Business Finance Authority

4 Park Street - Suite 302

Concord, NH  03301-6313

Tel. No. 603-271-2391

 

CHAPTER Bfa 100  ORGANIZATIONAL STATEMENTS

 

REVISION NOTE:

 

          Document #5719, eff 10-13-93, made extensive changes to the wording, format, structure, and numbering of rules in Chapters Bfa 100-500.  Document #5719 supersedes all prior filings for the sections in this chapter.  The prior filings for former Chapters Bfa 100-500 include the following documents:

 

#5505, Emergency, eff 11-19-92

#5533, Emergency, eff 12-18-92

 

          Pursuant to 1992, 262:14, the emergency rules remained in effect until superseded by rules in Document #5719.

 

          The "Business Finance Authority" was formerly the "Industrial Development Authority," which was reorganized pursuant to 1992, 262:3, effective 5-15-92, as the "Business Finance Authority."

 

          Pursuant to 1997, 329:12, adopting RSA 162-A:28, and 1997, 329:16, adopting RSA 541-A:21, I(u), effective 10-1-97, the Business Finance Authority became exempt from RSA 541-A and may adopt rules in accordance with its own procedures.  Pursuant to RSA 162-A:28, "Any rule adopted after the effective date of this section or any amendment or repeal of any existing rule shall be filed in the office of legislative services within 7 days of such adoption, amendment, or repeal."  Pursuant  to the exemption from RSA 541-A, the rules Bfa 100-500 filed under Document #5719 were not subsequently recorded by the Office of Legislative Services as expiring.

 

PART Bfa 101  DEFINITIONS

 

          Bfa 101.01  Terms Used Throughout Title.  The following terms have the following meanings throughout this title, unless the context requires otherwise:

 

          (a)  "Authority" means the business finance authority pursuant to RSA 162-A:3.

 

          (b)  "Authority's bond counsel" means an attorney or firm of attorneys of nationally recognized standing in the field of law relating to municipal, state, and public agency financing, selected by the directors to represent the authority in connection with the issuance of bonds.

 

          (c)  "Authority Guarantee Amount" means, with respect to any loan, the portion of the principal amount of the loan which is guaranteed, or is to be guaranteed, by the guarantee to be issued under RSA 162-A:8.

 

          (d)  "Board" means the board of directors for the authority.

 

          (e)  "Bond" means an evidence of indebtedness issued by the authority or another issuer.

 

          (f)  "Bond Counsel" means an attorney or firm of attorneys selected or accepted by a user or issuer to render a legal opinion as to the due authorization, validity, and if appropriate tax-exemption of bonds in a particular financing.  In any particular transaction the authority's bond counsel might also be bond counsel.

 

          (g)  "Bond Limit" means the private activity bond limit applicable to the state and its political subdivisions pursuant to Section 146 of the Internal Revenue Code of 1986 and allocated to the authority pursuant to RSA 162-M.

 

          (h)  "CAP" means the Capital Access Program established pursuant to RSA 162-A:12.

 

          (i)  "CAP Fund" means an administrative account maintained by the authority to account for funds accumulated pursuant to CAP.

 

          (j)  "Chairman" means the chairman of the authority's board of directors.

 

          (k)  "Code" means the Internal Revenue Code of 1986.

 

          (l)  "Credit enhancement" means any loan, expenditure, purchase, guarantee or contribution of funds authorized under RSA 162-A:7, 8, 9, 10, 12 and 13.

 

          (m)  "Directors" means directors of the authority.

 

          (n)  "Eligible facility" means any facility or portion of a facility pursuant to RSA 162-I:2.

 

          (o)  "Executive director" means the executive director of the authority.

 

          (p)  "Financing and security documents" means the financing document, as defined in RSA 162-I:2, VI, and the security document, as defined in RSA 162-I:2, X, for a particular issue of bonds.

 

          (q)  "Guarantee" means a promise on behalf of the state of New Hampshire to indemnify financial loss.

 

          (r)  "Issuer" means any state or local governmental unit, agency, authority or instrumentality, or any nonprofit or public corporation authorized to issue private activity bonds.

 

          (s)  "Loan" means an amount of money, in U.S. dollars, advanced, with the expectation of repayment, with or without interest, by the authority or a bank.

 

          (t)  "Local Development Organization" means any local or regional development agency, authority, corporation, association, foundation, or other entity, regardless of the name or manner of the organization, provided it has a principal function the promotion, encouragement, or development of business in the state.

 

          (u)  "Private activity bond" means any obligation of an issuer that is described in Section 141(a) of the Code the interest of which is intended to be excluded from gross income for federal income tax purposes.

 

          (v)  "Private financial institution" mean any bank, trust company, or other organization that is in the business of making loans to businesses and duly organized under the laws of the United States or any state, and with respect to any organization that is not a bank or trust company, it is qualified to do business in New Hampshire.

 

          (w)  "Project" means the creation, establishment, acquisition, construction, expansion, remodeling or replacement of an eligible facility, financed by the issue of bonds.

 

          (x)  "SBA" means the United States Small Business Administration.

 

          (y)  "State" means the state of New Hampshire.

 

          (z)  "User" means the person entitled to the use and occupancy of an eligible facility and primarily responsible for making payments sufficient to meet debt service on the bonds issued to finance the facility.  The term includes 2 or more persons who are in the aggregate so entitled and so responsible and also includes any person who has applied to the authority for the issue of bonds to finance an eligible facility.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 102  DESCRIPTION OF THE AUTHORITY

 

          Bfa 102.01  Statutory Authority.  The authority is a body corporate and politic operating as an agency of the state pursuant to RSA 162-A.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 102.02  Purpose.  In 1992 the general court continued, expanded, and modified the existing structure and powers of the industrial development authority, including renaming the agency the business finance authority. The purpose of the authority is to preserve, develop, and promote business and industry for the benefit of New Hampshire and its citizens. In order to meet its purpose, the authority interacts with business and industry.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 102.03  Function.  The authority provides the financial vehicle to encourage economic growth in New Hampshire. Loans, and loan guarantees are available to eligible businesses and industries located within the state.  Such programs are vehicles to enhance credit. Such credit enhancement programs are geared towards correcting market failures. Moreover, the authority provides the financial vehicle for issuing bonds.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 102.04  Management.  The powers of the authority shall be vested, pursuant to RSA 162-A, in a board of directors.  Such power shall be delegated with regard to the business and affairs of the authority as consistent with RSA 162-A.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 102.05  Board Structure.  The board shall, pursuant to RSA 162-A:4, consist of 14 directors.  The directors shall be responsible for the operation of the authority.  The governor and council appoint 9 directors.  The speaker of the house of representatives appoints 2, nonvoting, directors.  The president of the senate appoints 2, nonvoting, directors. The state treasurer is appointed as a nonvoting, ex-officio director.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 102.06  Rulemaking Authorization.  The Authority is empowered to adopt rules pursuant to RSA 162-A:6, IV and RSA 162-A:25, VII.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

CHAPTER Bfa 200  GENERAL PROCEDURES

 

PART Bfa 201  RULEMAKING

 

          Bfa 201.01  Petition for Adoption, Amendment or Repeal of Rules.  Any New Hampshire citizen, who's interests may be legitimately impacted by authority actions, policies, or rules, may petition the authority to adopt, amend, or repeal rules in accordance with the following procedure:

 

          (a)  The petitioner shall submit in writing a detailed request for rulemaking setting forth the proposed language of any rule to be adopted, amended, or repealed, stating which rule or rules, if any, are proposed to be amended or repealed, and describing the reasons for the proposed change.

 

          (b)  A petition for rulemaking shall be signed by the petitioner and shall contain the petitioner's address or an address to which correspondence may be sent.

 

          (c)  In the event the executive director determines that a petition is incomplete, the executive director shall return the petition to the petitioner within 7 days with a statement indicating the nature of the deficiencies.

 

          (d)  Petitions for rulemaking received at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.  Petitions received within 2 weeks of the next meeting of the directors shall be placed on the agenda if the directors will have adequate time to review the petition prior to the meeting.  Notwithstanding the foregoing, all petitions for rulemaking received by the authority shall be considered at a meeting scheduled in order to comply with RSA 541-A:6.

