2013 North Dakota Century Code Title 6 Banks and Banking Chapter 6-09 The Bank of North Dakota
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CHAPTER 6-09
THE BANK OF NORTH DAKOTA
6-09-01. Purpose and establishment of Bank of North Dakota.
For the purpose of encouraging and promoting agriculture, commerce, and industry, the
state of North Dakota shall engage in the business of banking, and for that purpose shall
maintain a system of banking owned, controlled, and operated by it, under the name of the Bank
of North Dakota.
6-09-02. Industrial commission to operate Bank - Business of Bank.
The industrial commission shall operate, manage, and control the Bank of North Dakota,
locate and maintain its places of business, of which the principal place must be within the state,
and make and enforce orders, rules, regulations, and bylaws for the transaction of its business.
The business and financial transactions of the Bank, in addition to other matters specified in this
chapter, may include anything that any bank or bank holding company lawfully may do, except
as it is restricted by the provisions of this chapter. This provision may not be held in any way to
limit or qualify either the powers of the industrial commission granted by or the functions of said
Bank as defined in this chapter. The powers of the industrial commission and the functions of
the Bank must be implemented through actions taken and policies adopted by the industrial
commission.
6-09-02.1. Declaration and finding of public purpose - Bank of North Dakota advisory
board of directors.
To enlist the help of private enterprise and to encourage more active use of the purposes for
which the Bank of North Dakota was created, the governor shall appoint an advisory board of
directors to the Bank of North Dakota consisting of seven persons, at least two of whom must
be officers of banks, the majority of the stock of which is owned by North Dakota residents, and
at least one of whom must be an officer of a state-chartered or federally chartered financial
institution. The governor shall appoint a chairman, vice chairman, and secretary from the
advisory board of directors. The term of a director is four years. The industrial commission shall
define the duties of the advisory board of directors.
6-09-02.2. Authority of the advisory board of directors to the Bank of North Dakota.
The advisory board of directors to the Bank of North Dakota shall:
1. Meet regularly with the management of the Bank of North Dakota to review the Bank's
operations to determine whether recommendations should be made by the board to
the industrial commission relating to improved management performance, better
customer service, and overall improvement in internal methods, procedures, and
operating policies of the Bank.
2. Make recommendations to the industrial commission relating to the establishment of
additional objectives for the operation of the Bank of North Dakota.
3. Make recommendations to the industrial commission concerning the appointment of
officers of the Bank of North Dakota.
4. Meet regularly with the industrial commission to present any recommendations
concerning the Bank of North Dakota.
5. In addition to the foregoing and pursuant to authorization from the industrial
commission, act on behalf of the Bank with respect to the powers and functions of the
Bank.
6-09-03. Industrial commission may acquire property by purchase or eminent domain
- Investment in banking house and furnishings.
Repealed by S.L. 1989, ch. 110, § 11.
Page No. 1
6-09-04. Commission to employ president and employees - Compensation, operation,
and maintenance expenditures limited to appropriations, revenue, or capital.
The industrial commission shall appoint a president, and may appoint and employ such
subordinate officers, employees, and agents as it may judge expedient and in the interests of
the state, and shall define the duties, designate the titles, and fix the compensation of all such
persons. The commission may designate the president or other officers or employees as its
agent in respect to the functions of the Bank, subject to its supervision, limitation, and control.
The total compensation of such appointees and employees, together with other expenditures for
the operation and maintenance of the Bank, shall remain within the appropriation, revenues, or
capital lawfully available for such purposes.
6-09-05. Removal and discharge of appointees.
The industrial commission may remove and discharge any and all persons appointed in the
exercise of the powers granted by this chapter, whether by the commission or by the president
of the Bank. All appointments and removals contemplated by this chapter must be made as the
commission deems fit to promote the efficiency of the public service.
6-09-06. Capital of Bank.
Repealed by S.L. 1979, ch. 138, § 1.
6-09-07. State funds must be deposited in Bank of North Dakota - Income of the Bank.
All state funds and funds of all state penal, educational, and industrial institutions must be
deposited in the Bank of North Dakota by the persons having control of such funds or must be
deposited in accordance with constitutional and statutory provisions. All income earned by the
Bank for its own account on state moneys that are deposited in or invested with the Bank to the
credit of the state must be credited to and become a part of the revenues and income of the
Bank.
6-09-08. Nonliability of officers and sureties after deposit.
Whenever any of the public funds hereinbefore designated are deposited in the Bank of
North Dakota, as hereinbefore provided, the official having control thereof and the sureties on
the bond of every such official shall be exempt from all liability by reason of loss of any such
funds while so deposited.
