Whenever any municipality, public trust, rural water or sewer district or any other eligible entity proposes to acquire or construct a project and/or refinance any indebtedness originally incurred to acquire or construct a project, the Board is hereby authorized to advance to the municipality, public trust, rural water district or other eligible entity or combination thereof sufficient funds for such purposes. Such loans by the Board shall be made pursuant to notes, bonds, revenue bonds or other appropriate form of evidence of indebtedness to the Board by the municipality, public trust, rural water district or other eligible entity. The interest rate and loan term shall be determined by the Board, provided, however, that the interest rate for loans made to rural water or sewer districts, created and existing under the provisions of Section 1324.1 et seq. of this title, for the purposes of acquiring or constructing a project and/or refinancing any indebtedness originally incurred to acquire or construct a project, shall not exceed fourteen percent (14%) per annum. As security, the Board may take a mortgage on the entire project, and a pledge of the revenues derived from the operation thereof or such other revenues as may be pledged by the applicant for such purposes. The Board, in its discretion, may defer the principal or an installment on such loans but the total cumulating time such payment may be deferred shall not exceed five (5) years. After a loan or other financial assistance is obtained under Sections 1085.31 through 1085.65 of this title, and during the term of such loan or other financial assistance, no person, other than the eligible entity obtaining the financial assistance, shall be authorized to provide services of the type relied on for security of the loan or other financial assistance to customers of the portion of the system that is identified in the loan documents as collateral for the loan and either (1) in existence at the time of the loan or other financial assistance or (2) financed by the loan or other financial assistance.

Amended by Laws 1982, c. 306, § 6, emerg. eff. May 28, 1982; Laws 1986, c. 272, § 7, operative July 1, 1986; Laws 1987, c. 208, § 116, operative July 1, 1987; Laws 1987, c. 236, § 104, emerg. eff. July 20, 1987; Laws 1989, c. 379, § 2, operative July 1, 1989.