Bill Text: VA HB253 | 2022 | Regular Session | Prefiled
Bill Title: Literary Fund; open application process for loans, maximum loan amounts, etc.
Spectrum: Strong Partisan Bill (Democrat 16-1)
Status: (Introduced - Dead) 2022-02-15 - Left in Appropriations [HB253 Detail]
Download: Virginia-2022-HB253-Prefiled.html
Be it enacted by the General Assembly of Virginia:
1. That §§22.1-147, 22.1-148, and 22.1-150 of the Code of Virginia are amended and reenacted and that the Code of Virginia is amended by adding a section numbered 22.1-146.2 as follows:
§22.1-146.2. Loan closing cost subsidies.
A. The Board shall establish a competitive program for the award of up to $25,000 to a school division that receives a Literary Fund loan for the purpose of subsidizing all or a portion of the closing costs for such loan.
B. The aggregate amount of subsidies provided pursuant to this section shall not exceed the allocation specified in the general appropriation act for each fiscal year.
§22.1-147. Application for and distribution of funds.
A. The Board shall establish an annual open application process for Literary Fund loans that shall occur during the period that the Board deems most suitable.
B. The
Board of Education shall provide for
an equitable distribution of the funds loaned or provided as loan interest rate
subsidy payments from the Literary Fund among the several school divisions. In
providing for such equitable distribution, the Board shall impose a maximum
limit of not more than $7.5 $25
million on the amount of any loan from the Literary Fund,
provided, however, that such maximum limit may be
increased to not more than $35
million for loans for any school construction or renovation project
that facilitates the consolidation of schools
pursuant to subdivision 4 of §22.1-79.
§22.1-148. Restrictions upon making loans; retirement of previous loans; waiting lists.
A. No loan from the Literary Fund shall exceed 100% 100
percent of the cost of the building, addition thereto, and
site on account of for which such loan is made.
No loan shall be made from the Literary Fund to aid in the erection of a
building or addition to cost that costs less than $500.
Whenever a loan is made from the Literary Fund for the purpose of enlarging a
building, any part of the proceeds of such loan may, in the discretion of the
Board, be used to retire any previous loan or loans on such building although
not matured at the time of such additional loan. The Board may refuse to make
any loan from the Literary Fund to any school board which that is in default in the
payment of any part of the principal of any previous loan from the Literary
Fund or which for the two years next preceding the loan has been more than six
months in default in the payment of interest due on any loan from the Literary
Fund.
B. Any school division which that has an application for a
Literary Fund loan for an approved school project pending before the Board of Education shall not be
denied or delayed in obtaining such loan solely for the reason that alternative
financing had been obtained to begin or complete construction on such project.
C. Notwithstanding the provisions of subsection B, the Board may remove any project that has been inactive for at least five years from any project waiting list that it maintains.
§22.1-150. Rate of interest.
The Board of Education is
authorized in its discretion to shall
fix the interest rate on all loans made from the Literary Fund at not less than two per centum one percent per annum and year, not
more than six per centum three percent per annum year, and at
increments of one half of one percent per year between such minimum and maximum
rates, payable annually. The Board
shall utilize a sliding scale based on the local school
division's composite index of local ability to pay to determine
the interest rate on each such loan. Every loan made under
the provisions of this chapter by selling the bonds, notes,
or other evidences of debt of school boards for investment of the trust funds
of the Virginia Retirement System shall bear interest at a rate not to exceed
six per centum percent
per year.
2. That the Board of Education shall make such amendments to its Regulations Governing Literary Loan Applications in Virginia (8VAC20-100) as are necessary to effectuate the provisions of the first enactment of this act.
