reglab/statecodes huggingface dataset:
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:06 - Permissible uses of loan proceeds

Current through Register Vol. 51, page 10, July 15, 2024
APEX loan proceeds may be used for the following purposes;
(1) Purchase and development of land, easements, rights-of-way, buildings, facilities, leases, or materials;
(2) Construction or acquisition and remodeling of buildings and works necessary to the operation and protection of the project;
(3) Purchase and installation of machinery, equipment, and leasehold improvements;
(4) Fees, services, and costs related to the construction of the project;
(5) Other purposes not listed in this section and not prohibited in §
									68:01:02:07, as individually approved by the authority and the USDA RD;
(6) Business construction, conversion, enlargement, repair, modernization, or development; and
(7) Business and industrial acquisitions if the loan will keep the business from closing, prevent the loss of employment opportunities, or provide expanded job opportunities.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-4,  1-16B-37,  1-16B-44.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:07 - Impermissible uses of loan proceeds

Current through Register Vol. 51, page 10, July 15, 2024
The borrower may not use the proceeds for any of the following purposes:
(1) Agricultural production;
(2) Transfer of ownership, unless the loan will keep the business from closing, prevent the loss of employment opportunities in the area, or provide expanded job opportunities;
(3) Financing or refinancing the preliminary design stage or existing debt;
(4) Assistance in excess of what is needed to accomplish the purpose of the ultimate recipient's project;
(5) Distribution or payment to the owners, partners, shareholders, or beneficiaries of the ultimate recipient or members of their families if such persons will retain any portion of their equity in the ultimate recipient;
(6) Charitable institutions that would not have revenue from sales or fees to support the operation and repay the loan, churches, organizations affiliated with or sponsored by churches, and fraternal organizations;
(7) Assistance to government employees, military personnel, or principals or employees of the intermediary or organizations for which such persons are directors or officers or in which they have ownership of 20 percent of more;
(8) A loan to an ultimate recipient who has an application pending with or a loan outstanding from another intermediary involving an IRP revolving fund if the total IRP loans would exceed the limits established in Sec. 4274.331 (b) of Rural Development Instruction 4274-D as of February 6, 1998;
(9) Community antenna television services or facilities;
(10) Any illegal activity;
(11) Any project that is in violation of either a federal, state, or local environmental protection law or regulation or an enforceable land use restriction unless the assistance given will result in curing or removing the violation;
(12) Lending and investment institutions and insurance companies; and
(13) Golf courses, race tracks, or gambling facilities.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-4,  1-16B-37,  1-16B-44.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:08 - Factors for action by authority

Current through Register Vol. 51, page 10, July 15, 2024
The authority, when making a decision on an application, may, in addition to other factors necessary to make a sound loan decision, consider the following:
(1) Program impact factors:
(a) Population of the community where the project is to be located;
(b) Amount of agricultural products used;
(c) Number of jobs created for low-income persons and displaced farm families;
(d) Amount of loan requested;
(e) Net economic effect of increasing or stabilizing the economy on the community, area, and state;
(f) Competitive effect on existing businesses;
(g) Support of the public entities of the community and area;
(h) The amount of the owner's equity contributed to the project;
(i) The effect of the project on the environment, health, and safety of the people in the community and state;
(j) Compatibility with economic development plans of the area and state;
(k) Potential for creating quality jobs and growth of those jobs;
(l) Payroll pay structure; and
(m) Employee benefit package;
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:09 - Action by authority on applications

Current through Register Vol. 51, page 10, July 15, 2024
Within 60 days after the GOED receives a completed application, the authority, in accordance with SDCL  1-16B-38, shall either approve the application as requested, disapprove the application for modification, approve the application contingent on the realization of certain defined conditions, or disapprove the application.
The authority may extend the time for consideration of an application for up to 50 additional days by advising the applicant of the extension in writing or by telephone.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-14(4),  1-16B-37,  1-16B-38,  1-16B-44.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:10 - Reservation of right to make loan