6-09-09. Deposits may be received from any source - Deposits to credit in other
banks.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-10. Guaranty of deposits - Exemption from all taxation.
All deposits in the Bank of North Dakota are guaranteed by the state. Such deposits are
exempt from state, county, and municipal taxes of any and all kinds.
6-09-11. Bank a clearinghouse.
For banks that make the Bank of North Dakota a reserve depositary, it may perform the
functions and render the services of a clearinghouse, including all facilities for providing
domestic and foreign exchange, and may rediscount paper, on such terms as the industrial
commission shall provide.
6-09-12. Interest rates fixed by commission - Time deposits - Limitations - Charges
for services.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-13. Collection items must be paid to Bank of North Dakota at par - Violation a
misdemeanor.
Repealed by S.L. 1975, ch. 106, § 673.
Page No. 2
6-09-14. Bank of North Dakota may deposit in any bank.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-15. Powers.
The Bank of North Dakota may:
1. Make, purchase, guarantee, or hold loans:
a. To state-chartered or federally chartered lending agencies or institutions or any
other financial institutions.
b. To holders of Bank of North Dakota certificates of deposit and savings accounts
up to ninety percent of the value of the certificates and savings accounts offered
as security.
c. To actual farmers who are residents of this state, if the loans are secured by
recorded mortgages giving the Bank of North Dakota a first lien on real estate in
North Dakota in amounts not to exceed eighty percent of the value of the security.
d. That are insured or guaranteed in whole or in part by the United States, its
agencies, or instrumentalities.
e. That are eligible to be guaranteed under chapter 15-62.1. Loans made pursuant
to this subdivision may provide for interest that remains unpaid at the end of any
period specified in the loan to be added to the principal amount of the debt and
thereafter accumulate interest.
f. To individuals or bank holding companies for the purpose of purchasing or
refinancing the purchase of bank stock of a bank located in the state.
g. To nonprofit organizations that are exempt from federal taxation under section
501(c)(3) of the Internal Revenue Code [26 U.S.C. 501(c)(3)], the proceeds of the
loans to be used for construction, reconstruction, repair, renovation, maintenance,
and associated costs on property under the control of the parks and recreation
department.
h. Under Public Law No. 99-198 [99 Stat. 1534; 7 U.S.C. 1932 et seq.], as amended
through December 31, 1996, to nonprofit corporations for the purpose of
relending loan funds to rural businesses.
i. Under title 7, Code of Federal Regulations, part 1948, subpart C; part 1951,
subparts F and R; and part 1955, subparts A, B, and C, as amended through
December 31, 1996, to finance businesses and community development projects
in rural areas.
j. Obtained as security pledged for or originated in the restructuring of any other
loan properly originated or participated in by the Bank.
k. To instrumentalities of this state.
l. As otherwise provided by this chapter or other statutes.
m. If the Bank is participating in the loan and the Bank deems it is in the best
interests of the Bank to do so, it may purchase the remaining portion of the loan
from a participating lender that is closed by regulatory action or from the receiver
of the participating lender's assets.
n. To an investment company created for completing a trust preferred securities
transaction for the benefit of a financial institution located in this state.
2. Make agricultural real estate loans in order to participate in the agricultural mortgage
secondary market program established pursuant to the Agricultural Credit Act [Pub. L.
100-233; 101 Stat. 1686; 12 U.S.C. 2279aa-2279aa-14], as amended through
December 31, 1996.
3. Purchase participation interests in loans made or held by banks, bank holding
companies, state-chartered or federally chartered lending agencies or institutions, any
other financial institutions, or any other entity that provides financial services and that
meets underwriting standards that are generally accepted by state or federal financial
regulatory agencies.
4. Invest its funds:
a. In conformity with policies of the industrial commission.
Page No. 3
b.
5.
6.
7.
8.
9.
10.
In a public venture capital corporation organized and doing business in this state
through the purchase of shares of stock.
c. In North Dakota alternative and venture capital investments and early-stage
capital funds, including the North Dakota development fund, incorporated, not to
exceed fifteen million dollars, for the purpose of providing funds for investment in
North Dakota alternative and venture capital investments, early-stage capital
funds, and entrepreneurship awards. The Bank may invest a maximum of two
hundred thousand dollars per biennium in North Dakota-based venture capital
entities that make investments in companies located outside North Dakota. The
Bank may allow for third-party management of the funds invested under this
subdivision if the management is provided by the North Dakota development
fund, incorporated, or a third party that is located in the state and that has
demonstrated fund management experience.
Buy and sell federal funds.
Lease, assign, sell, exchange, transfer, convey, grant, pledge, or mortgage all real and
personal property, title to which has been acquired in any manner.
