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Sweeping Bill Aims to Revitalize Connecticut’s Post-Pandemic Small Businesses and Economic Development Opportunities

  • Connecticut Senate passes bill offering several initiatives to support small business revitalization and encourage economic development opportunities
  • Measures include a small business microloan program, an expansion of the stranded tax credit program, and a “vocational village program” for the correctional system
  • Department of Economic and Community Development directed to prioritize applicants for economic development assistance based on a willingness to make jobs available to certain individuals

Summary by Dirk Langeveld

Microloan assistance, an expanded tax credit program, and numerous efforts to provide job training and certifications to Connecticut residents are among the measures in a sweeping bill designed to revitalize the state’s small businesses and economic development opportunities after the COVID-19 pandemic.

S.B. No. 3 has unanimously passed the Connecticut Senate. Its measures include:

An expansion of the stranded tax credit program

Current law allows businesses to exchange stranded research and development tax credits for capital investments. The bill updates the law to say the stranded credits can also be exchanged for human capital investments. These could include initiatives such as in-state job training for Connecticut residents, work education and training programs, the development of child care facilities to be used by in-state workers, or subsidies to in-state workers for child care.

A program to assist small businesses in accessing microloans

The Department of Economic Development and Community Development is directed to establish a program to assist small businesses, or those with 20 or fewer employees, in securing microloans from lenders. The department will create a registry of participating in-state lenders, a method for small businesses seeking a microloan to contact the DECD, provide assistance in filling out applications, and advertise the program on its website.

In addition, the Department of Banking must consider a bank’s participation in the micoloan program when assessing the bank’s record of performance under the Community Reinvestment Act. The CRA measures a bank’s ability to meet its local community’s credit needs, and those with poorer scores may be prohibited from certain activities such as opening new branches or merging with other banks.

A “vocational village” for the correctional system

The bill calls for the Department of Correction, in consultation with DECD, to administer a “vocational village program” for Connecticut inmates. This would provide inmates with opportunities to earn nationally recognized industry certifications and credentials in a variety of fields.

The Commissioner of Correction is charged with developing the program’s eligibility requirements, application process, staffing and equipment needs, and other details. Connecticut may either partner with private sector entities to develop the program or participate in the federal Prison Industry Enhancement Certification Program.

A task force on COVID-19’s impact on the hospitality workforce

The bill establishes a task force to study the impact of the COVID-19 pandemic’s impact on the hospitality industry, namely the ability of tourism, lodging, and restaurant businesses to recruit and retain workers. The study may include regional assessments regarding the industry’s recovery in Connecticut.

An effort to bolster SBIR/STTR funding

Connecticut Innovations is charged with developing and implementing a plan to increase funding provided to state businesses for the Small Business Innovation Research and Small Business Technology Transfer programs. It will complete this work in consultation with CTNext, DECD, and the Connecticut Center for Advanced Technology.

DECD directives

The DECD, in consultation with any relevant agencies, is charged with completing the following tasks:

  • Prioritizing applicants for economic development assistance based on a willingness to make jobs available to certain individuals, namely women, minorities, veterans, low-income residents, the unemployed, those training in fields where their gender comprises less than 25 percent of the total workforce, and displaced workers (such as laid-off workers who are ineligible for retirement or military spouses left jobless due to relocation)
  • Developing and implementing a plan to advertise certification programs, job training programs, and entry-level manufacturing jobs to high school and adult education students
  • Studying the financial incentives for Connecticut’s economically distressed opportunity zones to determine what economic development projects they have supported, what types of businesses have benefited from them, and which zones have the highest unemployment and poverty rates and the lowest median household income

All studies and reports are to be delivered to the Connecticut General Assembly by Jan. 1, 2022.

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