A BILL TO BE ENTITLED
AN ACT to create the north carolina urban empowerment initiative.
The General Assembly of North Carolina enacts:
SECTION 1.  Article 10 of Chapter 143B of the General Statutes is amended by adding a new Part to read:
"Part 22. North Carolina Urban Employment Initiative.
"§ 143B‑472.135.  Fund established.
A fund to be known as the North Carolina Urban Empowerment Initiative Fund is established in the Department of Commerce. This Fund shall be administered by the Department of Commerce. The Department of Commerce shall be responsible for receipt and disbursement for all funds as provided in this Part. Interest earnings shall be credited to the Fund.
"§ 143B‑472.136.  Definitions.
The following definitions apply in this Part:
(1)	Empowerment firm. – A business that (i) is owned by a minority, (ii) is domiciled in Mecklenburg, Guilford, or Forsyth County, (iii) and has been in operation for at least five consecutive years. An empowerment firm is a "large empowerment firm" when the business had annual gross sales of not less than one million dollars ($1,000,000) and not more than two million dollars ($2,000,000) in the year preceding receipt of moneys from the Fund. An empowerment firm is a "small empowerment firm" when the business had annual gross sales of not more than one million dollars ($1,000,000) in the year preceding receipt of moneys from the Fund.
(2)	Working capital. – Cash made available to an empowerment firm to be used to pay day‑to‑day operational expenses.
"§ 143B‑472.137.  Purpose.
The purpose of the North Carolina Urban Empowerment Initiative is to provide to empowerment firms economic development planning assistance, grant support, working capital loans, coordination with existing federal and State programs to enhance active participation by empowerment firms in the export market, greater access to and knowledge of the resources of the Employment Security Commission, and improved marketing capabilities of minority‑owned firms in traditional and social media environments. To achieve the purposes of the Initiative, the Department shall develop criteria for decisions with respect to Fund grant and loan applications and shall provide technical assistance and strategic planning support to eligible empowerment firms. Empowerment firms may apply for funding from the Fund as provided in this Part.
"§ 143B‑472.138.  Administration.
(a)	Rule‑Making Authority. – The Department of Commerce may adopt, modify, and repeal rules establishing the procedures to be followed in the administration of this Part and regulations interpreting and applying the provisions of this Part, as provided in the Administrative Procedure Act.
(b)	Reports. – The Department of Commerce and empowerment firms receiving funds from the Fund shall prepare and file on or before September 1 of each year with the Joint Legislative Commission on Governmental Operations and the Fiscal Research Division a consolidated report for the preceding fiscal year concerning the allocation of funds authorized by this Part.
The portion of the annual report prepared by the Department of Commerce shall set forth for the preceding fiscal year itemized and total allocations from the Fund. The Department of Commerce shall also prepare a summary report of all allocations made from the Fund for each fiscal year, the total funds received and allocations made, and the total unallocated funds in the Fund.
The portion of the annual report prepared by the empowerment firms shall include the total amount of funds that were received from the Fund and a description of how the allocated funds from the Fund were used during the preceding fiscal year, including details regarding the types of activity undertaken, the dates of the activity, the amount of allocated funds involved, and any other pertinent information, such as jobs created or retained and investments made.
(c)	Costs. – The Department of Commerce may annually use up to seventy‑five thousand dollars ($75,000) of the funds in the Fund for expenses related to the administration of the Fund.
"§ 143B‑472.139.  Grants.
(a)	Grant Funding. – The Secretary of Commerce shall award grants from the Fund of up to one million five hundred thousand dollars ($1,500,000) to selected, eligible large empowerment firms and grants of up to two hundred fifty thousand dollars ($250,000) to selected, eligible small empowerment firms. The Department of Commerce shall ensure that annual grants to companies in the service industry and grants to manufacturing or technology companies are substantially equal. Grant funds awarded from the Fund shall be used as provided by the provisions of this section and any rules or regulations adopted by the Secretary of Commerce.
(b)	Use. – Grant funds in the Fund shall be used for any of the following eligible expenses:
(1)	Building purchase or lease for large empowerment firms or building lease for small empowerment firms.
(2)	Building upfit.
(3)	Energy efficiency and water conservation renovations.
(4)	Signage.
(5)	Business equipment purchase or lease.
(c)	Application. – An application for grant funds shall include each of the requirements listed in this subsection. An empowerment firm whose application is denied may file a new or amended application.
