(a) The state treasurer may accept or reject an application based on the state treasurer’s evaluation of whether the city meets the requirements of the program. If sufficient funds are not available for a loan, the applications may be considered in the order received when funds are once again available.

(b) Upon acceptance of an application, the state treasurer shall certify to the director of investments the amount required for such loan and the director of investments shall place a deposit of such certified amount with the specific fund or account of the city indicated in the loan application and approved by the state treasurer. The interest rate on a loan shall be 2% below the market rate as provided in Kan. Stat. Ann. § 75-4237, and amendments thereto, and shall be recalculated on the first business day of January of each year using the market rate then in effect. The minimum interest rate shall be 0.25% if the market rate is below 2.25%. When necessary, the state treasurer may request the director of investments to place such deposit with the city prior to approval of an application.

(c) (1) The treasurer of each city shall remit to the state fiscal agent at least 20 days before the due date of a loan payment, payable at the office of the state treasurer as fiscal agent, sufficient moneys for such loan payment. The treasurer of any city, in lieu of remitting such moneys to the state fiscal agent at such time, may provide the state fiscal agent with electronic fund transfer instructions on forms prescribed by the state treasurer that shall certify that there will be funds on deposit on the transaction date sufficient for the loan payment and that such funds will either reach the office of the state fiscal agent on or before 12 noon of the third working day before the due date of such loan payment or reach the office of the state fiscal agent on or before 12 noon of the first working day before the due date of such loan payment, if such funds are transferred to the state fiscal agent electronically. Upon receipt of such certification, the state fiscal agent shall file the same in the office of the state fiscal agent.

(2) When a city needs moneys that are in the county treasury to make a loan payment, the treasurer of such city shall make a written request of the county treasurer for the amount needed not later than 25 days prior to the due date of such loan payment. Not later than two days following the receipt of such request, the county treasurer shall forward to the treasurer of the city the amount requested, if the county treasurer has collected such moneys for such purpose. If the full amount of such a request is not in the county treasury, the county treasurer shall forward the portion that is in the county treasurer’s possession for such purpose.

(3) When a county treasurer is charged with the collection of tax moneys for a city, the territory of which is in more than one county, such treasurer shall forward any such funds when collected to the proper county treasurer as soon as practical but not later than two days following receipt of a request from the county treasurer to whom they are to be forwarded.

(4) Failure to pay loan payment moneys when due is:

(A) Failure of a county treasurer to forward moneys in the county treasury when requested as provided in this section;

(B) failure of the treasurer of a city or any county treasurer to make timely request for moneys as provided in this subsection; or

(C) failure of the treasurer of a city to make timely remittance of moneys for payment of loans under this program when such moneys are available for such remittance.

(5) Failure to pay loan payment moneys when due is a class C misdemeanor.

(d) All moneys received by the state treasurer from cities for payment of loans made under the program shall be deposited in the state treasury to the credit of the pooled money investment portfolio.