House Bill 822

AN ACT TO ESTABLISH THE SMALL BUSINESS BRIDGE LOAN PROGRAM IN THE MISSISSIPPI DEPARTMENT OF BANKING AND CONSUMER FINANCE TO PROVIDE SHORT TERM BRIDGE LOANS TO SMALL BUSINESS OWNERS FOR THE PURPOSE OF PROVIDING FINANCIAL ASSISTANCE UNTIL THE OWNERS ARE ABLE TO SECURE OTHER FINANCING; TO CREATE A SPECIAL FUND TO BE KNOWN AS THE SMALL BUSINESS BRIDGE LOAN PROGRAM REVOLVING LOAN FUND, WHICH SHALL BE ADMINISTERED BY THE DEPARTMENT, AND EXPENDED FOR THE SOLE PURPOSE OF PROVIDING LOANS TO SMALL BUSINESS OWNERS UNDER THE PROVISIONS OF THIS ACT; TO PROVIDE THAT THE DEPARTMENT SHALL DETERMINE THE TERMS AND CONDITIONS OF THE LOANS AND SPECIFY CERTAIN REQUIREMENTS AND CONDITIONS FOR THE LOANS; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) As used in this act, the following terms have the meanings as defined in this section, unless the context clearly indicates otherwise:

(a) "Department" means the Mississippi Department of Banking and Consumer Finance; and

(b) "Small business" has the meaning as defined in Section 57-10-155.

(2) The Small Business Bridge Loan Program is established to provide short term bridge loans to small business owners for the purpose of providing financial assistance until the owners are able to secure other financing.

(3) (a) There is created in the State Treasury a special fund to be known as the Small Business Bridge Loan Program Revolving Loan Fund, which shall be administered by the department. The fund shall consist of legislative appropriations, federal funds, contributions, donations, gifts and monies from any other source that are made available for deposit into the fund. Monies in the fund shall be expended by the department upon appropriation of the Legislature for the sole purpose of providing loans to small businesses under the provisions of this section. Monies remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund, and any interest earned from the investment of monies in the fund shall be deposited to the credit of the fund.

(b) The State Fiscal Officer shall transfer from the Capital Expense Fund to the Small Business Bridge Loan Program Revolving Loan Fund, as created in subsection (3)(a) of this section, the sum of Three Million Dollars ($3,000,000.00) during fiscal year 2024; the sum of Two Million Dollars ($2,000,000.00) during fiscal year 2025; and the sum of One Million Dollars ($1,000,000.00) during fiscal year 2026.

(4) The department shall determine the terms and conditions of each loan, including the repayment of the loan by small businesses upon securing other financing to be deposited back in the revolving loan fund for issuance of future loans to other small businesses, which shall be subject to the following provisions:

(a) To be eligible for a loan authorized under this act, a small business must have been established in the state for not less than one (1) year prior to the request for a loan.

(b) To qualify for a loan, a small business must request funds for the purposes specified in subsection (2) of this section, and a loan received by a small business shall be used only for the requested purpose or purposes.

(d) The term of any loan made under this section shall be either ninety (90) days or one hundred eighty (180) days, as determined by the department based upon the circumstances of the business applying for the loan. However, the department may extend the term of any loan made under this act up to an additional one hundred eighty (180) days. The proceeds of the loans authorized under this act shall be used only for the purpose of providing short term financial assistance to small business owners until the owners are able to secure other financing.

SECTION 2. This act shall take effect and be in force from and after July 1, 2023.