2015 WISCONSIN ACT
316
An Act
to repeal
234.905 (2) (e), 234.905 (3m) and 234.905 (4) (b);
to renumber and amend
234.90 (4);
to amend
234.90 (2) (b), 234.90 (3) (b), 234.90 (3) (c), 234.90 (3g) (b), 234.90 (3n) (b), 234.90 (5), 234.905 (title), 234.905 (1) (b) (intro.), 234.905 (1) (b) 1., 234.905 (1) (b) 2., 234.905 (1) (b) 3., 234.905 (1) (e), 234.905 (1) (f), 234.905 (2) (intro.), (a), (b), (c), (d), (f) and (g), 234.905 (3) (a), 234.905 (3) (b), 234.905 (3) (e), 234.905 (4) (a), 234.905 (5), 234.907 (2) (c), 234.907 (2) (cm), 234.907 (2) (f), 234.907 (3), 234.91 (2) (c), 234.91 (3) (a) (intro.), 234.91 (3) (b), 234.91 (4), 234.91 (5) (a), 234.91 (5) (b) and 234.93 (1) (d); and
to create
234.90 (4) (b), 234.905 (1) (cm), 234.905 (4) (bn) and 234.91 (3) (a) 3. of the statutes;
relating to:
agricultural loan guarantee programs administered by the Wisconsin Housing and Economic Development Authority.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
Section
1
.
234.90 (2) (b) of the statutes is amended to read:
234.90
(2)
(b)
In order to maximize the benefits of the program under this section, the
The
total
outstanding principal amount
guarantee
of all loans to the borrower
that are guaranteed
under this section will not exceed
an amount set annually, no later than December 1, by the authority that is not less than $2,000 nor more than $150,000. For purposes of adjusting the total outstanding principal
amount of all loans to a borrower under this paragraph, the authority shall consider changes in the index of prices paid by farmers published by the federal department of agriculture
$250,000
.
Section
2
.
234.90 (3) (b) of the statutes is amended to read:
234.90
(3)
(b) The amount of the farmer's debts
related to the production of the agricultural commodity that is the subject of the guaranteed loan
totals at least
40%
40 percent
of the amount of the farmer's assets
related to the production of the agricultural commodity that is the subject of the guaranteed loan
.
Section
3
.
234.90 (3) (c) of the statutes is amended to read:
234.90
(3)
(c) In the judgment of the participating lender, it is reasonably likely that if the farmer receives a guaranteed loan the farmer's assets, cash flow
,
and managerial ability are sufficient to preclude voluntary or involuntary liquidation before
April 1 of the calendar year following the calendar year in which the participating lender granted
the
end of the
loan
term
.
Section
4
.
234.90 (3g) (b) of the statutes is amended to read:
234.90
(3g)
(b) In the judgment of the participating lender, it is reasonably likely that if the farmer receives a guaranteed loan the farmer's assets, cash flow
,
and managerial ability are sufficient to preclude voluntary or involuntary liquidation before
April 1 of the calendar year following the calendar year in which the participating lender granted
the
end of the
loan
term
.
Section
5
.
234.90 (3n) (b) of the statutes is amended to read:
234.90
(3n)
(b) The proceeds of a guaranteed loan may be used to refinance a guaranteed loan that has been refinanced one time if at least
60%
60 percent
of the principal amount of the refinanced guaranteed loan has been repaid
and the total guarantee amount to the borrower under this section after the refinancing is no more than the amount permitted under sub. (2) (b)
.
Section
6
.
234.90 (4) of the statutes is renumbered 234.90 (4) (a) and amended to read:
234.90
(4)
(a) The authority
shall
may
guarantee
repayment
collection
of
a percentage, not exceeding
90 percent
,
of the principal
, if less than $50,000, or 80 percent of the principal, if $50,000 or more,
of any agricultural production loan eligible for guarantee under sub. (2) made to a farmer eligible for a guaranteed loan under sub. (3) or (3g).
Section
7
.
234.90 (4) (b) of the statutes is created to read:
234.90
(4)
(b) The authority may extend a guarantee under this section beyond the original term of the guaranteed loan if the guaranteed loan is part of a loan workout agreement.
Section
8
.
234.90 (5) of the statutes is amended to read:
234.90
(5)
Interest reduction.
If at the time of origination or extension the interest rate on a guaranteed loan and the prime lending rate as reported by the federal reserve board in federal reserve statistical release H. 15 each equals or exceeds
10%
10 percent
, the authority
shall
may
pay, from the moneys in the Wisconsin development reserve fund, to the participating lender making the loan, an amount
equal to 2%
that is no more than 2 percent
of the principal amount of the loan.
Section
9
.
234.905 (title) of the statutes is amended to read:
234.905
(title)
Agricultural production
drought
disaster
assistance loan guarantees.
Section
10
.
234.905 (1) (b) (intro.) of the statutes is amended to read:
234.905
(1)
(b) (intro.) "Agricultural production
drought
disaster
assistance loan" means a loan to a farmer to finance extraordinary
drought-related
disaster-related
costs, including the cost of any of the following:
Section
11
.
