La. Admin. Code tit. 7 § III-101
Act-the Louisiana Agricultural Finance Act found in Chapter 3-B of Title 3 of the Louisiana Revised Statutes of 1950, (R.S. 3:261 et seq.).
Agricultural-the adjective form of agriculture as defined in R.S. 3:263(6).
Farm-the total of all areas of land, water, or both in Louisiana, used by an agricultural producer to produce or harvest one or more agricultural products, regardless of whether the area or areas are located in more than one parish.
LAFA-the Louisiana Agricultural Finance Authority.
Bond or Bonds-LAFA Direct Placement Agricultural Revenue Bonds which are exempt from federal taxation. Such bonds are issued from time to time throughout the year, and each issue will be identified by a letter designation, e.g., Series 1984-A, Series 1984-B, etc. The letter designation merely identifies the date of issue of each series of bonds. The proceeds of such bonds are used to purchase loans and pay the costs of issuance of the bonds.
Bond Resolution-the resolution adopted by LAFA to authorize the issuance of a bond to be sold to a lender.
Borrower-an individual, partnership, firm, corporation, company, cooperative, association, society, trust or any other business unit or entity, including any state or federal agency, which uses proceeds of a loan for any project which meets the requirements of these regulations.
Borrower's Certificate-the certified statement which each borrower must execute, prior to submission of the offer, setting forth the borrower's eligibility to participate in the program.
Closing-the date on which a loan is originated by a lender, which shall be mutually agreed upon between lender and borrower and sold to LAFA.
Code-the Federal Internal Revenue Code of 1954 as amended. In these regulations, the term Code may have specific reference to section 103(b)(6) of the Internal Revenue Code and/or to regulations enacted by the Internal Revenue Service pursuant thereunder.
Default or In Default-with respect to any loan, any payment of principal or interest which is more than 30 days in arrears.
Farm-includes stock, dairy, poultry, fruit, fur-bearing animal and truck farms; plantations; ranches; nurseries; ranges; greenhouses or similar structures used primarily for the raising of agricultural or horticultural commodities; and orchards.
Fee or Fees-any and all of the following:
a.Application Fee-a set fee based on the total value of the loan which is paid by the borrower and transmitted by the lender to LAFA for LAFA processing of the application for a loan.
b.Commitment Fee-a percentage of the total value of the loan which is paid by the borrower to the lender prior to submission of the offer to cover the costs of issuing the bond to support the loan granted to the borrower. This fee is refundable to the borrower under the conditions set forth in §121. B hereof.
c.Cost of Issue Fee-a percentage of the total value of the loan which is paid by the borrower to cover the costs of issuing the bond to support the loan granted to the borrower. The fee is paid in the form of a discount from the original principal amount of the loan when purchased by a LAFA from lender.
d.Origination Fee-a percentage of the total value of the loan which is paid by the borrower to the lender to cover the costs of processing, originating, and disbursing the proceeds of the loan granted to the borrower.
e.Program Participation Fee-a percentage of the remaining principal balance of the loan granted to borrower which is paid by the borrower to the lender on the due date of the annual payment directed by trustee. The lender transmits to the trustee along with the loan payment, and the proceeds thereof are used to cover the administrative costs of trustee and LAFA.
First-Time Farmer-an individual who has never had any direct or indirect ownership interest in substantial farmland in the operation of which such individual materially participated. Ownership or participation by a spouse or child is treated as ownership or participation by the individual. Substantial farmland means any parcel of land unless:
a. such parcel is smaller than 15 percent of the median farm size in the parish in which such parcel is located; and
b. the fair market value of the land does not at any time while held by the individual exceed $125,000.
Intent Resolution-the resolution adopted by LAFA stating its intent to accept the offer and to issue a bond, the proceeds of which will be used to purchase an agricultural loan originated by the lender and accepting the offer.
Interest Rate-one of the following when applied to a loan:
a.Fixed Interest Rate-a rate of interest which does not change throughout the term of the loan.
b.Variable Interest Rate-a rate of interest which may change from time to time at stated intervals throughout the term of the loan.
c.Prime Interest Rate-the base rate on corporate loans at large U.S. money center commercial banks as published in The Wall Street Journal as the prime rate. When the prime rate is published in The Wall Street Journal as a range in the form of a low and high rate, then in that event, LAFA may designate a rate within the published range which shall be the prime interest rate. When LAFA does not designate a rate within the published range the prime interest rate shall be the high of the range.