(1)	The proposed expenses for which the grant funds are to be used and the projected cost.
(2)	The amount of grant funds requested for these expenses.
(3)	Projections of time needed to complete the acquisition or improvement.
(4)	Any additional or supplemental information requested by the Department.
(d)	Recapture. – An empowerment firm that has been selected to receive a grant shall use the full amount of the grant for the expenses that were approved pursuant to the provisions of this section. An empowerment firm that fails to satisfy the use requirement of this subsection shall lose any funds that have not been used within three years of being selected. These unused funds shall be credited to the Fund and shall be available to other applicants as long as the Fund is in effect. An empowerment firm that fails to satisfy the use requirement of this subsection may file a new application.
(e)	Inspection. – The personnel of the Department of Commerce may inspect any acquisition for which a grant has been approved. No person may be approved to perform inspections who is an officer or employee of the empowerment firm to which the grant was made or who is engaged in the acquisition or improvement of any project for which the grant was made.
"§ 143B‑472.140.  Loans.
(a)	Loan Funding. – The Secretary of Commerce shall award working capital loans from the Fund of up to six hundred thousand dollars ($600,000) to selected eligible large empowerment firms and loans of up to one hundred thousand dollars ($100,000) to selected eligible small empowerment firms. Loan funds awarded from the Fund shall be used as provided by the provisions of this section and any rules or regulations adopted by the Secretary of Commerce.
(b)	Departmental Duties. – The Department shall have the following powers and duties with respect to this section:
(1)	To establish one or more revolving funds within the Department for the purpose of providing secured loans in amounts not greater than six hundred thousand dollars ($600,000) for a large empowerment firm and not greater than one hundred thousand dollars ($100,000) for a small empowerment firm to provide to the firm working capital.
(2)	To develop and adopt rules to allow State‑regulated financial institutions to provide secured loans to empowerment firms.
(3)	To work with appropriate State and federal agencies to develop and implement rules and regulations to facilitate this program.
(c)	Interest. – The annual interest rate charged for the use of the funds from the revolving fund established pursuant to this section shall be a percentage not to exceed three and one‑half percent (3.5%), excluding other fees required for loan application review and origination. The term of any loan originated under this section may not be greater than 15 years.
(d)	Principal Reduction. – The loan principal of any recipient empowerment firm shall be reduced for compensation paid to certain individuals in accordance with this subsection. For every dollar ($1.00) paid to a long‑term unemployed person hired and continuously employed on a full‑time basis for a 12-month consecutive period, the loan principal of the hiring empowerment firm shall be reduced by fifty cents (50¢). For every dollar ($1.00) paid to an intern under 21 years of age who is living in an urban progress zone, as defined in G.S. 143B‑437.09, or eligible for a free or reduced-price lunch pursuant to 42 U.S.C. § 1758, the loan principal of the hiring empowerment firm shall be reduced by sixty cents (60¢).
"§ 143B‑472.141.  Funding agreements.
(a)	Advisory Committee. – The Department of Commerce may establish an advisory committee to assist in the development of the specific selection criteria and the funding process of the Fund.
(b)	Agreements Required. – Funds may be disbursed from the Fund only in accordance with agreements entered into between the Department of Commerce and an eligible recipient. Each agreement must contain the following provisions:
(1)	A description of the acceptable uses of Fund proceeds. The agreement may limit the use of funds to specific purposes or may allow the funds to be used for any lawful purposes.
(2)	A provision allowing the Department of Commerce to inspect all records of the empowerment firm that may be used to confirm compliance with the agreement or with the requirements of this Part.
(3)	A provision establishing the method for determining compliance with the agreement.
(4)	A provision establishing a schedule for disbursement of funds under the agreement.
(5)	A provision requiring recapture of funds if a recipient subsequently fails to comply with the terms of the agreement.
(6)	Any other provision the State finds necessary to ensure the proper use of State funds."
SECTION 2.  There is appropriated from the General Fund to the North Carolina Urban Empowerment Initiative the sum of thirty million dollars ($30,000,000) for the 2012‑2013 fiscal year to support the North Carolina Urban Empowerment Initiative Program. These funds shall be used to provide grant and loan funds and assistance services to connect North Carolina minority‑owned companies with worldwide export and domestic market expansion opportunities.  It is the intent of the General Assembly to provide an aggregate appropriation of one hundred fifty million dollars ($150,000,000) in equal installments over the next five years to support the Program.
SECTION 3.  This act is effective when it becomes law.