A. Small business recovery loans shall be made for loan periods not to exceed ten years, as determined by the authority. The loans shall bear an annual interest rate equal to one-half of the Wall Street Journal prime rate on the date the loan is made; provided that no interest shall accrue during the first year of the loan.
B. Interest shall begin to accrue on a small business recovery loan on the first anniversary of the funding date of the loan. Thereafter, for the next two years, the authority shall require interest-only payments on a schedule determined by the authority. Beginning on the third anniversary of the funding date of the loan, payment on the outstanding principal and interest on the loan shall be due on a schedule determined by the authority for the remainder of the loan period.
C. Receipts from the repayment of principal or interest accrued on the loans made pursuant to the Small Business Recovery and Stimulus Act shall be transferred from the authority to the state investment council and deposited in the severance tax permanent fund.
D. No provision in a small business recovery loan or the evidence of indebtedness of the loan shall include a penalty or premium for prepayment of the balance of the indebtedness.
History: Laws 2020 (1st S.S.), ch. 6, § 5; 2021, ch. 5, § 5.
The 2021 amendment, effective March 3, 2021, increased the loan periods for small business recovery loans, provided that no interest shall accrue during the first year of a small business recovery loan, and changed the repayment terms for small business recovery loans; in Subsection A, after "shall be made for", deleted "an initial loan period of three" and added "loan periods not to exceed ten", after "years,", added "as determined by the authority", and after the semicolon, added "provided that no interest shall accrue during the first year of the loan"; completely rewrote Subsection B; and in Subsection C, changed "Small Business Recovery Act of 2020" to Small Business Recovery and Stimulus Act", and after "shall be", added "transferred from the authority to the state investment council and".
Temporary provisions. — Laws 2021, ch. 5, § 8, provided that for any small business recovery loan provided pursuant to the New Mexico Small Business Recovery Act of 2020 made prior to March 3, 2021, the New Mexico finance authority shall permit the recipient of that loan to refinance the loan subject to terms consistent with Laws 2021, ch. 5.