§ 9-12-308 — Large project loan program

Wyoming § 9-12-308

• Jurisdiction: Wyoming
• Title 09: Administration of the Government
• Ch. 12: WYOMING ECONOMIC DEVELOPMENT ACT
• Art. 3: WYOMING PARTNERSHIP CHALLENGE LOAN PROGRAM

Text

(a) The large project account within the revolving
investment fund created pursuant to article 16, section 12 of
the Wyoming constitution, created by 2014 Wyoming session laws,
chapter 46, section 2, is continued and codified.
(b) Funds in the large project account within the
revolving investment fund shall be used exclusively to promote
and aid economic development of the state by providing loan
guarantees or loans to proposed or existing enterprises that
will employ people within the state, provide services in the
state, use resources in the state or otherwise add economic
value to goods, services or resources within the state
consistent with this section.
(c) There is created a loan review committee to review all
projects, loans and loan guarantees proposed under this section.
The committee shall consist of:
(i) The governor or his designee;
(ii) The treasurer or his designee;
(iii) A member of the board of directors of the
council who has expertise in banking or experience in the
banking industry, designated by the chief executive officer of
the council.
(d) The members of the loan review committee may request
assistance from staff of the governor's office, the state
treasurer's office, the council and any bank participating in
the loan transaction or loan guarantee to review and evaluate
proposed projects, loans and loan guarantees under this section.
(e) Loans and loan guarantees provided under this section
shall be subject to the following procedures:
(i) Any project shall first be submitted to and
reviewed by the council who shall provide preliminary
recommendations for the size and parameters of the proposed loan
or loan guarantee. For any loan or loan guarantee made by any
nonpublic lender the council shall provide electronic notice to
all Wyoming financial institutions of the potential loan terms
and shall allow not less than fifteen (15) business days for
Wyoming financial institutions to respond with expressions of
interest with proposed terms. All offers of proposed terms shall
be provided to the council, the loan review committee and the
person seeking the loan for consideration. All information sent
by electronic notice shall be treated in accordance with
applicable confidentiality requirements. As used in this
paragraph, "Wyoming financial institution" means as defined in
W.S. 13-1-501(a)(i). The council shall review the project under
the process set forth in W.S. 9-12-601 through 9-12-603. In
developing recommendations for the size and parameters of the
proposed loan or loan guarantee under this paragraph, the
council may work with the bank that would issue the loan or loan
guarantee;
(ii) The council shall require all persons seeking a
loan to disclose and certify, under penalty of perjury, whether
the person holds a position with or has any present, direct
business connection to any state, county or municipal officer,
employee or instrumentality or has any familial relationship as
spouse, child, sibling or parent residing as a member of the
same household in the principal place of residence of any state,
county or municipal officer or employee. As used in this
paragraph, "direct business connection" includes employer-
employee and coprincipal relationships. Information disclosed
under this paragraph shall not be the determining factor in the
selection process;
(iii) The council shall present the project and the
proposed loan or loan guarantee and its terms to the loan review
committee, which may accept or deny the proposed loan or amend
its terms;
(iv) Upon a favorable recommendation by the council
and the loan review committee, the project shall then be
submitted to the state loan and investment board for final
approval. The council and the loan review committee shall only
forward projects and proposed loans under this section that have
been determined to meet the requirements of this section;
(v) The state loan and investment board shall vote to
accept or deny the project and the terms of the loan or loan
guarantee developed for the project.
(f) The council and the loan review committee shall
recommend, and the state loan and investment board shall only
approve, the issuance of loan guarantees and loans under this
section for projects that meet the following requirements:
(i) Are anticipated to have an economic impact and a
public benefit greater than the economic impact and public
benefit of projects regularly funded under the Wyoming business
ready community program;
(ii) Based upon the findings of an independent third
party selected and approved by the council, will provide the
following minimum public benefits:
(A) The creation of a significant expansion of
permanent jobs in the county or counties in which the project
will be located;
(B) A significant increase in the assessed
valuation of the county or counties in which the project will be
located, by not less than the value of the loans or loan
guarantees received by the applicant borrower;
(C) A substantial increase in the sales,
property or other tax revenues to the county or counties where
the project will be located; and
(D) Promotion of a stable, balanced and
diversified economy.
(iii) Has a high likelihood of completion.
(g) The council shall establish the terms of any loan,
loan participation or loan guarantee issued under this section
in accordance with the following:
(i) Loans or loan guarantees provided under this
section shall be adequately collateralized. To protect the
state's interest, the council may negotiate protections with
respect to any accepted collateral, including but not limited to
escrow accounts, debt limitations, cash sweeps, pledge rights,
corporate approval rights and other mechanisms the council deems
appropriate;
(ii) Loans under this section shall bear interest at
a fixed or adjustable rate. The interest rate shall be:
(A) Indexed to a rate as determined by rule
adopted by the council, plus any additional premium determined
by the council to be reasonably commensurate with the risk
profile of the loan or loan guarantee, as approved by the loan
committee; and
(B) Approved by the loan committee and the state
loan and investment board.
(iii) The council shall ensure through certification
of the applicant, or any other manner determined to be adequate
by the council, a commitment of at least twenty-five percent
(25%) of the total cost of the project from funding sources not
provided by the state of Wyoming;
(iv) Loans or loan guarantees shall be used for
direct investment in the project and shall not be used or made
available to refinance preexisting debt incurred before
commencement of the project;
(v) Borrowers shall demonstrate a balance sheet and
cash flow sufficient to demonstrate their ability to repay the
loan or loan guarantee;
(vi) Borrowers shall provide security to repay the
loan with a residual value sufficient to repay the loan or loan
guarantee in event of default;
(vii) When appropriate, the council may require
continuing loan guarantees by affiliates and principals of the
borrower;
(viii) Except as provided in this paragraph, the
council shall ensure that the lead lender secures a first
security interest in the entire project sufficient to adequately
protect the investment of loan proceeds or proceeds guaranteed
by the state under this section. The security interest shall be
shared pro rata with the state in percentage of the loan or loan
guarantee. If necessary, the council may allow the lead lender
to accept substitute security that will protect repayment to the
state on a basis substantially equivalent to a first security
interest on the project. The council shall ensure that any
alternate security is sufficient to prudently protect the
state's pro rata interest;
(ix) The council shall charge a loan origination fee
or loan guarantee fee of one percent (1%) of the total loan or
guaranteed loan amount. Funds collected under this paragraph
shall be deposited in the large project account within the
revolving investment fund, less any amounts used to pay the
costs of consultants retained pursuant to subsection (k) of this
section.
(h) No loan or loan guarantee shall be made under this
section without the written opinion of the attorney general
certifying the legality of the transaction and all documents
connected therewith.
(j) Repayment of principal and interest to the state in
connection with loans made under this section shall be deposited
to the large project account within the revolving investment
fund. All funds within the account may be used for and are
continuously appropriated for the purposes of this section. The
total principal balance of outstanding loans under this section
shall not exceed the amounts appropriated by the legislature
plus interest accrued and collected less any losses of loan
principal.
(k) The council is authorized to retain experts and
service providers as necessary to fully evaluate, negotiate and
implement the terms and conditions of the loans and loan
guarantees issued under this section. If an expert or service
provider is retained by the council under this subsection, any
costs incurred that exceed the loan origination fee or loan
guarantee fee set in paragraph (g)(ix) of this section shall be
paid by the applicant. The independent third party selected and
approved by the council under paragraph (f)(ii) of this section
shall not serve as an expert or service provider retained under
this subsection.
(m) The council shall promulgate rules necessary for the
implementation of this section.