2011 Oregon Revised Statutes
ORS Volume 13, Chapters 536 - 644
ORS Chapter 541
541.730 Loan contract; repayment plan; interest rate; other terms and conditions.

(1) If the Water Resources Commission approves the financing for the construction of a water development project, the commission, on behalf of the state, and the applicant may enter into a loan contract, secured by a first lien or by other good and sufficient collateral in the manner provided in ORS 541.740. The loan contract shall set forth, among other matters:

(a) That the commission, on behalf of the state, must approve the arrangements made by the applicant for the construction, operation and maintenance of the water development project, using moneys in the Water Development Fund for the construction.

(b) A plan for the repayment of moneys borrowed from the Water Development Fund and interest on those moneys as described in subsection (3) of this section.

(c) Provisions satisfactory to the commission for field engineering and inspection, the commission to be the final judge of completion of the contract.

(d) That the liability of the state under the contract is contingent upon the availability of moneys in the Water Development Fund for use in the construction, operation and maintenance of the water development project.

(e) Such further provisions as the commission considers necessary to ensure expenditure of the funds for the purposes set forth in the approved application.

(f) That the commission may institute an appropriate action or suit to prevent use of the facilities of a water development project financed by the Water Development Fund by any person who is delinquent in the repayment of any moneys due the Water Development Administration and Bond Sinking Fund.

(g) That a loan for a water development project is assignable or transferable to a third party only with the prior approval of the commission.

(2) The commission may approve a loan assignment or transfer only if the commission finds that the assignee or transferee qualifies as a water developer as defined in ORS 541.700 (7) and the assignment or transfer does not have serious adverse effect upon the family farm unit structure in this state.

(3) The commission, in consultation with the State Treasurer, shall set the interest rate in an amount the commission determines to be sufficient to cover, to the extent practicable:

(a) The interest rate to be paid to bondholders on the underlying bonds;

(b) The administrative expenses incurred by the commission, the Water Resources Department and the State Treasurer in connection with the loan program;

(c) All bond-related costs;

(d) The establishment of Water Development Administration and Bond Sinking Fund reserves; and

(e) An amount to be deposited to the Water Development Fund for the purpose of increasing the amount available for loans from that fund.

(4) In addition to any other fee or charge, the commission may charge a loan processing fee, not to exceed one percent of the loan amount.

(5) The repayment plan:

(a) Shall provide for commencement of repayment by the water developer of moneys used for project construction and interest on those moneys not later than two years after the date of the loan contract or at such other time as the commission may provide.

(b) May provide for reasonable extension of the time for making any repayment in emergency or hardship circumstances, if approved by the commission.

(c) Shall provide for such evidence of debt assurance of and security for repayment by the applicant as are considered necessary or proper by the commission.

(d) Shall set forth a schedule of payments and the period of loan. The period of the loan may not exceed the usable life of the constructed project, or 30 years from the date of the first payment due under the financial plan, whichever is less.

(e) Shall set forth the manner of determining when loan payments are delinquent.

(f) Shall include repayment of interest that accrues during any period of delay in repayment authorized by paragraph (a) of this subsection, and may require payments of varying amounts for collection of that accrued interest.

(g) May include provisions in addition to the provisions described in paragraphs (a) to (f) of this subsection. [1977 c.246 6; 1981 c.166 3; 1985 c.673 116; 1999 c.212 3; 2009 c.907 7]