Chapter 234

234.88(5) (5) Guarantee of collection.

234.88(5)(a) (a) Subject to par. (c), if the governor issues an executive order under s. 323.10 declaring a state of emergency related to heating costs or the availability of heating fuels and the joint committee on finance approves the authority’s plan under par. (b), the authority shall guarantee collection of not less than 50 percent or more than 80 percent of the principal of any emergency heating assistance loan eligible for guarantee under sub. (2) made to an individual eligible for a guaranteed loan under sub. (3).

234.88(5)(b) (b) If the governor declares a state of emergency related to heating costs or the availability of heating fuels, no later than 14 days after the governor’s declaration the authority shall submit the authority’s plan for guaranteeing collection of emergency heating loans under this section related to the declared state of emergency to the joint committee on finance for approval. The authority may include in its plan a request to modify the maximum total principal amount under sub. (2) (a).

234.88(5)(c) (c) The authority may guarantee emergency heating assistance loans under par. (a) only for 120 days following the joint committee on finance’s approval of the plan submitted under par. (b) unless the authority requests the joint committee on finance to permit the authority to guarantee emergency heating assistance loans for an additional 120 days.

234.88(6) (6) Interest reduction. The authority shall pay, from the moneys in the Wisconsin development reserve fund under s. 234.93, to each participating lender an amount equal to 3.5 percent of the principal amount of any guaranteed loan to reduce interest payments on the guaranteed loan paid by an individual.

234.88 History History: 2013 a. 175.

234.90 234.90 Agricultural production loan guarantees.

234.90(1) (1) Definitions. In this section:

234.90(1)(a) (a) “Agricultural commodity” has the meaning given under s. 94.67 (2).

234.90(1)(ad) (ad) “Agricultural production loan” means a loan to a farmer to finance the purchase of fertilizer, seed, fuel, pesticides, tillage services, crop insurance, animal feed or any other service or consumable good necessary to produce an agricultural commodity.

234.90(1)(ag) (ag) “Dairy plant” has the meaning given in s. 97.20 (1) (a).

234.90(1)(b) (b) “Farmer” has the meaning given under s. 102.04 (3).

234.90(1)(c) (c) “Guaranteed loan” means an agricultural production loan which is guaranteed by the authority.

234.90(1)(cp) (cp) “Milk” has the meaning given in s. 97.01 (10) (a).

234.90(1)(d) (d) “Participating lender” means a bank, production credit association, credit union, savings bank, savings and loan association or other person who makes agricultural production loans and who has entered into an agreement with the authority under s. 234.93 (2) (a).

234.90(2) (2) Eligible loans. Except as provided in sub. (3j), an agricultural production 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:

234.90(2)(a) (a) The loan is to finance production of an agricultural commodity.

234.90(2)(b) (b) The total guarantee of all loans to the borrower under this section will not exceed $250,000.

234.90(2)(bm) (bm) If the loan is one for which the borrower is eligible under sub. (3g), the amount of that loan does not exceed the amount of the payment, excluding interest or penalties if any, owed to the borrower by the insolvent or bankrupt dairy plant, subject to par. (b).

234.90(2)(c) (c) The rate of interest on the loan, including any origination fees or other charges relating to the loan, does not exceed a rate determined by the authority after considering the conditions of the financial market.

234.90(2)(d) (d) If the loan is one to which sub. (5) applies, the rate of interest on the loan for which the borrower is obligated, including any origination fees or other charges relating to the loan, does not exceed the rate determined under par. (c), minus 2 percent.

234.90(2)(e) (e) The participating lender shall pay directly any supplier of fertilizer, seed, fuel, pesticides, tillage services, crop insurance, animal feed or other service or consumable good necessary to produce an agricultural commodity, if the borrower obtains the loan to pay that supplier.

234.90(2)(f) (f) The participating lender obtains a security interest for repayment of the loan in the agricultural commodity resulting from use of the loan proceeds.

234.90(2)(g) (g) Unless waived by the authority, the borrower procures an insurance policy which protects the agricultural commodity to be financed with the proceeds of the loan against risk of loss, and the proceeds of which are payable to the participating lender.

234.90(2)(h) (h) The term of the loan does not extend beyond 12 months after the date on which the participating lender granted the loan.

234.90(2)(i) (i) The proceeds of the loan may not be applied to the outstanding balance of any other loan, except that the proceeds may be used to refinance a loan under this section, subject to sub. (3n).