 

          (e)  Petitions for rulemaking that are presented to the directors shall either be denied, if in the judgment of the directors the petition for rulemaking does not propose rules that are necessary or desirable to achieve the purposes of the authority, or the directors shall initiate rulemaking proceedings in accordance with RSA 541-A:6.

 

          (f)  If a petition for rulemaking is denied, the directors shall state the reasons, and the executive director shall provide the petitioner with a written statement of those reasons.

 

          (g)  If the directors instruct the executive director to initiate rulemaking proceedings, the executive director shall so inform the petitioner in writing.

 

          (h)  In any rulemaking proceeding commenced by the filing of a petition, the authority shall amend, revise, delete or add to the proposal of the petitioner whenever the directors determine such amendment, deletion or addition is necessary or desirable to achieve the purposes of the authority.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 202  DECLARATION OF RIGHTS

 

          Bfa 202.01  Procedure for Obtaining Declaratory Rulings.  Persons may apply to the executive director for a declaratory ruling as to the applicability of any statutory provision pertaining to, or rule or order of, the authority in accordance with the following procedure:

 

          (a)  A person requesting a declaratory ruling shall submit, in writing, a detailed request for a declaratory ruling setting forth the statutory provision, rule, or order which is questioned and the project or activity in question.  All such requests shall be typed and legible.

 

          (b)  A request for a declaratory ruling shall be signed by the person requesting same and shall contain the person's address or an address to which correspondence may be sent.

 

          (c)  After consideration in conjunction with the board, the executive director shall prepare a written response, based upon the board's considerations, to the request and the reasons for the response within 30 days.  However, if the executive director, in conjunction with the board, determines that an answer to the question necessitates referral of the matter  to the office of the attorney general or the authority's bond counsel, the executive director shall refer the question to the department of justice or the authority's bond counsel within 7 days following receipt of an application.  Upon receipt of an opinion or ruling from the attorney general or the authority's bond counsel, the executive director shall within 7 days send a written response to the applicant.

 

          (d)  In the event the executive director determines that an application provides insufficient information upon which to make the requested ruling, the executive director shall return the application to the applicant within 7 days with a written statement indicating the nature of the deficiencies.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

CHAPTER Bfa 300  GENERAL CREDIT ENHANCEMENT PROGRAM RULES

 

PART Bfa 301  GENERAL APPLICATION PROCEDURES

 

          Bfa 301.01  Scope.  Unless otherwise provided herein, applications which request the authority to take action under the programs established pursuant to RSA 162-A:7, RSA 162-A:8, RSA 162-A:9, RSA 162-A:10, and RSA 162-A:13 shall meet the requirements set forth in Bfa 301.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 301.02  Requirements for Complete Application.  Applications which fail to satisfy the following requirements shall be rejected by the authority:

 

          (a)  Applications shall be submitted and received at the authority's office by 4:00 p.m. before the expiration of any application filing deadlines.

 

          (b)  Each application shall include one original and one copy.

 

          (c)  Each of the programs require payment of an application fee to be established from time to time by the authority pursuant to RSA 162-A:25, VII.  Each application shall include payment of the applicable application fee.

 

          (d)  Each application shall include the specific information requirements set forth in Bfa 302 with respect to the specific program under which application is made.

 

          (e)  For programs which require submission of an appraisal of collateral which shall be offered to support an application for a credit enhancement, each application shall include the required appraisal.  However, if the applicant states that such an appraisal cannot be provided with the application for good cause, the authority shall accept as complete an application which states that the required appraisal shall be received by the authority no later than 90 days subsequent to the date the application is received by the authority.

 

          (f)  When the authority or a credit enhancement program requires an appraisal of collateral offered to support an application, the appraisal shall be made by an independent party.

 

          (g)  Good cause, for purposes of (e) above, means:

 

(1) The appraisal is not available because the independent party retained to perform such appraisal has not completed its appraisal;

 

(2)  The appraisal is not available because the proposed transaction described in the application is or has been subject to development under an expeditious timetable under circumstances not within the control of the applicant; and

 

(3)  The appraisal is not available due to any other factors which have delayed submission of such appraisal and are not within the control of the applicant.

 

          (h)  Each application shall be executed by an appropriate officer of the applicant who shall certify that the information  contained in the application is, to the best of the officer's knowledge, true and correct in all material respects.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 301.03  Request for Supplemental Administrative Information.  Upon receipt of applications, the executive director of the authority shall review each application to determine whether it has satisfied the requirements for a complete application.  If additional information of an administrative nature is required, the executive director or other designated members of the staff of the authority shall request supplemental information within 60 days after receipt of the application.  Such supplemental information shall be provided to the authority no later than 15 days after the date the authority deposited the request for supplemental information in the U.S. mail.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 302  SPECIFIC INFORMATION REQUIREMENTS FOR APPLICATIONS

 

          Bfa 302.01  Aid to Local Development Organization Program.

 

          (a)  Applications for a credit enhancement under RSA 162-A:7 shall be made by the local development organization.

 

          (b)  Such applications shall provide the following information:

 

(1)  The name and address of local development organization;

 

(2)  A statement of history and mission of local development organization;

 

(3)  A description of form and structure of local development organization;

 

(4)  A statement of support from municipalities served by local development organization;

 

(5)  A financial statement or statements of the local development organization prepared by an independent accountant;

 

(6)  A certification stating compliance by the business or project with the Americans With Disabilities Act and Equal Opportunity Act;

 

(7)  The name and address of business(es) involved in transaction;

 

(8)  The name and address of project(s) involved in the transaction;

 

(9)  The line(s) of business(es) involved in the transaction;

 

(10)  The background on management of business or project and all parties to transaction;

 

(11)  A description of transaction;

 

(12)  An analysis of sources and uses of funds financing each specified purpose of the transaction;

 

(13)  A description of principal factors that make the transaction speculative or one of high risk;

 

(14)  A description of all material legal proceedings affecting business or project;

 

(15)  A statement as to the accounting treatment of transaction;

 

(16)  A disclosure of all persons who shall directly or indirectly receive proceeds of this transaction as compensation for services;

 

(17)  A description of material features of the proposed transaction involving the authority's funds or resources;

 

(18)  A summary of material terms including, but not limited to:

 

a.  Principal amounts;

 

b.  Interest rates;

 

c.  Repayment terms;

 

d.  Covenants;

 

e.  Proposed loan agreements, lease agreements, acquisition agreements, security agreements, and guarantee agreements;

 

(19)  A description of the ability of local development organization to monitor performance of business or project;

 

(20)  An identification of primary and secondary sources of repayment;

 

(21)  A cash flow analysis;

 

(22)  A copy or copies of professional appraisals of collateral;

 

(23)  The appraisal required by Bfa 301.02(f);

 

(24)  An environmental site assessment if real estate is involved;

 

(25)  The financial statements, prepared by an independent accountant, for the business or project for 3 years prior to current year;

 

(26)  A certification by each party to the transaction of the following:

 

a.  The local development organization or business entity is fully organized, validly existing and in good standing under the laws of the State;

 

b.  The local development organization or business entity is not in violation of any term of its articles of incorporation or by-laws;

 

c.  The local development organization or business entity is not in violation of any term of any mortgage, loan agreement, or indenture to which it is a party or by which it is bound; and

 

d.  The local development organization or business entity is not in violation of any term of any other agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation;

 

(27)  A statement identifying the following:

 

a.  The ways the transaction serves a public use and provides a public benefit;

 

b.  The ways the transaction promotes the social welfare and economic prosperity of the area and the general welfare of New Hampshire citizens;

 

c.  The ways the transaction promotes development of business activities, creates or preserves employment opportunities, or protects physical environment; and

 

d.  The ways the transaction supports consistent application of local and regional development plans and policies;

 

(28)  The number of employment positions current, created, preserved and projected;

 

(29)  The number of current full-time employees and part-time employees; and

 

(30)  The estimated wage levels of current and projected jobs.

 

(c)  In the event the requested information cannot be provided, a detailed explanation of the reason why the requested information cannot be provided shall be included in said application.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 302.02  Guarantee of Loans to Small Business Program.

 

          (a)  Applications for a credit enhancement under RSA 162-A:8 shall be made by the private financial institution.

 

          (b)  Such applications shall provide the following:

 

(1)  A certification that the SBA has accepted the application for guarantee or loan as filed; and

 

(2)  A complete copy of the application submitted to the SBA, including any attachments that accompanied the application submitted to the SBA.

