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§ 1308. Eligibility for interest deferrals and loan guarantees and limitations thereon

Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 3 P.S. Agriculture

Purdon's Pennsylvania Statutes and Consolidated Statutes
Title 3 P.S. Agriculture (Refs & Annos)
Chapter 18. Agricultural Development Act (Refs & Annos)
3 P.S. § 1308
§ 1308. Eligibility for interest deferrals and loan guarantees and limitations thereon
Currentness
(a) Eligibility criteria.--To be eligible for an interest deferral or a loan guarantee, an applicant must demonstrate:
(1) That he is a resident of the Commonwealth, or that its principal operating or managing members or shareholders in the case of either a family farm partnership or a family farm corporation are Pennsylvania residents or show sufficient evidence that he or they intend to become a resident or residents. If the applicant is a corporation, it must be a Pennsylvania corporation in order to be eligible.
(2) That the applicant or the principal operating or managing members or shareholders thereof have sufficient education, training or experience in the type of farming for which he or they wish the interest deferral or loan guarantee and will participate in a farm management program, approved by the secretary, for the duration of the loan on which the interest will be deferred or for the duration of the loan guarantee.
(3) That the applicant has been processed by a lender for the loan on which the interest deferral or loan guarantee is sought and that the lender will make and service such loan. The lender shall be required to adequately secure the loan.
(4) That the applicant will use the loan proceeds for the eligible agricultural purposes as defined in section 21 and that the farmland or family farm enterprise is located in Pennsylvania.
(5) That the applicant is credit worthy, based on the applicant's net worth, cash flow projections, and credit rating and on the type of farmland or family farm enterprise involved.
(6) That the terms offered by the lender without an interest deferral or loan guarantee are not adequate to permit the applicant to carry out the agricultural purposes for which he is seeking the loan.
(7) That the loan guarantee or interest deferral would:
(i) facilitate the continued operation or transfer of a farm in this Commonwealth which is currently active;
(ii) help the applicant to replace all or part of its production with production of a commodity or commodities for which there is more likely to be an adequate market; or
(iii) help the family farm enterprise to process or market directly a commodity or commodities produced on the farm for which financial assistance is sought.
(b) Loan limit for acquiring farmland and farm structures.--The secretary may guarantee a loan or loans not to exceed the lesser of 90% of the amount of the loan or loans or $200,000 for each family farm enterprise for a term not to exceed 20 years if the loan is guaranteed for the purpose of acquiring farmland, farm structures or a combination thereof.
(c) Loan limit for acquiring equipment, livestock and other capital assets.--The secretary may guarantee a loan or loans not to exceed the lesser of 90% of the amount of the loan or loans or $150,000 for each family farm enterprise for a term not to exceed seven years if the loan guaranteed is for the purchase of capital assets, such as, but not limited to, equipment or livestock and horticultural assets.
(d) Loan limit for acquiring noncapital assets.--The secretary may guarantee a loan or loans not to exceed the lesser of 90% of the amount of the loan or loans or $50,000 for each family farm enterprise for a term not to exceed one year if the loan guaranteed is for the purchase of fertilizer, seed, livestock feed or other supplies normally used for agricultural activity or farming.
(e) Interest deferrals.--The secretary may make the interest payments for an applicant for up to the first three years of a loan if the loan is guaranteed in accordance with this section or is in the amount and for the purposes for which a loan may be guaranteed in accordance with this section. The secretary, in conjunction with the Secretary of Commerce,2 shall prescribe the period during which, and the terms under which, the applicant shall reimburse the Commonwealth for the interest which the secretary paid to the lender on the applicant's behalf and the security which the applicant must provide to assure reimbursement to the Commonwealth.

Credits

1984, July 2, P.L. 537, No. 108, § 8, imd. effective.

Footnotes

1
3 P.S. § 1302.
2
The Secretary of Commerce has been renamed the Secretary of Community and Economic Development. See 71 P.S. § 1709.2103.
3 P.S. § 1308, PA ST 3 P.S. § 1308
Current through 2023 Regular Session Act 1. Some statute sections may be more current, see credits for details.
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