Current through Register Vol. 51, page 10, July 15, 2024
If the authority approves the loan application, the application shall then be sent to USDA RD for approval. Except as provided in this section, no loan agreement may be entered into unless USDA RD approves the loan.
If USDA RD rejects a loan application, the authority, in accordance with SDCL  1-16B-38, may approve the loan from authority funds or revolving funds that are not subject to an agreement between the authority and USDA RD if the loan meets the guidelines in this chapter.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-41,  1-16B-43,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:11 - Acceptance by applicant - Time restrictions

Current through Register Vol. 51, page 10, July 15, 2024
Within six months after the official loan approval by the authority and USDA RD, the applicant must accept the commitment letter of the authority in writing or the approval may be withdrawn at the discretion of the authority.
Within six months after written acceptance, the applicant must begin the project. Final disbursement of the loan proceeds must be made within one year after approval by the authority, unless the time is extended by the authority pursuant to prior written consent. The request for extension must be submitted at a regularly scheduled meeting prior to the expiration of the six-month period. The authority shall decide the length of the extension period.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-14(4),  1-16B-37,  1-16B-44.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:12 - Review of financial status

Current through Register Vol. 51, page 10, July 15, 2024
After the loan is approved by the authority and the USDA RD but before the loan agreement is entered into, the authority or the GOED may conduct an overall review of the applicant's financial status. This review may include an analysis of all assets and liabilities and an analysis of the ability of the business to service and honor the loan commitments. If the applicant's financial condition has materially changed since the approval of the loan, the authority may disapprove the loan or seek modification of loan amounts and equity contributions.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:13 - Loan agreement

Current through Register Vol. 51, page 10, July 15, 2024
After the application for a loan is approved by the authority and the USDA RD and after the financial status of the applicant is reviewed, the authority shall execute a loan agreement with the borrower. The loan agreement shall contain the rights and responsibilities of the parties and the terms and conditions of the loan. The requirements to secure the loan shall be included in the loan agreement.
Loans may be secured or unsecured. Secured loans may be secured by liens on the interest of the borrower in all real and personal property, tangible or intangible; easements; rights-of-way; water rights; leasehold interest used in connection with the project; and any other assets of the borrower considered necessary by the authority to adequately collateralize the loan.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:14 - Maturity and interest rate

Current through Register Vol. 51, page 10, July 15, 2024
The maturity of the loan may not be more than 20 years with regular payments amortized over the term of the loan with a balloon payment prior to maturity. The authority shall match the term with the useful life of the assets being financed.
The interest rate of the loan shall be for a fixed rate as negotiated.
The borrower is responsible for arranging other financing when the note becomes due. If the borrower is unable to obtain financing, the borrower may apply before the loan due date for an extension of the loan by the authority at an interest rate and for a time period to be set by the authority.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:15 - Lender agreement

Current through Register Vol. 51, page 10, July 15, 2024
After an application is approved for a loan from APEX and USDA RD, the authority shall execute a lender agreement with the regulated lender. The lender agreement shall provide the rights and responsibilities of the lender and the authority and the terms and conditions of the agreement. The requirement for a lender agreement may be waived at the discretion of the board based upon participation of a participating lender or a servicing lender or if the applicant is a participant in other loan programs within the GOED.
The borrower is responsible for any servicing fee. The regulated lender's servicing fee may include any necessary contracting to monitor or service the loan that is performed by the lender or any other authority-approved party. The authority may enter into a participation agreement, servicing agreement, or both with a regulated lender and borrower concerning any APEX loan.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-14(5),  1-16B-37,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:16 - Reporting requirements for regulated lender

Current through Register Vol. 51, page 10, July 15, 2024
A regulated lender that enters into a servicing agreement may submit to the authority a regular management report, inventory report, asset report, and operations report as directed by the authority. The regulated lender shall also assist the borrower in complying with the borrower's reporting requirements.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-14(5),  1-16B-37,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:17 - Reporting requirements for borrower