234.905 (1) (b) 1. of the statutes is amended to read:
234.905
(1)
(b) 1. Fertilizer, seed, fuel, pesticides, tillage services, crop insurance, or any other service or consumable good necessary to produce an agricultural commodity to replace or supplement an agricultural commodity adversely affected by
drought
disaster
conditions.
Section
12
.
234.905 (1) (b) 2. of the statutes is amended to read:
234.905
(1)
(b) 2. Water delivery in connection with agricultural commodities adversely affected by
drought
disaster
conditions.
Section
13
.
234.905 (1) (b) 3. of the statutes is amended to read:
234.905
(1)
(b) 3. Feed and associated expenses for animals to supplement feed supplies adversely affected by
drought
disaster
conditions.
Section
14
.
234.905 (1) (cm) of the statutes is created to read:
234.905
(1)
(cm) "Disaster" means an act of nature for which the governor issues an executive order declaring a state of emergency for the state or any portion of the state under s. 323.10.
Section
15
.
234.905 (1) (e) of the statutes is amended to read:
234.905
(1)
(e) "Guaranteed loan" means an agricultural production
drought
disaster
assistance loan on which the authority guarantees collection.
Section
16
.
234.905 (1) (f) of the statutes is amended to read:
234.905
(1)
(f) "Participating lender" means a bank, production credit association, credit union, savings bank, savings and loan association or other person who makes agricultural production
drought
disaster
assistance loans and who has entered into an agreement with the authority under s. 234.93 (2) (a).
Section
17
.
234.905 (2) (intro.), (a), (b), (c), (d), (f) and (g) of the statutes are amended to read:
234.905
(2)
Eligible loans.
(intro.) An agricultural production
drought
disaster
assistance loan made by a participating lender is eligible for guarantee of collection from the Wisconsin development reserve fund under s. 234.93 if all of the following apply:
(a) The total
of the principal amounts
guarantee amount
of all
guaranteed
loans
extended
to the borrower
that are guaranteed
under this section will not exceed
$15,000
$25,000
.
(b) The rate of interest on the agricultural production
drought
disaster
assistance loan, including any origination fees or other charges relating to the agricultural production
drought
disaster
assistance loan, does not exceed a rate determined by the authority after considering the conditions of the financial market.
(c) The participating lender shall pay directly any supplier of fertilizer, seed, fuel, pesticides, tillage services, crop insurance, animal feed, water or other service or consumable good necessary to produce an agricultural commodity, if the borrower obtains the agricultural production
drought
disaster
assistance loan to pay that supplier.
(d) The participating lender obtains security for repayment of the agricultural production
drought
disaster
assistance loan or follows other procedures required by the authority to secure repayment of the agricultural production
drought
disaster
assistance loan.
(f) The proceeds of the agricultural production
drought
disaster
assistance loan may not be applied to the outstanding balance of any other loan.
(g) The proceeds of the agricultural production
drought
disaster
assistance loan may not be used to refinance a loan made under this section.
Section
18
.
234.905 (2) (e) of the statutes is repealed.
Section
19
.
234.905 (3) (a) of the statutes is amended to read:
234.905
(3)
(a) The farmer does not meet the participating lender's minimum standards of creditworthiness to receive an agricultural production
drought
disaster
assistance loan in the normal course of the participating lender's business.
Section
20
.
234.905 (3) (b) of the statutes is amended to read:
234.905
(3)
(b) The participating lender projects the amount of the farmer's debts
to be approximately 40% or more
related to the agricultural production that is the subject of the loan totals at least 40 percent
of the amount of the farmer's assets
related to the agricultural production that is the subject of the loan
.
Section
21
.
234.905 (3) (e) of the statutes is amended to read:
234.905
(3)
(e) The participating lender projects that the farmer will lose approximately
40%
40 percent
or more of the farmer's
crops
agricultural commodities
because of
drought conditions
a disaster
.
Section
22
.
234.905 (3m) of the statutes is repealed.
Section
23
.
234.905 (4) (a) of the statutes is amended to read:
234.905
(4)
(a)
Except as provided in par. (b), on or before June 30, 1989, the
The
authority
shall
may
guarantee collection of
90%
up to 90 percent
of the principal of any agricultural production
drought
disaster
assistance loan eligible for guarantee under sub. (2) made to a farmer eligible for a guaranteed loan under sub. (3).
Section
24
.
234.905 (4) (b) of the statutes is repealed.
Section
25
.
234.905 (4) (bn) of the statutes is created to read:
234.905
(4)
(bn) The term of the authority's loan guarantee under this section may not exceed 3 years, unless the guaranteed loan is included in a loan workout agreement.
Section
26
.
234.905 (5) of the statutes is amended to read:
234.905
(5)
Interest reduction.
The authority
shall
may
pay, from the moneys in the Wisconsin development reserve fund, to each participating lender an amount
equal to 3.5%
that is no more than 3.5 percent
of the principal amount of any guaranteed loan to reduce interest payments on the guaranteed loan paid by a farmer
, except that the authority shall make interest reduction payments for no more than 3 years of the repayment term of any guaranteed loan
.
