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ARIZONA STATE SENATE
Fifty-Fifth Legislature, First Regular Session
AMENDED
small business assistance grants
Purpose
An emergency measure that establishes the Small Business Assistance Relief Fund (Fund) administered by the Arizona Commerce Authority (ACA) to provide small business assistance grants to qualifying businesses. Appropriates $5 million to the Fund in FY 2022 from Coronavirus Aid, Relief and Economic Security Act (CARES Act) monies allocated to Arizona and deposited in the state Coronavirus Relief Fund (state CRF).
Background
The ACA promotes economic, community and workforce development. The ACA's duties include the support of statewide business expansion, retention, attraction, workforce development and job training and online assistance for new business start-ups and tax credit administration (A.R.S. § 41-1502).
The CARES Act establishes various emergency relief programs and appropriates monies from the federal Coronavirus Relief Fund (federal CRF) to states, territories, tribes and certain local governments for necessary expenditures incurred due to the Coronavirus Disease 2019 (COVID-19) public health emergency. Arizona's total federal CRF allocation for both the state and local governments is $2.82 billion, $1.86 billion of which was received by the state. Federal CRF monies received by the state are allocated by the Governor (P.L. 116-136, 116th Congress, 2020; JLBC).
H.B. 2282 appropriates $5 million to the Fund in FY 2022 from monies allocated from the CARES Act to Arizona and deposited in the state CRF.
Provisions
1. Establishes the Fund, administered by the ACA, to consist of legislative appropriations from monies allocated from the CARES Act to Arizona and deposited in the state CRF to provide grants to small businesses negatively affected by the COVID-19 pandemic.
2. Appropriates $5 million to the Fund in FY 2022 from monies allocated from the CARES Act to Arizona and deposited in the state CRF to provide financial relief to small businesses negatively affected by the COVID-19 pandemic and exempts the appropriation from lapsing.
3. Deems, as an eligible small business that may apply to the ACA for a small business assistance grant by December 31, 2021, a business, including a nonprofit organization, with 25 or fewer employees that:
a) currently operates in Arizona, was in operation on January 1, 2020, demonstrates the intent to continue operation in Arizona for at least six additional months and provides evidence of at least 20 percent revenue loss since March 11, 2020; or
b) operated in Arizona before January 1, 2020, and provides evidence of business closure as a result of the COVID-19 pandemic.
4. Directs the ACA to:
a) award small business assistance grants of up to $5,000;
b) allocate at least 30 percent of Fund monies to small businesses in counties with a population of fewer than 900,000 persons;
c) review the submitted applications and give priority to eligible small businesses that have not received financial assistance from any federal program; and
d) if there are Fund monies after awarding grants to small businesses that apply by December 31, 2021, extend the application deadline to allow additional businesses to apply.
5. Requires a closed small business applying for a small business assistance grant to provide plans to reopen to the ACA.
6. Includes, in an eligible small business that may apply to the ACA for a small business assistance grant:
a) an individual who operates as a sole proprietor or an independent contractor;
b) an individual who is self-employed and who regularly carries on any trade or business;
c) a tribal small business;
d) a cooperative and employee-owned business; or
e) a nonprofit organization.
7. Directs the ACA to prescribe the application form and requires the application to include:
a) the business's name and date of organization;
b) the number of employees at the time of application; and
c) other information the ACA requires to determine the financial impact on the business resulting from the COVID-19 pandemic.
8. Exempts the small business assistance grants awarded by the ACA from statutory Solicitation and Award of Grants requirements.
9. Exempts the ACA from rulemaking requirements for one year.
10. Specifies that Fund monies are continuously appropriated.
11. Contains a statement of legislative intent.
12. Becomes effective on signature of the Governor, if the emergency clause is enacted.
Amendments Adopted by the Commerce Committee
1. Adds an emergency clause.
2. Specifies that an eligible small business includes a nonprofit organization.
3. Includes, in the definition of eligible small business, a small business that:
a) has 25 or fewer employees;
b) operated in Arizona before January 1, 2020; and
c) provides evidence of business closure as a result of the COVID-19 pandemic.
Amendments Adopted by the Appropriations Committee
· Appropriates $5 million to the Fund from monies allocated to Arizona by the CARES Act and deposited in the state CRF, rather than from allocated CARES Act monies deposited in the state General Fund.
House Action Senate Action
COM 2/16/21 DPA 9-0-0-1 COM 3/17/21 DPA 9-0-0
APPROP 2/22/21 DPA 13-0-0-0 APPROP 3/31/21 DPA 9-1-0
3rd Read 3/3/21 55-2-3
Prepared by Senate Research
April 15, 2021
LB/MC/kja