123-300-0101 Definitions Terms used throughout this OAR Chapter 123, Division 300, are as defined in the Act, as provided in the Department’s Procedural Rules in OAR Chapter 123, Division 001, and herein. As used in this division of administrative rules, the following definitions apply, unless the context requires otherwise: (1) “Act” means ORS 285B.780 to ORS 285B.799. (2) “Agreement” means a contract between a lender and the Department authorizing the lender to participate in the Program and providing for the deposit of moneys awarded by the Department out of which the lender may be reimbursed for Principal Losses incurred due to defaults on Enrolled Loans. (3) “Bank Short-Term Rate” means the interest rate set by the market and which is published by the Wall Street Journal. (4) “Business” or “Borrower” means a corporation, partnership, limited liability company, joint venture, sole proprietorship, cooperative, or non-profit corporation. (5) “Claim” means a lender’s written request to the Department to authorize the withdrawal of funds from the lender’s Loan Loss Reserve Account to offset a Principal Loss resulting from the default of an Enrolled Loan. (6) “Community Development Financial Institution” or “CDFI” means a lender certified as such by the Community Development Financial Institutions Fund at the United States Department of the Treasury, that is not a financial institution as defined by ORS 706.008 and that maintains an office in this state. (7) “Community Lender” means a Qualified Lender that is not eligible to participate in the Department’s Capital Access Program established by ORS 285B.109 to 285B.119 or Credit Enhancement Fund program established by ORS 285B.200 to ORS 285B.218 because the lender is not a financial institution as that term is defined by ORS 706.008. (8) “Department” means the Oregon Business Development Department as established by ORS 285A.070. (9) “Director”, “executive officer”, “immediate family”, “principal shareholder” and “related interest” have the meanings given those terms in 12 C.F.R part 215.2 (2021). (10) “Enrolled Loan” means a Qualified Loan accepted by the Department for enrollment in the Program. (11) “Fund” means funds appropriated to the Department for making Program awards to eligible lenders. (12) “Loan Loss Reserve Account” means an account established by a lender and the Department, in accordance with department policy for the benefit of the lender, for the deposit of moneys awarded from the Fund for use as provided by the Program requirements. (13) “Prime Rate” has the meaning given that term in ORS 285B.784(2). (14) “Principal”, when used in regard to a Business seeking funding from a Community Lender, is defined as: (a) The proprietor if the Business is a sole proprietorship. (b) Each managing partner and each partner who is a natural person and holds a 20% or more ownership interest in the partnership if the Business is a partnership. (c) Each director, each of the five most highly compensated executives or officers of the entity, and each natural person who is a direct or indirect holder of 20% or more ownership stock or stock equivalent of the entity, if the Business is a corporation, limited liability company, association, cooperative or a development company. (15) “Principal Loss,” “Loss,” and “Losses” means the principal amount due under an Enrolled Loan, and not paid by a Borrower in default as described in OAR 123-300-1001. Principal Loss does not include unpaid accrued interest, fees, legal expenses, costs incurred in the liquidation of assets, costs incurred in realization of personal or other financial guarantees, or other costs incurred by the lender related to the defaulted Enrolled Loan. (16) “Program” means the Community Lenders’ Loan Loss Account Program established by the Act and as implemented by the rules herein. (17) “Qualified Business” or “Qualified Borrower” means a person that operates a business in Oregon, or attests to a qualified lender that the person will use proceeds from a qualified loan to establish a business in Oregon. (18) “Qualified lender” means a lender that h as an established physical presence in Oregon and at least five years of lending experience to Oregon based businesses and that is one or more of the following: (a) A CDFI; or (b) A nonprofit corporation as defined in ORS 307.130; or (c) An economic development district in Oregon designated by the Economic Development Administration of the United States Department of Commerce; or (d) Affiliated with a local government as defined in ORS 174.116. (19) “Qualified Loan” means a loan made, or an operating line of credit extended, by a lender to a qualified business for which the Principal Losses are reimbursable from moneys in the lender’s Loan Loss Reserve Account if the loan is enrolled by the Department in the Program. (20) “RFP” means a request for proposal. (21) “Socially and Economically Disadvantaged Individual” or “SEDI” means an individual who has had their access to credit on reasonable terms diminished as compared to others in comparable economic circumstances, due to their: (a) membership of a group that has been subjected to racial or ethnic prejudice or cultural bias within American society; (b) gender; (c) veteran status; (d) limited English proficiency; (e) physical handicap; (f) long-term residence in an environment isolated from the mainstream of American society; (g) membership of a federally or state-recognized Indian Tribe; (h) long-term residence in a rural community; (i) residence in a U.S. territory; (j) residence in a community undergoing economic transitions (including communities impacted by the shift towards a net-zero economy or deindustrialization); or (k) membership of another “underserved community” as defined in Executive Order 13985. (22) “SEDI-owned business” means being a Business that is: (a) Owned and controlled by Socially and Economically Disadvantaged Individuals; (b) Owned and controlled by individuals whose residences are in a CDFI Investment Area as defined in 12 C.F.R. part 1805.201(b)(3)(ii); (c) Operated in a location that is in a CDFI Investment Area as defined in 12 C.F.R. part 1805.201(b)(3)(ii); or (d) Located in a CDFI Investment Area as defined in 12 C.F.R. part 1805.201(b)(3)(ii). (23) “Underserved” under the Act means a SEDI or a SEDI-owned business. Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799 Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 History: OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023