Loan guaranty; important agricultural lands; agricultural and aquacultural loans
HRS §155-5.6
in effect155-5.6. Loan guaranty; important agricultural lands; agricultural and aquacultural loans
(a) From July 1, 2009, the chairperson of the board of agriculture and biosecurity may guarantee loans made by commercial lenders authorized to do business in this State, to agricultural producers for the purpose of developing and implementing agricultural projects; provided that the chairperson of the board of agriculture and biosecurity shall determine that:
(1) The agricultural projects are located on lands
designated as important agricultural lands pursuant to part III of chapter 205;
and
(2) The commercial lender has completed its due
diligence in approving the loan, including ensuring adequate collateral.
The chairperson of the board of agriculture and
biosecurity may impose other conditions that the chairperson deems reasonable
to implement the loan guaranty.
(b) In addition to the conditions that the
chairperson of the board of agriculture and biosecurity may impose under
subsection (a), any loan guaranty made pursuant to this section shall meet the
following conditions:
(1) For any loan that finances operating costs, the
maximum term of the loan shall be ten years;
(2) For any loan that finances capital improvement
costs, the maximum term of the loan shall be twenty years;
(3) The interest rate charged on any loan shall be
one per cent below the commercial lender's prime rate for as long as the loan
guaranty is in effect;
(4) The loan guaranty may be up to eighty-five per
cent of the outstanding principal amount of any single loan, but shall not
include any fees or accrued interest associated with the loan or its
collection; and
(5) The total principal amount of the guaranteed
portion of all loans outstanding at any time shall not exceed $2,500,000.
(c) The department of agriculture and
biosecurity may adopt rules pursuant to chapter 91 to effectuate this section.
(d) As used in this section:
"Agricultural producer" means a
farmer, cooperative association, or landowner who derives at least fifty per
cent of its gross income from agricultural or aquacultural activities.
"Agricultural project" means a
project relating to agricultural or aquacultural operations or capital
improvements.
[L 2008, c 233, §8; am L 2025, c 236, §§17,
18]
Source: Hawaii State Legislature (capitol.hawaii.gov), via Internet Archive capturesURL: http://www.capitol.hawaii.gov/hrscurrent/Vol03_Ch0121-0200D/HRS0155/HRS_0155-0005_0006.htmFetched: 11/10/2026