An Act To Authorize a General Fund Bond Issue To Support Maine Small Business and Job Creation
Maine Legislature, Session 126, LD 1827
Committee: Appropriations and Financial Affairs
Amends: 10 MRSA §1026-M

Legislative Document 
No. 1827 
S.P. 732 
In Senate, March 18, 2014 
An Act To Authorize a General Fund Bond Issue To Support Maine 
Small Business and Job Creation 
Reported by Senator VALENTINO of York for the Joint Select Committee on Maine's 
Workforce and Economic Future pursuant to Joint Order, S.P. 27. 
Reference to the Committee on Appropriations and Financial Affairs suggested and ordered 
printed pursuant to Joint Rule 218. 
DAREK M. GRANT 
Secretary of the Senate 
Preamble. Two thirds of both Houses of the Legislature deeming it necessary in 
accordance with the Constitution of Maine, Article IX, Section 14 to authorize the 
issuance of bonds on behalf of the State of Maine to provide funds as described in this 
Act, 
Be it enacted by the People of the State of Maine as follows: 
PART A 
Sec. A-1.  Authorization of bonds.  The Treasurer of State is authorized, under 
the direction of the Governor, to issue bonds in the name and on behalf of the State in an 
amount not exceeding $73,000,000 for the purposes described in section 5.  The bonds 
are a pledge of the full faith and credit of the State.  The bonds may not run for a period 
longer than 10 years from the date of the original issue of the bonds. 
Sec. A-2.  Records of bonds issued; Treasurer of State. The Treasurer of 
State shall ensure that an account of each bond is kept showing the number of the bond, 
the name of the successful bidder to whom sold, the amount received for the bond, the 
date of sale and the date when payable. 
Sec. A-3.  Sale; how negotiated; proceeds appropriated.  The Treasurer of 
State may negotiate the sale of the bonds by direction of the Governor, but no bond may 
be loaned, pledged or hypothecated on behalf of the State.  The proceeds of the sale of the 
bonds, which must be held by the Treasurer of State and paid by the Treasurer of State 
upon warrants drawn by the State Controller, are appropriated solely for the purposes set 
forth in this Part.  Any unencumbered balances remaining at the completion of the project 
in this Part lapse to the Office of the Treasurer of State to be used for the retirement of 
general obligation bonds. 
Sec. A-4.  Interest and debt retirement.  The Treasurer of State shall pay 
interest due or accruing on any bonds issued under this Part and all sums coming due for 
payment of bonds at maturity. 
Sec. A-5.  Disbursement of bond proceeds from General Fund bond issue.  
The proceeds of the sale of the bonds authorized under this Part must be expended as 
designated in the following schedule under the direction and supervision of the agencies 
and entities set forth in this section. 
Provides funds to insure portions of loans to small businesses made by a participating 
financial institution in order to spur investment and innovation.  
FINANCE AUTHORITY OF MAINE 
Total 
$5,000,000
Provides funds for state, regional and local financial intermediaries to make flexible 
loans to small businesses to create jobs, revitalize downtowns and strengthen our 
rural economy. 
Provides funds to be awarded on a competitive basis to facilitate the growth of 
marine businesses and commercial enterprises that create jobs and improve the 
sustainability of the State's marine economy and related industries through capital 
investments. 
Provides funds for research, development and commercialization as prioritized by the 
Office of Innovation's most recent Science and Technology Action Plan. The funds 
must be allocated to biotechnology, aquaculture and marine technology, composite 
materials technology, environmental technology, advanced technologies for forestry 
and agriculture, information technology and precision manufacturing technology 
through a competitive process and must be awarded to Maine-based public and 
private entities and leverage matching funds on at least a one-to-one basis. 
Provides funds, to be matched by $16,000,000 in other funds, to establish at the 
Jackson Laboratory in Bar Harbor a center for biometric analysis using state-of-the-
art technologies to expand the State's research capabilities in the area of medical 
analytics, make the State a global resource for precision medicine, improve the State's 
capacity to attract and retain young professionals and facilitate additional grant 
funding, private sector investment, job growth and economic activity in the State. 
