(a)It is the intent of the Legislature:
(1)To provide the Governor with appropriate emergency powers in order to enable utilization of available emergency funding to provide guarantees for interim loans to be made by lending institutions, in connection with relief provided for those persons affected by disasters or a state of emergency in
affected areas during periods of disaster relief assistance, for the purpose of supplying interim financing to enable small businesses to continue operations pending receipt of federal disaster assistance.
(2)That the Governor should utilize this authority to prevent business insolvencies and loss of employment in areas affected by these disasters.
(b)In addition to the allocations authorized by Section 8683 and the loan guarantee provisions of Se
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(a)
It is the intent of the Legislature:
(1)
To provide the Governor with appropriate emergency powers in order to enable utilization of available emergency funding to provide guarantees for interim loans to be made by lending institutions, in connection with relief provided for those persons affected by disasters or a state of emergency in
affected areas during periods of disaster relief assistance, for the purpose of supplying interim financing to enable small businesses to continue operations pending receipt of federal disaster assistance.
(2)
That the Governor should utilize this authority to prevent business insolvencies and loss of employment in areas affected by these disasters.
(b)
In addition to the allocations authorized by Section 8683 and the loan guarantee provisions of Section 63089.90, the Governor may allocate funds made available for the purposes of this chapter, in connection with relief provided, in affected areas during the period of federal disaster relief, to the Small Business Expansion Fund for use by the California Infrastructure and Economic Development Bank, pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code and Chapter 6
(commencing with Section 63088) of Division 1 of Title 6.7 of this code, to provide guarantees for low-interest interim loans to be made by lending institutions for the purpose of providing interim financing to enable small businesses that have suffered actual physical damage or significant economic losses, as a result of the disaster or state of emergency for which funding under this section is made available, to continue or resume operations pending receipt of loans made or guaranteed by the federal Small Business Administration. The maximum amount of any loan guarantee funded under this paragraph shall be limited by the directives and requirements. Each loan guarantee shall not exceed 95 percent of the loan amount, except that a loan guarantee may be for 100 percent of the loan amount if the applicant can demonstrate that access to business records pertinent to the loan application has been precluded by official action prohibiting necessary reentry into the affected business premises or that those
business records pertinent to the loan application have been destroyed. The term of the interim loan shall be determined by the lending institution providing the loan or shall be made payable on the date the proceeds of a loan made or guaranteed by the federal Small Business Administration with respect to the same damage or loss are made available to the borrower, whichever event first occurs.
(c)
Loan guarantees for which the initial 12-month term has expired and for which an application for disaster assistance funding from the federal Small Business Administration is still pending may be extended until the federal Small Business Administration has reached a final decision on the application. Applications for guarantees of interim loans shall be processed in an expeditious manner. Wherever possible, lending institutions shall fund nonconstruction loans within 60 calendar days of application. Loan guarantees for loans that have been denied
funding by the federal Small Business Administration, may be extended by the financial institution provided that the loan is for no longer than a maximum of seven years, if the business demonstrates the ability to repay the loan with an extended loan term, and a new credit analysis is provided. All loan guarantees whose term has been extended under this provision shall be repaid in installments of principal and interest, and be fully amortized over the term of the loan. Nothing in this section shall preclude the lender from charging reasonable administrative fees in connection with the loan.
(d)
Allocations pursuant to this section shall, for purposes of all provisions of law, be deemed to be for extraordinary emergency or disaster response operation costs, as provided in Section 8690.6, incurred by state employees assigned to work on the guarantees authorized by this section.
(e)
The California Infrastructure and Economic Development Bank, which is located within the Governor’s Office of Business and Economic Development, may adopt directives and requirements to implement the disaster loan guarantee program authorized by this section.
(f)
As long as there are any outstanding small business disaster loan guarantees, as authorized by Section 8684.2 or 63089.90, the bank shall provide a report to the Legislature on loan guarantees approved and rejected by gender, ethnic group, type of business and location, and each participating loan institution. The report may be combined with the report required in Section 63089.98.