Engrossed Substitute Senate Bill 5167 - Linked Deposit Program (State of Washington, 66th Legislature)

Summary

Engrossed Substitute Senate Bill 5167 of the State of Washington, 66th Legislature, by Senate Financial Institutions, Economic Development & Trade (originally sponsored by Senators Hasegawa, Saldaña, Darneille, Frockt, Keiser, Nguyen, and Mullet), read first time 01/25/19. It is an act relating to the linked deposit program that reenacts and amends RCW 43.86A.060. The text provides that the state treasurer shall establish a linked deposit program and that qualifying loans have terms that do not exceed ten years and an individual loan that does not exceed one million dollars. It also adds a priority for loans that create jobs in underserved communities and are for applicants that do not currently have loans with other small business lending agencies.

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“Engrossed Substitute Senate Bill 5167 - Linked Deposit Program (State of Washington, 66th Legislature).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2020-02-25-a26765-bill-5167-s-e-a40ce68abb/, SHA-256 d75fe2b23d12374dc3bd0c4dd46161f39c65e810c0b327f0a75989528367bd86.

Full text

                     ENGROSSED SUBSTITUTE SENATE BILL 5167


     State of Washington         66th Legislature       2019 Regular Session

     By Senate Financial Institutions,        Economic Development & Trade
     (originally sponsored by Senators        Hasegawa, Saldaña, Darneille,
     Frockt, Keiser, Nguyen, and Mullet)

     READ FIRST TIME 01/25/19.




 1       AN ACT Relating to the linked deposit program; and reenacting and
 2   amending RCW 43.86A.060.


 3   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:


 4       Sec. 1. RCW 43.86A.060 and 2009 c 385 s 3 and 2009 c 384 s 1 are
 5   each reenacted and amended to read as follows:
 6       (1) The state treasurer shall establish a linked deposit program
 7   for investment of deposits in qualified public depositaries. As a
 8   condition   of  participating   in  the   program,  qualified   public
 9   depositaries must make qualifying loans as provided in this section.
10   The state treasurer may purchase a certificate of deposit that is
11   equal to the amount of the qualifying loan made by the qualified
12   public depositary or may purchase a certificate of deposit that is
13   equal to the aggregate amount of two or more qualifying loans made by
14   one or more qualified public depositaries.
15       (2) Qualifying loans made under this section are those:
16       (a) Having terms that do not exceed ten years;
17       (b) Where an individual loan does not exceed one million dollars;
18       (c)(i) That are made to a minority or women's business enterprise
19   that has received state certification under chapter 39.19 RCW;
20       (ii) That are made to a veteran-owned business that has received
21   state certification under RCW 43.60A.190; or
                                       p. 1                         ESSB 5167
 1       (iii) That are made to a community development financial
 2   institution that is: (A) Certified by the United States department of
 3   the treasury pursuant to 12 U.S.C. Sec. 4701 et seq.; and (B) using
 4   that loan to make qualifying loans under (c)(i) of this subsection;
 5       (d) Where the interest rate on the loan to the minority or
 6   women's business enterprise or veteran-owned business does not exceed
 7   an interest rate that is two hundred basis points below the interest
 8   rate the qualified public depositary would charge for a loan for a
 9   similar purpose and a similar term, except that, if the preference
10   given by the state treasurer to the qualified public depositary under
11   subsection (3) of this section is less than two hundred basis points,
12   the qualified public depositary may reduce the preference given on
13   the loan by an amount that corresponds to the reduction in preference
14   below two hundred basis points given to the qualified public
15   depositary; and
16       (e) Where the points or fees charged at loan closing do not
17   exceed one percent of the loan amount.
18       (3) In setting interest rates of time certificate of deposits,
19   the state treasurer shall offer rates so that a two hundred basis
20   point preference will be given to the qualified public depositary,
21   except that the treasurer may lower the amount of the preference to
22   ensure that the effective interest rate on the deposit is not less
23   than zero percent.
24       (4) Upon notification by the state treasurer that a minority or
25   women's business enterprise is no longer certified under chapter
26   39.19 RCW or that a veteran-owned business is no longer certified
27   under RCW 43.60A.190, the qualified public depositary shall reduce
28   the amount of qualifying loans by the outstanding balance of the loan
29   made under this section to the minority or women's business
30   enterprise or the veteran-owned business, as applicable.
31       (5) A line of credit issued under the linked deposit program that
32   has a zero balance for twelve or more months must be removed from the
33   program.
34       (6) The office of minority and women's business enterprises has
35   the authority to adopt rules to prioritize loans that:
36       (a) Ensure that when making a qualified loan under the linked
37   deposit program, businesses that have never received a loan under the
38   linked deposit program are given first priority;



                                     p. 2                        ESSB 5167
 1       (b) Limit the total principal loan amount that any one business
 2   receives in qualified loans under the linked deposit program over the
 3   lifetime of the businesses;
 4       (c) Limit the total principal loan amount that an owner of one or
 5   more businesses receives in qualified loans under the linked deposit
 6   program during the owner's lifetime;
 7       (d) Limit the total amount of any one qualified loan made under
 8   the linked deposit program; ((and))
 9       (e) Ensure that loans made by community development financial
10   institutions are qualifying loans under subsection (2)(c)(i) of this
11   section; and
12       (f) Ensure that when making a qualified loan under the linked
13   deposit program priority is given to loans that:
14       (i) Create jobs in underserved communities that have inadequate
15   access to capital; and
16       (ii) Are for applicants that do not currently have loans with
17   other small business lending agencies.

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