A fee for administrative costs, which must be at a rate set by rule by the commissioner upon consultation with the Potato Marketing Improvement Committee but which that may not exceed 1% of the loan, must be charged on all loans made for projects, the total cost of which exceeds $50,000. This fee must be deposited in the fund Potato Marketing Improvement Fund.

Sec. 5. 7 MRSA §977 is enacted to read:

§977.__Potato Marketing Improvement Fund Operating Account

There is established a Potato Marketing Improvement Fund Operating Account.__This account draws funds from the Potato Marketing Improvement Fund established in Title 10, section 1023- N on a periodic basis to be determined by the department to cover the costs of administering the fund and any grants made.

Sec. 6. 10 MRSA §1023-N is enacted to read:

§1023-N.__Potato Marketing Improvement Fund

There is created a fund known as the Potato Marketing Improvement Fund, referred to in this section as the "fund."__The fund must be deposited with and maintained by the authority.__The fund must be administered by the Commissioner of Agriculture, Food and Rural Resources in accordance with Title 7, chapter 103, subchapter X.__All money received by the authority from any source for the development and implementation of an improved storage, packing and marketing program must be credited to the fund.__Any money credited to the fund from the issuance of bonds on behalf of the State for agricultural development may be used only for the purposes of state loans as prescribed by Title 7, section 974-A to provide assistance to farmers for the design, construction, improvement, support and operation of storage, packing and marketing facilities and to pay the administrative costs of processing loan applications and servicing and administering the fund and loans and grants made therein, to the extent that the costs exceed the fee for administrative costs established by Title 7, section 974-A, subsection 2.__Repayment of these loans and interest on the loans must be credited to the fund to be available for making additional state loans for the same purposes, except that any interest earned on the cash balance of the fund may be used for the grants authorized by Title 7, section 975-A.__In order to provide additional amounts for loans, the Commissioner of Agriculture, Food and Rural Resources, at the commissioner's discretion, may take such

actions and enter into such agreements as may be necessary to sell or assign up to $2,000,000 in the aggregate principal amount of loans and undivided interests in a pool of loans and assign or pledge any mortgage or other security to the authority, under the terms and conditions the commissioner considers advisable.__The assignment and related transactions may not result in indebtedness of the State.__The proceeds of the sale or assignment must be credited to the fund and used for the purposes authorized in this section.

A purchaser of a modern storage facility that was previously financed with a state loan from the fund may receive a loan under the conditions of this section.__Mortgages obtained from the fund may be assumed by subsequent purchasers of the property.__The Department of Agriculture, Food and Rural Resources shall adopt rules concerning the purchase of existing buildings.

Rules adopted pursuant to this section are routine technical rules as defined in Title 5, chapter 375, subchapter II-A.__These rules must include provisions that ensure that such purchases are in keeping with the purposes and intent of this subchapter and of Private and Special Law 1981, chapters 65 and 75.__They must also include a definition of a modern storage facility.

Sec. 7. Appropriation. The following funds are appropriated from the Other Special Revenue to carry out the purposes of this Act.

2001-02 2002-03

OTHER SPECIAL REVENUE:

AGRICULTURE, FOOD AND RURAL

RESOURCES, DEPARTMENT OF

Market and Production Development,

Division of

Positions - Legislative Count (1.000) (1.000)

Personal Services $63,582 $65,402

All Other 116,033 104,210

________ ________

TOTAL $179,615 $169,612

Potato Marketing Improvement

Fund

Positions - Legislative Count (-1.000) (-1.000)

Personal Services ($63,582) ($65,402)

All Other (116,033) (104,210)

__________ __________

TOTAL ($179,615) ($169,612)

DEPARTMENT OF AGRICULTURE,

FOOD AND RURAL RESOURCES __________ __________

TOTAL $0

SUMMARY

The purpose of this bill is to streamline the administration of the Potato Marketing Improvement Fund. This bill establishes the Potato Marketing Improvement Fund Operating Account and specifies that the Commissioner of Agriculture, Food and Rural Resources administers the Potato Marketing Improvement Fund.