Session Law

Identifying Information:L. 2001 ch. 180
Other Identifying Information:2001 House Bill 2103
Tax Type:Other
Brief Description:An Act concerning the Kansas agricultural production loan deposit program; amending K.S.A. 2000 Supp. 75-4271 and 75-4272 and repealing the existing sections.
Keywords:


Body:

CHAPTER 180

HOUSE BILL No. 2103


An Act concerning the Kansas agricultural production loan deposit program; amending

K.S.A. 2000 Supp. 75-4271 and 75-4272 and repealing the existing sections.

Be it enacted by the Legislature of the State of Kansas:

Section 1. K.S.A. 2000 Supp. 75-4271 is hereby amended to read as

follows: 75-4271. (a) The state treasurer is hereby authorized to dissem-

inate information and to provide agricultural production loan deposit loan

packages to the lending institutions eligible for participation in this act.

(b) The agricultural production loan deposit loan package shall be

completed by the borrower before being forwarded to the lending insti-

tution for consideration.

(c) (1) An eligible lending institution that agrees to receive an agri-

cultural production loan deposit shall accept and review applications for

loans from eligible agricultural borrowers. The lending institution shall

apply all usual lending standards to determine the credit worthiness of

eligible agricultural borrowers. No single agricultural production loan de-

posit loan shall exceed $250,000. The total aggregate amount of agricul-

tural production loan deposit loans under this program shall not exceed

$50,000,000 $55,000,000 of unencumbered funds pursuant to article 42

of chapter 75 of the Kansas Statutes Annotated, and amendments thereto.

(2) To be eligible to obtain an agricultural production loan, an eligible

agricultural borrower must have a debt-to-asset ratio of 40% or greater.

(3) Only one agricultural production loan deposit loan shall be made

and be outstanding at any one time to any agricultural borrower.

(4) No loan shall be amortized for a period of more than eight years.

(d) An eligible agricultural borrower shall certify on its loan applica-

tion that the reduced rate loan will be used exclusively for the operating

expenses involved in farming.

(e) The eligible lending institution may approve or reject an agricul-

tural production loan deposit loan package based on the lending institu-

tion's evaluation of the eligible agricultural borrowers included in the

package, the amount of the individual loan in the package and other

appropriate considerations.

(f) The eligible lending institution shall forward to the state treasurer,

an approved agricultural production loan deposit loan package, in the

form and manner prescribed and approved by the state treasurer. The

package shall include information regarding the amount of the loan re-

quested by each eligible agricultural borrower and such other information

regarding each eligible agricultural borrower the state treasurer requires,

including a certification by the applicant that such applicant is an eligible

agricultural borrower.

Sec. 2. K.S.A. 2000 Supp. 75-4272 is hereby amended to read as

follows: 75-4272. (a) The state treasurer may accept or reject an agricul-

tural production loan deposit loan package based on the state treasurer's

evaluation of whether the loan to the eligible agricultural borrower meets

the purposes of this act. If sufficient funds are not available for an agri-

cultural production loan deposit, then the applications may be considered

in the order received when funds are once again available subject to a

review by the lending institution.

(b) Upon acceptance, the state treasurer shall certify to the director

of investments the amount required for such agricultural production loan

deposit loan package and the director of investments shall place an ag-

ricultural production loan deposit in the amount certified by the state

treasurer with the eligible lending institution at an interest rate, which is

2% below the market rate provided in K.S.A. 75-4237, and amendments

thereto, and which shall be recalculated on the first business day of Jan-

uary and July of each calendar year using the market rate then in effect.

When necessary, the state treasurer may request the director of invest-

ments to place such agricultural production loan deposit prior to accep-

tance of an agricultural production loan deposit loan package.

(c) The eligible lending institution shall enter into an agricultural pro-

duction loan deposit agreement with the state treasurer, which shall in-

clude requirements necessary to implement the purposes of the Kansas

agricultural production loan deposit program. Such requirements shall

include an agreement by the eligible lending institution to lend an amount

equal to the agricultural production loan deposit to eligible agricultural

borrowers at an interest rate which is not more than 2% above the market

rate as determined under K.S.A. 75-4237, and amendments thereto, and

which shall be recalculated on the first business day of January and July

of each calendar year using the market rate then in effect. The agreement

shall include provisions for the agricultural production loan deposit to be

placed for a maturity considered appropriate in coordination with the

underlying agricultural production loan. The agreement shall include pro-

visions for the reduction of the agricultural production loan deposit in an

amount equal to any payment of loan principal by the eligible agricultural

borrower.

Sec. 3. K.S.A. 2000 Supp. 75-4271 and 75-4272 are hereby repealed.

Sec. 4. This act shall take effect and be in force from and after its

publication in the statute book.

Approved May 21, 2000.


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Date Composed: 09/25/2001 Date Modified: 09/25/2001