§ 130c.18. Review of a loan application.
(a) Evaluation. The Board will evaluate the application based on the applicant’s eligibility as set forth in § 130c.17 (relating to applicant eligibility).
(b) Ranking. No single factor will be paramount. In rendering a decision, the Board will rank the application based on the following criteria:
(1) Financial responsibility. Financial responsibility reflecting the ability of the applicant to meet and satisfy all debt service as it becomes due and payable, continue farm operations and protect the Department against undue risk. The applicant’s cash flow history, total assets controlled, equity owned, contingent liabilities and history of earnings to date are significant measures of financial responsibility.
(2) Collateral offered on available security. The requirement of collateral and collateral taken shall reasonably protect the Department, provide the necessary control of equity and repayment and leave the applicant in a position to reasonably manage the farm operation. The applicant’s ability to give the Department a first position in terms of a lien on collateral or to share a first position, will be given great weight.
(3) Repayment capacity. The relevant criminal and credit history and ratings of the applicant as determined from credit reporting services and other sources.
(4) Tax obligations. The payment to date of all tax obligations due and owing by the applicant to the Commonwealth or any political subdivisions thereof.
(5) Projected use. The manner in which loan proceeds will be utilized in furthering sustainable agriculture in this Commonwealth. This encompasses the goals of the project, its impact on agriculture, the environment and society, its ability to increase farm profitability and productivity, and the potential for success of the project.
(6) Capital needs (amount of the loan). The Board will look at the capital needs of the applicant in light of available funds.
(7) Farming practices. The intent to use practices that would improve soil fertility, lower the cost of production, cause the optimum and environmentally compatible use of off-farm inputs, such as chemical or synthetic fertilizers or pesticides, or otherwise promote sustainable agriculture. These practices are further explained and defined in § 130c.19 (relating to eligible uses).
(c) Discretion. The Board may exercise its judgment in reviewing applications and in determining the amount of each loan so that, where possible, the widest audience becomes acquainted with the principles of sustainable agriculture. This discretion may be exercised to assure loan funds are distributed to the maximum number of applicants and dispersed throughout this Commonwealth.
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