Total 
$15,000,000
ECONOMIC AND COMMUNITY 
DEVELOPMENT, DEPARTMENT OF 
Total 
$15,000,000
Maine Technology Institute 
Total 
$10,000,000
Jackson Laboratory 
Total 
$15,000,000
Provides funds, to be matched by $9,500,000 in other funds, to the Mount Desert 
Island Biological Laboratory in Bar Harbor to modernize and expand infrastructure 
needed to increase biotechnology workforce training from 350 to 500 students a year, 
retain and recruit to Maine multiple biomedical research and development groups and 
create a drug discovery and development facility that will improve human health and 
stimulate biotechnology job growth and economic activity. 
Provides funds for a University of Maine Cooperative Extension Insect and Animal 
and Plant Disease Identification Facility. 
Sec. A-6.  Contingent upon ratification of bond issue.  Sections 1 to 5 do not 
become effective unless the people of the State ratify the issuance of the bonds as set 
forth in this Part. 
Sec. A-7.  Appropriation balances at year-end.  At the end of each fiscal year, 
all unencumbered appropriation balances representing state money carry forward.  Bond 
proceeds that have not been expended within 10 years after the date of the sale of the 
bonds lapse to the Office of the Treasurer of State to be used for the retirement of general 
obligation bonds. 
Sec. A-8.  Bonds authorized but not issued.  Any bonds authorized but not 
issued within 5 years of ratification of this Part are deauthorized and may not be issued, 
except that the Legislature may, within 2 years after the expiration of that 5-year period, 
extend the period for issuing any remaining unissued bonds for an additional amount of 
time not to exceed 5 years. 
Sec. A-9.  Referendum for ratification; submission at election; form of 
question; effective date.  This Part must be submitted to the legal voters of the State at 
a statewide election held in the month of November following passage of this Act.  The 
municipal officers of this State shall notify the inhabitants of their respective cities, towns 
Mount Desert Island Biological 
Laboratory 
Total 
$5,000,000
UNIVERSITY OF MAINE SYSTEM 
University of Maine Cooperative 
Extension Service 
Total 
$8,000,000
and plantations to meet, in the manner prescribed by law for holding a statewide election, 
to vote on the acceptance or rejection of this Part by voting on the following question: 
"Do you favor a $73,000,000 bond issue to: 
1. Provide $5,000,000 in funds to insure portions of loans to small 
businesses to spur investment and innovation; 
2. Provide $15,000,000 in funds to make flexible loans to small 
businesses to create jobs, revitalize downtowns and strengthen our rural 
economy; 
3. Provide $10,000,000 in funds to promote research, development and 
commercialization for economic development and private sector job 
creation, awarded after a competitive process administered by the Maine 
Technology Institute, and leverage matching funds on at least a one-to-
one basis; 
4. Provide $8,000,000 in funds for a University of Maine Cooperative 
Extension Insect and Animal and Plant Disease Identification Facility to 
assist farmers and foresters and to protect plant, animal and human 
health; 
5. Provide $15,000,000 in funds, to be matched by $16,000,000 in 
private and public contributions, to establish at the Jackson Laboratory in 
Bar Harbor a center for biometric analysis using state-of-the-art 
technologies to expand the State's research capabilities in the area of 
medical analytics, make the State a global resource for precision 
medicine, improve the State's capacity to attract and retain young 
professionals and facilitate additional grant funding, private sector 
investment, job growth and economic activity in the State; 
6. Provide $5,000,000 in funds, to be matched by $9,500,000 in private 
and public funds, to modernize and expand the infrastructure at the 
Mount Desert Island Biological Laboratory needed to increase 
biotechnology workforce training from 350 to 500 students a year, retain 
and recruit to Maine multiple biomedical research and development 
groups and create a drug discovery and development facility that will 
improve human health and stimulate biotechnology job growth and 
economic activity; and 
7. Provide $15,000,000 in funds to facilitate the growth of marine 
businesses and commercial enterprises that create jobs and improve the 
sustainability of the State's marine economy and related industries 
through capital investments, awarded after a competitive process 
administered by the Department of Economic and Community 
Development in consultation with the Department of Marine Resources 
and the Maine Technology Institute, and leverage matching funds on at 
least a one-to-one basis?" 
