2022 -- H 8031

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LC005503

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2022

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HARD-HIT

LIQUIDITY PROGRAM ACT

     

     Introduced By: Representatives Messier, Felix, Alzate, and Tobon

     Date Introduced: March 23, 2022

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Subject to the conditions, limitations and restrictions hereinafter contained in

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this act, in addition to those monies previously appropriated pursuant to Chapter 162 of the Public

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Laws of 2021, the sum of twenty million dollars ($20,000,000) is hereby appropriated to the

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Commerce Corporation in addition to amounts previously appropriated and shall be paid out of

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funds made available to the state from federal sources under the American Rescue Plan Act of 2021

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not otherwise appropriated to be extended during the fiscal year ending June 30, 2022 to support

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and fulfill the provisions of the Rhode Island Hard-Hit Emergency Liquidity Program created

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pursuant to Section 2 of this Act. For the purposes and functions hereinafter mentioned, the state

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controller is hereby authorized and directed to draw his or her orders upon the general treasurer for

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the payment of such sums or such portions thereof as may be required from time to time upon

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receipt by him or her of properly authenticated vouchers.

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     SECTION 2. Title 42 of the General Laws entitled "STATE AFFAIRS AND

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GOVERNMENT" is hereby amended by adding thereto the following chapter:

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CHAPTER 162

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RHODE ISLAND HARD-HIT EMERGENCY LIQUIDITY PROGRAM ACT

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     42-162-1. Short title.

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     This chapter shall be known and may be cited as the “Rhode Island Hard-Hit Emergency

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Liquidity Program Act” or in short form the “RI HELP Act.”

 

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     42-162-2. Purpose.

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     The purpose of the RI HELP act program is to provide a special America Rescue Plan Act

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of 2021, (ARPA), Publ. L. 117-2, fund for those hard-hit companies in industries which have not

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received more than five hundred thousand dollars ($500,000) from other ARPA programs

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administered by the state or the commerce corporation in response to the coronavirus pandemic

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and who need additional funds to support operations to ensure that companies do not fail due to a

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loss of liquidity from the single or repeated cessation and reopening of operations.

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     42-162-3. Eligibility.

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     Eligibility for aid to be provided pursuant to the provisions of this chapter shall be

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determined based on an application filed with the commerce corporation with supporting financial

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documentation. There shall be three (3) categories of eligible recipients of aid under the RI HELP

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act:

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     (1) Regular eligibility shall be open to all domestic registered entities and Rhode Island

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residents operating non-registered businesses, such as sole-proprietorships, partnerships or

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associations, with up to five million dollars ($5,000,000) in annual sales based on calendar 2019 or

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FY 2019, as elected by the applicant, and who can show a drop in sales of at least thirty percent

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(30%) in each month from July 2020 to June 2021 as compared to the corresponding months from

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July 2018 to June 2019.

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     (2) Program eligibility shall be open to those companies eligible under subsection (1) of

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this section that can show a drop in monthly sales of at least fifty percent (50%) over the course of

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at least three (3) months during the period from November 2020 to June 2021 as compared to the

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corresponding months from November 2018 to June 2019.

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     (3) With regard to companies operating in the travel industry including companies engaged

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in travel, event and cultural activities that would otherwise qualify pursuant to the provisions of

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subsections (1) or (2) of this section, but for the annual sales limitations above, there shall be no

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limit on the size of the company based on annual sales revenue.

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     42-162-4. Benefits to be provided.

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     (a) Companies eligible under § 42-162-3 shall be eligible for different amounts of aid based

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on the percentage loss in sales. The aid further shall be calculated based on the total “fixed costs”

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paid over the course of a year. Each application shall declare how much the applicant pays in annual

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fixed costs for the year which ended December 31, 2021 or June 30, 2022, at the election of the

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applicant.

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     (b) For the purposes of this section, “fixed costs” shall be defined as including, but not

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being limited to:

 

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     (1) One hundred percent (100%) of costs for leases or rent payments for buildings, offices,

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land, machinery, equipment, vehicles, and mortgage payments including all principal and interest

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incurred for participation in the Main Street Lending Program established by the Federal Reserve

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and terminated on January 8, 2021, and involuntary prepaid principal and interest payments,

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property tax payments to a municipality, finance costs, insurance premiums, license fees, and costs

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for personal protective equipment purchased by the company in connection with its operations or

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for use by its employees, guests, or customers.

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     (2) Twenty percent (20%) of employee costs for salaries and benefits not paid on a per

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project or other temporary basis.

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     (3) Any travel industry company, for the purposes of this section, “fixed costs” shall

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include one hundred percent (100%) of lost tour operating margins and advertising and marketing

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costs paid during the year ending December 31, 2021 or June 30 2022, as elected by the applicant.

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"Lost tour operating margins" means the difference between the gross margins actually earned

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during twelve (12) month period that ended December 31, 2021, or June 30, 2022, as elected by

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the applicant and the comparable period ending in 2019.

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     (c) For the calculation of aid based on losses in sales for all non-travel industry eligible

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companies under § 42-162-3, aid shall be calculated as equal to:

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     (1) One hundred percent (100%) of fixed costs if sales dropped more than seventy percent

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(70%);

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     (2) Sixty percent (60%) of fixed costs if sales dropped between fifty percent (50%) to

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seventy percent (70%); or

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     (3) Forty percent (40%) of fixed costs if sales dropped more than forty percent (40%) but

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less than fifty percent (50%).

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     (d) For the calculation of aid based on losses in sales for eligible companies under § 42-

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162-3, the aid shall be increased as follows:

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     (1) Twenty-five percent (25%) on total fixed reimbursement in the event of a decline in

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sales of at least fifty percent (50%) in three (3) months;

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     (2) Thirty-five percent (35%) if sales declined at least fifty percent (50%) in four (4)

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months of the period; or

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     (3) Forty percent (40%) surcharge if sales declined at least fifty percent (50%) in five (5)

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or more months.

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     (e) No applicant may receive more than ten million dollars ($10,000,000) under this

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chapter.

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     (f) In the event there is insufficient money appropriated to the program to support the

 

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benefit calculations, payments shall be made on a pro rata basis based on eligible aid to be paid to

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all approved applicants who file their applications on or before June 1, 2022.

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     42-162-5. Sunset.

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     This chapter shall sunset upon the payment of all monies appropriated to support this

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program, or one year after the end of the state of emergency declared under law related to the

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coronavirus pandemic, or January 1, 2023 whichever is later.

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     42-162-6. Severability.

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     If any provision of this chapter or its application to any person, agency, or circumstances,

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is held invalid by a court of competent jurisdiction, the remainder of the chapter and the application

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of the provision to other persons, agencies, or circumstances, shall not be affected thereby. The

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invalidity of any section or sections, or part of any section or sections, of this chapter shall not

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affect the validity of the remainder of the chapter.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HARD-HIT

LIQUIDITY PROGRAM ACT

***

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     This act would establish the “Rhode Island Hard-Hit Emergency Liquidity Program Act”

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to provide up to twenty million dollars ($20,000,000) to businesses adversely affected by the

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coronavirus pandemic by providing aid for drop in sales.

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     This act would take effect upon passage.

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