June 29, 2005 — After four sessions of extensive discussion on an Economic Development Commission reform bill, a final draft of amendments to the bill was unanimously passed Wednesday by the Committee on Economic Development, Planning and Environmental Protection.
The proposal’s prime sponsor, Senate President Lorraine L. Berry, indicated that the bill, among other issues, helps close the loopholes within the law to eliminate the potential for abuse of the EDC Program; raises the maximum annual receipts that a small business can receive from $1 million to $4 million; and reduces the application and compliance fees for small businesses in order to encourage local entrepreneurs to seek EDC benefits.
"I think all concerns are met here," Berry said. "We wanted to meet the concerns of testifiers who have spoken on this in the past, and the concerns of the [U.S.] Treasury, who felt that some people have been abusing the [EDC benefits] program."
Sen. Usie Richards took further action on this measure by introducing an amendment, which addressed the granting of benefits to EDC companies not spending their money within the territory for services offered within the territory. According to Richards’ amendment, in the event that a service is not offered in the territory, a letter has to be submitted to the Economic Development Authority explaining the lack of service.
Another amendment was structured to grant EDC companies the ability to make loans within the territory. The measure permits EDC companies to lend money to borrowers needing funds over $1 million, and who have applied for credit at a local bank and have been turned down or not approved within 30 days.
Sen. Liston Davis claimed that this proposal was unorthodox. "If someone is rejected by a bank [or other financial institution], then they can go to the EDC companies and apply for a loan—what about if the bank offers a lower interest rate, and the EDC company offers a higher interest rate? There should be other entitlements," Davis said.
All amendments were unanimously approved and sent to the Committee on Rules and Judiciary for further deliberation.
Senators present at Wednesday’s meeting were: Lorraine Berry, Norman Jn Baptiste, Neville James, Usie Richards, Liston Davis, Craig W. Barshinger and Celestino White Sr.
Sen. Adlah "Foncie" Donastorg did not attend.
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