Acquire real or personal property or property rights by purchase, lease, or, subject to
chapter 32-15, the exercise of the right of eminent domain and may construct,
remodel, and repair buildings.
Receive deposits from any source and deposit its funds in any bank or other financial
institution.
Perform all acts and do all things necessary, convenient, advisable, or desirable to
carry out the powers expressly granted or necessarily implied in this chapter through
or by means of its president, officers, agents, or employees or by contracts with any
person, firm, or corporation.
Purchase mortgage loans on residential real property originated by financial
institutions.
6-09-15.1. Loans to general fund authorized - Continuing appropriation.
The state treasurer and the director of the office of management and budget may, when the
balance in the state general fund is insufficient to meet legislative appropriations, execute and
issue on behalf of the state evidences of indebtedness on the state general fund which at no
time exceed the total principal amount of ten million dollars with principal maturity of not more
than twelve months. As a condition precedent to the issuance and sale of the evidences of
indebtedness, the state treasurer must request and obtain a statement from the director of the
office of management and budget and state tax commissioner certifying that anticipated general
fund revenues for the balance of the fiscal year in which the evidences of indebtedness are to
be issued will exceed the principal amount and interest on the evidences of indebtedness to be
issued. The state industrial commission may in turn direct the Bank of North Dakota to make
loans to the state general fund by the purchase of the evidences of indebtedness at such rates
of interest as the industrial commission may prescribe. After evidences of indebtedness have
been issued and sold pursuant to this section, the state treasurer shall establish a fund for the
repayment of the principal upon maturity and the interest when due. The state treasurer shall
place all available general fund revenues into this fund until the fund contains a sufficient
balance for the repayment of the principal at maturity and interest when due, which moneys are
hereby appropriated for this purpose.
6-09-15.2. Bank may invest in certain government sponsored stocks - Limit.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-15.3. Bank stock loans - Requirements.
Repealed by S.L. 1989, ch. 110, § 11.
Page No. 4
6-09-15.4. Participations in loans to small business concerns - Direct loans to
nonprofit corporations.
Repealed by S.L. 1999, ch. 82, § 1.
6-09-15.5. Bank loans to beginning farmers - Revolving loan fund - Requirements.
1. A revolving loan fund must be maintained in the Bank of North Dakota for the purpose
of making or participating in loans to North Dakota beginning farmers for the purchase
of agricultural real estate, equipment, and livestock. All moneys transferred into the
fund, interest upon moneys in the fund, and payments to the fund of principal and
interest on loans made from the fund are appropriated for the purpose of providing
loans and to supplement the interest rate on loans to beginning farmers made by the
Bank of North Dakota under subdivision c of subsection 1 of section 6-09-15 and in
accordance with this section.
2. The revolving loan fund and loans made from the fund must be administered and
supervised by the Bank of North Dakota. The Bank may deduct a service fee for
administering the fund from interest payments received on loans. An application for a
loan from the fund must be made to the Bank and, upon approval, a loan must be
made from the fund in accordance with this section.
3. A loan made from the fund may not exceed eighty percent of the appraised value of
the agricultural collateral, with the actual percentage to be determined by the Bank.
The Bank may do all things and acts and may establish additional terms and
conditions necessary to make a loan under this section. A loan made from the fund
must have a first security interest.
4. A loan made from the fund must have the interest rate fixed at one percent below the
Bank's then current base rate for the first five years with a maximum rate of six percent
per year and variable at one percent below the Bank's then current base rate for the
second five years. During the second five years, the variable rate must be adjusted
annually on the anniversary date. The rate during the remaining term of the loan floats
at the Bank's base rate as in effect from time to time.
5. The maximum term of a real estate loan is thirty years. The maximum term of a farm
equipment or livestock loan is seven years.
6. The industrial commission shall contract with a certified public accounting firm to audit
the fund as necessary. The cost of the audit, and any other actual costs incurred by
the Bank on behalf of the fund, must be paid for by the fund.
7. The Bank shall adopt policies to implement this section.
8. Notwithstanding any other provision of law, the Bank may transfer any unobligated
funds between funds that have been appropriated by the legislative assembly for
interest buydown in the beginning farmers loan fund and the agriculture partnership in
assisting community expansion fund.
9. Notwithstanding any other provision of law, the Bank may transfer any unobligated
funds to the value-added agriculture equity loan program for the purpose of interest
buydown on a loan made for investment in a feedlot or dairy operation. Fund transfers
under this subsection may not exceed one million dollars during a biennium.
6-09-15.6. Bank of North Dakota purchase of export trading company stock Limitation.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-15.7. Bank may invest in a public venture capital corporation.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-15.8. Bank of North Dakota may make loans for improvement of facilities under
the control of the parks and recreation department.
