19.0091.

02000

Sixty-sixth
Legislative Assembly BILL NO.
of North Dakota

Introduced by

Senators Hogue, G. Lee, Bekkedahl

Representatives Streyle, Schmidt

1 A BILL for an Act to create and enact a new section in chapter 6-09 of the North Dakota Century
2 Code, relating to a political subdivision revolving loan program.

3 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:

4 SECTION 1. A new section to chapter 6-09 of the North Dakota Century Code is created
5 and enacted as follows:
6 Bank loans to political subdivisions - Political subdivision revolving loan fund -
7 Continuing appropriation.
8 1. A revolving loan fund must be maintained in the Bank of North Dakota to provide
9 below-market interest rate loans to municipalities, counties, and other political
10 subdivisions, except school districts. The fund consists of moneys transferred from the
11 legacy fund and earnings of the fund, less any administrative expenses and other
12 transfers authorized under this section. The legislative assembly shall direct the state
13 treasurer to transfer fifteen percent of the principal of the legacy fund to the revolving
14 loan fund on December 31, 2019, and direct the state treasurer on December
15 thirty-first of each of the next ten fiscal years to transfer fifteen percent of any annual
16 increase in principal of the legacy fund. All moneys in the fund are appropriated for
17 disbursement according to this section.
18 2. The revolving loan fund and loans made from the fund must be administered and
19 supervised by the Bank of North Dakota. Except as authorized under subsection 4, the
20 Bank may not implement any transaction costs as a condition on a loan under this
21 section. An application for a loan from the fund must be made to the Bank, and upon
22 approval, a loan must be made from the fund in accordance with this section.
23 3. The minimum loan amount under this section is five million dollars for a new project
24 and one million dollars for a loan for refinancing existing debt. A political subdivision

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 Sixty-sixth
Legislative Assembly

1 may not borrow more than two hundred million dollars under this section without
2 specific authorization from the legislative assembly. The bank may authorize no more
3 than twenty percent of the balance of the revolving loan fund to be used to refinance
4 existing projects. The Bank may adopt policies and establish guidelines to administer
5 the loan program under this section.
6 4. A loan made from the fund must have the interest rate fixed at one and fifty-six
7 hundredths percent per year for a maximum of fifty years. The Bank may deduct a
8 service fee of not more than six-one hundredths percent of a loan.
9 5. The Bank shall transfer all interest earnings from loan repayments to the legacy fund
10 and deposit all principal payments in the revolving loan fund.
11 6. The Bank may take any action necessary to negotiate loans, take security as deemed
12 necessary, and bring suit to collect interest and principal due the revolving loan fund.

Page No. 2 19.0091.02000