(a) The department of agriculture may provide funds for a share, not to exceed ninety per cent, of the principal amount of a loan made to a qualified farmer, qualified new farmer, or qualified food manufacturer by a private lender who is unable otherwise to lend the applicant sufficient funds at reasonable rates.
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Terms Used In Hawaii Revised Statutes 155-6

  • Food manufacturers: means entities that process Hawaii-grown agricultural products or that utilize Hawaii-grown agricultural products as an ingredient in the manufacturing process. See Hawaii Revised Statutes 155-1
  • New farmer: means a new farm enterprise or a person, who by reason of ability, experience, and training, is likely to successfully operate a farm and who otherwise meets the eligibility requirements of § 155-10 and includes any of the following:

    (1) Persons displaced from employment in an agricultural production enterprise;

    (2) College graduates in agriculture;

    (3) Community college graduates in agriculture;

    (4) Members of the Hawaii Young Farmer Association and National FFA Organization graduates with farming projects;

    (5) Persons who have not less than two years' experience as part-time farmers;

    (6) Graduates from farm trainee programs designed to provide interns with the necessary hands-on skills and management training to successfully operate their own farm;

    (7) Persons who have been farm tenants or farm laborers; or

    (8) Other individuals who have for the two years last preceding their application obtained the major portion of their income from farming operations. See Hawaii Revised Statutes 155-1

  • Private lender: includes banks, savings and loan associations, credit unions, mortgage companies, and other qualified companies whose business includes the making of loans in the State. See Hawaii Revised Statutes 155-1
  • Qualified farmer: means a person of proven farming ability who operates the person's own farm on land owned by the person in fee or on land rented or leased from others and who is presently devoting, has recently devoted, or intends to devote most of the person's time or who derives a major portion of the person's net cash income from direct participation in farming in its broadest sense. See Hawaii Revised Statutes 155-1
(b) Participating loans under this section shall be limited by sections 155-9 to 155-13 for purposes of class “A” through class “I”, the department’s share not to exceed the maximum amounts specified therefor; provided that class “E” loans to food manufacturers shall not be subject to § 155-10.
(c) Interest charged on the private lender’s share of the loan shall not be more than the sum of two per cent above the lowest rate of interest charged by all state or national banks authorized to accept or hold deposits in the State of Hawaii, on unsecured short term loans made to borrowers who have the highest credit rating with those banks.
(d) The private lender’s share of the loan may be insured by the department up to ninety per cent of the principal balance of the loan, under the provisions of § 155-5.
(e) When a participating loan has been approved by the department, its share may be paid to the participating private lender for disbursement to the borrower.
(f) Out of interest collected, the private lender may be paid a service fee to be determined by the department which fee shall not exceed one per cent of the unpaid principal balance of the loan; provided that this fee shall not be added to any amount which the borrower is obligated to pay; and further provided that the private lender services the loan.
(g) The participating private lender may take over a larger percentage or the full principal balance of the loan at any time that it has determined, to the satisfaction of the department, that the borrower is able to pay any increased interest charges resulting.
(h) Security for participating loans shall be limited by the provisions of section 155-11. All collateral documents shall be held by the private lender. Division of interest in collateral received shall be in proportion to participation by the department and the private lender.

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