Maine Revised Statutes Title 10 Sec. 1026-A – Insurance of loans
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(CONTAINS TEXT WITH VARYING EFFECTIVE DATES)
1. (TEXT EFFECTIVE UNTIL CONTINGENCY: See PL 2015, c. 38, §3) Insurance. The authority may make commitments and agreements to insure loan payments. Any loan insurance must be subject to the following:
A. Loan insurance may not exceed:
(1) One hundred percent of the principal amount of the loan made to any borrower including related entities for any of the following types of loans or projects:
(a) Loans to veterans and wartime veterans, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(b) Underground and aboveground oil storage facility projects and projects to install equipment related to the improvement of air quality pursuant to requirements for gasoline service station vapor control and petroleum liquids transfer vapor recovery, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(c) Sustainable biofuel vehicle projects, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(d) Waste oil disposal site clean-up projects, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $1,000,000; or
(e) The Plymouth waste oil remedial study, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $1,000,000; and
(2) Ninety percent of the principal amount of the loan made to any borrower, including related entities for any other manufacturing enterprise, industrial enterprise, recreational enterprise, fishing enterprise, agricultural enterprise, natural resource enterprise or any other eligible business enterprise; [PL 2019, c. 160, §5 (AMD).]
B. The loan must be serviced as required by the authority; [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
C. [PL 2003, c. 537, §30 (RP); PL 2003, c. 537, §53 (AFF).]
D. The authority must determine that there is a reasonable prospect that the loan will be repaid; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
E. The loan must be in compliance with the credit policy of the authority; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
F. Loan insurance payments may not exceed the lesser of:
(1) Principal, outstanding accrued interest and collection costs approved by the authority; and
(2) The original insured amount; and [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
G. Terms other than those specified in paragraphs A to F as may be required by law or by rule of the authority. [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
The authority may provide insurance for related entities of up to $7,500,000.
Notwithstanding any provision to the contrary in this chapter, the authority may provide special loan insurance benefits to veterans and wartime veterans determined by rule of the authority developed in consultation with the Department of Defense, Veterans and Emergency Management, Maine Bureau of Veterans’ Services.
For all loan insurance liability in excess of $1,000,000 and in other instances when the authority determines it is appropriate, the authority shall obtain a written assessment from the Department of Environmental Protection of the environmental conditions known by the department to exist at a project location so that the authority fully considers environmental risks when making its decisions. Environmental conditions posing risks that must be considered include, but are not limited to, licensing obligations, existing or historic regulatory noncompliance and site clean-up responsibilities.
[PL 2019, c. 160, §5 (AMD); PL 2019, c. 377, §6 (REV).]
Terms Used In Maine Revised Statutes Title 10 Sec. 1026-A
- Agricultural enterprise: means knowledge, skill or labor applied to growing or raising plants or animals, harvesting plants or growing or obtaining plant or animal by-products, includes forestry and aquaculture and includes production, processing, storing, packaging or marketing products derived from agricultural enterprise. See Maine Revised Statutes Title 10 Sec. 963-A
- Authority: means the Finance Authority of Maine as established by this chapter. See Maine Revised Statutes Title 10 Sec. 963-A
- Eligible collateral: means accounts, as-extracted collateral, chattel paper, commercial tort claims, consumer goods, deposit accounts, documents, equipment, farm products, fixtures, general intangibles, instruments, investment property, inventory, letter of credit rights, manufactured homes, money, real estate, supporting obligations and accessions to any of the foregoing and any other business assets. See Maine Revised Statutes Title 10 Sec. 963-A
- Eligible enterprise: means an agricultural enterprise, fishing enterprise, industrial enterprise, manufacturing enterprise or recreational enterprise. See Maine Revised Statutes Title 10 Sec. 963-A
- facility: means any aboveground oil storage tank or tanks, together with associated piping, and transfer and dispensing facilities located over land or water of the State at a single location for more than 4 months per year and used or intended to be used for the storage or supply of oil. See Maine Revised Statutes Title 10 Sec. 963-A
- Fishing enterprise: means knowledge, skill or labor applied to growing or catching fish, including shellfish, in fresh or salt water, including aquaculture, and includes production, processing, storing, packaging or marketing products derived from fishing enterprises. See Maine Revised Statutes Title 10 Sec. 963-A
- Industrial enterprise: means knowledge, skill or labor applied to conduct of a trade or business, selling of goods, providing services, providing dwelling accommodations, mining, education or discovery, research, development or refinement of new or known substances, processes or products. See Maine Revised Statutes Title 10 Sec. 963-A
- Insured: means any individual, partnership, corporation, association or other entity which is the beneficiary of a loan insurance agreement with the authority. See Maine Revised Statutes Title 10 Sec. 963-A
- Lien: A claim against real or personal property in satisfaction of a debt.