The legal voters of each city, town and plantation shall vote by ballot on this question 
and designate their choice by a cross or check mark placed within a corresponding square 
below the word "Yes" or "No."  The ballots must be received, sorted, counted and 
declared in open ward, town and plantation meetings and returns made to the Secretary of 
State in the same manner as votes for members of the Legislature.  The Governor shall 
review the returns.  If a majority of the legal votes are cast in favor of this Part, the 
Governor shall proclaim the result without delay and this Part becomes effective 30 days 
after the date of the proclamation. 
The Secretary of State shall prepare and furnish to each city, town and plantation all 
ballots, returns and copies of this Part necessary to carry out the purposes of this 
referendum. 
PART B 
Sec. B-1.  10 MRSA §1026-M, sub-§2, as amended by PL 1999, c. 401, Pt. 
OOO, §1, is further amended to read: 
2.  Eligible corporations.  The fund is open to local, regional and statewide nonprofit 
or governmental economic development corporations or entities, that are capable of 
providing financial assistance to businesses in order to create and protect jobs, as well as 
revitalize downtowns and build strong communities and a sustainable economy, referred 
to in this section as "corporations."  In the case of loans to quality child care projects, the 
authority may also provide loans directly to eligible borrowers.  To be eligible for 
assistance from the fund: 
A.  A corporation must apply to the authority to participate in the fund.  The 
application must describe the corporation and its funding sources, the region or 
regions it serves, its methods and criteria for qualifying borrowers, including any 
targeted lending and economic development strategies, its expertise in management 
assistance and financing of small and emerging businesses, the method by which it 
will leverage funds from other sources in an amount at least equal to 2 times the 
amount requested from the fund and other information the authority determines 
necessary; 
B.  A corporation must have a strategy for the creation and retention of jobs, an 
effective small business marketing and technical assistance plan and enough expert 
assistance available to it to underwrite, document and service loans and assist its 
clients or it must have a strategy for real estate development including commercial 
and mixed-use real estate and community facilities; 
C.  The corporation must be determined by the authority to be able to prudently and 
effectively administer a direct loan fund and to coordinate with other business 
assistance programs and employment training and social assistance programs; 
D.  The corporation must propose performance measurements and goals and a 
process for monitoring compliance with proposed measurements and goals.  The 
authority shall assist corporations in developing loan or equity-like debt underwriting 
and administrative capacity and in portfolio monitoring and servicing and may 
establish one or more advisory boards or committees to assist corporations; and 
E.  A child care project must apply to the authority or to a corporation and meet the 
eligibility criteria for a borrower. 
Sec. B-2.  10 MRSA §1026-M, sub-§3, ¶¶A and C, as enacted by PL 1993, c. 
722, Pt. C, §1 and affected by §2, are amended to read: 
A.  The size of the region or regions served by the corporation and the expected 
demand for loan funds in that region or those regions; 
C.  Whether an eligible corporation will serve statewide or will serve a geographic 
area or segment of potential business borrowers not served by other applicants. 
Sec. B-3.  10 MRSA §1026-M, sub-§5, as amended by PL 2001, c. 639, §2, is 
further amended to read: 
5.  Administrative costs.  A corporation may not use any money disbursed from the 
fund by the authority for administrative expenses, but may charge a commitment fee of 
up to 2% and may use interest earnings not to exceed 7% of each loan annually on loans 
to cover reasonable administrative, technical assistance and education costs operating 
costs, including loan fund management, technical assistance and education.  The authority 
shall review and approve a corporation's administrative expenses on an annual basis.  The 
authority may establish by rule reasonable administrative fees for its administration of the 
fund. 
Sec. B-4.  10 MRSA §1026-M, sub-§6, ¶A, as amended by PL 2009, c. 131, §4, 
is further amended to read: 
A.  Loans may not exceed $250,000 $350,000 to a borrower, including an affiliated 
entity, and approval of the authority is required for any loan in excess of $150,000.  
Loans for quality child care projects may not exceed $100,000 to a borrower.  Loans 
or portions of loans to a quality child care project to be used solely for lead abatement 
may not exceed $15,000. 