Current through Register Vol. 51, page 10, July 15, 2024
The borrower shall submit to the authority annually a report containing the following information:
(1) An employment report;
(2) The amount of agricultural products used in the business and the amount of the product that is exported from the state;
(3) The number of jobs for low-income persons and displaced farm families;
(4) Financial statements in a form acceptable to the authority as specified in the loan authorization document; and
(5) Other information as requested by the authority.
The authority may require that the financial statements be compiled, reviewed, or audited by an independent accountant at the expense of the borrower.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:18 - Inspection of business by authority - Retention of records

Current through Register Vol. 51, page 10, July 15, 2024
During the term of the loan, the authority or GOED may inspect construction, inspect the operation of the business, and request the borrower to provide accounting records, payments, and invoices to ensure compliance with the terms of the loan agreement. The borrower shall retain accounting and tax records for the term of the loan or for a period of three years, whichever is longer.
The authority may contract for project monitoring and servicing during the planning, construction, and operation of the business and project.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:19 - Default on loan agreement

Current through Register Vol. 51, page 10, July 15, 2024
If the borrower violates any of the terms of the loan agreement, the authority may place the borrower in default. Upon default, the authority may do one or more of the following:
(1) Declare immediately due and payable the entire principal amount then outstanding and the accrued interest;
(2) Take possession of the facility; repair, maintain, operate, sell, lease, or otherwise dispose of the facility to another entity; and charge the account of the borrower for expenses for repair, maintenance, and operation of the project and other expenses necessary to cure the cause of the default;
(3) Take any other action considered appropriate by the authority to protect the interest of the authority and USDA RD;
(4) Exercise any and all rights of a creditor under the South Dakota uniform commercial code or any other statute; and
(5) Take any action allowed by, enforce any responsibility imposed upon the borrower by, or enforce any remedies agreed to in the loan agreement executed between the borrower and the authority.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:01 - Economic development finance authority › Chapter 68:01:02 - APEX loan program › Section 68:01:02:20 - Interim financing

Current through Register Vol. 51, page 10, July 15, 2024
Interim financing is not refinancing of existing debt. The authority may require that the borrower use a commitment for an APEX loan to secure interim financing from a regulated lender. The authority shall satisfy the interim financing loan in accordance with the terms of the interim financing loan agreement upon certification of completion of the project in accordance with the APEX commitment.
General Authority:
SDCL  1-16B-14(4).
Law Implemented:
SDCL  1-16B-37,  1-16B-44,  1-16B-46.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:33 - Definitions

Current through Register Vol. 51, page 10, July 15, 2024
Terms used in this chapter mean:
(1) "Applicant," any natural person, for-profit entity, or non-profit entity that has completed a REDI fund loan application;
(2) "Board," the Board of Economic Development;
(3) "Borrower," an applicant who has been awarded a REDI fund loan;
(4) "Credit committee," a committee made up of members of the board appointed by the chair of the board with the powers described in §
									68:02:01:56;
(5) "Equity," capital that has no guaranteed or mandatory return which must be invested in the project in any event and which has no definite timetable for repayment to the equity holder;
(6) "GOED," the Governor's Office of Economic Development;
(7) "Multifamily housing," housing containing two or more dwelling units, including in an apartment building, duplex, triplex, quadriplex, or townhomes. The term includes housing intended for lease or purchase by the occupant.
(8) "Preliminary design stage," that portion of the project associated with market research studies identifying the project scope and need, compilation of the business plan, written initial cost estimates, written site options and description, and obtaining the commitments of the lenders;
(9) "Primary jobs," jobs derived from businesses that bring new income into an area, stimulate other local businesses, or assist a community to diversity and stabilize its economy;
(10) "Project," except when the term is used in conjunction with multifamily housing, the new business; retention, relocation or expansion of an existing business; or other endeavor which will create or retain primary jobs. When the term is used in conjunction with multifamily housing, new multifamily housing or the acquisition and refurbishment of existing multifamily housing;
(11) "REDI fund," the revolving economic development and initiative fund;
(12) "Total project costs," the direct costs associated with the purchase of land, necessary site development and improvements, construction or acquisition and remodeling of buildings and works necessary to the operation and protection of the project, purchase and installation of machinery and equipment, purchase or development of intellectual property rights, fees for services, approved in-kind contributions, adequate working capital financing, and any other cost approved by the board.
General Authority:
SDCL  1-16G-5,  1-16G-8, 1-16G-28.
Law Implemented:
SDCL  1-16G-5,  1-16G-8.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:34 - Eligibility requirements