 

          (c)  In the event the requested information cannot be provided, a detailed explanation of the reason why the requested information cannot be provided shall be included in said application.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 302.03  Secondary Market for Loans by Local Development Organization Program.

 

          (a)  Applications for a credit enhancement under RSA 162-A:10 shall be made by the local development organization.

 

          (b)  Such applications shall provide the following information:

 

(1)  The name and address of local development organization;

 

(2)  A statement of history and mission of local development organization;

 

(3)  A description of form and structure of local development organization;

 

(4)  A statement of support from municipalities served by local development organization;

 

(5)  A financial statement or statements of the local development organization prepared by an independent accountant;

 

(6)  A certification stating compliance by the business or project with the Americans With Disabilities Act and Equal Opportunity Act;

 

(7)  The name and address of the borrower;

 

(8)  The name and address of project(s) involved in the transaction;

 

(9)  The line(s) of business(es) of the borrower;

 

(10)  The background on management of business or project;

 

(11)  A description of principal factors that make the transaction speculative or one of high risk;

 

(12)  A description of all material legal proceedings affecting business or project;

 

(13)  A disclosure of all persons who shall receive, either directly or indirectly, any proceeds of the loan acquisition as compensation for services;

 

(14)  A statement as to the accounting treatment of transaction;

 

(15)  A description of the terms of the proposed loan purchase agreement;

 

(16)  A summary of material terms of financing documents to be acquired including, but not limited to:

 

a.  Loan agreements;

 

b.  Lease agreements;

 

c.  Acquisition agreements;

 

d.  Security agreements; and

 

e.  Guarantee agreements;

 

(17)  A description of local development organization's ability to monitor performance of business or project;

 

(18)  A detailed history of loan performance;

 

(19)  A detailed history of borrower's compliance with all terms of the financing documents;

 

(20)  An identification of primary and secondary sources of repayment by business;

 

(21)  A cash flow analysis;

 

(22)  The copies of professional appraisals of collateral;

 

(23)  The appraisal required by Bfa 301.02(f);

 

(24)  An environmental site assessment if real estate is involved;

 

(25)  The financial statements, prepared by an independent accountant, for the business or project for three years prior to current year;

 

(26)  A certification by each party to the transaction of the following:

 

a.  The local development organization or business entity is duly organized, validly existing and in good standing under the laws of the state;

 

b.  The local development organization or business entity is not in violation of any term of its articles of incorporation or by-laws;

 

c.  The local development organization or business entity is not in violation of any term of any mortgage, loan agreement, or indenture to which it is a party or by which it is bound; and

 

d.  The local development organization or business entity is not in violation of any term of any other agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation;

 

(27)  A detailed analysis of the specific use(s) and purpose(s) to which the local development organization shall apply the proceeds of the loan to be acquired;

 

(28)  A statement identifying the following:

 

a.  The ways the transaction serves a public use and provides a public benefit;

 

b.  The ways the transaction promotes the social welfare and economic prosperity of the area and the general welfare of New Hampshire citizens;

 

c.  The ways the transaction promotes development of business activities, creates or preserves employment opportunities, or protects physical environment; and

 

d.  The ways the transaction supports consistent application of local and regional development plans and policies;

 

(29)  The number of employment positions current, created, preserved and projected;

 

(30)  The number of full-time employees and part-time employees; and

 

(31)  The estimated wage levels of current and projected jobs.

 

          (c)  In the event the requested information cannot be provided, a detailed explanation of the reason why the requested information cannot be provided shall be included in said application.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 302.04 RESERVED

 

          Bfa 302.05  Guaranteed Asset Program.

 

          (a)  Applications for a credit enhancement under RSA 162-A:13 shall be made by the private financial institution.

 

          (b)  Such applications shall provide the following information:

 

(1)  The name and address of private financial institution;

 

(2)  An identification of private financial institution;

 

(3)  The form and ownership of private financial institution;

 

(4)  A financial statement or statements, prepared by an independent accountant, of private financial institution;

 

(5)  A certification stating compliance by the business or project with the Americans With Disabilities Act and Equal Opportunity Act;

 

(6)  The name and address of the borrower;

 

(7)  The name and address of project(s) involved in the transaction;

 

(8)  The line(s) of business(es) involved in the transaction;

 

(9)  The background on management of business or project;

 

(10)  The background of all parties to transaction;

 

(11)  A description of transaction, including the following:

 

a.  Project start date;

 

b.  Project completion date; and

 

c.  Projected productivity improvements;

 

(12)  An analysis of sources and uses of funds financing each specified purpose of the transaction;

 

(13)  A discussion of principal factors that make the transaction speculative or one of high risk;

 

(14)  A description of material legal proceedings affecting business or project;

 

(15)  A statement as to the accounting treatment of transaction;

 

(16)  A disclosure of all persons who will directly or indirectly receive proceeds of this transaction as compensation for services;

 

(17)  A description of the material terms of the proposed transaction involving authority funds or resources;

 

(18)  A summary of material terms of the following items involved with transaction:

 

a.  Loan agreements;

 

b.  Lease agreements;

 

c.  Acquisition agreements;

 

d.  Security agreements; and

 

e.  Guarantee agreements;

 

(19)  A description of the private financial institution's ability to monitor the performance of the project;

 

(20)  An identification of primary and secondary sources of repayment;

 

(21)  A cash flow analysis;

 

(22)  The copies of professional appraisals of collateral;

 

(23)  The appraisal required by Bfa 301.02(f);

 

(24)  An environmental site assessment if real estate is involved;

 

(25)  The financial statements, prepared by an independent accountant, for the business or project for 3 years prior to current year;

 

(26)  A certification by the borrower of the following:

 

a.  The borrower is duly organized, validly existing and in good standing under the laws of the state;

 

b.  The borrower is not in violation of any term of its articles of incorporation or by-laws;

 

c.  The borrower is not in violation of any term of any mortgage, loan agreement, or indenture to which it is a party or by which it is bound; and

 

d.  The borrower is not in violation of any term of any other agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation;

 

(27)  A statement identifying the following:

 

a.  The ways the transaction serves a public use and provides a public benefit;

 

b.  The ways the transaction promotes the social welfare and economic prosperity of the area and the general welfare of New Hampshire citizens;

 

c.  The ways the transaction promotes development of business activities, creates or preserves employment opportunities, or protects physical environment; and

 

d.  Why the guarantee will contribute significantly to the success of the transaction;

 

(28)  The number of employment positions current, created, preserved and projected;

 

(29)  The number of current full-time employees and part-time employees; and

 

(30)  The estimated wage levels of current and projected jobs.

 

          (c)  In the event the requested information cannot be provided, a detailed explanation of the reason why the requested information cannot be provided shall be included in said application.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 303  PROCEDURES FOR THE ESTABLISHMENT OF FEES AND CHARGES

 

          Bfa 303.01  Fees to Be Established at Meeting of Board.  The board shall establish fees and charges for applying under and participation in its credit enhancement programs from time to time at a meeting of the board.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 303.02  Criteria for Establishment of Fees and Charges.  The board shall establish fees and charges for each of its credit enhancement programs on the basis of the following criteria:

 

          (a)  Whether the fees and charges are comparable to the level of fees and charges which would be charged if the credit enhancement were provided by a private person in a private financial market transaction;

 

          (b)  Whether the fees and charges adequately recover the administrative costs of the authority to review and evaluate the implementation of the credit enhancement at the original effectiveness of the credit enhancement and over the term of the credit enhancement; and

 

          (c)  Whether the fees and charges are sufficient to ensure that the authority can meet its financial obligations as they come due in the ordinary course.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 304  PROCEDURES FOR REVIEW AND APPROVAL OF APPLICATIONS

 

          Bfa 304.01  Purpose.

 

          (a)  This part sets forth the criteria used and the procedures followed by the authority in approving applications under the programs established pursuant to RSA 162-A:7, RSA 162-A:8, RSA 162-A:9, RSA 162-A:10, and RSA 162-A:13.

