Code of Maine Rules › 01 - DEPARTMENT OF AGRICULTURE, CONSERVATION AND FORESTRY › 001 - AGRICULTURE - GENERAL › Chapter 31 - RULES FOR OPERATION OF POTATO MARKETING IMPROVEMENT FUND › Section 001-31-B - Loan Programs

Current through 2024-29, July 17, 2024
Because of the variety of needs and potential differences in
				  the capital requirements of individual projects, separate loan and grant
				  programs will be established to utilize the resources of the PMIF.
All potatoes stored or packed in facilities financed by the
				  Potato Marketing Improvement Fund must be produced in Maine.
1.
New Facilities Loan Fund
(a)
Description and Purpose
The New Facilities Loan Fund is designed to help finance
				  acquisition/improvement projects, or new construction of storages and/or
				  centralized packing facilities and acquisition of packing, sizing, washing or
				  drying equipment. Projects above $150,000 total cost qualify for the New
				  Facilities Loan Fund.
(b)
Eligible Uses of Loan Proceeds
Proceeds may be used for equipment acquisition and facility
				  acquisition, construction, conversion, or expansion, including, but not limited
				  to:
* Land acquisition;
* Land improvements;
* Purchase and remodeling of existing buildings. PMIF
				  participation is limited to cost of remodeling, up to a maximum of 45% of total
				  project cost;
* Major repairs and upgrades of existing facilities,
				  including structural repairs and improvements. Any facility using these funds
				  for major repairs and upgrades will be assessed for its structural integrity
				  and overall physical condition prior to commencement of the proposed repair or
				  upgrade, and will be determined to be suitable or appropriate for the proposed
				  repair or upgrade.
* Building construction or additions;
* Leasehold improvements. Additional loan covenants may be
				  required to protect the borrower's and the Department's rights to
				  collateral;
* Purchase and installation of machinery and equipment for
				  use in storage and packing facilities;
* Proceeds may not be used for working capital, nor will
				  interim financing be an eligible use of PMIF proceeds. This provision
				  notwithstanding, applications will be accepted and processed prior to the
				  initiation of construction, and conditional approval of the project for PMIF
				  financing may be used to secure interim or construction financing.
(c)
Loan Rates, Terms,
				Amounts, and Fees
* The interest rate charged shall be fixed at the federal
				  prime interest rate on the date of the loan commitment but may not be greater
				  than 5%.
* Loan term shall not exceed 25 years and shall reflect the
				  useful life of the assets being financed.
* For projects with a total cost of up to $1,500,000, PMIF
				  proceeds may be used to fund not more than 45% of total project costs, except
				  that, in the case of cooperative projects by two or more farmers, who do not
				  share farm equipment or land, PMIF proceeds may be used to fund not more than
				  50% of the total project costs.
* For projects with a total cost of more than $1,500,000,
				  PMIF proceeds may be used to fund 25% of project costs above $1,500,000, in
				  addition to the amounts permitted above.
* No PMIF loan may be approved unless the applicant has
				  demonstrated a commitment of private funds of at least 10% of the total project
				  cost, except that, in the case of cooperative projects by two or more farmers,
				  such demonstrated commitment of private funds shall total at least 5% of the
				  total project cost.
* One percent of the PMIF loan amount shall be paid to the
				  Fund at closing as an administrative fee.
* The borrower is responsible for all legal expenses and any
				  other out-of-pocket expenses of the Department related to the borrower's
				  project.
(d)
Eligible
				Applicants
Any individual or organization in the business of growing,
				  processing or marketing of potatoes may apply.
(e)
Technical Criteria -
				storages
Proposals for new storages must include the following
				  technical information:
* A business plan that explains how the storage will be used
				  to improve marketing practices and product quality as well as details on plans
				  to store for extended or late-season shipments;
* Type of ventilation, humidification, and insulation systems
				  to be used;
* Background of and provision for the services of an
				  architect, engineer, or consultant who may provide advice on storage design,
				  construction, and operation.
(f)
Technical Criteria - central
				packing facilities
Proposals for new central packing facilities must include
				  the following:
* A description of the product to be packed with emphasis on
				  an added-value pack;
* Plans to operate over an extended shipping season,
				  particularly during harvesting and planting;
* Sources of early and late season supplies;
* A sales plan, including dealer channels and target
				  markets.