Current through Register Vol. 51, page 10, July 15, 2024
Any natural person or entity whose project will create or retain primary jobs is eligible to apply for a loan from the REDI fund.
General Authority:
SDCL  1-16G-5,  1-16G-8(6).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(6).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:35 - Application requirements - Screening

Current through Register Vol. 51, page 10, July 15, 2024
Application forms shall be provided by GOED and shall be completed and signed before an application is presented to the board. GOED shall screen all applications for completeness and eligibility upon receipt. No incomplete or ineligible applications may be presented to the board. Applications shall include the following information:
(1) Applicant's name and address;
(2) Names, addresses, resumes, and references of owners, investors, and management of the business;
(3) Articles of incorporation and bylaws or other agreements that describe the legal operation or structure of the business;
(4) Name and address of the owner or operator of the business during the term of the loan;
(5) A business plan which contains information regarding the products or services to be offered by the applicant; job descriptions with attendant salary or wage information by job category; employee benefit package; educational requirements by job category; and methods of accounting, financing, marketing, sales, merchandising, and other disciplines proposed to be used for business growth and expansion;
(6) Letters of commitment from all funding sources;
(7) Up to three years of historical balance sheets, cash flow statements, and income statements or federal tax returns;
(8) Pro forma balance sheets, cash flow statements, and income statements for the greater of three years or the term of the loan;
(9) A statement of licensing requirements;
(10) A statement that addresses the effect of the business on the tax base of the area of the project and other positive and negative effects of the project on the area;
(11) Assurance of compliance with local zoning laws and building codes and that the necessary public utilities are available or will be available when needed by the project;
(12) Approximate construction date, construction completion date, and the date by which the project will be fully operational;
(13) Documentation that the preliminary design stage has been completed; and
(14) Any other information as requested by the board in order to make a sound loan decision.
General Authority:
SDCL  1-16G-5,  1-16G-8(7).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:36 - Loan amounts

Current through Register Vol. 51, page 10, July 15, 2024
Unless waived by the affirmative vote of two-thirds of the members of the board present and voting, a loan made pursuant to this chapter may not exceed the original principal amount of $1,000,000. Unless waived by the affirmative vote of two-thirds of the members of the board present and voting, a loan made pursuant to this chapter may not exceed 45 percent of the total project cost.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:37 - Equity contribution

Current through Register Vol. 51, page 10, July 15, 2024
The applicant shall provide an equity contribution of a minimum of 10 percent of the total project costs as determined by the board. The requirement may be waived by the affirmative vote of two-thirds vote of the members of the board present and voting if the equity contribution is not necessary to secure the interests of the board. In-kind contributions and completed work may be applied toward the equity contribution and total project costs if, in the judgment of the board, such in-kind contributions and completed work contribute substantially to the project. Costs associated with the preliminary design stage may not be considered as equity contribution except for board-approved intellectual property and innovative technology research and development expenses. The applicant shall provide proof of the existence or availability of the equity contribution.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:38 - Use of loan proceeds

Current through Register Vol. 51, page 10, July 15, 2024
Loan proceeds may be used for any portion of the total project costs. Except as otherwise provided in this chapter, loan proceeds may not be used for costs associated with the preliminary design stage. Loan proceeds may not be used to finance or refinance the cost of the preliminary design stage. Except for the refinancing of third party interim loans incurred for the project, loan proceeds may not be used to pay existing debt.
General Authority:
SDCL  1-16G-5,  1-16G-8(9).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(9).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:39 - REDI loan as take-out financing

