2016 North Dakota Century Code Title 6 Banks and Banking Chapter 6-09.14 Partnership in Assisting Community Expansion
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CHAPTER 6-09.14
PARTNERSHIP IN ASSISTING COMMUNITY EXPANSION
6-09.14-01. Definitions.
In this chapter, unless the context or subject matter otherwise requires:
1. "Business" means a corporation, limited liability company, partnership, individual, or
association involved in manufacturing, processing, value-added processing, and
targeted industries as defined by the Bank of North Dakota.
2. "Community" means the city or county in which an eligible business is located, or a
local development corporation, community organization, or any other group whose
interest is in the economic growth of the area.
3. "Partnership in assisting community expansion fund" or "fund" means a fund
established to buy down the interest rate on loans to businesses under this chapter.
6-09.14-02. Fund - Continuing appropriation - Administration.
A partnership in assisting community expansion fund is hereby established from a transfer
of earnings from the Bank of North Dakota. This is a revolving fund, and all moneys transferred
into the fund, interest on fund moneys, and payments to the fund are hereby appropriated for
the purposes of this chapter. This fund is not subject to section 54-44.1-11. The Bank of North
Dakota shall administer the fund.
6-09.14-03. Fund - Purpose - Interest rate buydown.
Moneys in the partnership in assisting community expansion fund must be used for the
purpose of buying down the interest rate on loans made by a lead financial institution in
participation with the Bank of North Dakota. The Bank of North Dakota's participation may not
exceed eighty percent nor be less than fifty percent of the total loans. If the loan is approved by
the lenders and there is evidence of the community's commitment and ability to fund its portion
of the buydown, the fund's participation in the buydown must automatically be approved. The
community's contribution of direct cash, loans, equity investments, land, property, or
infrastructure may count toward the community's funding of its portion of the buydown.
6-09.14-04. Fund moneys - Eligible uses.
1. The fund moneys may be used to participate in an interest rate buydown on a loan to a
new or expanding business for the following eligible uses:
a. Purchase of real property and equipment.
b. Expansion of facilities.
c. Working capital.
d. Inventory.
The loan funds cannot be used to refinance any existing debt or for the relocation of
the business within North Dakota.
2. The community shall determine the amount of the interest rate buydown and apply to
the Bank of North Dakota for participation from the partnership in assisting community
expansion fund. The funds for the community's portion of the buydown may come from
a local development corporation, contributions, community funds, future dedicated tax
programs, or any other community source.
3. The fund participation portion in the buydown must be determined by the Bank of
North Dakota based on economic conditions in the city or county in which the business
is located.
4. The maximum amount from the fund in the interest rate buydown may not exceed five
hundred thousand dollars per loan. The fund participation must be limited to the
amount required to buy down the interest to five hundred basis points below the
national prime interest rate.
5. The Bank of North Dakota shall adopt rules to implement this chapter.
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