 

          (b)  The purpose of this part is to describe the criteria used by the authority in the steps outlined in Bfa 304.03(a), 304.03(b) and 304.03(d).  It is not the purpose of this part to describe or establish the criteria used and the procedures followed by governor and council, which criteria and procedures are not within the scope of the authority's jurisdiction.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.02  Scope.  Discussion of criteria and procedures followed by governor and council contained in this part shall be descriptive only and shall not be rules binding on the governor and council.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.03  Outline of Procedure.  The application for and issuance of a credit enhancement under any of the authority's programs shall be a four-step procedure which shall consist of the following elements:

 

          (a)  The submission of a complete application in accordance with PART Bfa 301;

 

          (b)  The evaluation of an application with respect to the specific criteria under each program and the recommendation by the authority that the governor and council award a credit enhancement as specified in a resolution of the Board;

 

          (c)  A public hearing before the governor and council and the making of certain findings by the governor and council pursuant to RSA 162-A:18; and

 

          (d)  The execution and delivery of the credit enhancement documents and the effectiveness of the credit enhancement in accordance with the recommendation of the authority and the approval of the governor and council.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.04  Evaluation of an Application.

 

          (a)  Upon receipt of a complete application in accordance with Bfa 301, the executive director and staff of the authority shall review the material contained in the application.  The executive director or any designated member of the staff of the authority shall request any additional information from the applicant or other interested party as shall be deemed by the executive director and staff of the authority to be necessary or advisable to evaluate the credit worthiness of the applicant or the proposed transaction or to provide additional information to permit the board to evaluate the quality of the proposed credit enhancement as required by RSA 162-A:18.

 

          (b)  All records, materials, documents or information submitted to the authority in connection with an application for award of a credit enhancement shall constitute confidential, commercial and financial information the disclosure of which could adversely impact the competitive status of an applicant or an interested party.  Accordingly, such records, materials, documents or information shall be maintained as confidential by the authority and, pursuant to RSA 91-A:3, II(h) and RSA 91-A:5, IV, shall not be subject to public inspection unless the applicant shall request in writing that such information be subject to public disclosure.

 

          (c)  Upon completion of review by the executive director and staff of the authority, the application shall be considered at a meeting of the board.  Consideration of an application under RSA 162-A:7, RSA 162-A:8, RSA 162-A:9, RSA 162-A:10 and 162-A:13 shall be conducted in nonpublic session, unless the applicant requests a meeting that is open to the public.  Attendance by the staff of the authority or professional advisors to the authority shall not cause the nonpublic session to be treated as a public session.

 

          (d)  Minutes of proceedings in nonpublic session shall be kept and shall be withheld from public disclosure until the applicant requests public disclosure of such minutes or until it is determined by a majority of the voting board members that public disclosure of such minutes likely would not adversely affect the reputation or competitive position of the applicant or interested party.  The board shall consider any written submission concerning the application which may be supplied to the authority by a party other than the applicant.

 

          (e)  The board shall approve an application for recommendation to governor and council if the board determines, after considering the following criteria, that the credit enhancement proposed in the application serves a public use and provides a public benefit:

 

(1)  Whether the likely number of jobs that will be preserved or created by the project is significant;

 

(2)  Whether the level of unemployment and the need for economic development in the area in which the project is to be located will be improved;

 

(3)  Whether in the judgment of the board the project and the proposed credit enhancement is feasible;

 

(4)  Whether the applicant or business subject to a proposed credit enhancement is an equal opportunity employer;

 

(5)  Whether the project will improve and promote the orderly development of business activities, create or preserve employment opportunities, or protect the physical environment;

 

(6)  Whether the project will preserve or increase the social welfare or economic prosperity of the state and one or more of its political subdivisions, and will promote the general welfare of the state's citizens;

 

(7)  Whether the project and credit enhancement complies with all applicable statutory requirements;

 

(8)  Whether the proposed credit enhancement contains terms of conditions which reduce the risk of loss to the state as a result of the award of the credit enhancement; and

 

(9)  Whether, in the judgment of the board, the proposed credit enhancement is an appropriate use of the limited capacity available to provide credit enhancements under the authority's programs.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.05  Nature of Authority Approval.  Approval of an application by the board shall only be an expression of the authority's intent to recommend that governor and council approve the award of the credit enhancement approved at the meeting of the board.  Such approval shall not bind the authority to take action to make the credit enhancement effective, shall be subject to approval by governor and council.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.06  Resolution of the Board.  If the Board approves an application, the board shall adopt a resolution which shall:

 

          (a)  Make all the general and specific findings required under RSA 162-A:18 with respect to the specific program for which the application was submitted;

 

          (b)  Recommend to the governor and council that they make such findings;

 

          (c)  Provide specifically that the authority shall not execute or deliver the credit enhancement documents until after the governor and council have made such findings; and

 

          (d)  Authorize the staff of the authority to take all actions necessary to implement and make effective the credit enhancement authorized in the resolution.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.07  Governor and Council.  After the transmittal of the resolution of the board and accompanying material to the governor and council and the due publication of a notice of public hearing before governor and council, the chairman, executive director, or other authority staff member designated by the board shall present the proposed credit enhancement to the governor and council at the public hearing and request that they make the required findings under RSA 162-A:18.  A representative of the applicant or other person knowledgeable about the proposed credit enhancement or project shall attend the public hearing to answer any questions the governor or the councilors have about the project or the proposed credit enhancement.  The authority shall not execute any credit enhancement document unless the governor and council make the required findings.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.08  Effectiveness of the Credit Enhancement.

 

          (a)  After the governor and council have made the findings required by RSA 162-A:18, the persons authorized to execute and deliver the credit enhancement documents and any related certificates on behalf of the authority shall so execute and deliver such documents and related certificates.

 

          (b)  Not withstanding (a) above, any person authorized to execute and deliver such documents and certificates shall refuse to do so if in that person's judgment the documents and certificates do not adequately address or protect the financial interests of the authority or the state or are inconsistent with the purposes of RSA 162-A.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 304.09  Waiver of Rules.  The authority shall waive the provisions  of any rule, except where precluded by applicable law, if a majority of the board shall determine that such waiver is necessary to carry out the purposes of RSA 162-A, RSA 162-I or RSA 162-M.  Any such waiver shall be specific and in writing.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

CHAPTER Bfa 400  BONDS ISSUED BY THE AUTHORITY

 

PART Bfa 401  PURPOSE OF CHAPTER AND OUTLINE OF PROCEDURES

 

          Bfa 401.01  Purpose.

 

          (a)  This chapter describes the procedures to be followed by users in applying for and obtaining financing for an eligible facility through the issuance of bonds under RSA 162-I.  This chapter also describes the criteria used and the procedures followed by the authority in approving the issuance of bonds, except that the criteria used and the procedures followed by the authority in allocating bond limit are described in Bfa 500 ASSIGNMENT AND ALLOCATION OF BOND LIMIT.

 

          (b)  This chapter also describes generally the existing procedures relating to the step described below in Bfa 401.02(c) to the extent necessary to put the entire process of issuing bonds into context.  The authority recognizes, however, that the criteria used and the procedures followed by the governor and council are beyond its rulemaking power, and any discussion of those criteria and procedures contained in this chapter are intended to be descriptive only and are not intended as rules binding on the governor and council.

 

          (c)  The issuance of bonds by the authority, the interest on which is excluded from gross income of the owner thereof for federal income tax purposes, is governed not only by RSA 162-I, but also by Section 103 and Sections 141 through 150 of the Code.   Certain criteria used and procedures followed by the authority as set forth in this chapter are based upon requirements of Section 103 and Sections 141 through 150 of the Code.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 401.02  Outline of Procedure.  The application for and the issuance of bonds shall be a 4 step procedure which shall consist of the following elements:

 

          (a)  Except as provided in Bfa 402.03(b), the submission of a preliminary application by a user and the grant of preliminary official action by the authority;

 

          (b)  The submission of a final application and the authority's authorization of the issuance of bonds;

 

          (c)  A public hearing before the governor and council and the making of certain findings by the governor and council pursuant to RSA 162-I:9; and

 

          (d)  The issuance of the bonds.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 402  PRELIMINARY OFFICIAL ACTION

 

          Bfa 402.01  Preliminary Application.

 

          (a)  A user who wants to finance a project through the authority's issuance of bonds shall submit a request to the authority that it consider such a financing.  Such requests shall be submitted on Form Bfa-1, APPLICATION FOR PRELIMINARY OFFICIAL ACTION AND RESERVATION OF BOND LIMIT, which may be obtained by writing or calling the authority.

