Stonington — State Rep. Diana Urban, D-North Stonington, has introduced a bill designed to repay the Connecticut creditors of the now defunct Amistad America.

The plan would take a portion of the state funding that could be appropriated to Discovering Amistad, the new nonprofit organization running the schooner, in the still-to-be-approved 2017-18 budget and use it to repay creditors such as Mystic Seaport and a MBTees of Taftville. It is estimated that of the more than $2 million of debt that Amistad America owed when it ceased operation, about $250,000 is owed to businesses, individuals and organizations. The budget will be approved by the General Assembly next spring.

This is the third version of a repayment plan floated by Urban in recent months.

She initially had proposed that the state bond the money needed to repay the creditors. She later suggested the state take a portion of the $300,000 allocated in the budget, and repay the creditors.

Both suggestions were met with opposition, some from people who don’t want any more money spent on the ship, which has received more than $9 million in state funding since its inception while others feel it is unfair to penalize Discovering Amistad for the actions of Amistad America.

Urban said she understands that some people don’t want to spend more money on the ship through bonding, while taking money allocated in the current budget would pose a problem from a statutory and timing perspective.

She said $130,000 remains unspent in Discovering Amistad’s current allocation.

Urban then came up with the bill that she introduced to the legislature on Friday.

“This is how policy evolves, you listen to people,” she said.

Urban has pushed for years to reimburse the creditors, many of which are small businesses that she says are critically important to the state’s economy.

She said the creditors relied on the fact that the state was funding most of the ship’s operations and the legislature had designated the Amistad as the state’s official flagship when it decided to do business with Amistad America. In addition, she said, the state Department of Community and Economic Development did not monitor how Amistad America was spending $9 million in state funding.

Critics, though, say they took a risk like any other business or individual who decides to do work for someone.

Urban said she also wants Discovering Amistad to detail exactly how it has spent state money on administrative costs this year. She added that she continues to maintain the organization should be privately funded, something Discovering Amistad has said it is working toward.

Urban said that she understands that Discovering Amistad is a new organization and is working toward stabilizing the schooner’s financing and operation, but she said it also comes at a time when the state has made mid-year cuts in education and capital improvement aid already promised to towns. Towns now have to figure out how to deal with those cuts.

“People have to decide what they want their state government to do" in terms of its funding priorities, she said.

Len Miller, chairman of Discovering Amistad, which took over the ship after it was sold out of state receivership, has called Urban’s proposals to use some of the ship’s funding “very disconcerting, very troubling.”

He has said that when his group acquired the ship with state funding, there was an understanding that the state would continue to provide funding until his organization could show potential donors the ship and its new educational program is back in operation and can raise private funds. He said until then, Discovering Amistad will need to rely on state funding.

Urban said her bill will first go to the legislature’s Appropriations Committee for consideration. She said the committee’s chairwoman, state Sen. Cathy Osten, D-Sprague, is a co-sponsor of the bill.

Amistad America, formed in 1998 and based in Hamden, lost its nonprofit status in 2012 for failing to file three years of tax returns. Nevertheless, the state continued to make annual $360,000 payments to the organization, which fell deeper and deeper into debt, until finally freezing funding for the 2014-15 fiscal year as controversy over the organization’s lack of fiscal accountability intensified. The organization had provided little documentation about how it was spending state funding.

Following stories by The Day about how Amistad America had spent the $9 million in state funding and calls for an investigation by Urban, the state finally conducted an audit, seized the ship in the summer of 2014 and sold it to Discovering Amistad for $315,000. The state then provided $957,000 to Discovering Amistad so it could purchase and repair the ship. There was no money left from the sale to repay the creditors.

j.wojtas@theday.com