§ 49 — Economic stabilization program; criteria

[ Text of section added by 2024, 238, Sec. 58 effective February 18, 2025. See 2024, 238, Sec. 331.]Section 49. (a) The agency may establish and administer an economic stabilization program to provide flexible, high-risk financing:(i) necessary to implement a change of ownership, corporate restructuring or turnaround plan for economically viable but troubled businesses that face the likelihood of a large employment loss in the commonwealth, closure of a plant located in the commonwealth or failure without such a change of ownership, corporate restructuring or turnaround plan; provided, however, that the program shall provide assistance to firms in specific mature industries for the purpose of technological investment or upgrading of management operations in order for the business to maintain future economic stability; and provided further, that the financial participation of the agency shall aim to supplement private financial institutions and public economic development agencies when such institutions are unable to provide all the financing or bear all of the risk necessary to transfer ownership, restructure or turnaround a business where the business might otherwise fail, experience closure of a plant located in the commonwealth or greatly reduce its employment in the commonwealth; and(ii) in connection with starting up employee-owned businesses or the implementation of employee-ownership projects; provided, however, that the financial participation of the agency shall aim to supplement private financial institutions and public economic development agencies when such institutions are unable to provide all the financing or bear all of the risk necessary to starting up an employee-owned business or implement an employee-ownership project.(b) Before providing assistance in connection with the purchase of a troubled business pursuant to clause (i) of subsection (a), the agency's directors shall determine and incorporate in the minutes of a meeting of the directors that the business:(i) is likely to experience a large loss of employment in the commonwealth, closure of a plant located in the commonwealth or failure without a loan, financing or investment by the agency;(ii) within a specific mature industry, requires assistance to technological investment or upgrading of management operations for the business to maintain future economic stability;(iii) or person seeking to purchase the troubled business has taken or shall take such actions as the directors deem necessary to ensure the business has a reasonable chance to continue as a successful business including, but not limited to, changes in its operations, financing or management, and that the actions are included as a condition for financing by the agency in the financing agreement; and(iv) or person seeking to purchase the troubled business has made diligent efforts to obtain the financing necessary to continue its operations or transfer ownership of the business from private financial institutions and public economic development agencies and such financing is unavailable or has been offered on terms that would prevent the successful continuation or change in ownership of the business.(c) When providing assistance in connection with starting up an employee-owned business or implementation of an employee-ownership project pursuant to clause (ii) of subsection (a), the directors shall determine and incorporate in the minutes of a meeting of the directors that the business:(i) or person seeking assistance has taken or shall take such actions as the directors deem necessary to ensure that the employee-owned business or employee-ownership project has a reasonable chance to succeed; and(ii) except with respect to assistance for pre-feasibility and feasibility studies, has made diligent efforts to obtain the financing necessary to institute or implement the employee-ownership project from private financial institutions and public economic development agencies and such financing is unavailable or has been offered on terms that would prevent the successful institution or implementation of the employee-owned business or employee-ownership project.(d) The agency shall seek to direct not less than 10 percent of the financing provided by the economic stabilization program to businesses that are employee-owned businesses to meet the purposes of this section.