265—26.6(16) Nonpoint source loan programs.
- 26.6(1) Nonpoint source loan assistance. Loan assistance for nonpoint source projects will be in the form of low-interest loans, linked deposits, or loan participations through participating lending institutions.
- 26.6(2) Application for loan assistance. Application for loan assistance pursuant to this rule may be made at any participating lending institution or submitted to the authority or the authority’s agent, as applicable. A list of participating lending institutions will be made available by the authority or other entity that assists the authority to administer this program. Applications for loan assistance shall be in the form and content established by the authority.
- 26.6(3) Project approval. Each project must be approved by the appropriate environmental or conservation agency identified in subrule 26.6(7).
- 26.6(4) Loan approval. For linked deposit programs, the participating lending institution will either approve or deny the loan in accordance with the program requirements after receipt of a completed loan application form. If the loan is approved, the lending institution will notify the authority, or its agent, to reserve funds in that amount. This reservation is necessary to ensure that funds are available at the time of disbursement. If the loan is denied, the lending institution must notify the loan applicant, and the lending institution must clearly state the reasons for the loan denial. For low-interest loans with the authority, the authority or its agent will notify the applicant of the loan approval or denial. For loan participation, the authority or its agent will notify the applicant of the approval or denial.
- 26.6(5) Availability of funds. Before acting on a loan application, the lending institution shall ensure that adequate funds are available for the project.
- 26.6(6) Property transfer. The balance of a loan made pursuant to this rule shall be immediately due in full if the recipient transfers the project property.
26.6(7) Loan amount and period. All loans will be made contingent on the availability of funds for the applicable purpose as indicated in the IUP. The minimum and maximum loan amounts for each project type are as follows:
| Type of Project | Type of Assistance | Minimum Loan Amount | Maximum Outstanding Balance | Maximum Loan Term | Project Approval Agency |
| General Nonpoint Source | Low-interest loans, Linked deposit or Loan participations | $5,000 | No maximum | 20 years | DNR |
| Local Water Protection | Linked deposit | $5,000 | $500,000 per common ownership | 10 years | Division of Soil Conservation |
| Livestock Water Quality Facilities | Linked deposit | $10,000 | $500,000 per common ownership | 15 years* | Division of Soil Conservation |
| On-Site Wastewater Systems Assistance | Linked deposit | $2,000 | No maximum | 10 years | County |
*If the loan is made only for preparation of a comprehensive nutrient management plan, the loan period shall not exceed five years.
For the purposes of this subrule, “common ownership” means the ownership of an animal feeding operation as a sole proprietor, or a majority ownership interest held by a person, in each of two or more animal feeding operations as a joint tenant, tenant in common, shareholder, partner, member, beneficiary, or other equity interest holder. The majority ownership interest is a common ownership interest when it is held directly, indirectly through a spouse or dependent child, or both.
- 26.6(8) Prepayment. A recipient may prepay a loan, in whole or in part, without penalty, with the written consent of the authority.
- 26.6(9) Loan adjustments. If the eligible costs exceed the loan amount, the recipient may request an increase in the loan amount. The lending institution is authorized to execute a loan for a principal amount of up to 10 percent above the amount of the loan application if the eligible costs exceed the application amount. The authority will evaluate the request by considering available moneys and financial risk. Should the eligible costs be less than the loan amount, the loan shall be appropriately adjusted so that the loan amount does not exceed the amount of eligible costs.
- 26.6(10) Disbursement of funds. Funds shall be disbursed in accordance with the loan agreement. The loan agreement may allow for periodic disbursement of funds.
[ARC 9821C, IAB 12/10/25, effective 1/14/26]