- Loan: means an extension of credit made in consideration of a written promise of repayment or any other conditions that may be established by the authority, performance of which may be secured by mortgage. See Maine Revised Statutes Title 10 Sec. 963-A
- Loan payments: means payments required by or received on account of a mortgage or any other financial document, including, but not limited to, payments covering interest, installments of principal, taxes, assessments, loan insurance premiums and hazard insurance premiums. See Maine Revised Statutes Title 10 Sec. 963-A
- Manufacturing enterprise: means knowledge, skill or labor applied to giving of new shapes, new qualities or new combinations to matter as material products and includes assembling, fabricating, making, creating, working, preparing, milling, processing, recycling, manufacturing, finishing, fashioning, producing, storing, warehousing, preserving, distributing, handling or transporting in any manner goods, wares, merchandise, metals, fabrics, materials, substances, product or matter of any kind or nature including materials recovered from solid and hazardous wastes. See Maine Revised Statutes Title 10 Sec. 963-A
- Natural resource enterprise: means an agricultural enterprise or a fishing enterprise, but does not include selling of food at wholesale or retail, except when that selling is carried out as part of the natural resource enterprise. See Maine Revised Statutes Title 10 Sec. 963-A
- Project: means any eligible project. See Maine Revised Statutes Title 10 Sec. 963-A
- Real estate: includes lands and all tenements and hereditaments connected therewith, and all rights thereto and interests therein. See Maine Revised Statutes Title 1 Sec. 72
- Recreational enterprise: means knowledge, skill or labor applied to providing facilities or opportunities for recreation, culture, entertainment or tourism. See Maine Revised Statutes Title 10 Sec. 963-A
- security: means a note, bond, interim certificate, debenture or other evidence of indebtedness, including any recovery zone facility bond or qualified energy conservation bond, payment of which is secured by a pledge of revenues, as provided in section 1045?A or 1065, or by assignment or pledge of other eligible collateral. See Maine Revised Statutes Title 10 Sec. 963-A
- Waste oil: includes mixtures of waste oil and water. See Maine Revised Statutes Title 10 Sec. 963-A
1. (TEXT EFFECTIVE ON CONTINGENCY: See PL 2015, c. 38, §3) Insurance. The authority may make commitments and agreements to insure loan payments. Any loan insurance must be subject to the following:
A. Loan insurance may not exceed:
(1) One hundred percent of the principal amount of the loan made to any borrower including related entities for any of the following types of loans or projects:
(a) Loans to veterans and wartime veterans, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(b) Underground and aboveground oil storage facility projects and projects to install equipment related to the improvement of air quality pursuant to requirements for gasoline service station vapor control and petroleum liquids transfer vapor recovery, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(c) Clean fuel vehicle projects and sustainable biofuel vehicle projects, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $5,000,000;
(d) Waste oil disposal site clean-up projects, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $1,000,000; or
(e) The Plymouth waste oil remedial study, except that the authority may not at any time have, in the aggregate amount of the principal and interest outstanding, loan insurance obligations pursuant to this division exceeding $1,000,000; and
(2) Ninety percent of the principal amount of the loan made to any borrower, including related entities for any other manufacturing enterprise, industrial enterprise, recreational enterprise, fishing enterprise, agricultural enterprise, natural resource enterprise or any other eligible business enterprise; [PL 2009, c. 124, §3 (AMD).]
