CHAPTER 31 HOUSE BILL No. 2055 An Act concerning agriculture; relating to agricultural production loan deposit agreements;
interest rate; amending K.S.A. 2002 Supp. 75-4272 and repealing the existing section. Be it enacted by the Legislature of the State of Kansas:

      Section  1. K.S.A. 2002 Supp. 75-4272 is hereby amended to read as
follows: 75-4272. (a) The state treasurer may accept or reject an agricul-
tural production loan deposit loan package based on the state treasurer's
evaluation of whether the loan to the eligible agricultural borrower meets
the purposes of this act. If sufficient funds are not available for an agri-
cultural production loan deposit, then the applications may be considered
in the order received when funds are once again available subject to a
review by the lending institution.

      (b) Upon acceptance, the state treasurer shall certify to the director
of investments the amount required for such agricultural production loan
deposit loan package and the director of investments shall place an ag-
ricultural production loan deposit in the amount certified by the state
treasurer with the eligible lending institution at an interest rate, which is
2% below the market rate provided in K.S.A. 75-4237, and amendments
thereto, and which shall be recalculated on the first business day of Jan-
uary and July of each year using the market rate then in effect. When
necessary, the state treasurer may request the director of investments to
place such agricultural production loan deposit prior to acceptance of an
agricultural production loan deposit loan package.

      (c) The eligible lending institution shall enter into an agricultural pro-
duction loan deposit agreement with the state treasurer, which shall in-
clude requirements necessary to implement the purposes of the Kansas
agricultural production loan deposit program. Such requirements shall
include an agreement by the eligible lending institution to lend an amount
equal to the agricultural production loan deposit to eligible agricultural
borrowers at an interest rate which is not more than 2% above the market
rate as determined under K.S.A. 75-4237, and amendments thereto, and
which 4% greater than the interest rate on agricultural production loan
deposits as provided in subsection (b), except that for agricultural pro-
duction loans made commencing on the effective date of this act and end-
ing June 30, 2003, such interest rate shall be 4%. Such rate shall be re-
calculated on the first business day of January and July of each year using
the market rate then in effect. The agreement shall include provisions
for the agricultural production loan deposit to be placed for a maturity
considered appropriate in coordination with the underlying agricultural
production loan. The agreement shall include provisions for the reduction
of the agricultural production loan deposit in an amount equal to any
payment of loan principal by the eligible agricultural borrower.

      Sec.  2. K.S.A. 2002 Supp. 75-4272 is hereby repealed.

      Sec.  3. This act shall take effect and be in force from and after its
publication in the Kansas register.

Approved April 3, 2003.
 Published in the Kansas Register April 17, 2003.
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