LD 1766
pg. 19
Page 18 of 21 An Act To Simplify the Finance Authority of Maine Act Page 20 of 21
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LR 2611
Item 1
 
authority to be used for direct loans to eligible enterprises or
students pursuing higher education, the authority may provide that
such mortgage loans, interest rate swap agreements or loans to the
authority must be secured by one or more capital reserve funds
established pursuant to subsection 1 instead of or in addition to
mortgage insurance provided under other sections of this
subchapter. Limitations and requirements applicable to mortgage
insurance under sections 1026-A to 1028 are applicable to mortgage
loans, but not interest rate swap agreements or loans to the
authority, to which one or more capital reserve funds apply as if
the mortgage loans were backed by mortgage insurance. Capital
reserve funds may secure interest rate swap agreements pertaining
to eligible enterprises that demonstrate the ability to honor the
swap agreement as determined by the authority and that do not have
as a principal element space for retail sales or professional
office space, as defined by the authority. Any commitment with
respect to a mortgage loan executed and delivered pursuant to this
section is conclusive evidence of the eligibility of the mortgage
loan for insurance and the validity of any such commitment or
contract is incontestable in the hands of a mortgage lender, swap
counterparty or lender to the authority except for fraud or
misrepresentation on the part of the mortgage lender, swap
counterparty or lender to the authority. Mortgages Loans secured
by capital reserve funds under this section are made legal
investments for all insurance companies, trust companies, banks,
investment companies, savings banks, savings and loan associations,
executors, trustees and other fiduciaries, public and private
pension or retirement funds and other persons.

 
Sec. 46. 10 MRSA §1032, sub-§6, as amended by PL 1997, c. 217, §2, is
further amended to read:

 
6. Obligations outstanding. The authority may not have at
any one time outstanding obligations to which this section is
stated in any agreement of the authority to apply in principal
amount exceeding $150,000,000, less the amount of revenue
obligation securities to which section 1053 is stated in the
trust agreement or other document to apply. Amounts of revenue
obligation securities that are not taken into account pursuant to
section 1053, subsection 6, may not be taken into account for
purposes of determining the amount that may be outstanding under
this section. Of the $150,000,000, $1,000,000 must be reserved
for loans insured pursuant to section 1026-O. Notwithstanding
the foregoing, the authority may additionally have outstanding at
any one time up to $3,500,000 of obligations relating to direct
loans to students pursuing higher education.

 
Sec. 47. 10 MRSA §1041-A, first ¶, as enacted by PL 1991, c. 606, Pt.
F, §2, is amended to read:

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