the small
business fund or money appropriated to the program to make the grants. The program
shall be operated and administered by the authorized officers, employees, and
agents of the fund, including the MEDC and its employees.
(2) The fund shall develop a detailed application, approval, and
compliance process that is published and available on the website of the fund
or the MEDC. The detailed application, approval, and compliance process must,
at a minimum, provide for all of the following:
(a) An eligible applicant may apply for a grant under the program.
(b) The eligible applicant must use the grant to do 1 or more of the
following:
(i) Provide loans
to small businesses.
(ii) Provide grants
to small businesses.
(iii) Make
investments in small businesses.
(iv) Provide
technical assistance to small businesses.
(3) Before
approving an application under this section, the fund shall consider and
document, at a minimum, all of the following criteria:
(a) That
the applicant qualifies as an eligible applicant.
(b) Whether
the applicant is financially sound and has a reasonable likelihood of remaining
financially sound over time.
(c) Whether
the applicant has a demonstrated history of positively impacting small
businesses.
(d) The
region of this state in which the applicant proposes to provide services funded
by the grant and the need for the proposed services in that region.
(e) The
extent to which the issuance of the grant will increase entrepreneurship and
small business opportunities in this state.
(f) The
extent to which the grant will support entrepreneurship and small business
opportunities in growing industries.
(g) Whether
the services to be provided with the grant money will serve 1 or more stages of
small businesses, from early stage to established small businesses.
(4) If the
fund determines, after the considerations under subsection (3), to provide a grant
to an eligible applicant under the loan program, the fund shall enter into a
written agreement with the eligible applicant that includes in a clear and
concise manner all of the terms and conditions related to the grant, as
determined and documented by the fund board, including, but not limited to, all
of the following:
(a) The
amount of the grant.
(b) The
purposes for which the grant may be used, which must comply with subsection
(2)(b).
(c) A
requirement that the applicant repay the grant if the applicant fails to comply
with the written agreement.
(d) An
audit provision that requires the fund to verify that the terms and conditions
for the grant have been met.
(e) A
requirement that the applicant provide any information necessary for the fund
to comply with the reporting requirement in section 9(19).
Sec. 90v. (1) The
small business fund is created in the state treasury.
(2) The state treasurer shall deposit money and other assets received
under section 90v or from any other source in the small business fund. The
state treasurer shall direct the investment of money in the fund and credit
interest and earnings from the investments to small business fund.
(3) Money in the small business fund at the close of the fiscal year
remains in the small business fund and does not lapse to the general fund.
(4) The fund is the administrator of the small business fund for audits
of the small business fund.
(5) The fund shall expend money from the small business fund, on
appropriation, only for 1 or more of the following purposes:
(a) Administering the program.
(b) Providing grants to eligible applicants under the program.
Sec. 90w. In
exercising its powers and duties under this act or another law of this state,
the fund shall endeavor to prioritize and support the development of small
businesses in this state.