B. The loan must be serviced as required by the authority; [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
C. [PL 2003, c. 537, §30 (RP); PL 2003, c. 537, §53 (AFF).]
D. The authority must determine that there is a reasonable prospect that the loan will be repaid; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
E. The loan must be in compliance with the credit policy of the authority; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
F. Loan insurance payments may not exceed the lesser of:
(1) Principal, outstanding accrued interest and collection costs approved by the authority; and
(2) The original insured amount; and [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
G. Terms other than those specified in paragraphs A to F as may be required by law or by rule of the authority. [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
The authority may provide insurance for related entities of up to $10,000,000.
Notwithstanding any provision to the contrary in this chapter, the authority may provide special loan insurance benefits to veterans and wartime veterans determined by rule of the authority developed in consultation with the Department of Defense, Veterans and Emergency Management, Maine Bureau of Veterans’ Services.
For all loan insurance liability in excess of $1,000,000 and in other instances when the authority determines it is appropriate, the authority shall obtain a written assessment from the Department of Environmental Protection of the environmental conditions known by the department to exist at a project location so that the authority fully considers environmental risks when making its decisions. Environmental conditions posing risks that must be considered include, but are not limited to, licensing obligations, existing or historic regulatory noncompliance and site clean-up responsibilities.
[PL 2015, c. 38, §1 (AMD); PL 2015, c. 494, Pt. C, §7 (AFF); PL 2019, c. 377, §6 (REV).]
1-A. Coinsurance.
[PL 2003, c. 537, §30 (RP); PL 2003, c. 537, §53 (AFF).]
2. Loan eligibility. The authority may insure loan payments under this subchapter subject to the following requirements:
A. The loan must be secured by a lien on or a security interest in eligible collateral, subject to such encumbrances, including, without limitation, coordinate first liens, as are acceptable to the authority; [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
B. The eligible collateral must be owned, leased, used or held by or otherwise benefit an eligible enterprise; [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
C. The documents must contain provisions satisfactory to the authority pertaining to the payment of principal and interest and contain covenants and other provisions satisfactory to the authority pertaining to taxes, assessments, repairs, maintenance, insurance, default, remedies, transfer or alteration of eligible collateral, change in management or control of the business and such other matters as the authority may determine; and [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
D. Other conditions prescribed by law or by the authority must have been complied with. [PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
[PL 2003, c. 537, §30 (AMD); PL 2003, c. 537, §53 (AFF).]
3. Mortgage insured loan limitation for small businesses.
[PL 2003, c. 537, §30 (RP); PL 2003, c. 537, §53 (AFF).]
4. Ineligible for loan insurance. The authority may not provide loan insurance for the following:
A. Investment real estate; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
B. Religious organizations; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
C. Fraternal organizations; [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
D. Residential housing, other than congregate or group housing; or [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
E. Consumer loans. [PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
[PL 2003, c. 537, §30 (NEW); PL 2003, c. 537, §53 (AFF).]
5. Limitations on loan insurance. The authority may establish a maximum insurance liability for particular sectors and for existing loans by rule. Rules adopted pursuant to this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter 2?A.
[PL 2009, c. 131, §1 (AMD).]
SECTION HISTORY
PL 1985, c. 344, §49 (NEW). PL 1985, c. 714, §§16-18 (AMD). PL 1987, c. 697, §6 (AMD). PL 1991, c. 854, §§A3-6 (AMD). PL 1993, c. 319, §1 (AMD). PL 2003, c. 537, §30 (AMD). PL 2003, c. 537, §53 (AFF). PL 2009, c. 124, §3 (AMD). PL 2009, c. 131, §1 (AMD). PL 2015, c. 38, §1 (AMD). PL 2015, c. 38, §3 (AFF). PL 2015, c. 494, Pt. C, §7 (AFF). PL 2019, c. 160, §5 (AMD). PL 2019, c. 377, §6 (REV).