Texas Agriculture Code 58.071 – Definitions
Terms Used In Texas Agriculture Code 58.071
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- United States: includes a department, bureau, or other agency of the United States of America. See Texas Government Code 311.005
- Written: includes any representation of words, letters, symbols, or figures. See Texas Government Code 311.005
In this subchapter:
(1) “Eligible lending institution” means a financial institution that makes commercial loans, is either a depository of state funds or an institution of the Farm Credit System headquartered in this state, and agrees to participate in the young farmer interest rate reduction program and to provide collateral equal to the amount of linked deposits placed with it.
(2) “Linked deposit” means a time deposit governed by a written deposit agreement between the state and an eligible lending institution that provides:
(A) that the eligible lending institution pay interest on the deposit at a rate that is not less than the greater of:
(i) the current market rate of a United States treasury bill or note of comparable maturity minus three percent; or
(ii) 0.5 percent;
(B) that the state not withdraw any part of the deposit before the expiration of a period set by a written advance notice of the intention to withdraw; and
(C) that the eligible lending institution agree to lend the value of the deposit to an eligible borrower at a maximum rate that is the linked deposit rate plus a maximum of four percent.