For loans from the SWIFT and SWIRFT, the following procedures
will be used to set interest rates.
(1) The executive administrator will set interest rates
under this section for loans on a date that is at least five business
days prior to the political subdivision's anticipated adoption of
the ordinance or resolution authorizing its bonds and not more than
45 days before the anticipated closing of the loan from the board.
After 45 days from the establishment of the interest rate of a loan,
rates will be reconsidered, and may be extended only with the approval
of the executive administrator.
(2) For loans from the fund, the executive administrator
will set the interest rates in accordance with the following:
(A) To the extent that the source of funding is provided
from bond proceeds, the lending rate scale(s) will be determined as
provided under §363.33(b) of this title (relating to Interest
Rates for Loans and Purchase of Board's Interest in State Participation
Projects).
(B) The loan interest rate will be determined based
on a debt service schedule acceptable to the executive administrator.
The executive administrator will identify the appropriate scale for
the borrower and identify the market rate for the maturity due in
each year. The board may set an interest rate subsidy. The executive
administrator will reduce the market rate by a subsidy as determined
by the board and thereby identify a proposed loan interest rate for
each maturity. The proposed loan interest rate will be applied to
the proposed principal repayment schedule. In no instance shall the
subsidy determined by the board exceed 50 percent of the market rate.
(C) For loans made under §363.1305(a)(4) of this
subchapter (relating to Use of Funds), which receive deferred principal
and interest payments, the executive administrator will identify the
appropriate scale for the borrower and identify the market rate for
the maturity due in each year. The board may set an interest rate
subsidy. The executive administrator will reduce the market rate by
a subsidy as determined by the board and thereby identify a proposed
loan interest rate for each maturity. The proposed loan interest rate
will be applied to the proposed principal repayment schedule.
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