Chapter 21. Yap Small
Business Loan Security
§2101. Short title.
§2102. Purpose.
§2103. Definitions.
§2104. Program administration.
§2105. Eligibility, sources and authorization of funds in the Program.
§2106. Review and approval of applications for loan security.
§2107. Real property as security for loans.
§2108. Annual report.
§2109. Funds received.
§2110.
Severability.
This chapter shall be known and may
be cited as the "Yap Small Business Loan Security Act".
Source: YSL 4-91 §1, modified.
The purpose of this chapter is to
establish a loan security program for starting or expanding feasible,
small-scale businesses in the State in support of the State public sector
reform program. The public sector reform program requires a shift in
economic emphasis away from the public sector to the private sector and a
loan security program should stimulate the expansion of existing small
businesses and the establishment of new businesses that have the potential
of growth.
Source: YSL 4-91 §2.
As used in this chapter, unless the
context clearly requires otherwise, the term:
(a) "ADB" means the Asian Development Bank.
(b) "Borrower" means a State citizen applying for a loan which is to be secured under this Program.
(c) "FSM" means the National Government of the Federated States of Micronesia.
(d) "PIDB" means the Pacific Islands Development Bank.
(e) "Program" means the loan security program established by this chapter.
(f) "Small business loan security" means a business loan security in an amount not exceeding $50,000.00 provided by the Program for a small-scale business in Yap State by a State citizen or by a State citizen in joint venture with a foreign investor and determined by YIT as consistent with the State public sector reform program.
(g) "State" means the State of Yap.
(h) "State citizen" means any resident of Yap State who is a citizen of the Federated States of Micronesia.
(i) "YIT" means the Yap Investment Trust established by Yap State Law No. 3-84.
Source: YSL 4-91 §3, modified.
Cross-reference; The provisions of YSL 3-84 on the Yap Investment Trust are found chapter 20 of this title.
YIT shall, in a manner consistent
with this chapter and any other requirements applicable to YIT, administer
the Program for the State.
Source: YSL 4-91 §4, modified.
Three distinct categories of
borrowers may apply for loan security in the Program as
follows:
(a) Borrowers retiring under the Yap State early retirement program.
(b) Borrowers wanting to apply to PIDB for small business loans.
(c) Any other borrowers wanting to apply to any other banks for small business loans and needing loan security.
(d) The Governor is authorized to receive funds from any source for the Program. When necessary the Governor may designate a portion of the funds in the Program as a matching for other funds which may be available to the Program on a matching basis.
Source: YSL 4-91 §5, modified.
In addition to any procedures or
requirements YIT may issue to implement this chapter, the following
procedures and requirements shall govern any application for loan security
in the Program:
(a) Prior to submitting an application to PIDB or any other bank for a business loan, a borrower shall submit his or her loan application with a business plan to YIT for YIT's review and approval.
(b) If requested by YIT, the borrower shall provide to YIT any other information relating to the application or business plan for YIT's review and approval.
(c) Prior to approval by YIT of any loan security to any borrower, the borrower and YIT shall execute a written agreement identifying their respective rights and obligations with respect to the loan security provided by YIT.
Source: YSL 4-91 §6, modified.
In addition to other loan security YIT
may require from a borrower requesting loan security from YIT, YIT may,
as a condition of the loan security YIT provides, require and accept title
to real property on behalf and in the name of the State as security for
the borrower's loan security from the Program. YIT may decide
when security in real property is necessary, provided that YIT shall
comply with the requirements of YIT's enabling legislation, the provisions
of the Yap State Deed of Trust Act, and this chapter with respect to
processing and disposing of real property used as loan security in the
Program.
Source: YSL 4-91 §7.
Cross-reference: The statutory provisions on the Yap State Deed of Trust Act are found in chapter 2 of Title 29 of this Code.
No later than the first Monday of May
of each year, YIT shall submit a report to the Governor and the
Legislature regarding the condition of the Program, actual expenditures
therefrom for the last completed fiscal year, estimated expenditures
thereof for the fiscal year in progress, a full accounting of funds from
the State, FSM or other sources for the Program.
Source: YSL 4-91 § 8.
YIT shall deposit all funds received
by it for the Program from any source in an enterprise fund in the manner
authorized by the State Financial Management Act of 1983, as amended.
All such funds shall remain in the enterprise fund for the Program
and no balance thereof shall revert to the General Fund of the State of
Yap.
Source: YSL 4-91 § 9.
Cross-reference: The provisions on State Financial Management Act are found in chapter 12 of Title 13 of this Code. The statutory provisions on the General Fund and other special funds are found in subchapter II of chapter 12 of Title 13 of this Code.
If any provision of this chapter, or
amendments thereto, or application thereof to any person, thing or
circumstance is held invalid, the invalidity does not affect other
provisions or application of the chapter or amendments thereto that can be
given effect without the invalid provision or application, and to this end
the provisions of this chapter, or the amendments thereto, are
severable.
Source: YSL 4-91 § 10, modified.