Sec. B-5.  10 MRSA §1026-M, sub-§6, ¶B, as amended by PL 2009, c. 131, §5, 
is further amended to read: 
B.  Loans over $100,000 of $50,000 or more for borrowers other than quality child 
care projects may not exceed 1/3 1/2 of the net new funds being provided to a 
borrower.  Loans of $50,000 to $100,000 for projects other than quality child care 
projects may not exceed 1/2 of the net new funds being provided to a borrower. 
Loans of less than $50,000 and loans for quality child care projects may be for the 
total amount of new funds being provided to the borrower. 
Sec. B-6.  10 MRSA §1026-M, sub-§6, ¶C, as amended by PL 2007, c. 683, Pt. 
B, §1, is further amended to read: 
C.  The authority and each corporation shall establish interest rates, amortization 
schedules and repayment terms for each borrower, except that loans may not be for a 
term longer than 20 years and: 
(1)  Loans to a quality child care project must bear a rate of interest equal to 3%, 
not including any administrative costs or fees not greater than 5%; or 
(2)  Loans to any other eligible borrower may not bear a rate of interest greater 
than the prime rate of interest plus 7%. 
Sec. B-7.  10 MRSA §1026-M, sub-§7, ¶A, as amended by PL 2011, c. 11, §1, is 
further amended to read: 
A.  The business for which funds are requested has 50 100 or fewer employees or 
annual sales of $5,000,000 $10,000,000 or less, and it consists of or involves at least 
one of the following: 
(1)  Manufacturing technologies, such as value-added wood products, specialty 
fabricated metal and electronic products, precision manufacturing and use of 
composites or advanced materials; 
(2)  Technologies, such as advanced information systems, advanced 
telecommunications, energy and environmental products and services; 
(3)  Biological Value-added natural resource enterprises and biological and 
natural resource technologies, such as aquaculture, marine technology, 
agriculture, forestry products and biotechnology; 
(4)  A business converting from defense dependency; 
(5)  A business significantly engaged in export of goods or services to locations 
outside the State; 
(6)  A business that dedicates significant resources to research and development 
activities; 
(7)  Other businesses with 10 15 or fewer employees; and 
(8)  A child care project that includes any business that, for compensation, 
provides a regular service of care and protection for any part of a day less than 24 
hours to a child or children under 16 years of age whose parents work outside the 
home, attend an educational program or are otherwise unable to care for their 
children.; 
(9)  A business significantly engaged in commercial and mixed-use real estate 
and community facilities; and 
(10)  A business significantly engaged in serving tourists, such as in the areas of 
outdoor recreation, culture and heritage and hospitality. 
Notwithstanding the requirements of this paragraph, until June 30, 2012, a project or 
a borrower that is eligible for loan insurance under section 1026-A is eligible for 
financial assistance under the program. 
Sec. B-8.  10 MRSA §1026-M, sub-§8, as enacted by PL 1993, c. 722, Pt. C, §1 
and affected by §2, is amended to read: 
8.  Priorities.  Among eligible applicants, a corporation shall give priority to 
businesses and projects with the potential of meeting one or more of the following 
objectives. 
A.  The financing will help the business pursue a business that adds significant value 
to raw materials or inventory. 
B.  The financing is likely to result in a long-term net increase in permanent, quality 
jobs that meet a local or regional need or the retention of jobs in jeopardy of being 
lost. 
Sec. B-9.  Contingent effective date.  This Part takes effect only if the General 
Fund bond issue proposed in Part A is approved by the voters of the State. 
PART C 
Sec. C-1.  Administration of marine economy funds.  Funds awarded by the 
Department of Economic and Community Development to facilitate the growth of marine 
businesses and commercial enterprises that create jobs and improve the sustainability of 
the State's marine economy and related industries through capital investments pursuant to 
Part A must be administered according to the following guidelines.  Funds must be 
awarded on a competitive basis pursuant to a request for proposals and application 
process designed by the Department of Economic and Community Development in 
consultation with the Department of Marine Resources.  A successful application must 
include support from: 
1.  A marine-based research program at a private or public university or nonprofit 
research institution; 
2.  Commercial fishing or aquaculture interests; 
3.  Community-based organizations committed to the growth of their local 
economies; and 
4.  Private sector businesses. 
A successful application must demonstrate matching funds on at least a one-to-one 
basis.  As part of the application process, the Department of Economic and Community 
Development shall establish a technical review board process in consultation with the 
Maine Technology Institute.  In awarding funds, priority must be given to projects with a 
demonstrable return on investment to the State, including, but not limited to, job creation 
and improvements to the capacity and long-term sustainability of Maine's marine 
economy, as well as strong benchmarks and accountability measures to ensure these 
results. 