Repealed by S.L. 1989, ch. 110, § 11.
Page No. 5
6-09-15.9. Limitations on loans by the Bank of North Dakota - Disclosure of interests
in certain loans.
Notwithstanding any other provision of law, the Bank of North Dakota may not make any
loan or otherwise give its credit to a member of the industrial commission during the member's
term on the industrial commission. Before taking office, a member of the industrial commission
shall file a statement with the Bank of North Dakota indicating any personal interest that that
member has in any loan or loan application in existence or pending at any time during the
member's term on the industrial commission.
6-09-16. Funds transferred to state departments - How credited by state treasurer.
Repealed by S.L. 1979, ch. 142, § 1.
6-09-17. Office of management and budget to issue warrants against transferred
funds.
Repealed by S.L. 1979, ch. 142, § 1.
6-09-18. Real estate loans - Application - Appraisal - Action on loans.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-19. Conditions of real estate mortgage - Extension of payments.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-20. Mortgage and note payable to manager of Bank - Recitals - Recording Satisfaction and discharge.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-21. Sale and assignment of note and mortgage - Extension of payments limited.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-22. Assignment of note and mortgage to state treasurer - Payments Satisfactions.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-23. Partial release and satisfaction of mortgages assigned to state treasurer.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-24. Partial payments - Sale and assignment of mortgages assigned to state
treasurer.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-25. State treasurer may lease lands acquired through foreclosure of Bank
mortgages - Oil and gas leases.
Repealed by S.L. 1977, ch. 138, § 12.
6-09-26. Name in which business conducted and titles taken - Execution of
instruments.
All business of the Bank must be conducted under the name of "The Bank of North Dakota".
Title to property pertaining to the operation of the Bank must be obtained and conveyed in the
name of "The State of North Dakota, doing business as The Bank of North Dakota". Instruments
must be executed in the name of the state of North Dakota. Within the scope of authority
granted by the industrial commission, the president may execute instruments on behalf of the
Bank, including any instrument granting, conveying, or otherwise affecting any interest in or lien
upon real or personal property. Other officers or employees of, and legal counsel to, the Bank
may execute instruments on behalf of the Bank when authorized by the industrial commission.
Page No. 6
Any instrument executed prior to July 11, 1989, by the president, an attorney for the Bank, or an
officer or employee of the Bank, and otherwise proper, is valid and effective.
6-09-26.1. Execution of instruments.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-27. Civil actions on Bank transactions - Name of parties - Service - Venue.
1. Civil actions may be brought against the state of North Dakota on account of claims for
relief claimed to have arisen out of transactions connected with the operation of the
Bank of North Dakota upon condition that the provisions of this section are complied
with. In such actions, the state must be designated as "The State of North Dakota,
doing business as The Bank of North Dakota". The actions may be brought in the
same manner and are subject to the same provisions of law as other civil actions. The
action must be brought in Burleigh County except as provided in section 28-04-01 or
except as provided in subsection 2.
2. If the Bank seeks to participate in a loan that involves multiple banks and if the loan
documents require the Bank to agree that civil actions will be commenced in a state
outside of North Dakota, the Bank may agree to venue outside of North Dakota if
approved by the attorney general.
6-09-28. Surety on appeal, attachment, claim and delivery, and other cases in which
undertaking required, not required of Bank of North Dakota.
Provisions of law requiring that a surety or sureties be given on undertakings in actions on
appeal, attachment, claim and delivery, and other cases in which an undertaking is required, are
not applicable to the state of North Dakota, doing business as the Bank of North Dakota, as the
party seeking such relief. It is required to give its own undertaking without surety and to
reimburse the adverse party when required by law.
6-09-29. Examinations and audit reports.
The state auditor shall contract with an independent certified public accounting firm for an
annual audit of the Bank of North Dakota in accordance with generally accepted government
auditing standards. The state auditor shall audit annually or contract for an annual audit of the
separate programs and funds administered by the Bank of North Dakota. On request of the
state auditor, the industrial commission shall assist the state auditor in the auditing firm selection
process, but the selection of the auditing firm is the state auditor's responsibility. The auditor
selected shall prepare an audit report that includes financial statements presented in
accordance with the audit and accounting guide for banks and savings institutions issued by the
American institute of certified public accountants. The auditor also shall prepare audited
financial statements for inclusion in the comprehensive annual financial report for the state. The
state auditor may conduct performance audits of the Bank of North Dakota, including the
separate programs and funds administered by the Bank. The auditor shall report the results of
the audit to the industrial commission and to the legislative assembly. The Bank of North Dakota
or its separate programs and funds shall pay the costs of the audit. The department of financial
institutions, through the commissioner, shall examine the Bank of North Dakota at least once
each twenty-four months and conduct any investigation of the Bank which may be necessary.