Current through Register Vol. 51, page 10, July 15, 2024
Unless otherwise specifically provided in the resolution or motion approving the loan, the applicant shall use the loan to pay off interim financing incurred for the project.
General Authority:
SDCL  1-16G-5,  1-16G-8(9).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(9).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:40 - Factors for board action

Current through Register Vol. 51, page 10, July 15, 2024
When making a decision on an application, the board may, in addition to other factors necessary to make a prudent loan decision, consider the following:
(1) Project impact factors;
(a) Economic impact of primary jobs created or retained;
(b) Net economic effect of increasing or stabilizing the economy on the community, area, and state;
(c) Competitive effect on existing businesses;
(d) Support of the public entities of the community and area;
(e) The amount of the owner's equity contributed to the project;
(f) The effect of the project on the environment, health, and safety of the people in the community, area, and state;
(g) Compatibility with economic development plans of the area and state;
(h) Type of business;
(i) Payroll, pay structure, and employee benefit structure;
(j)  Number of jobs created or retained; and
(k) In the case of multifamily housing, the impact of the project on the availability of workforce within the project area.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:41 - Board action on applications

Current through Register Vol. 51, page 10, July 15, 2024
Within 30 days after GOED receives a complete application, the board shall either approve the application as requested, disapprove the application for modification, approve the application contingent on the realization of certain defined conditions, or disapprove the application. If the application is disapproved or disapproved for modification, the reasons shall be transmitted to the applicant in writing. The applicant whose application has been disapproved may submit another application that addresses the reason for disapproval. The board may extend the time for consideration of an application for up to 50 additional days by advising the applicant of the extension in writing.
General Authority:
SDCL  1-16G-5,  1-16G-8(7).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:42 - Acceptance and time restrictions of applicant

Current through Register Vol. 51, page 10, July 15, 2024
The applicant must comply with any conditions required by the board before the application is approved. Within six months after the official loan approval by the board, the applicant must accept the approval in writing or the approval is void. Within six months after written acceptance, the applicant must commence the project. All loan proceeds must be disbursed within one year after approval by the board. The board or credit committee may extend the time for completion of the project and the final disbursement of loan proceeds if mitigating circumstances prevent completion of the project and the applicant has made a diligent effort so to do. The applicant shall submit any request for extension by the monthly loan application deadline prior to the expiration of the six-month period for completion of the project. The board or credit committee may establish the length of the extension period based on the mitigating circumstances.
General Authority:
SDCL  1-16G-5,  1-16G-8(7)(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7)(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:43 - Review of financial status

Current through Register Vol. 51, page 10, July 15, 2024
After the loan is approved but before the loan is closed, the board or GOED may conduct an overall review of the applicant's financial status. The review may include an analysis of all assets and liabilities and an analysis of the applicant's ability to repay the loan and comply with the loan covenants. The board may withdraw the commitment at any time if a material adverse change occurs.
General Authority:
SDCL  1-16G-5,  1-16G-8(7)(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7)(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:44 - Loan agreement - Employment agreement - Security

Current through Register Vol. 51, page 10, July 15, 2024
After the application for a loan is approved, the board and the borrower shall execute a loan agreement, employment agreement, and any other loan documents required by the board. The loan agreement shall contain the rights and responsibilities of the parties and the terms and conditions of the loan. The requirements to secure the loan shall be included in the loan agreement. The employment agreement shall establish the number of primary jobs to be created or retained and the damages payable by the borrower if those jobs are not created or retained. No employment agreement is required for a project consisting solely of multifamily housing.
A loan may be secured or unsecured. A secured loan may be secured by a lien on the interest of the borrower in real and personal property, whether tangible or intangible, as deemed necessary by the board to adequately collateralize the loan.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:45 - Borrower reporting requirements