IRS-the Internal Revenue Service of the United States.
LAFA-the Louisiana Agricultural Finance Authority, an agency of state government under the jurisdiction of the Department of Agriculture and Forestry, and any of its duly authorized agents; the term also means the issuer of Direct Placement Agricultural Revenue Bonds.
Lender-any of the following, when participating in the program: a bank, bank or trust company, federal land bank, production credit association, bank for cooperatives, building and loan association, homestead, insurance company, investing banker, mortgage banker or company, pension or retirement fund, savings bank or savings and loan association, small business investment company, credit union, any other financial institution authorized to do business in Louisiana or operating under the supervision of any federal agency or any Edge Act Corporation or agreement, or a corporation organized or operating pursuant to Section 25 of the Federal Reserve Act.
Loan or Loans-an interest-bearing agricultural loan, described by an offer, originated by a lender participating in the LAFA Program to an eligible borrower, and evidenced by a loan note.
Loan File-the loan documents pertaining to a particular loan, which consist of the following, all in the form provided by LAFA:
a. loan purchase agreement;
b. loan submission voucher;
c. opinion of lender's counsel;
d. officer's closing certificate;
e. loan note;
f. mortgage or any other evidence of security securing the borrower's obligations under the loan note;
g. certificate of economic life; and
h. assignment of loan note.
Loan Note-a promissory note or other evidence of indebtedness executed by a borrower to evidence the borrower's obligation to repay the loan.
Loan Purchase Agreement-an agreement between LAFA and a lender under which, among other required provisions, LAFA agrees to purchase a loan after it is originated by the lender and the lender agrees to repurchase the loan in the event of default by the borrower.
Loan Submission Voucher-a document provided by LAFA and submitted by the lender to the trustee requesting the purchase of the loan by LAFA at a price equal to a specified percentage of the principal amount of the loan and which also contains substantially the same terms and conditions set forth in the loan terms schedule contained in the offer.
Loan Terms Schedule-a loan description form, to be attached to the offer, which describes the terms and conditions of the proposed loan and the project to be financed with loan proceeds.
Offer-the written document entitled Offer to Originate and Sell Agricultural Loans executed by a lender setting forth the terms and conditions whereby the lender agrees to originate and sell a loan to LAFA and to purchase a bond in the same principal amount as the loan.
Origination Period-a six-month period beginning with the date of issuance of a bond by LAFA.
Principal User-a person or company who uses more than 10 percent of a project, measured by the value paid by such user for the project. All capital expenditures for the project, must be taken into account to determine which are principal users of the project. For example, A, B, and C own Farm X in Parish X, each owning individually and not as a partner, respectively, 55 percent, 40 percent, and 5 percent by value, of the farm. A and B are principal users of Farm X (i.e., each owns more than 10 percent, by value), but C is not a principal user of Farm X because C only owns 5 percent by value. If A or B seek to acquire another Farm Y in Parish X, to be financed by a bond, the capital expenditures of A or B on Farm X will be deducted from the maximum principal amount of the bond (either $1,000,000 or $10,000,000; see §111). Since C is not a principal user of Farm X, if he acquired Farm Y with bond financing, he would not be required to deduct his capital expenditures on Farm X from the loan proceeds for the purchase of Farm Y.
Program-the Direct Placement Agricultural Revenue Bond Program administered by LAFA.
Project-the property to be financed with loan proceeds, pursuant to the terms and conditions contained in the offer and in the loan purchase agreement.
Rehabilitation Expenditures-any costs associated with renovation or modernization of an existing building or the equipment located within an existing building which can be properly charged to a capital account; the term does not include expenditures for enlargement of an existing building.
