(a) As used in this section:

(1) “Affiliate” means a business concern which directly controls or is controlled by another business concern, or a third party which controls both business concerns;

(2) “Corporation” means Connecticut Innovations, Incorporated established under § 32-35 or its successor;

(3) “Department” means the Department of Economic and Community Development or its successor agency;

(4) “Enterprise zone” has the same meaning as provided in § 32-70;

(5) “Impacted business” means any person impacted by (A) a disaster caused by natural forces including, but not limited to, floods or hurricanes, or (B) an economic emergency including, but not limited to, an existing or threatened major plant shutdown, business disruption from a major road or bridge repair project or other existing or potential economic emergency, provided such disaster or emergency described in subparagraph (A) or (B) of this subdivision is proclaimed as such by declaration of the Commissioner of Economic and Community Development, with the consent of the Secretary of the Office of Policy and Management, upon a determination by the Commissioner of Economic and Community Development that such disaster or emergency is of a magnitude that could materially affect the health or well-being of the citizens of the impacted area and that the financial assistance provided for under this section is necessary to assure timely and effective relief and restoration;

(6) “Loans” means loans and extensions of lines of credit;

(7) “Minority business enterprise” means any person who meets the criteria contained in § 4a-60g and who is receiving a state contract award;

(8) “Person” means any person or entity, including affiliates, engaged in a for-profit activity or activities in this state and who, except for an impacted business, is not an eligible borrower for assistance under the provisions of the Connecticut Growth Fund established under § 32-23v;

(9) “Rate of interest” means the interest rate which the corporation shall charge and collect on each loan made by the state under this section, which rate shall not exceed one per cent above the interest rate borne by the general obligation bonds of the state last issued prior to the date such loan is made, provided, such rate shall not exceed the maximum allowable under federal law;

(10) “Small contractor” means any person who is a contractor, subcontractor, manufacturer or service company who has been in business for at least one year prior to the date of its application for assistance under this section and whose gross revenues, including revenues of affiliates, did not exceed three million dollars in its most recently completed fiscal year prior to the date of its application for assistance under this section;

(11) “State or local development corporation” means any entity organized under the laws of this state which has the authority to promote and assist the growth and development of business concerns in the areas covered by their operations;

(12) “Targeted business” means a person located in an enterprise zone whose gross revenues did not exceed three million dollars in its most recently completed fiscal year prior to the date of its application for assistance under this section, or if such person has not been in business for at least one year prior to the date of such application, if the corporation determines in its discretion that such person’s gross revenues, including revenues of affiliates, are not likely to exceed three million dollars in its first fiscal year;

(13) “Water facilities” means (A) investor-owned water companies which supply water to at least twenty-five but less than ten thousand customers, (B) municipally-owned water companies, and (C) owners of privately and municipally-owned dams which the Commissioner of Energy and Environmental Protection has determined benefit the public.

(b) In order to stimulate and encourage the growth and development of the state economy, the Comprehensive Business Assistance Fund is hereby created to provide financial assistance to targeted businesses, businesses impacted by economic emergencies and natural disasters, businesses located in certain regions of the state and certain industry sectors, including businesses located in entertainment districts designated under § 32-76 or established under section 2 of public act 93-311*, and to assist in the development of clean water facilities. The state, acting through the corporation, may make, or participate with private sector financial institutions in making, loans from said fund to persons in accordance with the provisions of this section. Payments of principal and interest on such loans, and funds received by the corporation from any other source for the purposes of the Comprehensive Business Assistance Fund, shall be deposited into said fund and shall be used to make additional loans and for such other purposes authorized by this section.

(c) The state, acting through the corporation, may make, or participate with private sector financial institutions in making, loans from the Comprehensive Business Assistance Fund to any person who in the discretion of the corporation, demonstrates financial need by either its inability to obtain conventional financial assistance in satisfactory amounts or on satisfactory terms in accordance with the following provisions:

(1) The corporation may make loans at the rate of interest to small contractors and minority business enterprises for the purpose of financing labor and material costs only. The aggregate outstanding amount of any loans made under this subdivision to any one person, including affiliates, shall not exceed two hundred fifty thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed one year.

(2) The corporation may make loans at the rate of interest to targeted businesses. The aggregate outstanding amount of any loans made under this subdivision to any one person, including affiliates, shall not exceed three hundred thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed (A) twenty years for real property; (B) ten years for machinery and equipment; and (C) seven years for working capital. For the purposes of this subdivision and subdivision (3) of this subsection, working capital may include, but shall not be limited to, capital for expansion or restructuring of a business.