Current through Register Vol. 51, page 10, July 15, 2024
The borrower shall submit to the board annually the following information:
(1) Employment report;
(2) Federal tax returns or periodic financial statements, or both, as requested by the board; and
(3) Other information which the board or GOED deems necessary to determine the financial condition of the borrower and conformance to loan covenants.
The board may require that the financial statements be compiled, reviewed, or audited by an independent accountant at the borrower's expense.
General Authority:
SDCL  1-16G-5,  1-16G-8(5).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(5).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:46 - Inspection by the board and retention of records

Current through Register Vol. 51, page 10, July 15, 2024
During the term of the loan, the board or GOED may inspect construction; inspect the borrower's operations, books, and records; and request the borrower to provide accounting records, payments, and invoices to ensure compliance with the terms of the loan agreement and the borrower's ongoing ability to repay the loan. The borrower shall retain accounting and tax records for the term of the loan or for a period of three years, whichever is longer.
The board may contract for project monitoring and servicing during the planning, construction, and operation of the project and the borrower's business.
General Authority:
SDCL  1-16G-5,  1-16G-8(5).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(5).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:47 - Additional notification requirements

Current through Register Vol. 51, page 10, July 15, 2024
The borrower shall provide the board with written notice within 10 business days of any changes in top level management of the borrower's business or of any plans for sale, public offering, or lease of the business. Any sale, public offering, or lease of the business requires the prior written approval of the board. If the notification and prior approval requirements of this section are not satisfied, the board may call the loan immediately due and payable.
General Authority:
SDCL  1-16G-5,  1-16G-8(5).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(5).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:48 - Maturity and interest rate

Current through Register Vol. 51, page 10, July 15, 2024
Except in the case of a project consisting solely of multifamily housing, the maturity of the loan may not be more than five years from the date of loan closing, with payments amortized over not more than 20 years. Upon the affirmative vote of two-thirds of the members of the board present and voting, the board may at the time the loan is approved establish a longer maturity for the loan, but in no event may the original maturity date be more than 10 years from the date of loan closing. In the case of a project consisting solely of multifamily housing, the maturity of the loan may not be more than 30 years from the date of loan closing, with payments amortized over not more than 30 years.
The standard interest rate for REDI loans shall be established by the board from time-to-time and published on the GOED website. The board may deviate from the standard interest rate based on the economic impact of the project, nature and extent of collateral, risk, the amortization period of the loan, and other prudent lending criteria.
The board shall consider the following when establishing the standard interest rate:
(1) State and national market interest rates;
(2) State and national economic conditions;
(3) The solvency and balance of the REDI fund; and
(4) Other economic or business information necessary to fulfill the board mission to promote economic development in South Dakota.
The borrower is responsible for arranging other financing when the loan is due. If the borrower is unable to obtain financing, the borrower may apply before the loan due date for extension of the loan by the board at an interest rate and time period established by the board. The borrower shall submit any application for extension by the monthly loan application deadline prior to the loan maturity date.
General Authority:
SDCL  1-16G-5,  1-16G-8(7)(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7)(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:49 - Default

Current through Register Vol. 51, page 10, July 15, 2024
If the borrower violates any of the terms of the loan agreement, the other loan documents, this chapter, or other applicable law, the board may declare the loan in default. Upon default, the board may do one or more of the following:
(1) Declare the entire principal amount then outstanding and interest accrued thereon immediately due and payable
(2) Increase the interest rate to the default rate established in the loan documents;
(3) Take possession of the collateral;
(4) Repair, maintain, and operate the collateral, or sell, lease, or otherwise dispose of the collateral to another person or entity; or
(5) Take any other action considered appropriate by the board to protect the interest of the board and the REDI fund.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-1.1(6),  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:50 - Delegation of administrative functions

Current through Register Vol. 51, page 10, July 15, 2024
The GOED shall perform the administrative functions of the creation, processing, and review of loan applications; the preparation and negotiation of loan agreements; the review of the financial status of an applicant; loan servicing; and other functions necessary to expedite and assist it in the performance of its duties. Notwithstanding any assurance, guarantee, communication, or representation made to the contrary, there is no commitment of the REDI fund without specific authorization by the board. Only the board may make an award from the REDI fund to an applicant.
General Authority:
SDCL  1-16G-5,  1-16G-8(5)(7).
Law Implemented:
SDCL  1-16G-5, 1-52-3.2, 1-52-3.3,  1-52-5.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:51 - Official forms