 

          (b)  When applying for preliminary official action 20 copies of a completed Form Bfa-1 shall be submitted to the offices of the authority.

 

          (c)  Form Bfa-1 shall be accompanied by 20 copies of each of the following items, if applicable:

 

(1)  For all eligible facilities:

 

a.  The user's annual report, brochure or other printed material describing the user;

 

b.  The user's most recent available annual financial statements, or such other financial information about the user necessary to enable the authority to determine, after considering all of the other information before it, that the project and proposed financing of the project are feasible and that the user has the financial resources necessary to operate the proposed eligible facility successfully; and

 

c.  A letter described in Bfa 403.01(d)(4);

 

(2)  For small scale power facilities and water powered electric generating facilities, letters of intent to purchase power generated by the facility from the proposed purchasers of such power, unless the user is the primary consumer of such power; and

 

(3)  For industrial facilities described in RSA 162-I:2, VII,(d), where the user is not to be the primary generator of waste materials, letters of intent to supply waste material from the proposed suppliers of such material, and if such material is being converted into other products, such as steam or electricity, where the user is not to be the primary consumer of such products, letters of intent to purchase such other products from the proposed purchasers thereof.

 

          (d)  An application for preliminary official action shall also be accompanied by a non-refundable application fee.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 402.02  Granting of Preliminary Official Action.

 

          (a)  Upon receipt of an application from a user for preliminary official action, the staff of the authority and authority's bond counsel shall review the application and promptly advise the user of any omission or deficiency in the application.  If a user is advised by the staff of the authority that any application is incomplete or deficient the user may supplement or amend its application.  The executive director shall accept an application that does not meet the requirements of Bfa 402.01(b)(1)-(3) if, in the judgment of the executive director, the omission shall not diminish the ability of the directors to evaluate the project and the user.

 

          (b)  When the executive director determines that an application for preliminary official action is complete, the request for preliminary official action shall be considered at a meeting of the directors.  Applications for preliminary official action that are completed at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.  Completed applications for preliminary official action that are received within 2 weeks of the next meeting of the directors shall be placed on the agenda if, the executive director determines that the staff of the authority, authority's bond counsel and the directors will have adequate time to review the application.

 

          (c)  The directors shall approve an application for preliminary official action if after considering the following criteria, to the extent they are applicable to a particular project, the directors determine that the project will preserve or increase the social or economic prosperity of the state and one or more of its political subdivisions, and will promote the general welfare of the state's citizens:

 

(1)  The extent to which jobs will be preserved or created by the project;

 

(2)  The extent to which the project is to be located in an area of high unemployment or where there is a need for economic development;

 

(3)  The extent to which the project and the proposed financing thereof appears to be feasible;

 

(4)  The extent to which the project will have a beneficial impact on the environment;

 

(5)  The extent to which the project will reduce the state's dependence on fossil fuels and utilize better the state's energy resources;

 

(6)  The extent to which there is a need for the project in the area in which it is to be located;

 

(7)  Whether any new construction or major renovation conducted in connection with a project conforms to the Architectural Barrier Free Design Code for the state;

 

(8)  Whether the user is an equal opportunity employer; and

 

(9)  The likelihood that the project will be carried out within a reasonable period of time.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 402.03  Effect of Preliminary Official Action.

 

          (a)  Adoption of a preliminary official action resolution by the directors shall be only an expression of intent to issue bonds.  Among other things, preliminary official action shall be intended to satisfy "official intent"  requirement as set forth in Treas. Reg. Sec. 150-2.  The actual issuance of bonds shall be subject to further proceedings by the directors and by the governor and council.

 

          (b)  Preliminary official action resolutions shall provide that the authority approves a user's commencing the project and making expenditures that shall be reimbursed from bond proceeds under RSA 162-I, but any expenditures made by a user for a project prior to the actual issuance of  bonds shall be at user's own risk.  Preliminary official action shall not be an assurance that bonds will be issued for the project.  Where action is not necessary to satisfy federal tax law requirements, such as the proposed issuance of refunding bonds or of bonds the interest on which is not intended to be excluded from gross income for federal income tax purposes, a user may elect not to seek preliminary official action under Bfa 402.

 

          (c)  Adoption of a preliminary official action resolution by the directors shall not constitute a reservation or allocation of a portion of the bond limit.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 402.04  Amendment of Preliminary Official Action Resolutions.  If a project is modified, the estimated cost of a project is changed, or some other event occurs or circumstance arises making it advisable to amend a preliminary official action resolution, the authority shall, upon the written request of the user, or upon its own motion, amend such resolution.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 403  FINAL APPROVAL OF BOND ISSUES

 

          Bfa 403.01  Final Applications.

 

          (a)  After the terms of a proposed bond issue have been substantially fixed, the user, through bond counsel, shall submit an application for the director's approval of the issuance of bonds for the user's project.  The application shall consist of the following items, each of which is described in more detail in Bfa 403.01(b)-(g):

 

(1)  Ten bound application books;

 

(2)  Twenty summary sheets;

 

(3)  Three copies of a notice of a proposed public hearing on the bonds by the governor and council;

 

(4)  Two press packages;

 

(5)  Two copies of the proposed resolution to be adopted by the governor and council immediately after the public hearing, with draft extracts of the minutes of the public hearing attached; and

 

(6)  Thirty copies of the proposed resolution to be adopted by the directors approving the issuance of the bonds.

 

          (b)  The application books shall be used by the authority and may be used by the governor and council in considering the bond issue.  The application books shall contain sufficient information to enable the authority and the governor and council to make all of the findings with respect to the project and the bonds as required by RSA 162-I:9.  Application books shall be bound in a manner that makes it easy to substitute pages in the event corrections or additions are necessary and shall be clearly labeled substantially as follows:

 

"APPLICATION

 

Business Finance authority of the State of New Hampshire

 

(Amount of Bonds) Bonds

 

(User)

 

(Location of Project)."

 

          (c)  Application books shall contain a cover letter addressed to the governor and council requesting that the governor and council hold a public hearing and adopt a resolution under RSA 162-I:9 and listing the material contained in the application book.  This cover letter shall be dated the date the authority is expected to approve the issuance of bonds and shall be prepared for the signature of the executive director or such other officer or employee of the authority as the authority shall direct.

 

          (d)  The application book shall also contain the following material, listed in the order in which it shall appear:

 

(1)  The proposed resolution to be adopted by the governor and council under RSA 162-I:9;

 

(2)  A letter from bond counsel describing the transaction;

 

(3)  The items described in Bfa 402.01(a)(1)a. and b. and, if applicable, the items described in Bfa 402.01(a)(2) and (3), may be updated, supplemented, or edited to the extent deemed appropriate by bond counsel.

 

(4)  A commitment letter fitting one of the following categories, which may also include reasonable conditions, such as receipt of satisfactory documentation and legal opinions:

 

a.  A letter from one or more lenders or underwriters agreeing to purchase the bonds;

 

b.  A letter from one or more placement agents agreeing to use their best efforts to place the bonds and expressing the opinion that such placement is likely to be successful; or

 

c.  A letter from a bank, bond insurance company or similar financial entity agreeing to issue a letter of credit, a municipal bond insurance policy, or a similar financial guaranty to pay debt service on the proposed bonds;

 

(5)  Any additional information necessary to enable the directors and the governor and council to make the special findings specified by RSA 162-I:9, II,(a) and, if applicable, the findings under RSA 162-I:9-a or 162-I:9-b for the project;

 

(6)  Drafts of the financing documents and security documents for the proposed issue of bonds;

 

(7)  A copy of the proposed resolution to be adopted by the directors authorizing the issuance of the bonds; and

 

(8)  A summary of the findings required to be made under RSA 162-I:9 for the project and of the evidence contained in the application supporting each required finding; and

 

(9)  If the user is seeking a state guarantee of the bonds under RSA 162-I:9-b, a draft of the letter of credit, bond insurance policy, or similar credit enhancement required by RSA 162-I:9-b, II shall be submitted;

 

          (e)  Summary sheets shall summarize the proposed transaction in outline form and shall contain the following information:

 

(1)  The name or names of each user;

 

(2)  The location of the project;

 

(3)  A brief description of the project, including a description of the activities to be carried out at the eligible facility upon its completion and the number of jobs expected to be created or preserved by the operation at the facility;

 

(4)  The principal amount of the bonds;

 

(5)  The interest rate on the bonds;

 

(6)  The repayment terms of the bonds;

 

(7)  The name or names of each initial purchaser of the bonds or each placement agent;

 

(8)  A list of the operative documents for the transaction to which the authority is a party;

 

(9)  A description of the security for the bonds;

 

(10)  Any prepayment or redemption provisions of the bonds;

 

(11)  Whether additional bonds may be issued under the operative documents and whether any such additional bonds are presently contemplated;

 

(12)  What happens if interest on the bonds should become subject to federal income taxes;

 

(13)  The name of the trustee for the bonds, if any;

 

(14)  A description of any special features of the bonds or the transaction of which they are a part;

 

(15)  A description of any previous dealings the authority has had with the user or the project; and

 

(16)  If a state guarantee of the bonds is being sought pursuant to RSA 162-I:9-a or 162-I:9-b, the amount of principal of the bonds to be guaranteed.