The commissioner shall report the examination results, and the results of any necessary
investigation, to the industrial commission as soon as practicable and to the legislative
assembly. The department of financial institutions shall charge a fee for any examination or
investigation at an hourly rate to be set by the commissioner, sufficient to cover all reasonable
expenses of the department associated with the examinations and investigations provided for by
this section.
6-09-30. Repayment of moneys appropriated for Bank to state.
Repealed by S.L. 1967, ch. 91, § 2.
Page No. 7
6-09-31. Sale of land held by state treasurer as trustee for state.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-32. Bank may adopt rules governing sales.
Repealed by S.L. 1967, ch. 91, § 2.
6-09-33. Bank of North Dakota to administer assets of rural rehabilitation corporation.
Repealed by S.L. 1989, ch. 110, § 11.
6-09-34. Electronic fund transfer systems.
The Bank of North Dakota may establish, under such rules and regulations as adopted by
the industrial commission, a system to provide fund transfer services to its customers and to the
customers of state-chartered and federally chartered banks located within the state of North
Dakota, and to other financial institutions otherwise authorized to utilize the services of
electronic fund transfer systems, to acquire such equipment as is necessary to establish
electronic fund transfer systems, and to make such reasonable charges for services rendered to
other banks hereunder as may be established by the industrial commission.
6-09-35. Confidentiality of Bank records.
The following records of the Bank of North Dakota are confidential:
1. Commercial or financial information of a customer, whether obtained directly or
indirectly, except for routine credit inquiries or unless required by due legal process. As
used in this subsection, "customer" means any person who has transacted or is
transacting business with, or has used or is using the services of, the Bank of North
Dakota, or for whom the Bank of North Dakota has acted as a fiduciary with respect to
trust property.
2. Internal or interagency memorandums or letters which would not be available by law to
a party other than in litigation with the Bank.
3. Information contained in or related to examination, operating, or condition reports
prepared by, on behalf of, or for the use of a state or federal agency responsible for
the regulation or supervision of any Bank activity.
4. Information obtained from the state department of financial institutions which would not
be available from that agency under section 6-01-07.1.
5. The report by a Bank officer or member of the Bank's advisory board of directors
concerning personal financial statements.
6-09-36. Bank of North Dakota - Custodian of securities.
Notwithstanding any other provision of law to the contrary, the Bank of North Dakota shall
replace the state treasurer as the custodian of all securities that are required to be deposited
with the state except that the state treasurer is the custodian of all securities resulting from the
investment of funds by the state treasurer, or except as otherwise required by this section and
sections 6-05-04, 6-05-05, 6-05-27, 39-16-10, and 39-16.1-15, subsection 1 of section
39-16.1-17, and subsection 1 of section 39-16.1-19.
6-09-37. Sale and leasing of acquired agricultural real estate.
The sale and leasing of agricultural real estate with an appraised value of ten thousand
dollars or more acquired by the Bank of North Dakota through foreclosure or deed in lieu of
foreclosure must be done in accordance with chapter 15-07 or 15-09 and policies adopted by
the industrial commission. The sale and leasing of agricultural real estate with an appraised
value of less than ten thousand dollars, acquired by the Bank of North Dakota through
foreclosure or deed in lieu of foreclosure, may be done in a manner as the Bank determines is
appropriate given the circumstances. In the case of a lease by the party holding the right of
redemption, that party has the right to purchase at any time.
Page No. 8
6-09-38. North Dakota higher education savings plan - Administration - Rules Continuing appropriation.
The Bank of North Dakota shall adopt rules to administer, manage, promote, and market a
North Dakota higher education savings plan. The Bank shall ensure that the North Dakota
higher education savings plan is maintained in compliance with internal revenue service
standards for qualified state tuition programs. The Bank, as trustee of the North Dakota higher
education savings plan, may impose an annual administrative fee to recover expenses incurred
in connection with operation of the plan or for other programs deemed to promote attendance at
an institution of higher education. Administrative fees received by the Bank are appropriated on
a continuing basis to be used as provided in this section. Contributions made during the taxable
year to a higher education savings plan administered by the Bank, pursuant to the provisions of
the plan, are eligible for an income tax deduction as provided in chapter 57-38. Information
related to contributions is confidential except as is needed by the tax commissioner for
determining compliance with the income tax deduction provided in chapter 57-38.
6-09-39. Truckdriver training programs - Loans to students.
Expired under S.L. 2007, ch. 79, § 2.
6-09-40. Reimbursement of Bank losses.
Repealed by S.L. 2007, ch. 87, § 2.
6-09-41. Livestock loan guarantee program - Establishment - Rules.
