01 NCAC 41C .0203         Loan Percentage and CONDITIONS AND LIMITATIONS

(a)  The interest rate on the loan shall be set pursuant to G.S. 143B-344.44(c) by the State Energy Office based on the following:

(1)           previous State Energy Office loan recipients get one percent deduction with closed loans and no defaults to zero percent;

(2)           loans made to residents and small businesses shall receive a one percent interest rate;

(3)           loans made to nonprofit organizations and local governments projects shall receive a two percent interest rate; and

(4)           loans made to commercial and industrial entities shall receive a three percent interest rate.

(b)  Loans shall be made subject to the following conditions:

(1)           the repayment schedule shall be based on the estimated payback as shown in the Technical Analysis Report, pursuant to Rule .0303 of this Subchapter;

(2)           the commercial or industrial business, nonprofit organization, local government entity, or resident shall make payments at least once a month;

(3)           the total amount of the loan, or any portion thereof, may be repaid at any time before the total amount is due, without penalty;

(4)           rebates received through other program offerings of the State Energy Office for projects undertaken from loan proceeds shall be used to reduce the amount of principal;

(5)           the borrower shall warrant that all work or construction done with the proceeds of a loan under this program shall comply with all building codes;

(6)           project implementation shall begin within 90 days after approval of the application. If delays are encountered following loan closing, any arbitrage profits will be repaid to the Energy Loan Fund;

(7)           loan payments or drafts shall be sent or delivered to the Financial Service Division, in accordance with 04 NCAC 12D .0101; and

(8)           a letter of credit from a bank approved to do business in North Carolina shall secure the loan against non-payment and also serve as a quarterly drafting mechanism for loan repayment from the bank.

(c)  Loans shall be made subject to the following limitations:

(1)           the amount of the loan shall not exceed allowable costs;

(2)           loans shall not be used to replace an existing loan; and

(3)           no loans shall be forgiven.

History Note:        Authority G.S. 143B-344.44;

Eff. August 1, 2004;

Readopted Eff. June 1, 2021.