2006 Minnesota Statutes

41B.043 AGRICULTURAL IMPROVEMENT LOAN PROGRAM.
    Subdivision 1. Establishment. The authority may establish, adopt rules for, and implement
an agricultural improvement loan program to finance agricultural improvements.
    Subd. 1a. Direct loans. Direct loans may be made to borrowers who meet the requirements
of section 41B.03, subdivision 1, clauses (1) and (2), and who are actively engaged in farming.
    Subd. 1b. Loan participation. The authority may participate in an agricultural improvement
loan with an eligible lender to a farmer who meets the requirements of section 41B.03, subdivision
1 , clauses (1) and (2), and who is actively engaged in farming. Participation is limited to 45
percent of the principal amount of the loan or $200,000, whichever is less. The interest rates and
repayment terms of the authority's participation interest may be different than the interest rates
and repayment terms of the lender's retained portion of the loan.
    Subd. 2. Specifications. No direct loan may exceed $35,000 or $125,000 for a loan
participation. Each direct loan and participation must be secured by a mortgage on real property
and such other security as the authority may require.
    Subd. 2a. Snow, flood, or other naturally caused damage. A prospective borrower
applying for a loan participation through an eligible lender may refinance an existing debt in
order to repair or replace farm driveways, drainage ditches and tile lines, grassed waterways, or
agricultural buildings damaged due to snow, flooding, or other weather-related causes.
    Subd. 3. Application and origination fee. The authority may impose a reasonable
nonrefundable application fee for each application for a direct loan or participation and an
origination fee for each direct loan issued under the agricultural improvement loan program. The
origination fee initially shall be set at 1.5 percent and the application fee at $50. The authority
may review the fees annually and make adjustments as necessary. The fees must be deposited in
the state treasury and credited to an account in the special revenue fund. Money in this account is
appropriated to the commissioner for administrative expenses of the agricultural improvement
loan program.
    Subd. 4. Interest rate. The interest rate per annum on the agricultural improvement direct
loan or participation must be the rate of interest determined by the authority to be necessary to
provide for the timely payment of principal and interest when due on bonds or other obligations
of the authority issued under chapter 41B to provide financing for direct loans and participations
made under the agricultural improvement loan program, and to provide for reasonable and
necessary costs of issuing, carrying, administering, and securing the bonds or notes and to pay
the costs incurred and to be incurred by the authority in the implementation of the agricultural
improvement loan program.
    Subd. 5. Total net worth limit. A prospective borrower for an agricultural improvement
loan in which the authority holds an interest must have a total net worth, including assets and
liabilities of the borrower's spouse and dependents, of less than $350,000 in 2004 and an amount
in subsequent years which is adjusted for inflation by multiplying that amount by the cumulative
inflation rate as determined by the United States All-Items Consumer Price Index.
History: 1992 c 602 s 9; 1993 c 298 s 2; 1995 c 220 s 52-54; 2Sp1997 c 2 s 16; 1998 c 383 s
31; 2000 c 477 s 58; 2000 c 488 art 3 s 17; 1Sp2001 c 2 s 69,70; 2004 c 254 s 19,20