234.83 Small business development loan guarantee program.
(1c) Definition. In this section, “small business" means a business, as defined in s. 84.185 (1) (a), that employs 250 or fewer employees on a full-time basis.
(1m) Guarantee requirements. The authority may use money from the Wisconsin development reserve fund to guarantee a loan under this section if all of the following apply:
(a) The borrower qualifies as an eligible borrower under sub. (2).
(b) The loan qualifies as an eligible loan under sub. (3).
(c) The lender enters into an agreement under s. 234.93 (2) (a).
(2) Eligible borrower. Any of the following qualifies as an eligible borrower if unable to obtain adequate business financing on reasonable terms:
(a) A small business, provided that the name of the owner of the small business does not appear on the statewide support lien docket under s. 49.854 (2) (b) or, if the name of the owner of the small business appears on that docket, the owner of the small business provides to the authority a payment agreement that has been approved by the county child support agency under s. 59.53 (5) and that is consistent with rules promulgated under s. 49.858 (2) (a).
(b) The elected governing body of a federally recognized American Indian tribe or band in this state.
(3) Eligible loans. A loan is eligible for guarantee of collection from the Wisconsin development reserve fund under s. 234.93 if all of the following apply:
(a) The borrower uses the loan proceeds for a business development project. Loan proceeds may be used for direct or related expenses associated with any of the following:
1. The expansion or acquisition of a business, including the purchase or improvement of land, buildings, machinery, equipment or inventory.
2. The start-up of a child care business, including the purchase or improvement of land, buildings, machinery, equipment, or inventory.
3. The start-up of a small business in a vacant storefront in the downtown area of a city, town, or village in this state, including the purchase or improvement of land, buildings, machinery, equipment, or inventory.
(b) Loan proceeds are not used to refinance existing debt or for entertainment expenses, expenses related to the production of an agricultural commodity, as defined in s. 94.67 (2), or expenses related to a community-based residential facility, except that loan proceeds may be used to refinance existing debt if the borrower also expands an existing business.
(c) The interest rate on the loan, including any origination fees or other charges, is approved by the authority.
(d) The loan term does not extend beyond 15 years after the date on which the lender disburses the loan unless the authority agrees to an extension of the loan term.
(f) The lender obtains a security interest in the physical plant, equipment, machinery or other assets.
(g) The lender believes that it is reasonably likely that the borrower will be able to repay the loan in full with interest.
(h) The lender agrees to the percentage of guarantee established for the loan by the authority.
(i) The authority believes that the loan will have a positive impact in terms of job creation or retention.
(4) Guarantee of repayment. The authority may guarantee repayment of a portion of the principal of any loan eligible for a guarantee under sub. (1m). That portion may not exceed 80 percent of the principal of the loan or $750,000, whichever is less. The authority shall establish the portion of the principal of an eligible loan that will be guaranteed, using the procedures described in the agreement under s. 234.93 (2) (a). The authority may establish a single portion for all guaranteed loans that do not exceed $937,500 and a single portion for all guaranteed loans that exceed $937,500 or establish on an individual basis different portions for eligible loans that do not exceed $937,500 and different portions for eligible loans that exceed $937,500.
History: 1991 a. 39; 1993 a. 394; 1997 a. 27; 1999 a. 9; 2001 a. 16; 2005 a. 75; 2009 a. 185; 2011 a. 32, 79.