Agenda Item 6
January 24, 2017
Public Hearing
MEMORANDUM
January 20, 2017
TO:
FROM:
County Council
!YJ
J
1
Josh Hamlin, Legislative AttomeM
SUBJECT:
Public Hearing:
Bill 49-16, Economic Development - Workforce Development-
Microlending Program
Bill 49-16, Economic Development - Workforce Development - Microlending Program,
sponsored by Lead Sponsors Council President Berliner and Councilmembers Navarro and
Hucker, and Co-Sponsors Councilmembers Floreen and Rice, was introduced on December 13.
A Planning, Housing and Economic Development Committee worksession is tentatively scheduled
for January 30 at 2:00 p.m.
Bill 49-16 would:
• provide that the County's Workforce Development Corporation must administer a
microlending program to provide financial and technical assistance
to
County
entrepreneurs;
• establish certain criteria for the operation ofthe micro lending program;
• require the Corporation's annual report to include certain information on the
microlending program; and
• generally amend County law related to workforce development.
A memorandum from the Bill's lead sponsors is at ©6.
Background
Under County Code Chapter 30B, Economic Development, the County is empowered to
designate a nonprofit corporation as the County's Workforce Development Corporation to
implement the County's workforce development policies. Worksource Montgomery, Inc., has
been so designated, and has as its mission: (1) to meet the talent attraction, development, and
retention needs of strategic industries; (2) to meet the needs of the underemployed and
unemployed; and (3) to develop career pathways that lead to sustainable wage jobs and support a
thriving mission.
I
Bill 49-16 would add the administration of a micro lending program
to
the
responsibilities of the Workforce Development Corporation.
Under the microlending program required under Bill 49-16, County residents with
businesses headquartered in the County would be eligible for loans of up to $15,000
This mission is consistent with the Policy Objectives of the County Workforce Development Corporation set forth
in
§30B-8.
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("microloans"). Loan recipients would be required to participate in educational and technical
assistance that would be part ofthe program. The program could use non-County funds for capital
and program administration, and materials and assistance would have to be provided in multiple
languages. Worksource Montgomery would have to report on the status of the micro lending
program each year as part of its annual report to the Executive and CounciL
This packet contains:
Bill 49-16
Legislative Request Report
Bill Sponsors' Memo
F:\LA w\BILLS\1649 Workforce Development - Microlending\PH Memo.Docx
Circle #
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Bill No.
49-16
Concerning: Economic Development ­
Workforce
Development·
Microlending Program
Revised:
11/30/2016
Draft No. . .!. .1_ __
Introduced:
December
13. 2016
Expires:
June
13. 2018
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ _ __
Sunset Date:
--'-'-N~on..:.::e=____:__---_
Ch. _ _ Laws of Mont. Co. _ _ __
I
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
Lead Sponsors: Council President Berliner and Councilmembers Navarro and Hucker
Co-Sponsors: Councilmembers Floreen and Rice
AN
ACT
to:
(1)
(2)
(3)
(4)
provide that the County's Workforce Development Corporation must administer a
micro lending program to provide financial and technical assistance to County
entrepreneurs;
establish certain criteria for the operation ofthe micro lending program;
require the Corporation's annual report to include certain information on the
microlending program; and
generally amend County law related to workforce development.
By amending
Montgomery County Code
Chapter 30B, Economic Development
Article II, Workforce Development
Sections 30B-8, 30B-12 and 30B-14
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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BILL
No. 49-16
1
Sec. 1. Sections 30B-S, 30B-12 and 30B-14 are amended as follows:
ARTICLE II. WORKFORCE DEVELOPMENT.
30B-S. Policy objectives.
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3
4
(a)
The success of Montgomery County's economic development goals is
dependent upon a comprehensive and demand-driven system of
workforce development that:
(1) meets the talent attraction, development, and retention needs of
strategic industries;
(2)
(3)
meets the needs ofthe underemployed and unemployed;
[and]
develops career pathways that lead to sustainable wage jobs to
support a thriving
economy~
and
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12
13
ill
provides financial and technical assistance through micro loans to
County entrepreneurs to develop or expand small businesses in the
County.
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(b)
To achieve these goals, the County Government may designate a
nonprofit corporation as the County's Workforce Development
Corporation to implement the County's workforce development policies
established by the Workforce Development Board.
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18
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20
*
(a)
*
*
Sec. 30B-12. Workforce development program.
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The Workforce Development Corporation's Board of Directors must
recommend
workforce
development
programs
and
associated
performance measures to the Executive, Council, and Workforce
Development Board each year to advance the policy objectives listed in
Section 30B-8.
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@
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BILL
No. 49-16
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(b)
The Workforce Development Corporation's workforce development
programs may include a plan for sponsorship of private investment,
marketing, and advocacy initiatives.
(c)
The Workforce Development Corporation must administer
proficient microlending program under which:
~
culturally
ill
ill
loans must not exceed $15,000;
loans must only be issued to Montgomery County residents:
CA)
who have resided in Montgomery County for at least 180
days before the loan application is made; and
lID
whose business is headquartered in Montgomery County;
ill
ill
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@
loan recipients must participate in educational and technical
assistance provided
by
the program;
non-County funds may be used as
~
source for capital and program
administration; and
materials and assistance are provided m multiple languages
reflective ofthe County's popUlation.
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The Workforce Development Corporation's Board and staff must meet
with the Executive, the Council, and the Workforce Development Board
at least annually regarding the Workforce Development Corporation's
activities and fmances.
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48
*
30B-14. Report.
