(2) A loan committee shall be maintained within the department of agriculture to evaluate and act upon proposals received.

(a) further encourage Montana's rural youth to enter into agricultural projects;

(b)          preserve interest in Montana's agricultural future;

and

(c) provide financing experience and training through personal involvement and accomplishments.

(2) Each applicant must provide evidence and/or sign a written statement that they are unable to acquire the needed funds from another source at reasonable rates or terms.

(3) Active membership in the FFA, 4-H, or other recognized rural youth organization is desired. Parents or guardians must be willing to cooperate with the borrower and have ample facilities available for implementation of the project.

( 4) A three-member loan committee must be established in the local community from which an application is received. This committee should be composed of any three of the following: agriculture education instructors, county extension agents, agricultural loan officers, and others. This committee is established to make recommendations concerning the making and servicing of the loan proposal.

(2) All livestock presently owned and those purchased by the borrower must be listed on the security agreement provided by the department.

(3) All loan security instruments shall be filed appropriately and the borrower must pay all necessary fees.

(a) All livestock shall be identified by the borrowers registered brand, or other markings as approved by the department of agriculture.

(b) All mortgaged property must be kept on the borrowers property, and/or property described within the lease agreement.

(c) At such time as the loan is paid in full, the borrower shall pay any fees necessary to release all related liens.

(4) The department may require insurance coverage on all mortgaged property, resulting production, or offspring.

(5) All mortgaged property to be sold by the borrower, must be sold in the borrower's and the Montana department of agriculture's names. Sale receipts shall then be released in accordance with the loan agreement.

(6) The borrower shall allow representatives of the department of agriculture and the project supervisor to inspect the loan project and facilities upon request. The borrower shall handle the project to the best of his/her ability, and cooperate with the project supervisor's and the Montana department of agriculture's recommended practices and procedures.

(2) No loan shall exceed $3,500 for age nine to 11 and $8,500 for age 12 to 21 for any one individual borrower or $14,000 for any chapter or club. Loans may be renegotiated providing the borrower does not exceed the maximum loan limits at any time.

(3) Applicants may borrow up to 90% of the total funds required for the proposed project.

(4) Repayment schedules may vary, but must not exceed five years for individuals and 10 years for clubs and chapters.

(5) The department of agriculture may immediately terminate a loan agreement if the applicant is unable to fulfill the terms of the loan agreement. In the event that any mortgaged property is sold during the program loan period without prior approval by the department, the balance of the loan may be immediately due and payable.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

(a) Operating loans will be for a one year maximum time frame.

(b) Operating loans may be made for 60% of the value of the mortgaged property.

(c) Insurance may be required on subordinated property at the discretion of the department of agriculture.

(a) Real estate loans will be made upon availability of funds, but in no case shall the term exceed a 20 year repayment schedule.

(b) Title insurance and fire insurance must be carried on the mortgaged real estate, with the Montana department of agriculture listed as the first lien holder.

(1)  Application must be made to the Montana Department of Agriculture.  All application documents must be completed and presented to the department before the department loan committee will consider the request.

(2)  Each applicant must be unable to obtain the needed funds from a private lender or other sources at reasonable rates or terms.  Evidence shall consist of a statement, signed by a private lender, that financing was unavailable.

(3)  Applicant(s)  shall be at least 18 years of age.

(4)  An applicant's net worth including that of spouse and minor children cannot exceed $450,000 at the time of application as determined using generally accepted accounting principles (GAAP):

(a)  contingent assets or liabilities shall be included in the determination of net worth and total assets.  Contingent assets or liabilities are those for which contracts or agreements have been or are in the process of being entered into but for which the asset or liability will be recognized in the future.

(5)  Applicant(s)  must demonstrate access to assets necessary to carry out the proposed agricultural enterprise.

(6)  Applicant(s)  must demonstrate the experience, knowledge and ability necessary to conduct the proposed agricultural enterprise.

(7)  Applicant(s)  must demonstrate repayment capacity using proceeds from the agricultural enterprise or other acceptable income.

(8)  A two-member local committee must be established by the applicant to review the loan request.  The committee shall be composed of an officer from a bank in the borrower's home community or bank where the borrower normally conducts business, and an agricultural specialist.  Examples of agricultural specialists are county extension agents, vocational agriculture education teachers, and farm service agency district supervisors.  This committee will review the loan application and make recommendations concerning the proposed loan.

(9)  There is a nonrefundable application fee of $75.

(2)  The department may require insurance coverage on all mortgaged or otherwise secured property.

(3)  The department may require an appraisal from a qualified appraiser on property to be financed or used to secure a loan or to determine the value of the applicant's assets.

(4)  The department may loan up to 80% of the value of secured property.  The department may require collateral in addition to property being financed with loan funds.

(5)  The department shall require a first mortgage position on any land being mortgaged.

(6)  The applicant(s)  shall provide title insurance in the name of the department for any land to be purchased with loan funds.

(7)  The borrower(s)  and guarantor(s)  shall sign all necessary documents as required by the department and all documents requiring filing shall be properly filed by the department.

(8)  The department may require the borrower to register a brand with the Montana department of livestock for the purpose of recording a lien on the brand and may require secured livestock to be branded.

(9)  The borrower shall pay fees required to file, continue, or release financing statements, mortgages, and brand liens.

(10)  A representative of the Montana department of agriculture may at a reasonable time visit personally with applicant(s)  for the purpose of verifying the applicant's collateral, qualifications and abilities to conduct the proposed agricultural enterprise.

(11)  The borrower shall allow members of the local loan committee and the department to inspect collateral or loan-related records upon request at any reasonable time during the repayment period.

(12)  The borrower shall care for collateral and conduct agricultural operations in accordance with good and recognized agricultural practices.

(2)  Loans may be renegotiated up to the maximum of $75,000.

(3)  Interest rates for loans shall be established yearly by the director of the Montana department of agriculture.  Loans will bear simple interest charged yearly on the unpaid balance.

(4)  Loan funds shall be used for purposes approved by the department and applicant(s)  shall provide the amount necessary for a down payment as required by the department and use that amount for only the approved purposes.

(5)  Loans may be authorized to finance the following types of property or activities:

(a)  depreciable property and equipment suitable for use in agriculture or agri-business;

(b)  depreciable agricultural improvements which are located on agricultural land;

(c)  annual operating expenses;

(d)  agricultural land; and

(e)  other expenditures for agricultural equipment, property, facilities, or expenses as approved by the department.

(6)  Loans shall not be eligible for financing personal residences, nonfarm vehicles, family-living expenses or other property used for household purposes.

(7)  The repayment period shall be determined by the department prior to closing and shall not exceed the following schedules:

(a)  loans for depreciable agricultural property or equipment shall not exceed seven years;

(b)  loans for depreciable agricultural improvements or agricultural land shall not exceed 10 years; and

(c)  loans for operating expenses will be paid within one year unless first-year operating costs are included in a loan for agricultural property, equipment, improvements, or land in which case the amount for operating expense can be amortized over the repayment period.