Growth capital division; criteria for projects to provide capital or increase availability of capital; minority-owned or women-owned contractors; improvement of economic opportunities for low and moderate income people; consulting and technical assistance; micro businesses
M.G.L. c. 23G, § 48
in effectc. 23G, § 48. Growth capital division; criteria for projects to provide capital or increase availability of capital; minority-owned or women-owned contractors; improvement of economic opportunities for low and moderate income people; consulting and technical assistance; micro businesses
Section 48. (a) There shall be within the agency a growth capital division to provide growth capital and other financial assistance to small businesses.
[ First paragraph of subsection (b) effective until August 5, 2025. For text effective August 5, 2025, see below.]
(b) The agency may participate in projects to provide capital or increase or improve the availability of capital; provided, however, that before such participation, the agency shall find and incorporate in the official records of the corporation that the project is reasonably expected to: (i) support or promote economic development, revitalization or stability; (ii) promote employment opportunities for residents; (iii) promote the creation or retention of jobs; or (iv) support the creation or expansion of a business sector whose success would enhance the economic development of the commonwealth, quality of life of residents or employment opportunities for residents.
[ First paragraph of subsection (b) as amended by 2025, 14, Sec. 17 effective August 5, 2025. For text effective until August 5, 2025, see above.]
(b) The agency may participate in projects to provide capital or increase or improve the availability of capital; provided, however, that before such participation, the agency shall find and incorporate in the official records of the agency that the project is reasonably expected to: (i) support or promote economic development, revitalization or stability; (ii) promote employment opportunities for residents; (iii) promote the creation or retention of jobs; or (iv) support the creation or expansion of a business sector whose success would enhance the economic development of the commonwealth, quality of life of residents or employment opportunities for residents.
The agency shall not participate in a project unless it determines, in writing, that its participation is necessary because without such participation adequate funding for the project would not be available or would be offered on terms that would preclude the success of the project. The agency shall prioritize participation in projects that enhance the quality of life of a target area as defined in section 2 of chapter 40H or enhance the quality of life and promote employment opportunities for low- and moderate-income residents of the commonwealth. If a certified community development corporation requests that the agency participate in a project, the agency shall make a determination of whether the project is likely to provide employment opportunities to or enhance the quality of life of low- and moderate-income residents of the commonwealth, or whether the project supports the creation or expansion of the business sector in the region served by the CDC.
(c) The agency may participate in projects to provide capital or increase or improve the availability of capital available to minority-owned or women-owned contractors. The agency shall not participate in a project unless it determines, in writing, that its participation is necessary because without such participation adequate funding for the project would not be available or would be offered on terms that would preclude the success of the project. The agency shall endeavor to participate in projects each year that promote the equitable growth of minority-owned or women-owned businesses.
(d) The agency may establish or invest in the capital stock of any corporation organized to increase capital available to small businesses or to engage local residents and businesses to work together to undertake programs, projects and activities that develop and improve urban, rural and suburban communities by creating and expanding economic opportunities for low- and moderate-income people. Without limitation, any such corporation may: (i) serve as a financial intermediary between entities undertaking projects and small businesses and public or private sources of capital including, but not limited to, direct lenders, guarantors or grant makers; and (ii) provide financial and managerial consulting services to entities undertaking projects, small businesses and minority-owned or women-owned contractors. Any corporation so organized may accomplish its purposes by means of investing in the equity capital of, making grants to, making loans to or issuing loan guarantees to entities undertaking projects or to small businesses. The agency may have a controlling or a minority interest in such a corporation, as the directors of the agency shall determine; provided, however, that at least 1 director of the agency shall sit on the board of directors of the corporation.
(e) Before making an investment in the equity capital of, making grants to, making loans to or issuing loan guarantees to entities undertaking projects or to small businesses, a corporation established or in which the agency has invested under subsection (d) shall make the following findings:
(i) such action is consistent with the objectives of this section and may reasonably be expected to contribute to the redevelopment and economic well-being of the commonwealth, will create or retain jobs or will assist minority- or women-owned businesses;
(ii) the funds provided by the agency will be used solely in connection with the costs of the project or the operation of the small business;
(iii) the contract for participation in a project requires: (A) adequate reporting of financial data from the small business or project to the corporation; (B) that a business receiving financial products shall participate in financial and managerial consulting services; and (C) an annual or other periodic audit of the books of the project or the small business; and
(iv) the corporation's participation is necessary to the successful completion of the proposed project or to the success of the small business because funding for the project or small business is unavailable in the traditional capital markets or that credit has been offered on terms that would preclude the success of the project or the small business.
If the agency desires to sell or otherwise dispose of stock received under a contract under this section, the small business or entity undertaking a project, or the small business or entity's nominee, shall not later than 120 days have the right of first refusal upon the sale and the right to meet a subsequent bona fide offer by a third party. The agency shall not, individually or in combination with a corporation established or invested in by the agency under this section, own more than 49 per cent of the voting stock in a small business. Upon the request of the agency, the commissioner of banks shall examine the books of a corporation established or invested in by the agency under this section, if such examination is a condition of the particular investment, lending, loan guaranty or grant program administered by such corporation.
(f) The agency shall establish a program to support the provision of financial and managerial consulting and technical assistance to eligible companies that receive financial assistance from the commonwealth or any public authorities thereof. Services that may be supported shall include, but not be limited to, procurement of investment capital, management, administration, production, product marketing, assisting business in securing federal contracts and business expansion, renovation and diversification. The program may include: (i) referrals to technical assistance provided without charge to eligible companies by public and private small business support organizations; (ii) financial support to engage private consultants; and (iii) a directory of organizations, experts and consultants available to be engaged to offer financial or managerial consulting services. The agency shall coordinate the program with the United State Small Business Administration, the Massachusetts Small Business Development Center Network and other private for profit and nonprofit providers of consulting and technical assistance to small businesses.
(g) The agency may provide matching grants to fund consulting and technical assistance to small businesses who receive financial assistance from the commonwealth or any of the commonwealth's public authorities. The grants shall be used by the recipient businesses to pay for mandated small business consulting and technical assistance services. Prior to awarding a grant, the agency shall have determined that the financial or managerial consulting services mandated as a condition of financial support of the small business are not available without charge from an entity participating in the program and that procuring such services creates a hardship and impedes the likelihood of success of a project. Grants awarded pursuant to this subsection shall require a 100 per cent match by the recipient.
(h) The agency may disburse loans and grants to low- and moderate-income entrepreneurs who are forming, operating or expanding micro businesses in the commonwealth, in consultation with the micro business development center established by section 69 of chapter 23A.
Source: Massachusetts General Court (malegislature.gov)URL: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleII/Chapter23G/Section48Fetched: 10/20/2026