Expired under S.L. 2005, ch. 57, § 5.
6-09-42. Health information technology loan fund - Appropriation.
1. The health information technology loan fund is established in the Bank for the purpose
of providing loans to health care providers to purchase and upgrade electronic health
record technology, train personnel in its use, improve security of information exchange,
and for other purposes as established by the health information technology office, in
collaboration with the health information technology advisory committee. This fund is a
revolving loan fund. All moneys transferred into the fund, interest upon moneys in the
fund, and collections of interest and principal on loans made from the fund are
appropriated for disbursement according to this section.
2. The Bank shall make loans from this fund to health care providers as approved by the
health information technology office director, in collaboration with the health
information technology advisory committee, in accordance with the criteria established
by the health information technology office director under section 54-59-26. A loan
made under this fund must be repayable over a period that may not exceed ten years.
3. The Bank shall administer the health information technology loan fund. Funds in the
loan fund may be used for loans as provided under this section and the costs of
administration of the fund. Annually, the Bank may deduct a service fee for
administering the revolving loan fund maintained under this section.
4. An application for a loan under this section must be made to the health information
technology office. The health information technology office director, in collaboration
with the health information technology advisory committee, may approve the
application of a qualified applicant that meets the criteria established by the health
information technology office director. The health information technology office shall
forward approved applications to the Bank. Upon approval of the application by the
Bank, the Bank shall make the loan from the revolving loan fund as provided under
this section.
5. The Bank may do all acts necessary to negotiate loans and preserve security as
deemed necessary, to exercise any right of redemption, and to bring suit in order to
collect interest and principal due the revolving loan fund under mortgages, contracts,
and notes executed to obtain loans under this section. If the applicant's plan for
financing provides for a loan of funds from sources other than the state of North
Page No. 9
Dakota, the Bank may take a subordinate security interest. The Bank may recover
from the revolving loan fund amounts actually expended by the Bank for legal fees and
to effect a redemption.
6-09-43. Health information technology planning loan fund - Appropriation.
1. The health information technology planning loan fund is established in the Bank for the
purpose of providing low-interest loans to health care entities to assist those entities in
improving health information technology infrastructure. This fund is a revolving loan
fund. All moneys transferred into the fund, interest upon moneys in the fund, and
collections of interest and principal on loans made from the fund are appropriated for
disbursement according to this section.
2. The Bank shall make loans from this fund to health care entities as approved by the
health information technology office director, in collaboration with the health
information technology advisory committee, in accordance with the criteria established
by the health information technology director under section 54-59-26.
3. The Bank shall administer the health information technology planning loan fund. Funds
in the loan fund may be used for loans as provided under this section and the costs of
administration of the fund. Annually, the Bank may deduct a service fee for
administering the revolving loan fund maintained under this section.
4. An application for a loan under this section must be made to the health information
technology office. The health information technology office director, in collaboration
with the health information technology advisory committee, may approve the
application of a qualified applicant that meets the criteria established by the health
information technology office director. The health information technology office shall
forward approved applications to the Bank. Upon approval of the application by the
Bank, the Bank shall make the loan from the revolving loan fund as provided under
this section.
5. The Bank may do all acts necessary to negotiate loans and preserve security as
deemed necessary, to exercise any right of redemption, and to bring suit in order to
collect interest and principal due the revolving loan fund under mortgages, contracts,
and notes executed to obtain loans under this section. If the applicant's plan for
financing provides for a loan of funds from sources other than the state of North
Dakota, the Bank may make a loan subordinate security interest. The Bank may
recover from the revolving loan fund amounts actually expended by the Bank for legal
fees and to effect a redemption.
6-09-44. Residential mortgages.
1. The Bank may establish a residential mortgage loan program under which the Bank
may originate residential mortgages if private sector mortgage loan services are not
reasonably available. Under this program a local financial institution or credit union
may assist the Bank in taking a loan application, gathering required documents,
ordering required legal documents, and maintaining contact with the borrower.
2. If the Bank establishes a program under this section, at a minimum the program must
provide:
a. An applicant must be referred to the Bank by a local financial institution or credit
union;
b. The loan application must be for an owner-occupied primary residence;
c. The Bank provide all regulatory disclosures, process and underwrite the loan,
prepare closing documents, and disburse the loan; and
d. The terms of the loan originated by the Bank must provide:
(1) The amount of the loan may not exceed an amount to be established by
Bank policy;
(2) The term of the loan may not exceed thirty years;
(3) The rate of the loan must be equal to the Bank's market rate;
(4) The maximum loan to value may not exceed eighty percent of appraised
value; however, a local financial institution or credit union may take a
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3.
second mortgage that does not exceed a combined loan to value of
ninety-five percent; and
(5) Standard credit underwriting and documentation applies.
