99-626 C.M.R. ch. 1, § 3 - Application Procedures

Current through 2022-14, April 6, 2022

A. Phase I - Application
1. An Applicant shall submit an application complying with the requirements of this rule on forms developed by the Authority as may be specified with supporting information as required by this rule and additional information as requested by the Authority.
2. The Authority shall be responsible for making application forms available.
3. Applications will be rated on the following criteria: problem, solution, commitment, citizen participation and evidence that Local Development Corporation has the rights to develop a Commercial Facility and control of the subject site.
a. Problem Statement:

Scope of Problems - Identification and description of the nature and magnitude of the identified problems to be addressed with Community Industrial Building, including evidence of the loss of or major downsizing of major employer(s), chronic unemployment or underemployment, lack of economic diversification or, historical lack of private investment in the region.

b. Solution:
(i) Project Description - Describe how funds will be used. Include a project budget.
(ii) Comprehensive Nature of Solution - Description of how the activities relate to the community's total economic development effort. Include a description of how the project will address the need for new employment; retaining or improving existing employment opportunities or improving the competitiveness of an occupant business. The application must detail how the project will address the problems identified, and a plan to market and manage the facility.
(iii) Feasibility - Identification of tasks, timetables and the responsible parties to implement the proposed solution. Application must also Identify the market need for a Community Industrial Building.
(iv) Right to develop - Evidence that Local Development Corporation has the rights to develop a Commercial Facility and control of the subject site.
c. Citizen Participation - Identification and description of the process, descriptions of public meetings, hearings and other methods to solicit the involvement of residents, developers, local organizations and public officials, and how the involvement contributed to this application.
d. Commitment/Match - Identify and describe how the community, and other organizations including private developers will contribute financial and/or technical resources to the project, and the status of those commitments.
4. No application will be considered complete unless all questions are answered, and all supporting information is provided.
5. Upon approval of an application by the Authority, a loan commitment shall be issued at the successful conclusion of Phase I, setting forth the terms and conditions under which the loan will be included in the program. The commitment shall include a requirement that the Phase II conditions be satisfactorily met and may specify special requirements applicable to the Project and requiring the submission in final form within a time specified of all appropriate documents, drawings, plans, specifications, appraisals, bonds, guarantees, permits, approvals, surveys, title insurance, opinions, financial statements, cost, other certifications and other instruments evidencing full compliance with the Authority's requirements and in form and content satisfactory to the Authority.
6. No commitment shall become effective until the Borrower has signed it and the Borrower has agreed to pay to the Authority the loan origination fees specified in the program application, and other applicable fees. Loan origination fees will not exceed 2% of the total loan.
7. If, upon examination of the application and supporting information, the Authority rejects an application, the Borrower shall be informed of the rejection and the reasons. Rejection of a Project may occur at any time during Phase I or prior to Phase II.
B. Phase II - Project Planning
1. Local Development Corporations whose applications rank the highest after the scoring of the weighted criteria will be invited to participate in Phase II. Emphasis during this second phase will be developing the best Project to meet the community's industrial space needs. The Authority will work with the Local Development Corporation in evaluating the proposed site and building conceptualization and more fully planning the Project. During Phase II the Local Development Corporation will complete the following activities at its own expense:
a. Develop site plans, including plans for landscaping and lighting the building, surface water runoff control, utilities connections, and all other non-eligible costs.
b. Develop a building design, including the foundation, structure and architectural design.
c. Determine the suitability of the proposed site, including soil analysis and municipal services.
d. Provide evidence of insurance against loss or damage to the building as well as fire protection for and maintenance of the building until it is sold.
e. Ensure that an adequate access road exists from public highway to the building lot.
f. Secure appropriate licenses and permits to construct, operate and occupy the building.
g. Ensure the site is consistent with all applicable state and local ordinances and requirements.
h. Ensure that the building lot is either owned by the Local Development Corporation or owned by an instrumentality of state, local or federal government.
2. Submissions and Review: The Local Development Corporation shall submit plans and specifications for the proposed Project, prepared by a registered Architect and Engineer in Maine, to the Authority for review. The plans and specifications shall clearly outline the scope of work for the Project including the following:
a. Site plan showing a boundary survey indicating property lines, all utilities including water, sewer and power, building foot print, landscaping, surface water runoff control and associated parking.
b. Floor plans, elevations wall sections, foundation plan, structural system, mechanical and electrical systems and details indicating the size, height and overall scope of the proposed building.
c. Specifications indicating the type and quality of the systems and material that will be used in the construction of the building.
3. Final documents shall be submitted to the Authority for review and approval prior to the closing of a loan. Prior to the start of the construction the Borrower will provide the Authority a set of construction documents for the Project.
C. Phase III - Project Construction