 

          (f)  Proposed notices of public hearing for the bonds before the governor and council shall state:

 

(1)  The time and place of the public hearing;

 

(2)  The maximum amount of the bonds to be issued;

 

(3)  The names of the user or users;

 

(4)  The location of the project;

 

(5)  The intended purpose of the project; and

 

(6)  That the hearing is being held pursuant to RSA 162-I:9 and, if applicable, RSA 162-I:9-a or 162-I:9-b.

 

          (g)  Press packages shall consist of the following items in the order in which they shall appear:

 

(1)  The cover letter addressed to the governor and council contained in the application book;

 

(2)  The Form Bfa-1 for the project;

 

(3)  The letter from bond counsel described in Bfa 403.01(b)(2); and

 

(4)  The proposed resolution to be adopted by the governor and council.

 

          (h)  The proposed resolution to be adopted by the governor and council shall include all of the findings required under RSA 162-I:9 and, if applicable, RSA 162-I:9-a or 162-I:9-b for an eligible facility of the type proposed to be financed.

 

          (i)  The proposed resolution to be adopted by the authority, in addition to authorizing the execution and delivery of the financing and security documents and the issuance and sale of the proposed bonds, shall:

 

(1)  Make all of the findings required under RSA 162-I:9 and if applicable, RSA 162-I:9-a or 162-I:9-b for an eligible facility of the type proposed to be financed;

 

(2)  Recommend to the governor and council that they make such findings;

 

(3)  Provide specifically that the authority shall not execute the financing and security documents or issue bonds pursuant to the resolution until after the governor and council have made such findings; and

 

(4)  Include an allocation of bond limit subject to such restrictions as the authority shall prescribe pursuant to Bfa 500.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 403.02  Authorizing the Issuance of Bonds.

 

          (a)  Upon receipt from bond counsel of a final application, the staff of the authority and authority's bond counsel shall review the application and promptly advise bond counsel of any omission or deficiency in the application.  If bond counsel is advised by the staff of the authority that any final application is incomplete or deficient, bond counsel may supplement or amend the application.

 

          (b)  When the executive director determines that a final application is complete, the request for the issuance of bonds shall be considered at a meeting of the directors.  Final applications that are completed at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.  Final applications that are completed within 2 weeks of the next meeting of the directors shall be placed on the agenda if, the executive director determines that the staff of the authority, authority's bond counsel and the directors will have adequate time to review the application.

 

          (c)  In order to expedite review of a final application by the staff of the authority and authority's bond counsel, bond counsel may submit draft application documents to the authority or the authority's bond counsel prior to submitting the final application.

 

          (d)  The directors shall consider an application for the issuance of bonds on the basis of the criteria set forth in Bfa 402.02 for consideration of applications for preliminary official action.  A representative of the user and bond counsel shall attend the meeting of the directors at which the issuance of bonds is considered to answer any questions the directors have about the project or the financing.

 

          (e)  Upon the directors' authorization of the issuance of bonds to finance a particular project, the executive director shall transmit the final application for those bonds to the governor and council.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 404  GOVERNOR AND COUNCIL

 

          Bfa 404.01  Description of Approval by the Governor and Council.  After the transmittal of the final application to the governor and council and the due publication of a notice of public hearing before the governor and council, the executive director or the chairman shall present the proposed bond issue to the governor and council at the public hearing and request that they make the required findings under RSA 162-I:9 and, if applicable, RSA 162-I:9-a or 162-I:9-b.  A representative of the user and bond counsel shall attend the public hearing to answer any questions the governor or the councilors have about the project or the financing.  The authority shall not execute any financing or security document or issue any bonds with respect to an eligible facility unless the governor and council make the required findings.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART 405  ISSUANCE OF BONDS

 

          Bfa 405.01  Issuance of Bonds.

 

          (a)  After the governor and council have made the findings required by RSA 162-I:9 and, if applicable, RSA 162-I:9-a or 162-I:9-b, the persons authorized to execute and deliver the bonds, the financing and security documents and any related certificates and documents on behalf of the authority shall so execute and deliver the bonds and such documents and certificates.

 

          (b)  Notwithstanding (a) above, any person authorized to execute and deliver bonds and related documents shall refuse to do so, if in that person's judgment the bonds and documents do not adequately address or protect the interests of the authority or the state or are inconsistent with the purposes of RSA 162-I.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

CHAPTER Bfa 500  ASSIGNMENT AND ALLOCATION OF BOND LIMIT

 

PART Bfa 501  PURPOSE OF CHAPTER AND OUTLINE OF PROCEDURES

 

          Bfa 501.01  Purpose of Chapter.  This chapter describes the procedures to be followed by issuers, other than the authority, in obtaining a reservation or assignment of bond limit and by users, in the case of authority bond issues, in obtaining a reservation or an allocation of bond limit.  This chapter also describes the criteria used and the procedures followed by the authority in approving a reservation, assignment or allocation of bond limit.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 501.02  Reservations, Assignments and Allocation of Bond Limit.

 

          (a)  For purposes of this chapter:

 

(l)  An assignment of bond limit shall refer to the authority's transfer of bond limit to another issuer for allocation to a particular bond issue; and

 

(2)  An allocation of bond limit shall refer to the authority's designation of a portion of the bond limit for one of its own bond issues.

 

          (b)  The authority shall reserve bond limit in anticipation of either an assignment or an allocation of bond limit.  In order to evaluate fully a proposed bond issue and in order to ensure that the bond limit is not wasted, the authority shall not make an actual assignment or allocation of bond limit until the issuance of the bonds in the near future is reasonably assured.  To facilitate planning for bond issues, however, the authority shall make a reservation of bond limit for a bond issue at an early stage of the issue's development if it determines that a reservation is appropriate under either Bfa 503.01(e) or 504.02(g).  Such a reservation shall mean that the authority has set aside a portion of the bond limit for a particular bond issue.

 

          (c)  A reservation of bond limit shall be an expression of the authority's intent to make an assignment or allocation of bond limit to a bond issue if an assignment or allocation is sought before the expiration of the reservation.  Because the authority might not be in possession of all of the material facts at the time a reservation is made, however, a reservation shall not provide absolute assurance that an assignment or allocation will be made.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 502  CATEGORIZATION OF BOND LIMIT

 

          Bfa 502.01  Establishment of Categories.

 

          (a)  The directors shall, at their first meeting in each calendar year, establish categories of private activity bonds based on the purpose of the bond issue and shall allot a portion of the bond limit to each category.  The establishment of such categories and the amount of bond limit allotted to each category shall be based on the past experience of the authority with respect to the relative demand for bond limit for various types of projects and on the obligation of the authority to carry out established state policies.

 

          (b)  The various categories established shall include a reserve category, not to exceed 20 percent of the total bond limit for that year, which shall be assigned or allocated to bond issues that do not fit into any of the established categories and for bond issues that fit into an established category from which the entire allotted bond limit has been depleted.  The categories and the amount of bond limit allotted to each category shall be revised periodically by the directors as new information regarding the demand for bond limit becomes available.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 502.02  Assignments and Allocations from Categories.  Whenever the authority reserves, assigns or allocates bond limit, it shall determine into which category the bond issue fits, if any, and shall use bond limit from that category.  If the bond issue does not fit into any category, or if the amount of the bond issue exceeds the amount of bond limit available from the category into which it fits, the authority shall use bond limit from the reserve category to the extent necessary.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 503  PROCEDURES FOR APPLICATION BY AN ISSUER

 

          Bfa 503.01  Application for Reservation.