*
*
The Workforce Development Corporation's Board of Directors must report
annually on the activities and fmances of the Corporation and provide an audited
fmancial statement of the Corporation to the Executive, the Council, and the
Workforce Development Board by November 1 of each year. The report must also
include:
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o
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BILL
No. 49-16
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{ill
the Corporation's plan to solicit and receive additional public and private
funding for its
operations~
and
(hl
information on the microlending program including:
ill
ill
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ill
Approved:
the number of microloans issued during the prior fiscal year
Qy
dollar value of the loan;
~
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description of the how each loan was used;
loan repayments received;
the rate of repayment; and
non-County funds leveraged to support the program.
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Roger Berliner, President, County Council
Date
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Approved:
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Isiah Leggett, County Executive
Date
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This is a correct copy o/Council action.
Linda M. Lauer, Clerk ofthe Council
Date
G
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LEGISLATIVE REQUEST REPORT
Bill 49-16
Economic Development
-
Worliforce Development
-
Microlending
DESCRIPTION:
Bill 49-16 would provide that the County's Workforce Development
Corporation must administer a micro lending program to provide
financial and technical assistance to County entrepreneurs.
Entrepreneurs often lack adequate access to capital even in the small
amounts necessary to start a small business
To increase the ability of County residents to start and expand small
businesses by providing small loans and technical assistance in a
culturally proficient manner to small business owners.
WorkSource Montgomery
To be requested.
To be requested.
To be requested.
To be researched.
Josh Hamlin, Legislative Attorney
To be researched.
PROBLEM:
GOALSAND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
None
F:\LA W\BILLS\1649 Workforce Development - Microlending\LRR.Docx
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MONTGOMERY COUNTY COUNCIL
ROCKVILLE, MARYLAND
ROGER BERLINER
COUNCILMEMBER
DISTRICT 1
CHAIRMAN
TRANSPORTATION, INFRASTRUCTURE
ENERGY
&
ENVIRONMENT COMMITTEE
MEMORANDUM
December 8, 2016
TO:
FROM:
Council Colleagues
Council President Roger Berliner
Councilmember Nancy Navarro, Chair, GO Committee
Councilmember Tom Hucker
Empowering Entrepreneurship and Economic Well-Being through Microlending
SUBJECT:
At our November 29
th
Council session, we were briefed on the extraordinary progress that WorkSource
Montgomery is making to transform workforce development in Montgomery County into a system that is
focused not just on job placement for a job seeker but on talent development, career pathways, and job creation.
Nationally and locally, micro and small local businesses are a driver of a vibrant economy. These businesses
improve the economic wellbeing and self-sufficiency of our residents, particularly for our immigrant population
who often find themselves in low wage jobs, but have the creativity and desire to own and operate a wide
variety of businesses. This is why we are proposing the establishment of a County microlending program.
Last March, we convened a meeting with the leadership of the principal organizations in our county and
region that are currently working the most in this arena. Those organizations included
Impact Silver Spring, the
Latino Economic Development Center, Life Asset, Blessed Coffee, Crossroad Community Food Network, Asian­
American Homeownership Counseling, the Consumer Health Foundation, the Chinese Culture and Community
Service Center, and the Greater Washington Hispanic Chamber ofCommerce.
During our meeting, those
leaders all expressed the beliefthat our immigrant entrepreneurs would greatly benefit from a mUlti-pronged
assistance program - one that provides both the necessary technical assistance and access to micro loans that can
help aspiring entrepreneurs turn their dreams into a reality. On its website,
Impact Silver Spring
says the
following:
• Jobs are simply not enough for people to achieve an adequate level of self-sufficiency and quality of life.
• The challenges and barriers that people in our Network encounter in starting their own businesses are
significant. These barriers include the lack of availability oflegal and business development support
that is both reliable and geographically and linguistically accessible, and the lack of access to capital for
people with limited income, credit history, and experience with the formal banking system
(emphasis added).
STELLA B. WERNER OFFICE BUILDING'
100
MARYLAND AVENUE,
6
TH
FLOOR, ROCKVILLE, MARYLAND
20850
240-777-7828
OR
240-777-7900, TTY 240-777-7914, FAX 240-777-7989
WWW.MONTGOMERYCOUNTYMD.GOV
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To that end, we are introducing legislation establishing a microlending program as a program of the
County's Workforce Development Corporation (WorkSource Montgomery). The legislation:
• Limits loans to no more than $15,000, although loans limits could be lower for the first years ofthe
program. We expect most loans will be in the $500 to $5,000 range.
• Limits loans to Montgomery County residents that headquarter their business in Montgomery County.
• Requires recipients to participate in appropriate educational and technical assistance. We heard loudly
and clearly at our March meeting that this is critical to the recipient's success. Non-profits such as
Life
Asset
and the
Latino Economic Development Center
lend to people with poor credit histories, people
who are currently homeless, and people with a dream and a product or service but limited business
experience, and still have extraordinarily high repayment rates.
• Encourages the program to leverage non-County funds to provide additional capital and operating
resources. Some organizations use crowd funding, foundations, and partnerships with financial
organizations as a source of capital and we hope that County funds can be used to creatively leverage
other resources.
We expect this program will benefit a wide range of energetic entrepreneurs but will be ofparticular
importance to our budding immigrant entrepreneurs. As you appreciate, many immigrants come to our county
with both the skills and the desire to start small business enterprises or expand the businesses they have begun.
Yet the roadmap to get from where they are to where they need to get to is complicated and completely
unfamiliar to them. Access to the small amount of capital that they may need for things such as a computer,
kitchen equipment, shelving or office furniture is formidable, ifnot totally beyond their reach. We believe our
County can and should playa more direct and aggressive role in bridging those gaps in order to ensure they
have every opportunity to succeed and prosper. We hope you will support us in this effort.