La. Admin. Code tit. 7 § III-117

Current through Register Vol. 50, No. 11, November 20, 2024

Section III-117 - Borrowers

A. Each borrower must be eligible to receive a loan with proceeds of LAFA bonds. See in particular definitions of principal user and related person contained in §101 hereof in order to make a determination as to each borrower's eligibility.

B. Each borrower must be approved by the lender to whom the borrower makes application for a loan; lenders shall apply the same criteria for approval of borrowers applying for loans to be funded with proceeds of LAFA bonds as they apply to borrowers in the lenders' conventional agricultural loan program.

C. The borrower must expend the proceeds of loan solely to finance the project described in the offer and the loan terms schedule and not for any other purpose.

D. The borrower or a related person of the borrower must be the principal user (as defined in §101 hereof) of the project.

E. A borrower will not be eligible for a loan if prior to LAFA's written acceptance of the offer and adoption of an intent resolution, the borrower or any related person of the borrower has taken any of the following actions:

1. commenced acquisition or construction to be financed with loan proceeds;

2. entered into any building agreement or purchase agreement covering the facilities to be constructed with loan proceeds;

3. commenced the installation or acquisition of any property to be acquired with loan proceeds;

4. commenced any on-site work in connection with construction of the project to be financed with loan proceeds; or

5. commenced any off-site fabrication or acquisition of any portion of the project to be financed with loan proceeds.

F. Each borrower must execute a borrower's certificate, in the form required by LAFA, setting forth the borrower's compliance with the requirements of Section 103(b)(6) of the code. When the original principal amount of a loan exceeds $1,000,000, the principal amount of the bond must be aggregated with certain capital expenditures of the borrower in accordance with regulations applicable under Section 103(b)(6) of the code to determine the total loan proceeds for which the borrower is eligible. In such circumstances, the borrower must execute, in addition to the borrower's certificate required in the first sentence of this rule, an additional borrower's certificate setting forth the assurances required under the code.

La. Admin. Code tit. 7, § III-117

Promulgated by the Department of Agriculture, Agricultural Finance Authority, LR 10:869 (November 1984).

AUTHORITY NOTE: Promulgated in accordance with R.S. 3:266, R.S. 3:270 and Section 103(b)(6) of the Internal Revenue Code of 1954, as amended.