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The Vermont Statutes Online
Title
10
:
Conservation and Development
Chapter
012
:
VERMONT ECONOMIC DEVELOPMENT AUTHORITY
Subchapter
005
:
DIRECT MORTGAGE LOANS
§
263. Mortgage loan; limitations
(a) When it has
been determined by the Authority that the establishment or expansion of a
particular eligible facility will accomplish the public purposes of this act,
the Authority may contract to loan to the mortgagor an amount not in excess of
40 percent of the cost of such eligible facility. In addition, the Authority
shall have determined that the mortgagor has obtained from other independent
and responsible sources, such as banks and insurance companies or otherwise, a
firm commitment for all other funds, over and above the loan of the Authority
and such funds or property as the local development corporation may hold,
necessary for payment of all of the cost of the project, and that the sum of
all these funds, together with any funds, machinery, and equipment to be
provided by the mortgagor is adequate for the completion and operation of the
project.
(b) Any loan of
the Authority under this subchapter shall be for a period of time and shall
bear interest at such rate as determined by the Authority and shall be secured
by a mortgage on the eligible facility for which the loan was made or upon the
assets of a municipal communications plant, including the net revenues derived
from the operation thereof, or both. The mortgage may be subordinate to one or
more prior mortgages, including the mortgage securing the obligation issued to
secure the commitment of funds from the independent and responsible sources and
used in the financing of the economic development project. Monies loaned by the
Authority shall be withdrawn from the Vermont jobs fund and paid over to the
mortgagor in such manner as provided and prescribed by the rules and
regulations of the Authority. All payments of principal and interest on the
loans shall be deposited by the Authority in the Vermont jobs fund.
(c) Loans by the
Authority for an eligible facility under this subchapter shall be made only in
the manner and to the extent provided in this section, except, however, in
those instances where an agency of the federal government participates in the
financing of an eligible facility by loan, grant or otherwise. When any federal
agency participates the Authority may adjust the required ratio of financial
participation by the local development corporation, independent sources of
funds, and the Authority in such manner as to insure the maximum benefit
available by the participation of the federal agency. Where any federal agency
participating in the financing of an eligible facility is not permitted to take
as security a mortgage, the lien of which is junior to the mortgage of the
Authority, the Authority shall be authorized to take as security for its loan a
mortgage junior in lien to that of the federal agency.
(d) The
Authority may develop and incorporate into loan instruments formulae which
require prepayment of loans when the profits attained by the borrower warrant
prepayment.
(e) All real and
personal property to which the Authority holds title by reason of foreclosure
upon a mortgage or other security granted it pursuant to this subchapter, or a
voluntary conveyance in lieu thereof, shall as long as it is not leased or
rented, be exempt from all taxes and special assessments of the state and all
local municipal property taxes for the remaining balance of the tax year in
which title becomes vested in the Authority and the entire next succeeding
year, provided however, that thereafter the Authority shall pay 50 percent of
the local municipal property taxes annually assessed against such property
during the term of the Authority's ownership.
(f) The
authority shall give preference to projects located within labor market
districts declared to be economically depressed areas as defined by the Vermont
agency of commerce and community development or the Vermont department of
labor, or to projects located within the area that is a designated job
development zone under subchapter 2 of chapter 29 of this title.
(g) The
authority shall give preference to projects involving loans to employee-owned
businesses, to businesses that are becoming employee-owned through the purchase
of stock or business assets, and to start-up businesses that will be owned by
substantially all of the employees.
(h) All actions
of a municipality taken under this subchapter for the financing of an eligible
project described in subsection 212(b) shall be as authorized in section 245 of
this title.
(i) The
provisions of section 247 of this title shall apply to the financing of an
eligible project described in subdivision 216(6) of this title. (Added 1973,
No. 197 (Adj. Sess.), § 1; amended 1975, No. 18, § 19, eff. March 27, 1975;
1975, No. 187 (Adj. Sess.), § 6; 1977, No. 228 (Adj. Sess.), § 6, eff. April
17, 1978; 1981, No. 54, § 16, eff. April 28, 1981; 1985, No. 172 (Adj. Sess.), §
4; 1985, No. 172 (Adj. Sess.), § 4; 1993, No. 89, § 3, eff. June 15, 1993;
1995, No. 190 (Adj. Sess.), § 1(a); 2003, No. 121 (Adj. Sess.), § 90, eff. June
8, 2004; 2005, No. 103 (Adj. Sess.), § 3, eff. April 5, 2006; 2005, No. 170
(Adj. Sess.), § 3; 2015, No. 41, § 25, eff. June 1, 2015.)