PROVIDENCE – Businesses in the knowledge and technology sectors could ask the state to guarantee loans for expansion projects if a bill passed by the House on Tuesday clears the Senate and gets the governor’s signature.
The House legislation would allow the R.I. Economic Development Corporation to guarantee up to $125 million in such loans. Banks would lend the money, but the state would protect the bank from losses through the guarantee program.
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The legislation calls for the EDC to give priority to companies that create permanent, full-time jobs that pay more than 250 percent of minimum wage, which translates to $18.50 an hour.
“This is a good program that takes a relatively small commitment from the state to leverage private investment in up-and-coming industries that will blossom into healthy employers for our people,” House Finance Committee Chairman Steven Costantino said in a news release. “This is the sort of development that we need to help our economy become robust once more.”
The bill allows the EDC to charge companies that participate in the program “reasonable fees for the [EDC’s] guaranty and reimbursement of expenses.” The bill also requires the EDC to report annually the loans it guaranteed, along with their amounts, the number of jobs they created and the wages and income tax paid.
The bill now heads to the Senate.