(3) The corporation may make loans at the rate of interest to impacted businesses. The aggregate outstanding amount of any loans made under this subdivision to any one person, including affiliates, shall not exceed five hundred thousand dollars, except the corporation, with the consent of the Secretary of the Office of Policy and Management, may increase the maximum loan amount under this subdivision to one million dollars if the corporation in its discretion determines that the particular needs and conditions of such impacted business warrant such increase. The maximum term for repayment of any loan made under this subdivision shall not exceed (A) twenty years for real property; (B) ten years for machinery and equipment; and (C) seven years for working capital.

(4) The corporation may make loans at the rate of interest to water facilities. Such loans shall be used for the planning, design, modification or construction of drinking water facilities made necessary by the requirements of the Safe Water Act of 1974 or by an order of the Department of Public Health, which drinking water facilities shall include, but shall not be limited to, collection facilities, treatment facilities, wells, tanks, mains, pumps, transmission facilities and any other machinery and equipment necessary to meet the requirements of said act. Such loans shall also be used for the repair of dams subject to the jurisdiction of the Department of Energy and Environmental Protection under chapter 446j. For the purposes of this subdivision, repair costs include, but shall not be limited to, fees and expenses of architects, engineers, attorneys, accountants and other professional consultants, and costs of preparing surveys, studies, site plans and specifications for such repair. The aggregate outstanding amount of any loans made under this subdivision to any water facility, including affiliates, shall not exceed two hundred fifty thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed (A) twenty years for real property; and (B) ten years for machinery and equipment.

(5) The corporation may make loans at zero per cent interest to municipal economic development commissions established under § 7-136 or business outreach centers described in § 32-9qq, that establish or participate in loan pools that lend funds to (A) persons or groups of persons who complete entrepreneurial training programs funded or approved by the Commissioner of Economic and Community Development, or (B) business support groups. As used in this subdivision, “business support group” means a group of five or more persons, firms or corporations which plans to start or expand separate businesses, has community or other ties demonstrating a common mission or purpose, agrees to undergo an entrepreneurial training program funded or approved by the commissioner, and each member of which agrees to provide business support to other members of the group. The aggregate outstanding amount of any loans made under this subdivision to any one person, group of persons or business support group shall not exceed twenty-five thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed ten years.

(6) The corporation shall make loans at the rate of interest to entertainment or entertainment support service businesses located in the municipality with the pilot entertainment district established pursuant to section 2 of public act 93-311*, and on and after July 1, 1995, may make loans at the rate of interest to entertainment or entertainment support service businesses located in municipalities with entertainment districts designated under § 32-76.

(d) The state, acting through the corporation, may make loans to state or local development corporations, for the purpose of providing funds to enable such state or local development corporations to make loans to any person eligible for assistance under subsection (c) of this section. The aggregate outstanding amount of any loan made under this subsection to a state or local development corporation for a loan with respect to any one project shall not exceed one million dollars.

(e) To carry out the purposes of this section, the corporation shall have those powers set forth in § 32-23e. The corporation shall also have the power to take all reasonable steps and exercise all available remedies necessary or desirable to protect the obligations or interests of the corporation including, but not limited to, the purchase or redemption on foreclosure proceedings, bankruptcy proceedings or in other judicial proceedings of any property on which it holds a mortgage or other lien or in which it has an interest, and for such purposes payment may be made from the Comprehensive Business Assistance Fund.

(f) The borrower shall pay such costs of processing applications for loans made under this section, including closing costs, as the corporation determines are reasonable and necessary. The department may assist the corporation in carrying out the provisions of this section and any administrative expenses incurred by the department for services provided to the corporation or expenses incurred by the corporation in carrying out the provisions of this section to the extent not paid by the borrower or from moneys appropriated to the department or the corporation for such purposes, may be paid from the Comprehensive Business Assistance Fund.

(g) Each loan may be authorized by the corporation or, if the corporation so determines, by a committee of the corporation, one of whose members may be its chief executive officer.

(h) Payments from the Comprehensive Business Assistance Fund to eligible borrowers or to pay administrative expenses shall be made upon certification by the chief executive officer of the corporation that payment is authorized under the provisions of this section and under any applicable regulations or program criteria of the corporation.

(i) For the purposes of this section, the State Bond Commission shall have the power, from time to time, to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate seventeen million three hundred fifty thousand dollars. The proceeds from the sale of said bonds shall be used by the department to make grants to the corporation for deposit in the Comprehensive Business Assistance Fund for the purposes authorized under this section. The terms and conditions of such grants shall be governed in accordance with a grant contract entered into between the department and the corporation. All provisions of § 3-20 or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said § 3-20 and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of such bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission in its discretion may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due. Net earnings on any assets of the Comprehensive Business Assistance Fund, including investments or reinvestments of proceeds, accrued interest and premiums on the issuance of such bonds, after payment therefrom of expenses incurred by the Treasurer or State Bond Commission in connection with their issuance, shall become part of the Comprehensive Business Assistance Fund.