§ 42-34-6. Definitions.
As used in this chapter, the following words and terms have the following meanings
unless the context shall indicate another or different meaning or intent:
(1)(i) "Cost of project� means in the case of an industrial project described in subsection
(4)(i), the cost or fair market value of acquisition, whichever is lower, or the cost
of construction, alteration, reconstruction, expansion, or rehabilitation of an industrial
project by a local industrial development corporation or by a project owner, and in
the case of an industrial project described in subsection (4)(ii), the cost of acquisition
by a local development corporation or by a project owner. There may be included in
cost of project the costs of all financing charges, existing encumbrances, interest
during construction period, engineering, architectural and legal services, plans,
specifications, surveys, cost estimates, studies, and other expenses as may be necessary
or incident to the development, construction, financing, and placing in operation
of an industrial project.
(ii) "Cost of project� in the case of a recreational project described in subsection (12)
means the cost or fair market value of new construction (including renovations or
remodeling of existing structures if the authority determines that such renovation
or remodeling adds fifty percent (50%) or more to the fair market value of the structure
exclusive of the value of the land upon which it rests if any), lands, property rights,
machinery, easements, franchises, fixtures, financing charges, interest, engineering
and legal services, plans, specifications, surveys, cost estimates, studies, and other
expenses as may be necessary or incident to the development, construction, financing,
and placing in operation of a recreational project; provided, however, that the expense
of any renovations or remodeling of existing structures shall not be included in "cost
of project� to the extent that expense exceeds the fair market value of the structure
(exclusive of the land upon which it rests if any) as so renovated or remodeled.
(2) "Federal agency� means and includes the United States of America, the President of
the United States of America, and any department of, or corporation, agency, or instrumentality
heretofore or hereafter created, designated, or established by the United States of
America.
(3) "Industrial pollution� means any gaseous, liquid, or solid waste substance, or combination
thereof, resulting from the operations of an industry referred to in subsection (4)(i)
of this section, that pollute the land, water, or air of Rhode Island.
(4)(i) "Industrial project� means lands or buildings or other real estate improvements in
Rhode Island, or any interest therein, acquired and constructed, reconstructed, improved,
expanded, renovated, or rehabilitated by a local development corporation or by a project
owner, together with all easements and other interests in the property, provided that
the industrial project is to be used:
(A) By any industry for the manufacturing, processing, or assembling of raw materials
or manufactured products; or
(B) For the providing of research or warehousing facilities for the benefit of any such
industry; or
(C) An office and/or wholesale and/or retail facility, which facility is to be at least
fifty-one percent (51%) owner-occupied, and provided further that the authority has
determined that the industrial project or other real estate improvement will tend
to provide gainful employment for the people of Rhode Island, or to prevent, eliminate,
or reduce unemployment in Rhode Island, increase the tax base of the economy, diversify
and expand industry so that periods of large-scale unemployment and distressed times
may be avoided, and generally benefit economic development in Rhode Island. An "industrial
project� as defined herein may be located on leased land provided the term of the
lease extends at least until the "maturity date,� as defined in this section.
(ii) "Industrial project� also means any machinery and equipment provided:
(A) The machinery and equipment has been acquired for use in connection with any building
new or otherwise, or other real estate improvement in Rhode Island, used for the manufacturing,
processing, or assembling of raw materials or manufactured products or for the providing
of research facilities in connection therewith, furniture and/or fixtures, or used
for office and/or wholesale and/or retail purposes in a facility that is at least
fifty-one percent (51%) owner-occupied;
(B) The authority has determined that the machinery and equipment will tend to provide
gainful employment for the people of Rhode Island or to prevent, eliminate, or reduce
unemployment in Rhode Island, increase the tax base of the economy and diversify and
expand industry so that periods of large-scale unemployment and distressed times may
be avoided, and generally benefit economic development in Rhode Island;
(C) The owner therefore has agreed not to remove the machinery and equipment from the
building or real estate improvement until the principal obligation of any mortgage
on the machinery and equipment, the mortgage payments under which are insured by the
authority pursuant to §â€‚42-34-10, has been paid in full, except that the machinery and equipment may be removed from
the building or real estate improvement with the prior written consent of the authority
if such owner has agreed to substitute in place thereof other machinery and equipment
approved by the authority and the mortgage within such reasonable period of time as
the authority shall prescribe.
(iii) An "industrial project� as defined herein shall cost more than one hundred thousand
dollars ($100,000); provided, however, where the authority commences to insure mortgage
payments on an "industrial project� defined in subsection (4)(ii) at the same time
as it commences to insure mortgage payments on an "industrial project� defined in
subsection (4)(i) it shall have the power to commence insuring mortgage payments on
such "industrial project� defined in subsection (4)(ii) without limitation as to the
minimum amount of one hundred thousand dollars ($100,000) provided for herein.
