Business
Finance Authority
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to 1992, 262:14, the emergency rules remained in effect until superseded by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
(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
(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
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
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
(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
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
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
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
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
(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
(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
(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