234.90(2)(j) (j) If the loan is one for which the borrower is eligible under sub. (3g), the terms of the loan require the borrower to pay to the authorized lender, in repayment of the loan, money received from or on behalf of the bankrupt or insolvent dairy plant, immediately upon receipt of the money.

234.90(3) (3) Eligible farmers. Except as provided under subs. (3g) and (3j), a farmer is eligible for a guaranteed loan if all of the following apply:

234.90(3)(a) (a) The farmer does not meet the participating lender’s minimum standards of creditworthiness to receive an agricultural production loan in the normal course of the participating lender’s business.

234.90(3)(b) (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 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.

234.90(3)(c) (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 the end of the loan term.

234.90(3)(d) (d) The farmer’s name does not appear on the statewide support lien docket under s. 49.854 (2) (b) or, if the farmer’s name appears on that docket, the farmer provides to the authority a payment agreement that has been approved by the county child support agency under s. 59.53 (5) and that is consistent with rules promulgated under s. 49.858 (2) (a).

234.90(3g) (3g) Eligible dairy farmer. Except as provided in sub. (3j), a farmer is eligible for a guaranteed loan under this subsection if all of the following apply:

234.90(3g)(a) (a) The farmer has not been paid for milk provided to a dairy plant because of the bankruptcy or insolvency of the dairy plant.

234.90(3g)(b) (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 the end of the loan term.

234.90(3g)(c) (c) The farmer’s name does not appear on the statewide support lien docket under s. 49.854 (2) (b) or, if the farmer’s name appears on that docket, the farmer provides to the authority a payment agreement that has been approved by the county child support agency under s. 59.53 (5) and that is consistent with rules promulgated under s. 49.858 (2) (a).

234.90(3j) (3j) Emergency eligibility criteria. The authority may guarantee a loan to a farmer using eligibility criteria determined by the authority that differ from the criteria under subs. (2) to (3g) if all of the following apply:

234.90(3j)(a) (a) The governor has determined that an emergency situation exists and that the criteria under subs. (2) to (3g) prevent the authority from making an adequate response to the emergency situation.

234.90(3j)(b) (b) The authority has submitted to the joint committee on finance for review under s. 13.10 the emergency eligibility criteria that it proposes to use, and the joint committee on finance has approved the use of the criteria for the emergency situation.

234.90(3n) (3n) Refinancing.

234.90(3n)(a) (a) Except as provided in par. (b), proceeds of a guaranteed loan may be used to refinance a guaranteed loan no more than one time.

234.90(3n)(b) (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 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).

234.90(3p) (3p) Installment payment of certain loans. An authorized lender may require a borrower to repay a loan described in sub. (3g) in installments.

234.90(4) (4) Guarantee.

234.90(4)(a) (a) The authority may guarantee collection of a percentage, not exceeding 90 percent, of the principal 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).

234.90(4)(b) (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.

234.90(5) (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 percent, the authority may pay, from the moneys in the Wisconsin development reserve fund, to the participating lender making the loan, an amount that is no more than 2 percent of the principal amount of the loan.

234.90(6) (6) Review. The authority shall annually review the program under this section for the purpose of maximizing the benefits of the program.

234.90 History History: 1985 a. 9, 29, 153, 332, 334; 1987 a. 7, 27, 178, 421; 1989 a. 1, 10, 31, 336; 1991 a. 4, 39, 221; 1993 a. 1; 1995 a. 5, 150, 404; 1999 a. 9; 2001 a. 16; 2003 a. 236; 2011 a. 80; 2015 a. 242, 316.

234.905 234.905 Agricultural production disaster assistance loan guarantees.

234.905(1) (1) Definitions. In this section:

234.905(1)(a) (a) “Agricultural commodity” has the meaning given under s. 94.67 (2).

234.905(1)(b) (b) “Agricultural production disaster assistance loan” means a loan to a farmer to finance extraordinary disaster-related costs, including the cost of any of the following:

234.905(1)(b)1. 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 disaster conditions.

234.905(1)(b)2. 2. Water delivery in connection with agricultural commodities adversely affected by disaster conditions.

234.905(1)(b)3. 3. Feed and associated expenses for animals to supplement feed supplies adversely affected by disaster conditions.

234.905(1)(cm) (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.