(iv) An "industrial project� under the provisions of subsections (4)(i) and (4)(ii) may
include a real estate improvement or machinery and equipment suitable for the abatement
or control of industrial pollution to be used in connection with any buildings, real
estate improvement, or machinery and equipment; provided, however, that the determinations
under the provisions of subsections (4)(i) and (4)(ii) of this section need not be
made by the authority.
(5) "Local development corporation� means any corporation or foundation organized and
operated primarily for the purposes of fostering, encouraging, and assisting the physical
location, settlement, and resettlement of industrial and manufacturing enterprises
or recreational enterprise within the state or promoting the industry or recreational
promotion of the state, including, for recreational purposes, the Rhode Island industrial
facilities corporation no part of the net earnings of which inures to the benefit
of any private shareholder or individual.
(6) "Maturity date� means the date on which the mortgage indebtedness would be extinguished
if paid in accordance with periodic payments provided for in the mortgage.
(7)(i) "Mortgage� means for a subsection (4)(i) or (4)(ii) project, a first mortgage or security
agreement on an industrial project creating and constituting a first lien of record,
together with bonds, notes, evidences of indebtedness, or other credit instruments
issued by a mortgagor to finance such project and secured thereby; provided, however,
a first mortgage shall include a second or subsequent mortgage or security agreement
on an industrial project if:
(A) The holder of such second or subsequent mortgage or security agreement is also the
holder of a prior mortgage or security agreement on such industrial project under
which prior mortgage or security agreement the authority is already insuring mortgage
payments; and
(B) No other person or legal entity holds an intervening mortgage, security interest,
or lien on such industrial project prior to such second or subsequent mortgage or
security interest; and provided further, that "mortgage� shall also mean a second
mortgage or security agreement that: (I) is issued by a project owner to a local development
corporation; and (II) involves a principal obligation that does not exceed forty percent
(40%) of the cost of project. Industrial projects described in subsections (4)(i),
(4)(ii), and (4)(iv) may be financed and secured together if the requirements of §â€‚42-34-10 are met.
(ii) "Mortgage� means for the purpose of a subsection (12) project, a first mortgage (including
a first preferred ship mortgage) on a recreational project together with bonds, notes,
evidences of indebtedness, or other credit instruments issued by a mortgagor to finance
such project and secured thereby.
(8) "Mortgagee� means the original lender approved by the authority under a mortgage,
and its successors and assigns and may include all insurance companies, trust companies,
banks, building and loan associations, credit unions, savings and loan associations,
investment companies, savings banks, local development corporations, individuals,
executors, administrators, guardians, conservators, trustees, and other fiduciaries;
including pension, retirement, and profit-sharing funds; provided, however, that where
there has been appointed a trustee under an indenture of trust or other similar document
for the benefit of the holders of bonds or notes issued to finance an industrial project
secured by a mortgage, "mortgagee� means such trustee. A local development corporation
can be a second mortgagee only for a subsection (4)(i) or (4)(ii) project if the second
mortgage or security agreement is issued by the project owner to the local development
corporation and the principal obligation of the second mortgage does not exceed forty
percent (40%) of the cost of the project.
(9) "Mortgage payments� means periodic payments by the mortgagor to the mortgagee required
by the mortgage, and may include interest, installments of principal, taxes and assessments,
land lease rentals, mortgage insurance premiums and hazard insurance premiums, or
any of them as the authority may prescribe.
(10) "Mortgagor� means a local development corporation as defined herein.
(11) "Project owner� means any business entity, other than a local development corporation,
that owns an industrial project.
(12) "Recreational project� means any building, facility, development, or improvement in
Rhode Island and the interest of the owner of such building, facility, development,
or improvement in and to the land upon which it may be located, provided that the
owner's interest be in fee simple or be a leasehold interest in land owned by the
state of Rhode Island having a term expiring not less than ten (10) years after the
date of recording the mortgage herein defined, and provided the building, facility,
development, or improvement is designed in whole or in part to attract tourists to
this state and including, without limiting in any way the generality of the foregoing,
marinas, ships, beaches, bathing facilities, ski facilities, convention facilities,
hotels, motels, golf courses, campgrounds, arenas, theaters, lodges, guest cottages,
and all types of facilities, and furniture and/or fixtures, related thereto as may
be determined from time to time by the authority and that the authority has determined
will contribute to the health and welfare of the people or will tend to improve the
economy of the state, increase employment, or provide a wider tax base. A "recreational
project� as defined herein shall cost more than twenty-five thousand dollars ($25,000).
(13) "Ship� means a sailing vessel that is:
(i) Over one hundred fifty feet (150′) in length overall;
(ii) Registered with the United States coast guard;
(iii) Displaces at least four hundred fifty (450) registered tons; and
(iv) Has its hailing port in Rhode Island.