 

          (a)  An issuer that is planning an issue of private activity bonds may submit a request to the authority that it consider making a reservation of bond limit for that issue of bonds.  Such requests shall be submitted on Form Bfa-2, ISSUER APPLICATION FOR RESERVATION OF BOND LIMIT, which may be obtained by writing or calling the authority.

 

          (b)  When applying for a reservation an issuer shall provide the authority with 20 copies each of a completed Form Bfa-2 and the following:

 

(1)  A certified copy of a preliminary official action resolution, or of a resolution evidencing the issuer's intent to issue the bonds;

 

(2)  A letter of commitment to buy the proposed bonds from a lender or lenders with the financial resources to do so, or a letter of commitment to place the proposed bonds from an investment banker or bankers who can be reasonably expected to place successfully the bonds; and

 

(3)  A letter from bond counsel for the proposed bond issue to the effect that it is not aware of any reason why interest on the bonds will not be excluded from gross income for federal income tax purposes.

 

          (c)  Upon receipt from an issuer of an application for a reservation of bond limit, the staff of the authority and authority's bond counsel shall review the application and promptly advise the issuer of any omission or deficiency in the application.  If an issuer is advised by the staff of the authority that any application is incomplete or deficient the issuer may supplement or amend its application.

 

          (d)  When the executive director determines that an issuer's application for a reservation of bond limit is complete, the request for the reservation shall be considered at a meeting of the directors.  Issuer applications for a reservation of bond limit that are completed at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.  Completed applications for a reservation that are received within 2 weeks of the next meeting of the directors may be placed on the agenda if the executive director determines that the staff of the authority, authority's bond counsel and the directors will have adequate time to review the application.

 

          (e)  The directors shall consider an issuer's application for a reservation of bond limit in the manner described in Bfa 505.  If the directors make a reservation of bond limit, the reservation shall be effective until the last day of the third month following the director's meeting at which the reservation was made.  The duration of a reservation shall be determined by the directors based upon the need to ensure that bond limit not be wasted.

 

          (f)  If the directors make a reservation of bond limit, they shall delegate to the chairman, vice chairman, or executive director the power to make the assignment of bond limit, subject, however, to the conditions set forth in Bfa 503.03.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 503.02  Extensions of Reservations.

 

          (a)  Before a reservation expires the issuer shall either obtain an assignment of bond limit or obtain an extension of the reservation period.  If a reservation expires, the reserved portion of the bond limit shall be returned to the category or categories from which it was drawn pursuant to Bfa 502 and shall be available for other bond issues.  After the expiration  of a reservation for a bond issue, the issuer may reapply for a new reservation for that bond issue, but the bond issue shall be completely re-evaluated by the authority taking into account all other requests for reservations, assignments and allocations of bond limit then before the authority.

 

          (b)  If an issuer will not be ready to obtain an assignment of bond limit within the reservation period, it may apply to the authority for an extension of the reservation.  Requests for extensions of reservations shall be in writing and shall be submitted to the authority at least 2 weeks before the last meeting of the directors prior to the expiration of the reservation.  Requests for extensions of reservations received within 2 weeks of such directors' meeting shall be placed on the agenda for that meeting if the executive director determines that the staff of the authority and the directors will have adequate time to review the request.  A request for an extension of a reservation shall state the reasons the issuer requires an extension and when the issuer expects to be ready to seek an assignment of bond limit.

 

          (c)  The directors shall grant an extension of a reservation for a period of one month if the directors determine that the bond issue is progressing toward closing with all practicable speed.  The directors shall not grant an extension of a reservation if the need for an extension could have been avoided by the issuer or the ultimate beneficiary of the bond issue.  The directors shall grant a series of extensions of a reservation, but for each extension the issuer shall make a request as provided in this section.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 503.03  Assignments of Bond Limit.

 

          (a)  After an issuer has obtained a reservation of bond limit for a particular issue of private activity bonds, it may apply to the authority for an assignment of bond limit.  An issuer shall request an assignment by writing to the authority.

 

          (b)  A request for an assignment of bond limit shall include the following:

 

(1)  A certificate that the information contained in the Form Bfa-2 with respect to the bond issue remains true, correct, and complete in all material respects;

 

(2)  An update of the information contained in the Form Bfa-2, if applicable;

 

(3)  A certified copy of the resolution authorizing the bonds; and

 

(4)  A draft or preliminary opinion of bond counsel for the bonds, in form and substance satisfactory to authority's bond counsel, to the effect that the bonds are valid and binding obligations of the issuer and that interest on the bonds will be excluded from gross income of the owners thereof for federal income tax purposes.

 

          (c)  Upon receipt from an issuer of a request for an assignment of bond limit as described in Bfa 503.03(a) the chairman, vice chairman or the executive director shall make the assignment of bond limit to the issuer, provided:

 

(1)  The reservation of bond limit has not expired;

 

(2)  Such officer has been authorized to make the assignment pursuant to the resolution of the authority reserving the bond limit; and

 

(3)  The request includes the material described in Bfa 503.03(a) through Bfa 503.03(b).

 

          (d)  The assignment of bond limit pursuant to this subsection shall be effective until the last day of the month following the month in which the assignment was made, or until such other time as the directors shall designate in the resolution making the reservation of bond limit.

 

          (e)  If an assignment of bond limit cannot be made pursuant to Bfa 503.03(c) either because the provisions of Bfa 503.03(c)(l)-(3) are not met, or for any other reason, the request of through an issuer for an assignment of bond limit shall be considered at a meeting of the directors.  Such requests for an assignment of bond limit that are received by the authority at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.

 

          (f)  Requests that are received within 2 weeks of the next meeting of the directors shall be placed on the agenda if the executive director determines that the staff of the authority, authority's bond counsel and the directors will have adequate time to review the application.  The directors shall consider an issuer's request for an assignment of bond limit in the manner described in Bfa 505.

 

          (g)  If the directors make an assignment of bond limit, the assignment shall be effective until the last day of the month following the directors' meeting at which the assignment was made, or for such other period as the directors shall determine is a reasonable period in which to issue the bonds.

 

          (h)  Notwithstanding Bfa 502.03(c) or (d), no assignment of bond limit shall extend beyond the end of the calendar year.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 503.04  Extensions of Assignment.

 

          (a)  Prior to the expiration of an assignment of bond limit, the issuer shall either issue the bonds or obtain an extension of the assignment, or the assignment shall expire.  If an assignment expires, the assigned portion of the bond limit shall be returned to the category or categories from which it was drawn pursuant to Bfa 502 and shall be available for other bond issues.  After the expiration of an assignment for a bond issue, the issuer may reapply for a new assignment for that bond issue, but the bond issue shall be completely re-evaluated by the authority taking into account all other requests for reservations, assignments, and allocations of bond limit then before the authority.

 

          (b)  If an issuer will not be ready to issue the bonds within the assignment period, it may apply to the authority for an extension of the assignment.  Requests for extensions of assignments shall be in writing and shall be submitted to the authority at least 2 weeks before the last meeting of the directors prior to the expiration of the assignment.  Requests for extensions of assignments received within 2 weeks of such directors' meeting shall be placed on the agenda for that meeting if, in the judgment of the executive director, the staff of the authority and the directors will have adequate time to review the request.  A request for an extension of an assignment shall state the reasons the issuer requires an extension and when the issuer expects to be ready to issue the bonds.

 

          (c)  The directors shall grant an extension of an assignment for a period of one month if the directors determine that the bond issue is progressing toward closing with all practicable speed.  The directors shall not grant an extension of an assignment if the need for an extension could have been avoided by the issuer or the ultimate beneficiary of the bond issue.  The directors shall grant a series of extensions of an assignment, but for each extension the issuer shall make a request as provided in this section.  An assignment of bond limit shall not be extended into the following calendar year.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 503.05  Reporting Requirement.  Upon the issuance of any private activity bonds, the issuer of those bonds shall promptly file with the office of investment and debt management and the authority a copy of the certification required by Section 149(e) of the Code.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 504  PROCEDURES FOR APPLICATION BY A USER

 

          Bfa 504.01  Scope.  This part applies to a user who wants to finance a  project through the authority's issuance of bonds and is seeking a  reservation and an allocation of bond limit.  The procedures described in this part are similar to the procedures established for issuers, other than the authority, to apply for reservations and assignments of bond limit under Bfa 503.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 504.02  Application for Reservation.