The Bank may sell eligible first-time home buyer loans to the North Dakota housing
finance agency.
6-09-45. Required transfer - Special education contract costs.
If the industrial commission is notified by the superintendent of public instruction that, using
all available sources, there are insufficient moneys with which to fully reimburse school districts
for the excess costs of serving the one percent of special education students statewide who
require the greatest school district expenditures in order to be provided with special education
and related services, the industrial commission shall transfer from the earnings and
accumulated and undivided profits of the Bank of North Dakota the amount that the
superintendent of public instruction certifies is necessary to provide the statutorily required level
of reimbursement. The superintendent of public instruction shall file for introduction legislation
requesting that the ensuing legislative assembly return any amount transferred under this
section to the Bank of North Dakota.
6-09-46. Rebuilders loan program - Loan fund - Continuing appropriation Requirements.
1. The Bank of North Dakota shall maintain a loan fund to make or participate in loans to
North Dakota residents affected by a presidentially declared disaster in the state for
the purpose of the resident rebuilding the resident's flood-damaged home, rebuilding
nonowner-occupied property, or purchasing a new home or federal emergency
management agency temporary housing unit located in a community-approved group
housing site in the disaster-impacted community. For a resident rebuilding the
resident's flood-damaged home or purchasing a new home, up to twenty percent of the
loan proceeds disbursed under this program may be used for debt service, debt
retirement, or other credit obligations. All moneys transferred into the fund, interest
upon moneys in the fund, and payments to the fund of principal and interest on loans
made from the fund are appropriated for the purpose of providing loans in accordance
with this section.
2. The Bank shall administer and supervise the loan fund and loans made from the fund.
The Bank may deduct, from interest payments received on loans, a service fee for
administering the fund for the Bank and originating financial institutions. An application
for a loan from the fund must be made to the Bank or originating financial institution
and, upon approval, a loan must be made from the fund in accordance with this
section.
3. A loan may be made from the fund only to a resident of a federal emergency
management agency temporary housing unit located in a community-approved group
housing site, a homeowner residing, or owner of nonowner-occupied property in an
area in this state in which federal emergency management agency individual
assistance was available to homeowners after a presidentially declared disaster in the
state as a result of a flood event occurring during 2011. A loan may be made from the
fund only to a resident of a federal emergency management agency temporary
housing unit located in a community-approved group housing site or a homeowner
residing in this state whose home, or owner of nonowner-occupied property whose
property, was granted a reduction in 2011 in true and full valuation from the individual's
property's preflood value by an assessment reduction pursuant to the governor's
executive order 2011-22 or by an abatement for flood-damaged property granted by
the board of county commissioners. In order for an owner of nonowner-occupied
property to qualify for a loan under this section, the owner of the property must have
been the owner at the time of the presidentially declared disaster and the number of
households in the property rebuilt under this section must remain the same as before
the presidentially declared disaster. The owner of nonowner-occupied property is
eligible for only one loan for nonowner-occupied property under this section and that
loan must be secured by the property for which the loan is made. An initial loan made
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4.
5.
6.
7.
8.
9.
to a homeowner or owner of nonowner-occupied property under this section from state
funds may not exceed thirty thousand dollars or the actual amount of documented
damage not paid by flood insurance, whichever is less. A supplemental loan of up to
twenty thousand dollars may be made to a homeowner who has received an initial
loan under this section if the full amount of the initial loan and supplemental loan is
secured by the property and does not exceed the actual amount of documented
damage not paid by flood insurance. A loan made to a resident of a federal emergency
management agency temporary housing unit located in a community-approved group
housing site may not exceed thirty thousand dollars or the purchase price as
established by the federal emergency management agency, whichever is less. For
purposes of this section, "nonowner-occupied property" means property consisting of
one or more rental dwelling units, none of which is occupied by the owner, and does
not include hotel or motel accommodations or any other commercial property.
A loan from the fund must have the interest rate fixed at one percent per year for no
more than twenty years.
For every loan made from the fund to a homeowner to rebuild or replace that
individual's flood-damaged home, principal and interest payments must be deferred for
the first twenty-four months of the loan. There is no deferral of principal and interest
payments for a loan for nonowner-occupied property.
A loan application for an initial loan to a homeowner or for a federal emergency
management agency temporary housing unit or for a loan for nonowner-occupied
property under this section may not be accepted after September 30, 2013. A loan
application for a supplemental loan to a homeowner may not be accepted before
October 1, 2013, nor after December 31, 2013.