Current through Register Vol. 51, page 10, July 15, 2024
The board may from time-to-time establish official forms of loan documents, including a loan agreement, promissory note, mortgage, security agreement, employment agreement, and such other documents, certifications, and agreements as the board deems necessary and appropriate. GOED may consent on behalf of the board on a case-by-case basis to any non-substantive modification or to any modification necessary to conform the official forms to the terms of the loan as established by the board.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:52 - Conflicts of interest

Current through Register Vol. 51, page 10, July 15, 2024
No member of the board or GOED staff may participate in or vote upon a decision of the board relating to an application or loan servicing action relating to a borrower in which that individual has a direct personal or financial interest.
General Authority:
SDCL  1-16G-5,  1-16G-8(7).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(7).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:53 - Confidentiality

Current through Register Vol. 51, page 10, July 15, 2024
The board, any committee of the board, and the GOED shall, to the extent it constitutes or contains trade secrets or commercial or financial information relating to the operation of an applicant or borrower, maintain as confidential any document, materials, information, or data received or generated by the board, any committee of the board, or the GOED in connection with a proposed or pending application for a REDI loan or an existing REDI loan. If requested by the applicant, the fact that an application has been proposed or is pending shall be maintained as confidential until such time as the application is considered by the board for approval. Any meeting of the credit committee shall be conducted in accordance with SDCL chapter 1-25 and SDCL  1-16G-11.
General Authority:
SDCL  1-16G-5,  1-16G-8(7).
Law Implemented:
SDCL  1-16G-5,  1-16G-11.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:54

Current through Register Vol. 51, page 10, July 15, 2024
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10).
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:55 - Banking Commission examination

Current through Register Vol. 51, page 10, July 15, 2024
The board shall request the South Dakota Banking Commission to make an annual examination of the board's lending policies and procedures and the documentation and classification of loans in the REDI fund loan portfolio, including loans made under chapter 68:02:02 of this article.
General Authority:
SDCL  1-16G-5.
Law Implemented:
SDCL  1-16G-5.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:01 - REDI loans › Section 68:02:01:56 - Credit committee - Other committees

Current through Register Vol. 51, page 10, July 15, 2024
The chair shall appoint and may remove the members of the credit committee. The credit committee has the powers and duties described in this chapter and such other powers and duties as the board may delegate to it.
The board may establish other standing or ad hoc committees as the board deems appropriate. The chair shall appoint and may remove the members of committees established by the board.
General Authority:
SDCL  1-16G-5,  1-16G-8(7).
Law Implemented:
SDCL  1-16G-5.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:02 - Value-added agriculture subfund › Section 68:02:02:15 - Definitions

Current through Register Vol. 51, page 10, July 15, 2024
Terms used in this chapter mean:
(1) "Applicant," any natural person or entity that has completed a VASF loan application;
(2) "Board," the Board of Economic Development;
(3) "Borrower," an applicant who has been awarded a VASF loan;
(4) "Equity," capital that has no guaranteed or mandatory return which must be invested in the project in any event and which has no definite timetable for repayment to the equity holder;
(5) "GOED," the Governor's Office of Economic Development;
(6) "Project," the new business or expansion or redirection of an existing business that is eligible for a VASF loan;
(7) "REDI fund," the revolving economic development and initiative fund;
(8) "Study," the feasibility study, including any associated business plan; or marketing study, including any associated business plan; to be conducted in connection with the project and funded from the VASF. The term, "study," does not include research and development study or studies, advertising, travel, costs of consultants, or any other work associated with an equity drive;
(9) "VASF," the value-added agriculture subfund of the REDI fund created by SDCL 1-16G-25 to 1-16G-27, inclusive.
General Authority:
SDCL  1-16G-5,  1-16G-8.
Law Implemented:
SDCL 1-16G-25 to 1-16G-27, inclusive.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:02 - Value-added agriculture subfund › Section 68:02:02:16 - Eligibility