Section
27
.
234.907 (2) (c) of the statutes is amended to read:
234.907
(2)
(c) Subject to par. (cm), the total
principal
guarantee
amount of all loans to the borrower that are guaranteed under this section will not exceed $750,000.
Section
28
.
234.907 (2) (cm) of the statutes is amended to read:
234.907
(2)
(cm) The total
principal
guarantee
amount
extended
of all loans
to the borrower
for loans
that are guaranteed under this section and that are made for working capital or an item necessary to, or used to, commercially harvest whitefish from Lake Superior will not exceed $100,000.
Section
29
.
234.907 (2) (f) of the statutes is amended to read:
234.907
(2)
(f) The
loan
term
does not extend beyond
of the authority's guarantee under this section is not longer than
15 years
after the date that the participating lender disburses the loan unless the loan is extended by the authority
.
This paragraph does not apply to a loan that is part of a loan workout agreement.
Section
30
.
234.907 (3) of the statutes is amended to read:
234.907
(3)
Guarantee of collection.
The authority
shall
may
guarantee collection of
a percentage, not exceeding 90%,
up to 90 percent
of the principal of any loan eligible for a guarantee under sub. (2). The authority shall establish the percentage of the unpaid principal of an eligible loan that will be guaranteed, using the procedures described in the guarantee agreement under s. 234.93 (2) (a). The authority may establish a single percentage for all guaranteed loans or establish different percentages for eligible loans on an individual basis.
Section
31
.
234.91 (2) (c) of the statutes is amended to read:
234.91
(2)
(c) The total
outstanding guaranteed principal
guarantee
amount of all loans made to the borrower that are guaranteed under this section will not exceed $200,000, or $100,000 if any of the loans is affected by any other state or federal credit assistance program.
Section
32
.
234.91 (3) (a) (intro.) of the statutes is amended to read:
234.91
(3)
(a) (intro.) The farmer is
either
any
of the following:
Section
33
.
234.91 (3) (a) 3. of the statutes is created to read:
234.91
(3)
(a) 3. A person who intends to operate farm premises and maintain the family farmstead on the farm premises and who has previous experience with the operation of the specific farm premises.
Section
34
.
234.91 (3) (b) of the statutes is amended to read:
234.91
(3)
(b) The amount of the farmer's debts
related to the agricultural assets
, including the loan,
is at least 40 percent and
does not exceed
85%
85 percent
of the farmer's assets, including the value of the agricultural assets to be acquired, or the improvements to be made, with the proceeds of the loan.
The authority shall consider only the farmer's debts and assets that are related to the agricultural assets that are the subject of the loan.
Section
35
.
234.91 (4) of the statutes is amended to read:
234.91
(4)
Origination fees.
The authority
shall
may
charge a guarantee origination fee on every loan guaranteed under this section. The amount of the fee
shall be 1%
may not exceed 1.5 percent
of a loan's guaranteed principal. The participating lender shall collect the fee and remit it to the authority. The authority shall deposit all fees received under this subsection in the Wisconsin development reserve fund
to be used to guarantee loans under this section
.
Section
36
.
234.91 (5) (a) of the statutes is amended to read:
234.91
(5)
(a) The authority
shall
may
guarantee collection of a percentage of the principal of a loan eligible for a guarantee under sub. (2). The
principal
total guarantee
amount of
an eligible loan that the authority may guarantee
all loans to the farmer that are guaranteed under this section
may not exceed the borrower's net worth or
25%
25 percent
of the total loan amount, whichever is less, calculated at the time the loan is made.
Section
37
.
234.91 (5) (b) of the statutes is amended to read:
234.91
(5)
(b) The term of
a
the authority's
loan guarantee under this section
may not exceed
is not longer than
10 years.
This paragraph does not apply to a guarantee of a loan that is part of a loan workout agreement.
Section
38
.
234.93 (1) (d) of the statutes is amended to read:
234.93
(1)
(d)
To be used for guaranteeing loans under s. 234.91, fees
Fees
collected under s. 234.91 (4).
Section
39
.
Initial applicability.
(1)
Agricultural production disaster assistance loan guarantees.
The treatment of section 234.905 (title), (1) (b) (intro.), 1., 2., and 3., (cm), (e), and (f), (2) (intro.), (a), (b), (c), (d), (e), (f), and (g), (3) (a), (b), and (e), (3m), (4) (a), (b), and (bn), and (5) of the statutes first applies to a loan guarantee for which an application is made under section 234.905 of the statutes on the effective date of this subsection.
(2)
Agricultural production, agricultural development, and farm assets reinvestment management loan guarantees.
The treatment of sections 234.90 (2) (b) and (h), (3) (b) and (c), (3g) (b), (3n) (b), (4), and (5), 234.907 (2) (c), (cm), and (f) and (3), 234.91 (2) (c), (3) (a) (intro.) and 3. and (b), (4), and (5) (a) and (b), and 234.93 (1) (d) of the statutes first applies to a loan guarantee for which an application is made under section 234.90, 234.907, or 234.91 of the statutes on the first day of the calendar year after the effective date of this subsection.