If, subsequent to receiving a loan from the fund, the property for which the loan was
made is purchased for flood mitigation purposes or otherwise sold, the balance of the
loan and any interest accrued on the loan must be repaid to the fund upon the closing
of the sale. If the rebuilders loan borrower provides financial evidence satisfactory to
the Bank of North Dakota to show that the borrower does not have the financial ability
to repay the rebuilders loan in full upon sale of the property, after the sale of the
property the Bank of North Dakota may allow the borrower to continue to make
payments based on the loan terms.
The industrial commission shall contract with a certified public accounting firm to audit
the fund as necessary. The cost of the audit, and any other actual costs incurred by
the Bank on behalf of the fund, must be paid by the fund.
The Bank shall adopt policies to implement this section.
6-09-47. (Effective through July 31, 2017) Medical facility infrastructure loan
program - Continuing appropriation - Audit and costs of administration.
1. The Bank of North Dakota shall administer a loan program to provide loans to medical
facilities to conduct construction that improves the health care infrastructure in the
state or improves access to existing nonprofit health care providers in the state. The
construction project may include land purchases and may include purchase, lease,
erection, or improvement of any structure or facility to the extent the governing board
of the health care facility has the authority to authorize such activity.
2. In order to be eligible under this loan program, the applicant must be the governing
board of the health care facility which shall submit an application to the Bank. The
application must:
a. Detail the proposed construction project, which must be a project of at least one
million dollars and which is expected to be utilized for at least thirty years;
b. Demonstrate the need and long-term viability of the construction project; and
c. Include financial information as the Bank may determine appropriate to determine
eligibility, such as whether there are alternative financing methods.
3. The governor shall establish a task force to review loan applications under this section
and to make recommendations to the Bank on the loan applications. The task force
must include representation of medical providers and medical facilities from the
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oil-producing counties in the state. The task force shall work with the Bank to establish
criteria for eligibility for a loan under the program. The criteria established by the task
force and the Bank must give priority to applicants that are located in oil-producing
counties.
4. A loan provided under this section:
a. May not exceed the lesser of fifteen million dollars or seventy-five percent of the
actual cost of the project;
b. Must have an interest rate equal to one percent; and
c. Must provide a repayment schedule of no longer than twenty-five years.
5. A recipient of a loan under this section shall complete the financed construction project
within twenty-four months of approval of the loan. Failure to comply with this
subsection may result in forfeiture of the entire loan received under this section.
6. The medical facility infrastructure fund is a special fund in the state treasury. All
moneys in the medical facility infrastructure fund are appropriated to the Bank on a
continuing basis for the purpose of providing loans under this section.
7. Funds in the medical facility infrastructure fund may be used for loans as provided
under this section and to pay the costs of administration of the fund. Annually, the
Bank may deduct a service fee for administering the medical facility infrastructure fund
maintained under this section.
8. The medical facility infrastructure fund must be audited in accordance with section
6-09-29. The cost of the audit and any other actual costs incurred by the Bank on
behalf of the fund must be paid from the fund.
9. The Bank shall deposit loan repayment funds in the medical facility infrastructure fund.
After deduction of fees and costs as provided in this section, the Bank shall make an
annual transfer of repayment funds deposited in the medical facility infrastructure fund
to the state treasurer for deposit in the strategic investment and improvements fund.
(Effective August 1, 2017, through July 31, 2043) Medical facility infrastructure loan
program - Continuing appropriation - Audit and costs of administration.
1. The Bank of North Dakota shall service loans made under the medical facility
infrastructure loan program. The repayment schedule of these loans may not exceed
twenty-five years.
2. Funds in the medical facility infrastructure fund may be used for loans as provided
under this section and to pay the costs of administration of the fund. Annually, the
Bank may deduct a service fee for administering the medical facility infrastructure fund
maintained under this section.
3. The medical facility infrastructure fund must be audited in accordance with section
6-09-29. The cost of the audit and any other actual costs incurred by the Bank on
behalf of the fund must be paid from the fund.
4. The Bank shall deposit loan repayment funds in the medical facility infrastructure fund.
After deduction of fees and costs as provided in this section, the Bank shall make an
annual transfer of repayment funds deposited in the medical facility infrastructure fund
to the state treasurer for deposit in the strategic investment and improvements fund.
6-09-48. Funds received in relation to federal student loan program - Administration Continuing appropriation.
1. The Bank of North Dakota shall administer and manage the funds received in relation
to the federal student loan program under section 2212 of the Health Care and
Education Reconciliation Act of 2010 [Pub. L. 111-152].
2. The funds shall be used to support the functions of the Bank related to higher
education.
3. The funds received by the Bank under subsection 1 are appropriated on a continuing
basis to be used as provided in this section.
4. These funds are not subject to section 54-44.1-11.
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