1. (a)

   1. (1) Initially, the nonpoint source program will provide assistance in the form of a linked deposit.
   2. (2) This form of assistance is based on the idea that local financial institutions will provide low interest loans to eligible borrowers if the program is linked to the RLF program depositing funds in that financial institution.
2. (b) Loans will be made for the purpose of implementing best management practices for nonpoint source management projects.
3. (c) RLF program funds will be deposited into a non-interest-bearing demand deposit account or other deposit account at a below market interest rate.
4. (d) The financial institutions will take full responsibility for the credit evaluation of the borrowers, preparation and execution of loan agreements, disbursement of funds, monitoring and servicing of loans, and take the credit risk of possible repayment problems or actual defaults.
5. (e) Deposits in excess of Federal Deposit Insurance Corporation or Federal Savings and Loan Insurance Corporation insured amounts will be fully collateralized by the financial institutions.
6. (f) As changes in priorities require additional funding options, the RLF program will add such features as direct loans, providing funds to other state agencies in Arkansas for use in nonpoint source abatement, or other types of assistance authorized by federal law and/or United States Environmental Protection Agency regulation.

Codification Notes: "RFL" means revolving loan fund.