Sec. C-2.  Contingent effective date.  This Part takes effect only if the General 
Fund bond issue proposed in Part A is approved by the voters of the State. 
SUMMARY 
This bill is reported out by the Joint Select Committee on Maine's Workforce and 
Economic Future pursuant to its authority under Joint Order 2013, S.P. 27 and Joint 
Order 2013, S.P. 602.  The committee is reporting the bill out with the recommendation 
that it be referred to the Joint Standing Committee on Appropriations and Financial 
Affairs for an appropriate public hearing and subsequent processing in the normal course. 
Part A provides for a bond issue in the amount of $73,000,000 to be used to provide 
funds to the Finance Authority of Maine, the Maine Technology Institute, the Department 
of Economic and Community Development, the University of Maine System, the Jackson 
Laboratory and the Mount Desert Island Biological Laboratory.  The funds would be used 
to: 
1. Provide $5,000,000 to insure portions of loans to small businesses made by a 
participating financial institution to spur investment and innovation; 
2. Provide $15,000,000 for state, regional and local financial intermediaries to make 
flexible loans to and investments in small businesses to create jobs; 
3. Provide $10,000,000 to promote research, development and commercialization for 
economic development and private sector job creation, awarded after a competitive 
process administered by the Maine Technology Institute, and leverage matching funds on 
at least a one-to-one basis; 
4. Provide $15,000,000, to be matched by $16,000,000 in private and public 
contributions, to establish at the Jackson Laboratory in Bar Harbor a center for biometric 
analysis using state-of-the-art technologies to expand the State's research capabilities in 
the area of medical analytics, make the State a global resource for precision medicine, 
improve the State's capacity to attract and retain young professionals and facilitate 
additional grant funding, private sector investment, job growth and economic activity in 
the State; 
5. Provide $5,000,000, to be matched by $9,500,000 in private and public funds, to 
modernize and expand infrastructure at the Mount Desert Island Biological Laboratory 
needed to increase biotechnology workforce training from 350 to 500 students a year, 
retain and recruit to Maine multiple biomedical research and development groups and 
create a drug discovery and development facility that will improve human health and 
stimulate biotechnology job growth and economic activity; 
6. Provide $15,000,000 in funds to facilitate the growth of marine businesses and 
commercial enterprises that create jobs and improve the sustainability of the State's 
marine economy and related industries through capital investments, awarded after a 
competitive process administered by the Department of Economic and Community 
Development in consultation with the Department of Marine Resources and the Maine 
Technology Institute, and leverage matching funds on at least a one-to-one basis; and 
7. Provide $8,000,000 in funds for a University of Maine Cooperative Extension 
Insect and Animal and Plant Disease Identification Facility to assist farmers and foresters 
and to protect plant, animal and human health. 
Part B amends the laws regarding the Regional Economic Development Revolving 
Loan Program of the Finance Authority of Maine to include revitalization of downtowns 
and building stronger communities and a sustainable economy as purposes of the 
program. It clarifies that a lending corporation under the program may use revenue from 
commitment fees and interest to cover its operating costs, including loan fund 
management, increases the dollar amount of the maximum loan available to a borrower, 
allows a lending corporation to serve more than one region and adjusts other financing 
terms. It also adds businesses engaged in commercial and mixed-use real estate and 
community facilities and businesses engaged in serving tourists to the list of businesses 
that are eligible for financial assistance under the program.  It changes the program to 
allow participation by companies with 100 or fewer employees, instead of 50 or fewer, 
and by companies with annual sales of up to $10,000,000, instead of $5,000,000 or less.  
It amends the total loan amount by increasing the cap from $250,000 to $350,000 for 
corporations and from $100,000 to $350,000 for quality child care projects.  
Part C provides guidelines for the administration of the $15,000,000 for marine 
businesses provided in Part A. 
Parts B and C take effect only if the General Fund bond issue proposed in Part A is 
approved by the voters of the State.