(1) Moneys received by the board from public or private gifts, grants, or donations or from any other source shall be forwarded to the state treasurer and shall be credited to the agriculture value-added cash fund, which fund is hereby created. Moneys in the fund are continuously appropriated to the board and shall be used for the purpose of preparing criteria and reviewing applications as provided in section 35-75-204 and for financial or technical assistance to agricultural projects, project concepts, and research as approved by the board. All interest earned on the investment of moneys in the fund shall be credited to the fund. The board may provide or facilitate grants, loans and loan guarantees, and equity investments for agricultural projects, project concepts, or research; except that such grants, loans and loan guarantees, and equity investments shall be limited to two million dollars per project. Grants, loans and loan guarantees, and equity investments may only be provided to feasible projects and for an amount that is the least amount necessary to cause the project to occur, as determined by the board. The board may structure the grants, loans and loan guarantees, and equity investments in a way that facilitates the project and also provides for a compensatory return on investment or loan payment to the board based on the risk of the project. Any moneys credited to the agriculture value-added cash fund and unexpended at the end of any given fiscal year shall remain in the fund and shall not revert to the general fund or any other fund.

(1.5) Repealed.

(2) (a) The board, upon application, may:

(I) Issue certificates of guaranty covering a first loss guarantee up to, but not more than, twenty-five percent of the loan on a declining principal basis for loans to eligible borrowers, executing a note or other evidence of a loan made for the purpose of a loan made pursuant to this part 2, but not to exceed the amount of two hundred fifty thousand dollars for any eligible borrower; and

(II) Pay from the fund to an eligible lender up to twenty-five percent of the amount, on a declining principal basis, of any loss on any guaranteed loan made pursuant to the provisions of this article in the event of default on the loan. Upon payment on the guarantee, the board shall be subrogated to all the rights of the eligible lender.

(b) The board shall charge for each loan made pursuant to this part 2 a one-time participation fee of one percent of the loan amount, which shall be collected by the eligible lender at the time of closing and paid to the board. In addition, the board may charge a special loan guarantee fee of up to one percent per annum of the outstanding principal, which fee shall be collected from the eligible borrower by the eligible lender and paid to the board. Moneys collected shall be deposited in the agriculture value-added cash fund.

(c) Moneys paid to satisfy a defaulted loan made pursuant to this part 2 shall only be paid out of the agriculture value-added cash fund.

(d) The total outstanding loans made pursuant to this part 2 shall at no time exceed an amount which, according to sound actuarial judgment, would allow immediate redemption of at least forty percent of the outstanding loans guaranteed by the fund at any one time.

(e) The board may make financial arrangements for an eligible business to purchase an existing, established development facility.

(f) The department shall, as part of the administration of the agriculture value-added development fund program created in this part 2, establish market promotion activities and may apply to the board to support such activities through disbursements from the fund.

(3) In any given year, at least ten percent of the funds granted to rural agricultural projects and project concepts shall be awarded in response to grant requests of fifty thousand dollars or less. No single rural agricultural project or project concept shall receive more than two hundred thousand dollars in grant awards from the board.