Bill Text: OH SB281 | 2011-2012 | 129th General Assembly | Comm Sub

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Bill Title: To modify the Agricultural Linked Deposit Program with respect to the maximum amount the Treasurer of State may invest in agricultural linked deposits, the interest rate at which loans are made under the Program, and the maximum loan amount.

Spectrum: Moderate Partisan Bill (Republican 31-10)

Status: (Engrossed - Dead) 2012-02-15 - Passed 3rd Consideration House [SB281 Detail]

Download: Ohio-2011-SB281-Comm_Sub.html

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As Reported by the House Agriculture and Natural Resources Committee

129th General Assembly Regular Session 2011-2012

Am. S. B. No. 281

Senator Beagle 

Cosponsors: Senators Lehner, Cafaro, Hite, Seitz, Jones, Skindell, Widener, LaRose, Schaffer, Manning, Oelslager, Brown, Obhof, Hughes, Bacon, Balderson, Burke, Daniels, Eklund, Faber, Gentile, Kearney, Niehaus, Patton, Sawyer, Schiavoni, Smith, Tavares, Turner, Wagoner 

Representatives Hall, Boose, Buchy, Damschroder, Derickson, Hagan, C., Kozlowski, Landis, Ruhl, Scherer 

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A BILL

To amend sections 135.631, 135.73, 135.74, and 135.75

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of the Revised Code to modify the Agricultural

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Linked Deposit Program with respect to the maximum

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amount the Treasurer of State may invest in

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agricultural linked deposits, the interest rate at

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which loans are made under the Program, and the

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maximum loan amount.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 135.631, 135.73, 135.74, and 135.75	8
of the Revised Code be amended to read as follows:	9

Sec. 135.631.  The treasurer of state shall attempt to place	10
up to one hundred twenty-fivesixty-five million dollars of the	11
amount authorized to be invested under section 135.63 of the	12
Revised Code in agricultural linked deposits, as defined in	13
section 135.71 of the Revised Code, subject to the procedures set	14
forth in sections 135.71 to 135.76 of the Revised Code.	15

Sec. 135.73.  (A) An eligible lending institution that	16
desires to receive an agricultural linked deposit shall accept and	17
review applications for loans from eligible agricultural	18
businesses. The lending institution shall apply all usual lending	19
standards to determine the creditworthiness of each eligible	20
agricultural business. No loan shall exceed one hundred fifty	21
thousand dollars.	22

(B) An eligible agricultural business shall certify on its	23
loan application that the reduced rate loan will be used	24
exclusively for agricultural purposes on land or in facilities	25
owned or operated by the business in this state and that the loan	26
will materially contribute to the preservation of the business.	27
Whoever knowingly makes a false statement concerning such	28
application is guilty of the offense of falsification under	29
section 2921.13 of the Revised Code.	30

(C) In considering which eligible agricultural businesses to	31
include in the agricultural linked deposit loan package for	32
reduced rate loans, the eligible lending institution shall give	33
priority to the immediacy of a business's financial need for the	34
loan to meet planting deadlines. The institution may also consider	35
the economic needs of the area in which the business is located	36
and other factors it considers appropriate to determine the	37
relative financial need of the business.	38

(D) The eligible lending institution shall forward to the	39
treasurer of state an agricultural linked deposit loan package, in	40
the form and manner prescribed by the treasurer of state. The	41
package shall include information regarding the amount of the loan	42
requested by each eligible agricultural business and such other	43
information regarding each business as the treasurer of state	44
requires. The institution shall certify that each applicant is an	45
eligible agricultural business, and shall, for each business,	46
certify the present borrowing rate applicable to each specific	47
eligible agricultural business.	48

Sec. 135.74.  (A) The treasurer of state may accept or reject	49
an agricultural linked deposit loan package or any portion	50
thereof, based on the treasurer's evaluation of the eligible	51
agricultural businesses included in the package, the amount of	52
individual loans in the package, and the amount of the package. In	53
evaluating the eligible agricultural businesses, the treasurer of	54
state shall give priority to a business's financial need for the	55
loan to meet planting deadlines but shall also consider the	56
overall financial need of the business and the economic needs of	57
the area where the business is located.	58

(B) Upon acceptance of the agricultural linked deposit loan	59
package or any portion thereof, the treasurer of state may place	60
certificates of deposit with the eligible lending institution at a	61
rate below current market rates, as determined and calculated by	62
the treasurer of state, or may invest in bonds, notes, debentures,	63
or other obligations or securities issued by the federal farm	64
credit bank with respect to the eligible lending institution at a	65
rate below current market rates, as determined and calculated by	66
the treasurer of state. When necessary, the treasurer may place	67
certificates of deposit or may invest in such obligations or	68
securities prior to acceptance of an agricultural linked deposit	69
loan package.	70

(C) The eligible lending institution shall enter into an	71
agricultural linked deposit agreement with the treasurer of state,	72
which shall include requirements necessary to carry out the	73
purposes of sections 135.71 to 135.76 of the Revised Code. Such	74
The requirements shall includeat least do the following:	75

(1) Include an agreement by the eligible lending institution	76
to lend the value of the agricultural linked deposit to eligible	77
agricultural businesses at a rate that reflects a percentage rate	78
reduction belowequal to the present borrowing rate applicable to	79
each specific agricultural business in the accepted loan package	80
that is equal tominus the percentage rate reduction below	81
difference between one of the following, as applicable:	82

(a) The market ratesrate and the actual rate at which the	83
certificates of deposit that constitute the agricultural linked	84
deposit were placed or;	85

(b) The market rate and the actual rate at which the	86
investments in bonds, notes, debentures, or other obligations or	87
securities that constitute the agricultural linked deposit were	88
made. Such requirements shall also reflect;	89

(2) Reflect the market conditions prevailing in the eligible	90
lending institution's lending area. The	91

The agricultural linked deposit agreement may include a	92
specification of the period of time in which the lending	93
institution is to lend funds upon the placement of a linked	94
deposit, and shall include provisions for the certificates of	95
deposit to be placed or the investment in bonds, notes,	96
debentures, obligations, or securities to be made for any maturity	97
considered appropriate by the treasurer of state not to exceed two	98
years and may be renewed for up to an additional two years at the	99
option of the treasurer. Interest shall be paid at the times	100
determined by the treasurer of state.	101

(D) Eligible lending institutions shall comply fully with	102
Chapter 135. of the Revised Code.	103

Sec. 135.75.  (A) Upon the placement of an agricultural	104
linked deposit with an eligible lending institution, such	105
institution is required to lend such funds to each approved	106
eligible agricultural business listed in the agricultural linked	107
deposit loan package required by division (D) of section 135.73 of	108
the Revised Code and in accordance with the agricultural linked	109
deposit agreement required by division (C) of section 135.74 of	110
the Revised Code. The loan shall be at a rate that reflects a	111
percentage rate reduction below the present borrowing rate	112
applicable to each business that is equal to the percentage rate	113
reduction below market rates at which the certificate of deposits	114
that constitute the agricultural linked deposit were placed or at	115
which the investments in bonds, notes, debentures, or other	116
obligations or securities that constitute the agricultural linked	117
deposit were made. A certification of compliance with this section	118
in the form and manner as prescribed by the treasurer of state	119
shall be required of the eligible lending institution.	120

(B) The treasurer of state shall take any and all steps	121
necessary to implement the agricultural linked deposit program and	122
monitor compliance of eligible lending institutions and eligible	123
agricultural businesses, including the development of guidelines	124
as necessary.	125

Section 2. That existing sections 135.631, 135.73, 135.74,	126
and 135.75 of the Revised Code are hereby repealed.	127