234.905(1)(d) (d) “Farmer” has the meaning given under s. 102.04 (3).

234.905(1)(e) (e) “Guaranteed loan” means an agricultural production disaster assistance loan on which the authority guarantees collection.

234.905(1)(f) (f) “Participating lender” means a bank, production credit association, credit union, savings bank, savings and loan association or other person who makes agricultural production disaster assistance loans and who has entered into an agreement with the authority under s. 234.93 (2) (a).

234.905(2) (2) Eligible loans. An agricultural production 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:

234.905(2)(a) (a) The total guarantee amount of all loans to the borrower that are guaranteed under this section will not exceed $25,000.

234.905(2)(b) (b) The rate of interest on the agricultural production disaster assistance loan, including any origination fees or other charges relating to the agricultural production disaster assistance loan, does not exceed a rate determined by the authority after considering the conditions of the financial market.

234.905(2)(c) (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 disaster assistance loan to pay that supplier.

234.905(2)(d) (d) The participating lender obtains security for repayment of the agricultural production disaster assistance loan or follows other procedures required by the authority to secure repayment of the agricultural production disaster assistance loan.

234.905(2)(f) (f) The proceeds of the agricultural production disaster assistance loan may not be applied to the outstanding balance of any other loan.

234.905(2)(g) (g) The proceeds of the agricultural production disaster assistance loan may not be used to refinance a loan made under this section.

234.905(3) (3) Eligible farmers. A farmer is eligible for a guaranteed loan if all of the following apply:

234.905(3)(a) (a) The farmer does not meet the participating lender’s minimum standards of creditworthiness to receive an agricultural production disaster assistance loan in the normal course of the participating lender’s business.

234.905(3)(b) (b) The participating lender projects the amount of the farmer’s debts 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.

234.905(3)(c) (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 the end of the loan term.

234.905(3)(d) (d) The farmer’s name does not appear on the statewide support lien docket under s. 49.854 (2) (b). The condition under this paragraph is met for a farmer whose name does appear if the farmer provides to the authority a payment agreement that has been approved by the county child support agency under s. 59.53 (5) and that is consistent with rules promulgated under s. 49.858 (2) (a).

234.905(3)(e) (e) The participating lender projects that the farmer will lose approximately 40 percent or more of the farmer’s agricultural commodities because of a disaster.

234.905(4) (4) Guarantee of collection.

234.905(4)(a) (a) The authority may guarantee collection of up to 90 percent of the principal of any agricultural production disaster assistance loan eligible for guarantee under sub. (2) made to a farmer eligible for a guaranteed loan under sub. (3).

234.905(4)(bn) (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.

234.905(5) (5) Interest reduction. The authority may pay, from the moneys in the Wisconsin development reserve fund, to each participating lender an amount 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.

234.905 History History: 1987 a. 421; 1989 a. 2, 10, 31, 336; 1991 a. 4, 39, 221; 1995 a. 404; 1999 a. 9; 2015 a. 316.

234.907 234.907 Agricultural development loan guarantee program.

234.907(1) (1) Definitions. In this section:

234.907(1)(d) (d) “Guaranteed loan” means a loan on which the authority guarantees collection under sub. (3) or (4).

234.907(1)(e) (e) “Participating lender” means a bank, credit union, savings bank, savings and loan association or other person, who makes loans for working capital or to finance physical plant needs, equipment or machinery and who has entered into an agreement with the authority under s. 234.93 (2) (a).

234.907(1)(f) (f) “Percentage of guarantee” means the percentage established by the authority under sub. (3) or (4).

234.907(1)(g) (g) “Raw agricultural commodity” means any agricultural, aquacultural, horticultural, viticultural, vegetable, poultry, and livestock products produced in this state, including milk and milk products, bees and honey products, timber and wood products, or any class, variety or utilization of the products, in their natural state.

234.907(1)(h) (h) “Security interest” means an interest in property or other assets which secures payment or other performance of a guaranteed loan.

234.907(2) (2) Eligible loans. A 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:

234.907(2)(a) (a) The loan is made for working capital or to finance any of the following items, if the working capital or item is necessary to, or used to, process or market a product from a raw agricultural commodity produced in this state or to commercially harvest whitefish from Lake Superior:

234.907(2)(a)1. 1. Physical plant.

234.907(2)(a)2. 2. Machinery or equipment.