Texas § AG.44.007 - INTEREST RATE REDUCTION PROGRAM

§ AG.44.007. INTEREST RATE REDUCTION PROGRAM

INTEREST RATE REDUCTION PROGRAM. (a) The board shall establish an interest rate reduction program to foster the: (1) creation and expansion of enterprises based on agriculture in this state; or (2) development or expansion of businesses in rural areas of this state. (b) The board shall approve or disapprove any and all applications under this chapter, provided that the board may delegate this authority to the commissioner. (c) The board shall promulgate rules for the loan portion of the interest rate reduction program. (d) In order to participate in the interest rate reduction program, an eligible lending institution may solicit loan applications from eligible borrowers. (e) After reviewing an application and determining that the applicant is eligible and creditworthy, the eligible lending institution shall send the application for a linked deposit loan to the administrator of the Texas Agricultural Finance Authority. (f) The eligible lending institution shall certify the interest rate applicable to the specific eligible borrower and attach it to the application sent to the administrator of the Texas Agricultural Finance Authority. (g) After reviewing each linked deposit loan application, the board or the commissioner shall recommend to the comptroller the acceptance or rejection of the application. (h) After acceptance of the application, the comptroller shall place a linked deposit with the applicable eligible lending institution for the period the comptroller considers appropriate. The comptroller may not place a deposit for a period extending beyond the state fiscal biennium in which it is placed. Subject to the limitation described by Section 44.010 , the comptroller may place time deposits at an interest rate described by Section 44.001 (4). (i) Before the placing of a linked deposit, the eligible lending institution and the state, represented by the comptroller, shall enter into a written deposit agreement containing the conditions on which the linked deposit is made. (j) If a lending institution holding linked deposits ceases to be either a state depository or a Farm Credit System institution headquartered in this state, the comptroller may withdraw the linked deposits. (k) The board may adopt rules that create a procedure for determining priorities for loans granted under this chapter. Each rule adopted must state the policy objective of the rule. (l) A lending institution is not ineligible to participate in the interest rate reduction program solely because a member of the board is also an officer, director, or employee of the lending institution, provided that a board member shall recuse himself or herself from any action taken by the board on an application involving a lending institution by which the board member is employed or for which the board member serves as an officer or director. Added by Acts 1987, 70th Leg., 2nd C.S., ch. 32, art. 1, Sec. 1, eff. Nov. 3, 1987. Amended by Acts 1993, 73rd Leg., ch. 644, Sec. 2, eff. Aug. 30, 1993; Acts 1995, 74th Leg., ch. 419, Sec. 5.07, eff. Sept. 1, 1995; Acts 1997, 75th Leg., ch. 891, Sec. 3.02, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 901, Sec. 1, eff. June 18, 1997; Acts 1997, 75th Leg., ch. 1010, Sec. 5.10, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1423, Sec. 2.02, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1459, Sec. 4, eff. June 19, 1999; Acts 2001, 77th Leg., ch. 26, Sec. 2, eff. May 2, 2001. Amended by: Acts 2009, 81st Leg., R.S., Ch. 506 (S.B. 1016 ), Sec. 1.02, eff. September 1, 2009. Acts 2009, 81st Leg., R.S., Ch. 506 (S.B. 1016 ), Sec. 1.03, eff. September 1, 2009. Acts 2013, 83rd Leg., R.S., Ch. 1197 (S.B. 1214 ), Sec. 4, eff. June 14, 2013.