HB 303 -- Linked Deposit Loans for Agriculture

Sponsor:  Hobbs

This bill adds "eligible facility borrowers" to those entities
that may qualify for linked deposit loans.  Eligible facility
borrowers are any new generation cooperative, formed or
incorporated for the purpose of operating a development facility
or a renewable fuel production facility, and any new generation
processing entity organized or incorporated for the purpose of
owning or operating a development facility or a renewable fuel
production facility.  The State Treasurer is allowed to place a
certificate of deposit with an eligible lending institution at up
to 3% below the current market interest rate, provided the
institution agrees to lend the value of the deposit according to
the deposit agreement.

Applicants for reduced rate loans are required to apply to the
Agricultural and Small Business Development Authority for
qualification as an eligible facility borrower.  Upon authority
qualification, the qualified lending institution, contingent on
the treasurer's linked deposit, will determine if an eligible
facility borrower may receive a reduced rate loan.  The treasurer
will have the final decision on whether to place a linked deposit
in an amount equal to the loan amount with the lending
institution.

No reduced rate loan to an eligible facility borrower will:

(1)  Exceed $70 million;

(2)  Exceed 90% of the total anticipated cost of the development
or renewable fuel facility or, in the case of refinancing an
existing debt, exceed 90% of the fair market value of the
facility; and

(3)  Exceed a loan term of five years, except that the loan may
be extended up to two additional loan periods of five years each
for a maximum total loan term of 15 years.

The aggregate eligible facility borrower linked deposits placed
by the treasurer will not exceed $400 million.  The treasurer
will not, after January 1, 2020, place any linked deposit for an
eligible facility borrower to receive a lower rate loan
financing, except that this restriction does not apply to any
extensions of existing loans.

Missouri House of Representatives
93rd General Assembly, 1st Regular Session
Last Updated August 25, 2005 at 1:18 pm