<html> <head> <title>Rule 12:22:02:08 Factors for action by VAFA.</title> <META NAME="Keywords" Content="Administrative Rules 12:22:02:08"> <META NAME="Description" Content="Administrative Rules 12:22:02:08 Factors for action by VAFA."> <meta http-equiv=Content-Type content="text/html; charset=windows-1252"> <meta name=Generator content="Microsoft Word 15 (filtered)"> <style> <!-- /* Font Definitions */ @font-face {font-family:"Cambria Math"; panose-1:2 4 5 3 5 4 6 3 2 4;} @font-face {font-family:Times; panose-1:2 2 6 3 5 4 5 2 3 4;} /* Style Definitions */ p.MsoNormal, li.MsoNormal, div.MsoNormal {margin:0in; margin-bottom:.0001pt; font-size:10.0pt; font-family:"Times",serif;} a:link, span.MsoHyperlink {color:blue; text-decoration:underline;} a:visited, span.MsoHyperlinkFollowed {color:purple; text-decoration:underline;} .MsoChpDefault {font-size:10.0pt;} @page WordSection1 {size:8.5in 11.0in; margin:1.0in 1.0in 1.0in 1.0in;} div.WordSection1 {page:WordSection1;} --> </style> </head> <body lang=EN-US link=blue vlink=purple> <div class=WordSection1> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>12:22:02:08.&nbsp;&nbsp;Factors for action by VAFA.</b> The VAFA, in making a decision on an application, may, in addition to other factors necessary to make a sound loan decision, consider the following:</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (1)&nbsp;&nbsp;Program impact factors:</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)&nbsp;&nbsp; Population of the community where the project is to be located;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)&nbsp;&nbsp; Amount of agricultural products used;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)&nbsp;&nbsp; Number of jobs created for low-income persons and displaced farm families;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)&nbsp; Amount of loan requested;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e)&nbsp;&nbsp; Net economic effect of increasing or stabilizing the economy on the community, area, and state;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp; (f)&nbsp;&nbsp; Competitive effect on existing businesses;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g)&nbsp;&nbsp; Support of the public entities of the community and area;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h)&nbsp;&nbsp; The amount of the owner's equity contributed to the project;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;&nbsp;&nbsp; The effect of the project on the environment, health, and safety of the people in the community and state;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j)&nbsp;&nbsp;&nbsp; Compatibility with economic development plans of the area and state;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k)&nbsp;&nbsp; Potential for creating quality jobs and growth of those jobs;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l)&nbsp;&nbsp;&nbsp; Payroll pay structure; and</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m)&nbsp; Employee benefit package;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (2)&nbsp;&nbsp;Business feasibility factors;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)&nbsp;&nbsp;The potential success of the business;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)&nbsp;&nbsp;The character, experience, management record, and background of the applicant;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)&nbsp;&nbsp;The capacity of the applicant to repay the loan. In determining the capacity of the applicant, the VAFA shall consider the following:</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>The amount of the loan;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>The economic feasibility of the project and product;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>i</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>The ability of the applicant to service the debt from cash flow of operations, capital, or collateral;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>The review of financial status of the project, business plan, and applicant;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;T</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>he satisfaction of engineering standards, legal requirements, and environmental regulations; and</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi)</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>&nbsp;&nbsp;</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>The availability of necessary public utilities;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)&nbsp;&nbsp;The total capitalization of the project, which includes all capitalization subordinated to VAARP;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e)&nbsp;&nbsp;The terms and conditions of the loan and their compatibility with the needs of the business and VAARP; and</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f)&nbsp;&nbsp;The availability of sufficient unencumbered collateral to secure the interests of VAARP.</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Source:</b> 28 SDR 44, effective October 2, 2001.</span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>General Authority:</b> SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=1-16E-24">1-16E-24.</A></span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Law Implemented:</b> SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=1-16E-8">1-16E-8.</A></span></p> <p class=MsoNormal style='text-align:justify'><span style='font-size:12.0pt; font-family:"Times New Roman",serif'>&nbsp;</span></p> </div> </body> </html>