NY A05086

Establishes a loan guarantee program administered by the Department of Financial Services to guarantee repayment of loans made by banks and credit unions to small businesses and not-for-profit organizations with no more than 50 employees during a declared state of emergency.

Limits individual loans to a maximum of $5,000 with a 90-day grace period after the emergency ends during which no repayment or interest is required, followed by 180 additional days of interest-free status.

Allows affected businesses and organizations to receive up to three loans total, one per each 30-day period they remain affected, with repayment required in 3-6 equal installments within 180 days after the interest-free period ends.

Requires creditworthiness to not be a factor in loan eligibility determinations and mandates eligible financial institutions offer credit counseling services to borrowers.

Halts new loan approvals if guarantee payouts exceed 10 percent of total loans issued and exempts deferred or uncharged interest from state taxes for affected borrowers.