Current through Register Vol. 51, page 10, July 15, 2024
Any natural person or entity whose project meets the following criterion may apply for a VASF loan:
(1) The industrial and nonfood production processes of the project utilize South Dakota agricultural products; or
(2) The food, feed, and fiber products and uses of the project utilize South Dakota agricultural products and add to the value of South Dakota agricultural products.
Any proposal aimed solely at business expansion or creation without regard to agricultural product utilization, any proposal that cannot reasonably be expected to result in a viable commercial application, or any proposal that is or has been duplicated by other research efforts or an existing business is not eligible for a VASF loan.
General Authority:
SDCL  1-16G-5,  1-16G-8(6).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(6), 1-16G-25 to 1-16G-27, inclusive.
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:02 - Value-added agriculture subfund › Section 68:02:02:17 - Application requirements - Screening

Current through Register Vol. 51, page 10, July 15, 2024
Application forms shall be provided by GOED, and shall be completed and signed before being presented to the board. GOED shall screen all applications for completeness and eligibility upon receipt. No incomplete or ineligible applications may be presented to the board. Applications shall include the following information if applicable:
(1) Applicant's name and address;
(2) Names, addresses, resumes, and references of owners, investors, and management of the project and of consultants to be engaged in connection with the study;
(3) Articles of incorporation and bylaws or other legal documents or agreements that describe the legal operation or structure of the business or of an intent to form a legal entity upon the award of a VASF loan;
(4) Name and address of the owner or operator of the project during the term of the VASF loan;
(5) An executive summary, summarizing the essential elements of the project, including narrative and funding request;
(6) Project narrative, including:
(a) Description of the product or process which will result from the study;
(b) Description of the planned commercialization efforts, including market research and feasibility studies to date by the applicant or others, and potential market for the product or process to be developed. A copy of any marketing plan to date and a copy of any business plan to date must be attached;
(c) Description of the feasibility or market research methodology to be employed, including objectives, tasks, milestones and research site; and a schedule of planned activities and timeframe for completion;
(d) Summary of prior market or feasibility research done by the applicant or others and the development of the product or process to date;
(e) Explanation of how the technology or innovation will benefit the applicant and agricultural producers in South Dakota;
(f) Explanation of why the project is needed and how the project will further develop existing technologies;
(g) Explanation of patents or regulatory approval needed, granted, or expected to be granted as a result of successful feasibility studies or marketing research;
(h) Explanation of the estimated benefit of the project to one or more sectors of South Dakota agriculture, such as increased markets, new uses, or value added to agricultural products;
(i) Explanation of the estimated benefit of the project in terms of impact on tax base, job creation, impact on infrastructure, stability of the economy, bringing new income to the area, or stimulation of other local businesses, together with other positive and negative effects of the project on the area; and
(j) List of project co-sponsors, including name of organization, address, telephone, key contact, and nature of participation. Letters of commitment from co-sponsors must be attached;
South Dakota Administrative Rules › Title 68 - Tourism and State Development › Article 68:02 - Board of economic development › Chapter 68:02:02 - Value-added agriculture subfund › Section 68:02:02:18 - Loan amount

Current through Register Vol. 51, page 10, July 15, 2024
Unless waived by the affirmative vote of two-thirds of the members of the board present and voting, the total amount of a loan made pursuant to this chapter may not exceed $100,000. Unless waived by the affirmative vote of two-thirds of the members of the board present and voting, a VASF loan may not exceed 45% of the total cost of the study. Matching funds may not include grant or loan funds from another agency or grant or loan program of the state.
General Authority:
SDCL  1-16G-5,  1-16G-8(10).
Law Implemented:
SDCL  1-16G-5,  1-16G-8(10), 1-16G-25 to 1-16G-27, inclusive.