 

          (a)  Whenever a user makes an application for preliminary official action pursuant to Bfa 402.01, that application shall also be treated as an application for a reservation of bond limit, provided:

 

(1)  A letter described in Bfa 403.01(b)(4) is included in the application; and

 

(2)  The user has not informed the authority that it is seeking only preliminary official action at that time.

 

          (b)  If the requirements of Bfa 504.02(a)(1)-(2) are met, the directors shall consider whether to grant a user a reservation at the same time it considers the user's application for preliminary official action.

 

          (c)  If a user has received preliminary official action, but not a reservation of bond limit, that user may apply for a reservation at any time by submitting to the authority a written request for a reservation, together with 15 copies of the following:

 

(1)  A letter described in Bfa 403.01(b)(4); and

 

(2)  If the user had obtained preliminary official action prior to the effective date of these rules, a completed Form Bfa-1.

 

          (d)  Upon receipt from a user of a request for a reservation of bond limit, the staff of the authority and authority's bond counsel shall review the request and promptly advise the user of any omission or deficiency in the request.

 

          (e)  If a user is advised by the executive director of the authority that any request is incomplete or deficient, the user may supplement or amend its request.

 

          (f)  When the executive director determines that a request for a reservation of bond limit is complete, the request shall be considered at a meeting of the directors.  Requests for reservations of bond limit that are completed at least 2 weeks prior to the next meeting of the directors shall be placed on the agenda for and considered at that meeting.  Completed requests for a reservation of bond limit that are received within 2 weeks of the next meeting of the directors shall be placed on the agenda if the executive director determines that the staff of the authority, authority's bond counsel and the directors will have adequate time to review the request.

 

          (g)  The directors shall consider whether or not to grant a user's request for a reservation of bond limit in the manner described in Bfa 505.  If the directors make a reservation of bond limit, the reservation shall be effective until the last day of the third month following the directors' meeting at which the reservation was made.  The duration of a reservation shall be determined by the directors based upon the need to ensure that bond limit not be wasted.

 

          (h)  A user may elect not to seek a reservation of bond limit and proceed directly to seek an allocation of bond limit under Bfa 504.04.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 504.03  Extensions of Reservations.

 

          (a)  Before a reservation expires the user shall either obtain an allocation of bond limit or obtain an extension of the reservation period.  If a reservation expires, the reserved portion of the bond limit shall be returned to the category or categories from which it was drawn pursuant to Bfa 502 and shall be available for other bond issues.  After the expiration of a reservation for a bond issue, the user may reapply for a new reservation for that bond issue, but the bond issue shall be completely re-evaluated by the authority taking into account all other requests for reservations and allocations of bond limit then before the authority.

 

          (b)  If a user will not be ready to obtain an allocation of bond limit within the reservation period, it may apply to the authority for an extension of the reservation.  Requests for extensions of reservations shall be in writing and shall be submitted to the authority at least 2 weeks before the last meeting of the directors prior to the expiration of the reservation.  Requests for extensions of reservations received within 2 weeks of such directors' meeting shall be placed on the agenda for that meeting if the executive director determines that the staff of the authority and the directors will have adequate time to review the request.  A request for an extension of a reservation shall state the reasons the user requires an extension and when the user expects to be ready to seek an allocation of bond limit.

 

          (c)  The directors shall grant an extension of a reservation for a period of one month if the directors determine that the bond issue is progressing toward closing with all practicable speed.  The directors shall not grant an extension of a reservation if the need for an extension could have been avoided by the user.  The directors shall grant a series of extensions of a reservation, but for each extension the user shall make a request as provided in this section.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 504.04  Allocations of Bond Limit.

 

          (a)  Whenever a user submits an application for the directors' approval of bonds pursuant to Bfa 403.01, that application shall also be treated as an application for an allocation of bond limit.

 

          (b)  If a bond issue meets the criteria necessary for the directors to authorize the issuance of the bonds as provided in Bfa 403.02, the directors shall consider whether to allocate bond limit to the bonds in the manner described in Bfa 505.  If the directors authorize the bonds and make an allocation of bond limit, the allocation shall be effective until the last day of the month following the directors' meeting at which the allocation was made, or for such other period as the directors may designate, except that no allocation shall extend beyond the end of the calendar year.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 504.05  Extensions of Allocations.

 

          (a)  Prior to the expiration of an allocation of bond limit, the user shall either obtain the issuance of the bonds or obtain an extension of the allocation period.  If an allocation expires, the allocated portion of the bond limit shall be returned to the category or categories from which it was drawn pursuant to Bfa 502 and shall be available for other bond issues.  After the expiration of an allocation for a bond issue, the user may reapply for a new allocation for the bond issue, but the bond issue shall be completely re-evaluated by the authority taking into account all other requests for reservations and allocations of bond limit then before the authority.

 

          (b)  If a user is not ready to issue the bonds within the allocation period, it may apply to the authority for an extension of the allocation.  Requests for extensions of allocations shall be in writing and shall be submitted to the authority at least 2 weeks before the last meeting of the directors prior to the expiration of the allocation.  Requests for extensions of allocations received within 2 weeks of such directors' meeting shall be placed on the agenda for that meeting if the executive director determines that the staff of the authority and the directors will have adequate time to review the request.  A request for an extension of an allocation shall state the reasons the user requires an extension and when the user expects to be ready to issue the bonds.

 

          (c)  The directors shall grant an extension of an allocation for a period of one month if the directors determine that the bond issue is progressing toward closing with all practicable speed.  The directors shall not grant an extension of an allocation if the need for an extension could have been avoided by the user.  The directors shall grant a series of extensions of an allocation, but for each extension the user shall make a request as provided in this section.  An allocation of bond limit shall not be extended into the following calendar year.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 505 FACTORS TO BE CONSIDERED BY THE AUTHORITY IN MAKING RESERVATIONS, ASSIGNMENTS AND ALLOCATIONS

 

          Bfa 505.01  Considerations.  The directors shall grant a reservation, assignment or allocation if, after considering the following criteria, to the extent they are applicable to a particular bond issue, the directors determine that the reservation, allocation or assignment serves a public use and provides a public benefit:

 

          (a)  The extent to which the bond issue carries out the intent of the federal law that the state's bond capacity be as fairly distributed among state and local users as is practicable;

 

          (b)  The extent to which the bond issue will have a beneficial effect on the environment;

 

          (c)  The extent to which the bond issue finances a project located in an area of high unemployment or where there is a need for economic development;

 

          (d)  The extent to which the bond issue will preserve or create jobs for New Hampshire residents;

 

          (e)  The extent to which the jobs preserved or created are high paying jobs;

 

          (f)  The extent to which a project financed by the bond issue will use New Hampshire contractors and subcontractors;

 

          (g)  The applicant's need for borrowed funds within a short period of time; and

 

          (h)  Such other factors which may be applicable in particular cases, but not all cases, and which the authority deems relevant to an equitable allocation of the bond limit.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

          Bfa 505.02  Evaluation of Bond Issues.  The authority shall evaluate each request for a reservation, assignment or allocation of bond limit against the factors listed in Bfa 505.01.  The authority shall not directly compare bond issues that come before it at the same time, except where the total amount of bond limit sought to be reserved, assigned or allocated exceeds the amount of available bond limit.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93

 

PART Bfa 506  CARRY FORWARD OF UNUSED BOND LIMIT

 

          Bfa 506.01  Carry Forward of Unused Bond Limit.  After the authority has reserved, assigned, or allocated bond limit to all private activity bonds to be issued in that calendar year, the authority shall carry forward unused bond limit under Section 146 of the Code.  In determining which types of bonds shall receive a CARRY FORWARD of unused bond limit and the amount of that CARRY FORWARD, the authority shall apply the factors listed in Bfa 505.01.

 

                                                                      Source.  (See Revision Note at chapter heading for Bfa 100) #5719, eff 10-13-93