Kansas Administrative Regulations › Agency 110 - KANSAS DEPARTMENT OF COMMERCE › Article 3 - KANSAS PARTNERSHIP FUND PROGRAM › Section 110-3-5 - Terms of the program

Current through Register Vol. 43, No. 28, July 11, 2024
Except as otherwise provided in a loan agreement, the Kansas
				partnership fund revolving loan fund program shall make loans available under
				the following terms.
(a) Program
			 loans shall not exceed the total cost of the project.
(b) Except when waived by the secretary, a
			 local unit of government shall not have more than $2,000,000 in total program
			 loans outstanding at any one time.
(c) The term of program loans shall not
			 exceed the expected life of the financed public improvement or improvements as
			 determined by a certified professional engineer, or 15 years, whichever is
			 less. An extended loan term beyond 15 years may be authorized by the secretary
			 in unusual cases where a special need is demonstrated. However, any loans
			 funded in whole or in part with bond proceeds shall be subject to the terms and
			 conditions provided for in the bond indentures.
(d) The interest rate for new loans shall be
			 reviewed and established annually by the secretary of commerce on January 1 of
			 each year. The interest rate for new loans may be changed by the secretary
			 whenever bonds are issued by the Kansas development finance authority for the
			 purposes of the Kansas partnership fund.
(e) All loan proceeds shall be made available
			 to the borrower incrementally on a receipts-only basis. Whenever a loan is
			 approved, an encumbrance shall be issued for the full amount of the loan. This
			 amount shall be set aside and then may be drawn down as eligible project cost
			 receipts are submitted and approved. Interest shall only be due on loan amounts
			 actually received. Any interest earnings on encumbered funds which have been
			 set aside shall be credited to the partnership fund or designated for repayment
			 of bonds issued for this program as needed.
(f) Any costs incurred for improvements
			 beyond the necessary scope of a single purpose project, or associated with
			 activities in addition to the single purpose project, shall not be considered
			 allowable expenses under this program. In multi-purpose projects, only costs
			 that are documented by a certified professional engineer as necessary and
			 appropriate for an eligible single purpose project shall be considered
			 allowable expenses under this program.
(g) The first payment of loan principal and
			 interest shall become due at a time coordinated with the loan recipient's
			 budget cycle, but not later than 18 months after receipt of the first loan
			 disbursement.
(h) Payments shall
			 be due thereafter on at least a semi-annual basis, and the payments may be
			 adjusted so that the total of principal and interest shall be in approximately
			 equal amounts throughout the life of the loan.
(i) A delinquency charge of 1.5% per month
			 shall be applied to any payments more than 30 days overdue.
(j) Each borrower shall have the right to
			 prepay loan obligations in accordance with the terms of the loan contract.