Nature and Limitations of Financial Assistance
(1)Unless otherwise approved by the Legislature, Legislative Ways and Means Committee or Legislative Emergency Board, financial assistance shall be limited to loans.
(2)Loans secured by means other than sale of General Obligation Bonds by the public agency shall be subject to approval by the Environmental Quality Commission.
(3)Loans shall not exceed 100 percent of the eligible project cost. In the event the project receives grant or loan assistance from any other sources, the total of such assistance and any loan provided from the Pollution Control Fund shall not exceed 100 percent of eligible costs.
(4)The loan interest rate paid by the public agency shall be equal to the interest rate on the state bonds from which the loan is made, except as provided in sections (5) and (6) of this rule.
(5)The Department shall charge fees, purchase loans at a discount, or add to the rate of interest otherwise to be charged on loans a surcharge, in an amount reasonably calculated to permit the Department to recover its costs in issuing General Obligation Bonds to fund the loans, and its costs in acquiring the loans and administering the loans and the Pollution Control Fund.
(6)The public agency must retire its debt obligation to the state at least as rapidly as the state bonds from which the loan funds are derived are to be retired; except that special debt service requirements on the public agency’s loan may be established by the Department when:
(a)A debt requirement schedule longer than the state’s bond repayment schedule is legally required; or
(b)Other special circumstances are present.
(7)Interest and principal payments shall be due at least thirty days prior to the interest and principal payment dates established for the state bonds from which the loan is advanced.
(8)Any excess loan funds held by the public agency following completion of the project for which funds are advanced shall be used for prepayment of loan principal and interest.
Rule 340-081-0026 — Nature and Limitations of Financial Assistance,