Local Development Corporations that successfully complete Phase I and Phase II will close a loan with the Authority for all or a portion of the Construction Costs and begin Project Implementation.

1. Loans shall be given in an amount that corresponds with the funds available in the Fund and is reasonable to construct a Community Industrial Building as demonstrated by a contractor's bid package.
2. Interest on a loan shall be up to 2% over High Wall Street Prime Rate as published in the Wall Street Journal on the date of the loan commitment.
3. Loans must be secured by collateral having a fair market value sufficient to provide adequate security for the loan, and/or such guarantees and/or other financial support, or incentives from the municipality in which the Community Industrial Building is located. The Authority shall require a first lien on collateral.
4. The term of each loan shall be based on the Borrower's circumstances and the useful life of the Community Industrial Building but in no event will it exceed five (5) years.
5. The proceeds of the loan will be used only for Construction Costs.
6. If not paid sooner, the amount payable is principal and interest on the loan.
7. Periodic payments of interest shall be established in accordance with the Borrower's individual needs. The Authority may defer up to three (3) years the collection of interest from the Borrower for a loan involving Community Industrial Building which remains unoccupied following completion of the building. The Authority may provide that such deferred interest is not payable until sale of the building or the maturity of the loan, whichever occurs first, and in appropriate circumstances at the discretion of the Authority, interest due may be abated in whole or in part.
8. The Authority may limit its disbursements so that the undisbursed portion of the loan shall be sufficient at all times to cover the Project construction costs.
9. In the event of default, the principal of and interest on the loan may be declared immediately due and payable.
10. The Borrower will agree to the following terms and conditions in the loan documentation, as may be applicable:
a. The Borrower will comply with all applicable planning, zoning, sanitary, building and environmental laws, ordinances and regulations of the federal, state and local governments.
b. The Borrower will agree not to convey, lease or transfer any collateral for the loan without the prior written consent of the Authority.
c. The Borrower will expend no portion of the loan directly or indirectly for purposes other than those approved by the Authority.
d. The Borrower will keep insured to the satisfaction of the Authority all insurable property securing the loan and will maintain the collateral in good condition and repair.
e. The Borrower will not materially alter or relocate collateral without the prior written consent of the Authority.
f. The Borrower will comply with such other covenants as the Authority impose or establish in order to protect the Authority's interests. Any such other covenants shall be expressly set forth in the loan commitment or exhibits or attachments.
11. Use of Loan Proceeds. The Borrower shall use loan proceeds for the purposes stated in the commitment, and the borrower's rights under the commitment shall not be assignable.
12. Construction Inspection. The Borrower will allow the Authority or the Authority's representative access to the building site and/or building periodically to inspect all aspects of the work to check and verify that the work is being constructed in accordance with the construction documents.
13. Certification of Payments. The Borrower shall provide the Authority certificate of payment from the architect or engineer of record based on the architect's or engineer's evaluation of the work and on the data comprising the Contractor's Application for payment, that the work has progressed to the point indicated and, that to the best of the architect's or engineer's knowledge, information and belief, the quality and quantity of the work is in accordance with the Contract Documents.

Notes

99-626 C.M.R. ch. 1, § 3

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