(a) The following requirements and conditions apply to loans provided by the Foundation:
(1) The maximum total amount of loans provided to an individual recipient shall not exceed $500,000.
(2) The maximum loan amount for any loan shall not exceed 70% of the appraised preservation easement value of the farmland property which is being purchased and subject to perpetual preservation easement.
(3) A condition of the loan is that the eligible farmland being acquired is to be subjected at closing to a permanent preservation easement in the form determined by the Foundation, such easement to have priority status and not be subject to subordination.
(4) The loans provided by the Foundation shall be secured by notes and mortgages which allow for the following conditions:
a. Notes and mortgages will be subordinated to other loans provided for the purchase, in whole or in part, of the eligible farmlands; provided however, that the perpetual preservation easement placed on the eligible farmland property at the time of settlement shall not be subordinated.
b. The notes and mortgages shall bear no interest and the payback may be structured for final payback within 30 years, with initial payments to begin after the primary commercial or other financing for the purchase of the farmland property is satisfied or released.
c. The notes and mortgages shall contain a requirement for payment in full of the balance of the loan upon the sale or transfer of the secured farmland property; provided however, the Foundation shall have the discretion to allow for assumption of the loan by the transferee under such terms and conditions deemed advisable, provided the transferee satisfies the loan eligibility requirements set forth in § 944(a) of this title above.
(5) Loans are limited to the purchase of farmland and farmland improvements only. Portions of the property subject to purchase which are used or proposed for use for residential purposes are not eligible for loans, provided further nonetheless, that those lands used or intended for use for residential purposes are subject to the limitations set forth in § 909(a)(4)a. and b. of this title.
(b) The approval of loans by the Foundation under this subchapter is purely a discretionary function and the Foundation shall be under no obligation to provide a loan to any applicant.
78 Del. Laws, c. 157, § 1; 81 Del. Laws, c. 76, § 3.
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