HOUSE BILL NO. 544
AN ACT TO AMEND TITLE 29 OF THE DELAWARE CODE RELATING TO A BUSINESS DEVELOPMENT CORRIDOR AND ECONOMIC SUPPORT PROGRAM.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE :
Section 1. Amend Chapter 50, Title 29 of the Delaware Code, by inserting therein a new subchapter II as follows:
“Subchapter II. Business Development Corridor and Economic Support Program
§ 5030. Legislative intent.
The General Assembly finds that it has created various incentives designed to focus State, local and private resources on particular areas of the State to thereby invigorate and revitalize those areas. The areas that have been designated for such incentives are of vital significance to Delaware’s economic well-being.
The General Assembly also finds that businesses within areas that have been designated for such incentives sometimes have a difficult time accessing funds through conventional channels due to the high cost of these funds and the reluctance of banks to provide financing secured by a larger percentage of the businesses’ property.
To help allay these obstacles, the General Assembly hereby directs the Delaware Economic Development Office to use Funds available to it to support businesses situated within development corridors by offering partial, low-cost loans to qualifying businesses; by guaranteeing loans sought by qualifying businesses; by purchasing credit enhancements for the sustenance and growth of qualifying businesses; and by making direct grants to qualifying businesses.
§ 5031. Qualifying businesses; evaluation preferences; development corridor.
(a) A business qualifies for incentive supports pursuant to this subchapter if that business:
(1) Is actively engaged in a commercial or retail activity within a development corridor; and
(2) Has been actively engaged in the same or a similar commercial or retail activity within the development corridor for at least 20 consecutive years.
(b) In evaluating a qualified business for assistance through the Business Corridor and Incentive Support Program, the Director shall:
(1) Consult with the Governor’s Council on Economic Development or, in the absence of such a Council, the Council on Development Finance;
(2) Give primary preferential treatment to businesses that also qualify for special consideration by virtue of the fact that they are situated within an environmentally, historically, or culturally significant area such as being located on an Historic or Scenic Highway, within a Park or Conservation District, or within a Historic Preservation District; and
(3) Give secondary preferential treatment to businesses that also qualify for a tax credit or deduction set forth in 30 Del. C. Chapter 20, or Subchapter VIII of this Chapter.
(c) For the purposes of this subchapter a ‘development corridor’ is a public road that is situated between and connects 2 or more targeted areas described in 30 Del. C. § 2020(1)d. together with any real property whose property boundary line is situated within or abuts the public road.
§ 5032. Business Development Corridor and Economic Support Program.
(a) Upon application of a qualifying business for support from the Economic Development Office, the Director is hereby authorized to use funds made available to the Office which are not restricted, by law or otherwise, to a particular use or for distribution through a specific process, to make an award of support as follows:
(1) The Director may use funds as a guarantee of payment of a loan sought by the qualifying business from a financial institution approved by the Director;
(2) The Director may use funds to make loans directly to the qualifying business at a commercially reasonable rate for a duration not to exceed 30 years;
(3) The Director may use funds to purchase credit enhancements for the sustenance and growth of the qualifying business; or
(4) The Director may use funds to make grants to the qualifying business with such terms and conditions as the Director deems appropriate.
(b) Loans made pursuant to this section may be secured or unsecured and, if secured, may be secured by up to 110% of the market value of any real property used as collateral. Real property used as collateral for a loan under this section need not be situated within a development corridor.
(c) Prior to making an award of support to a qualifying business, the Director shall consult with the Governor’s Council on Economic Development or, in the absence of such a Council, the Council on Development Finance.
(d) Notwithstanding the results of his or her consultation with the Council, the Director may make an award of support in his or her discretion for which a rational basis exists.”
Section 2. The Director may consult with any agency or instrumentality of the State s/he deems necessary to assist in determining whether a particular business is situated within environmentally, historically, or culturally significant area.
Approved July 19, 2004