9 NYCRR 7910.8

The interest rates on loans proposed to be made by a financing institution shall be reviewed by the Energy Office. The Energy Office, in its discretion, may refuse to issue interest subsidies on loans which are proposed to be made at rates determined by the Energy Office to be unreasonably high after considering prevailing market rates, interest rates on other program loans, and the class of the loan.

Program loans shall contain one of the following types of payment schedules:

Payment of the loan, including principal and interest, is made in equal installments.

The Energy Office, in its discretion, may agree to issue interest subsidies on loans which contain alternative payment schedules. Interest subsidies on loans with althernative payment schedules shall be calculated in accordance with section 7910.3(c) of this Part.

Applicants may apply for interest subsidies under the program in connection with more than one eligible building. The total of all loans subsidized under this program for any single applicant may not exceed $1 million; provided, however, that any amount in excess of $500,000 must be attributable to the implementation of an onsite power production project.

For construction loans in which the principal amount is paid to the applicant by the financing institution in installments as work progresses, the interest subsidy will not be paid for any period of time prior to the payment by the financing institution of the final installment.

Work on energy conservation improvement projects which receive an interest subsidy must be completed within six months of the program loan closing. The Energy Office may extend this period on a case-by-case basis where the applicant has demonstrated reasonable cause for the delay.

Program loans shall be made by a financing institution only after the applicant and financing institution receive written notification from the Energy Office approving both the application and the terms of the financing institution's loan commitment, and stating the amount of the interest subsidy which will be paid by the Energy Office.

The commissioner may, in his discretion, use monies appropriated to the program for the purpose of providing principal reductions on program loans, where the terms and conditions applicable to such appropriated funds allow for such use.

Except as otherwise provided for in this subdivision, where a borrower defaults on a program loan, interest subsidies will be terminated and any interest subsidy payments being held by the financing institution will be returned to the Energy Office. The financing institution shall notify the Energy Office of the default within 30 calendar days of its occurrence. The Energy Office may, in its discretion, authorize the financing institution to continue to receive interest subsidies on behalf of the borrower for an agreed-upon period of time while the financing institution works out a revised payment schedule with the borrower. If continued interest subsidies are authorized by the Energy Office and loan payments are not resumed by the borrower within 90 days of the initial default, then all subsidy payments will be terminated immediately. Where a new payment schedule is established between the banking organization and the borrower within the designated time period, the total interest subsidy originally approved by the Energy Office will remain unchanged. However, the Energy Office may establish a revised schedule of interest subsidy payments on behalf of the borrower.

In the event of the prepayment of a program loan, the financing institution will be required to promptly return any unapplied portion of the interest subsidy being held by the financing institution to the Energy Office.

The applicant shall promptly provide written notice to the Energy Office of any changes in energy conservation improvements to be implemented which differ from the program application submitted to the Energy Office. Loan subsidies will not be provided by the Energy Office unless such changes are approved by the Energy Office.

The applicant shall promptly provide written notice to the Energy Office of any change in the cost of an energy conservation improvement project which differs from the selected contractor's cost estimate, or the applicant's schedules and selected estimate in the case of an in-house project submitted to the Energy Office, by either more than 10 percent or $20,000. Based on such changed costs, the Energy Office may adjust the interest subsidy as follows:

The approved applicant shall promptly provide written notice to the Energy Office of its receipt of a financial incentive from its utility company for the energy conservation improvements funded under this program. The amount of any incentive received shall be deducted from the project cost to arrive at a net project cost, and the amount of the interest subsidy shall be recalculated based on the net project cost.