Utah Code § 63A-3-404 — Utah Code / Title 63A / Chapter 63A-3 / § 63A-3-404
§ 63A-3-404. Loan agreement.
Status: in_force

(1) (a) A borrower that borrows money from an infrastructure fund shall enter into a loan agreement with the division for repayment of the money. (b) (i) A loan agreement under Subsection (1)(a) shall be secured by: (A) bonds, notes, or another evidence of indebtedness validly issued under state law; or (B) revenue generated from an infrastructure project. (ii) The security provided under Subsection (1)(b)(i) may include the borrower's pledge of some or all of a revenue source that the borrower controls. (c) The respective loan approval body may determine that property tax revenue or revenue from the infrastructure project for which the infrastructure loan is obtained is sufficient security for an infrastructure loan. (2) An infrastructure loan shall bear interest at a rate not to exceed .5% above bond market interest rates available to the state. (3) (a) Subject to Subsection (3)(b), the respective loan approval body shall determine the length of term of an infrastructure loan. (b) If the security for an infrastructure loan is property tax revenue, the repayment terms of the infrastructure loan agreement shall allow sufficient time for the property tax revenue to generate sufficient money to cover payments under the infrastructure loan. (4) An infrastructure loan agreement may provide for a portion of the loan proceeds to be applied to a reserve fund to secure repayment of the infrastructure loan. (5) (a) If a borrower fails to comply with the terms of an infrastructure loan agreement, the division may: (i) seek any legal or equitable remedy to obtain: (A) compliance with the agreement; or (B) the payment of damages; and (ii) request a state agency with money due to the borrower to withhold payment of the money to the borrower and instead to pay the money to the division to pay any amount due under the infrastructure loan agreement. (b) A state agency that receives a request from the division under Subsection (5)(a)(ii) shall pay to the division the money due to the borrower to the extent of the amount due under the infrastructure loan agreement. (6) Upon approval from the respective loan approval body the division shall loan money from an infrastructure fund according to the terms established by the respective loan approval body. (7) (a) The division shall administer and enforce an infrastructure loan according to the terms of the infrastructure loan agreement. (b) (i) Beginning May 5, 2021, the division shall assume responsibility from the State Infrastructure Bank Fund for servicing the loan under Subsection 63B-27-101(3)(a)(i). (ii) Payments due on or after October 1, 2021, under the loan under Subsection 63B-27-101(3)(a)(i) shall be made to the division rather than to the State Infrastructure Bank Fund, to be deposited into the military development fund. (iii) Notwithstanding Subsection (7)(b)(ii) and upon receipt of each debt service payment, the division shall deposit an amount equal to interest payments due on the bond described in Subsection 63B-27-101(3)(a)(i) into the Transportation Investment Fund of 2005 created in Section 72-2-124. (8) A borrower may request, and the division may consider, an amendment to a loan agreement described in this section that: (a) extends the term of the borrower's repayment; or (b) forgives the balance of the borrower's loan. (9) (a) The division may agree to a request described in Subsection (8) and amend a loan agreement as described in this Subsection (9). (b) Upon receiving a request described in Subsection (8), the division shall notify the Executive Appropriations Committee no later than 10 days after the day on which the division receives the request. (c) Before amending a loan agreement, the division shall: (i) consider factors necessitating the amendment and whether the amendment is in the best interests of the state, including if: (A) the infrastructure project was properly managed and loan funds were wisely invested; (B) external factors existed beyond the borrower's control that made the infrastructure projects impossible or impractical to complete; and (C) changes to the infrastructure project would avoid the need for extension or forgiveness and additional investment of funds; (ii) consider how and if the state shall be made financially whole, in whole or in part, under the proposed amendment; and (iii) provide notice to, and receive advice from, the Executive Appropriations Committee as described in Subsection (9)(d). (d) (i) The division shall notify the Executive Appropriations Committee of a proposed amendment to a loan agreement at least 45 days before the division executes the amendment. (ii) The Executive Appropriations Committee may provide, and the division shall consider, advice regarding a proposed amendment described in this Subsection (9).