Related Person-
a. the following are related persons if borrower is an individual:
i. borrower's spouse or a spouse's ancestors or lineal descendants;
ii. borrower's siblings (i.e., brothers and sisters);
iii. borrower's ancestors and/or lineal descendants;
iv. a corporation in which more than 50 percent in value of the outstanding stock is owned, directly or indirectly, by or for borrower;
v. a trust of which borrower is the grantor or the beneficiary; and
vi. a partnership of which borrower owns, directly or indirectly, more than 50 percent of the capital or profits interest;
b. the following are related persons if borrower is a corporation:
i. an individual who owns, directly or indirectly, more than 50 percent in value of the outstanding stock of the corporation;
ii. a trust which owns, directly or indirectly, more than 50 percent in value of the outstanding stock of the corporation;
iii. a corporation that is a member of the same parent-subsidiary controlled group, a brother-sister controlled group, or a combined group of corporations;
iv. a partnership which owns, directly or indirectly, more than 50 percent of the outstanding stock of the corporation; and
v. for purposes of these regulations, stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust is considered to be owned proportionately by or for its shareholders, partners or beneficiaries. In addition, an individual is considered to be the owner of stock owned, directly or indirectly, by or for his family;
c. the following are related persons if borrower is a partnership:
i. a partner who owns, directly or indirectly, more than 50 percent of the capital or profits interest of the partnership;
ii. another partnership in which the same persons own, directly or indirectly, more than 50 percent of the capital or profits interest;
iii. if an individual owns stock in a corporation, other than constructively though his family, he is considered as owning the stock owned, directly or indirectly, by or for his partner; and
iv. a partner is considered as the owner of partnership interests:
(a). owned by a corporation, partnership, estate or trust, proportionately, if he is a shareholder, partner, or beneficiary; and
(b). owned by his brothers, sisters, spouse, ancestors or lineal descendants;
d. the following are related persons if borrower is a trust:
i. its grantor;
ii. another trust, if the same person is the grantor of both trusts;
iii. a beneficiary of the trust;
iv. a beneficiary of another trust, if the same person is the grantor of both trusts; and
v. a corporation of which more than 50 percent in value of the outstanding stock is owned, directly or indirectly, by or for the trust or by or for a grantor of the trust.
TEFRA-the Tax Equity and Fiscal Responsibility Act of 1982 (federal).
Trustee-Capital Bank and Trust Company of Baton Rouge, Louisiana.
Expected Gross Crop Revenue (for 2016)-the level of revenue that would have been expected to have been generated in 2016 under normal weather conditions and is calculated using the applicants response to the number of acres harvested in 2016, a 5-year parish average for crop yields and the estimated average market price in 2016.
Gross Crop Revenue (for 2016)-calculated by multiplying total acres harvested times the total average yield times an estimated average selling price. The estimated average selling price is calculated by dividing the applicants share of crop revenue by the amount of the crop marketed by the applicant.
Increases in either Harvest or Production Costs-the costs of having to replant crops that were ruined due to high levels of rainfall and flooding; costs associated with harvesting crops under excessively wet field conditions causing reduced harvest speeds and efficiency; and costs associated with increased tillage and land preparation due to damage caused to land resulting from either having to harvest under excessively wet conditions or resulting from the impact of pounding rainfall and flooding.
Loss of Stored Hay-calculated by using the number of bales destroyed and then converting them into tons of hay assuming an average bale weight of 1,200 pounds. A market value for hay lost due to flooding is then calculated using the average 2016 market price as defined by the 2016 Louisiana Summary publication.
Lost or Dead Cattle-cattle that were lost or killed and calculated on a value per head by for the two classes of cattle using average 2016 market prices obtained from the 2016 Louisiana Summary publication and assuming an average weight for calves of 500 pounds and breeding animals of 1,200 pounds.
Net Estimated Losses-the amount of losses eligible for assistance under the 2016 Louisiana Farm Recovery Grant Program calculated by the difference between the total estimated losses and any assistance received by the applicant from other sources.
Producer-one who engages, as an occupation, in farming operations as a distinct activity for the purpose of producing a farm crop and assumes the production and market risks associated with the agricultural production of those crops. A corporation or farmers cooperative may be a "producer" if engaged in actual farming of the nature and extent there indicated.
Reductions in Grazing Availability-the economic loss associated with pastures that were flooded making grazing unavailable to cattle which is calculated using a hay equivalent methodology. The methodology assumes the economic loss is equal to the value of the amount of hay that would be needed to compensate for the lost grazing. The methodology assumes that each mature cow weighs 1,200 pounds and eats 2 percent of her body weight per day. With this information, the total amount of hay needed for the number of days grazing was unavailable is calculated. The value of that hay is then estimated using the average 2016 market price for hay as defined by the 2016 Louisiana Summary publication.
Total Estimated Losses (suffered by the farming operation)-a summation of the estimated economic losses associated with each crop produced and any cattle related losses.
La. Admin. Code tit. 7, § III-101