N.Y. Comp. Codes R. & Regs. tit. 21 § 4250.3

Current through Register Vol. 46, No. 50, December 11, 2024

Section 4250.3 - Eligible business, eligible projects and ineligible projects

(a) Business loans shall be offered by community based lending organizations on the terms and conditions that are in accordance with and subject to the act and the provisions of this Part. Business loans shall be provided by the community based lending organization only to eligible businesses for eligible projects and shall not be used for ineligible projects. The terms eligible business, eligible projects and ineligible projects are defined as follows. An eligible business is a:

(1) business enterprise that is resident in and authorized to do business in New York State;

(2) independently owned and operated;

(3) not dominant in its field; and

(4) employs 100 or fewer persons.

(b) An eligible project is a business loan from a community based lending organization to an eligible business in the service delivery area for an eligible use, whereby the community based lending organization has reviewed every business loan application to determine the feasibility of the proposed eligible use(s) of the financing requested by the small business applicant, the likelihood of repayment, and the potential that the loan will generate economic development and jobs within the State. An eligible project cannot be an ineligible project as defined below.

(c) An ineligible project shall mean:

(1) a project or use that would result in the relocation of any business operation from one municipality within the State to another, except under one of the following conditions:

(i) when a business is relocating within a municipality with a population of at least one million where the governing body of such municipality approves such relocation; or

(ii) each municipality from which such business operation will be relocated has consented to such relocation;

(2) projects with respect to newspapers, broadcasting or other news media, medical facilities, libraries, community or civic centers, and public infrastructure improvements;

(3) providing funds, directly or indirectly, for payments, distribution or as a loan (except in the case of a loan to a sole proprietor for business use), to owners, members, partners or shareholders of the applicant business, except as ordinary income for services rendered;

(4) any project that results in a business loan to a person who is a member of the board or other governing body, officer, employee, or member of a loan committee, or a family member of the community based lending organization or who shall participate in any decision on the use of program funds if such person is a party to or has a financial or personal interest in such loan.

N.Y. Comp. Codes R. & Regs. Tit. 21 § 4250.3