Section 3423 - Loan Terms(a) All loans shall be secured by a Uniform Commercial Code Financing Statement. The term of the loan shall be for 20 years if the loan is also secured by real property. The term of the loan shall be for 10 years if the loan is not also secured by real property. The interest rate for loans is set pursuant to section 25299.104 of the Health and Safety Code at one-half of the most recent overall yield on general obligation bonds issued by the State Treasurer.(b) The minimum loan amount is ten thousand dollars ($10,000). The maximum loan amount is seven hundred fifty thousand dollars ($750,000) less the total principal balance owed by the applicant on existing RUST Program loans at the time of the application.(c) Each loan agreement shall include the following terms and conditions:(1) A description of collateral securing the loan and conditions pertaining thereto, as determined by the Board, and agreed to by the applicant;(2) A provision that the borrower shall pay a late fee in the event of late or incomplete payment of principal or interest;(3) An affirmative covenant by the borrower that it shall continuously comply with all permit requirements and applicable laws, including chapter 6.7 of division 20 of the Health and Safety Code, section 41954 of the Health and Safety Code, and all implementing regulations throughout the term of the loan;(4) A provision that all work funded with loan proceeds shall be performed by a contractor who holds current and active license(s) issued by the California Contractors State License Board and meets all applicable requirements set forth in section 2715 of chapter 16 of title 23 of the California Code of Regulations;(5) A provision that the borrower shall pay a loan origination fee of up to two percent of the requested amount of loan principal upon execution of the loan; and(6) Any other provision that the Board determines is necessary to protect its position as a creditor, to ensure that the project meets all applicable laws, including chapter 6.7 of division 20 of the Health and Safety Code, section 41954 of the Health and Safety Code, and all implementing regulations, or to ensure the Board's compliance with applicable state funding laws.(d) Disbursements only may be made for costs invoiced to the borrower for completed work and each disbursement shall require satisfaction of conditions precedent to disbursement. No disbursements will be made for deposits. The Board may withhold the final 10 percent of the loan principal until completion of the project. Disbursement of loan funds is conditioned on the borrower's submittal to the Board of all of the following: (1) An executed contract for the project, by a licensed contractor including costs consistent with the project budget contained in the loan agreement;(2) Copies of all permits or regulatory approvals required for the project, including, if applicable, an authority to construct, permit to install, removal permit, or other construction permit issued for the project by the applicable local agency and air district;(3) Original invoices supporting all requested costs, including all subcontractor(s) invoices; and(4) Any other information or supporting documentation reasonably required by the Board to determine whether the requested cost is eligible under section 3421.Cal. Code Regs. Tit. 23, § 3423
1. New section filed 12-3-2004 as an emergency; operative 12-3-2004 (Register 2004, No. 49). A Certificate of Compliance must be transmitted to OAL by 6-1-2005 pursuant to Health and Safety Code section 25299.108 or emergency language will be repealed by operation of law on the following day.
2. Certificate of Compliance as to 12-3-2004 order transmitted to OAL 5-31-2005 and filed 7-13-2005 (Register 2005, No. 28).
3. Amendment of section and NOTE filed 3-6-2023; operative 7-1-2023 (Register 2023, No. 10). Note: Authority cited: Section 25299.108, Health and Safety Code. Reference: Sections 25299.101 and 25299.104, Health and Safety Code.
1. New section filed 12-3-2004 as an emergency; operative 12-3-2004 (Register 2004, No. 49). A Certificate of Compliance must be transmitted to OAL by 6-1-2005 pursuant to Health and Safety Code section 25299.108 or emergency language will be repealed by operation of law on the following day.
2. Certificate of Compliance as to 12-3-2004 order transmitted to OAL 5-31-2005 and filed 7-13-2005 (Register 2005, No. 28).
3. Amendment of section and Note filed 3-6-2023; operative 7/1/2023 (Register 2023, No. 10).