602 KAR 15:010.
Airport development loans.
RELATES TO: KRS
183.200-183.213
STATUTORY
AUTHORITY: KRS 183.213(1)
NECESSITY,
FUNCTION, AND CONFORMITY: KRS 183.213(1) provides that the Transportation
Cabinet shall promulgate administrative regulations governing airport loans
made under KRS 183.200 to 183.210. This administrative regulation is
promulgated to set forth specifications regarding applications for and terms of
the loans.
Section 1.
Definition. "Airport development loan" means a loan authorized by KRS
183.200 to 183.213.
Section 2. An
airport board that seeks an airport development loan shall file an original and
one (1) copy of Transportation Cabinet form TC 56-15L, "Airport
Development Loan Application" with the Transportation Cabinet, Director,
Division of Aeronautics, Frankfort, Kentucky 40622.
Section 3.
Content of Application. The following information and exhibits shall be
included in the application:
(1) Name and
address of the airport board.
(2) The amount
of airport development loan requested from the cabinet.
(3) The
description of the proposed airport project including an attached exhibit
consisting of an engineer's plat which shows the following as each exists at
the time of the application and proposed improvement:
(a) Site boundaries;
(b) Total
acreage;
(c) The
airstrip;
(d) Facilities;
(e) Servicing
utilities; and
(f) Access road;
(4) An exhibit
showing the ownership and encumbrances on the land described in subsection (3)
of this section.
(5) An exhibit
stating the itemized detailed cost or estimated cost of the:
(a) Land and all
proposed improvements;
(b) Engineering
and legal expenses; and
(c) Other
expenses necessary to the cost of the airport project.
(6) An exhibit
providing:
(a) The method
and amount of financing for the proposed project including:
1. Federal
participants;
2. State
participants; and
3. Local
participants;
(b) The
percentage of the total project cost contributed by a participant;
(c) Evidence of
the availability of funds from the participants;
(d) The proposed
terms of an:
1. Airport
development loan; and
2. Schedule of
repayment; and
(e) The
percentage of the total project cost to be covered by an airport development
loan.
(7) An exhibit
with documentation of the financial standing of the airport board in the form
of a current financial statement containing a full disclosure of all assets,
liabilities, and income.
(8) A statement
of when the proceeds of the loan will be needed and a proposed schedule for
site acquisition or development.
(9) An exhibit
containing a letter from each appointing authority attesting that if the
airport board defaults on the loan, the authority accepts full responsibility
for payment of the following:
(a) Loan
principal;
(b) Interest;
and
(c) Late penalty
payment.
Section 4. The
annual rate of interest to be charged throughout the life of an airport
development loan shall be two (2) percent per annum.
Section 5.
Determination Standards. The following standards shall be used by the cabinet
to determine the soundness and feasibility of a project and whether a loan
application shall be granted:
(1) The
availability of project funds from a:
(a) Federal;
(b) State; or
(c) Other;
(2) Whether the
proceeds of the loan will be expended for:
(a) Initial construction
of an airport facility; or
(b) The
improvement of the safety or adequacy of an existing airport facility;
(3) The
foreseeability that the airport development project will generate adequate
revenue to repay the loan; and
(4) The need for
the proposed facility to provide better service to operators anticipated to use
the facility, based upon the:
(a) Airport
master plan; or
(b) Airport
layout plan.
Section 6. Terms
of Loan. The airport development loan agreement entered into between the airport
board and the cabinet shall have the following terms in addition to those
stated in KRS 183.210:
(1) The
principal amount loaned shall be repaid to the cabinet in annual installments
plus accrued interest or as otherwise provided in the agreement.
(2) The first
installment payment shall be due within one (1) year after the proceeds of the
loan are paid to the airport board.
(3) The airport
board may repay any of the unpaid balance without penalty if the interest is
computed to the date the advance repayment is made.
(4) All payments
on principal and interest shall be made to the Transportation Cabinet, or as
otherwise provided in the agreement.
(5) The loan
shall be used by the airport board for the purpose stated in the application.
(6) For value
received and for the purpose of affording credit to the airport board, the
appointing authority or authorities jointly and severally, absolutely and
unconditionally, guarantee the payment at maturity of all obligations under the
loan agreement.
(7) The agreement
may contain other terms agreed upon by the airport board and the cabinet.
Section 7.
Material Incorporated by Reference. (1) Transportation Cabinet form TC 56-15L
(March 1997 edition) is incorporated by reference as a part of this
administrative regulation.
(2) A copy of
the form incorporated by reference may be viewed, copied, or obtained free of
charge from the Transportation Cabinet, Division of Aeronautics, 125 High
Street, Frankfort, Kentucky 40622. The hours of operation of the division are 8
a.m. to 4:30 p.m. weekdays. (2 Ky.R. 228; eff. 12-10-75; Am. 6 Ky.R. 580; eff.
7-2-80; 9 Ky.R. 1235; eff. 6-1-83; 11 Ky.R. 244; eff. 9-11-84; 1074; eff.
2-12-85; 14 Ky.R. 262; eff. 9-10-87; 23 Ky.R. 3615; 4117; eff. 6-2-97.)
