Cal. Code Regs. tit. 25 § 8251

Current through Register 2024 Notice Reg. No. 50, December 13, 2024

Section 8251 - Definitions

Unless otherwise indicated by the context, the following definitions shall apply to this subchapter.

(a) "Amortized" or "amortized loan" means a loan which shall be repaid in regular payments of principal and interest sufficient to pay off the loan at maturity.

(b) "Applicant" means an entity applying for a guaranty, a direct loan, or microenterprise assistance.

(c) "Application" means the information provided by a borrower applying for a guaranty, a direct loan, or microenterprise assistance.

(d) "Borrower" means an applicant who has received a guaranty, a direct loan, or microenterprise assistance, but does not include an "intermediary."

(e) "Child care and development facility" means any residence or building or part thereof in which child care and development services are provided.

(f) "Child care and development services" means those services designed to meet a wide variety of needs of children and their families, while their parents or guardians are working, in training, seeking employment, incapacitated, or in need of respite. These services may include direct care and supervision, instructional activities, resource and referral programs, and alternative payment arrangements.

(g) "Collateral" means real or personal property pledged by a borrower, guarantor or intermediary as security for repayment of a direct loan, microenterprise, guarantied loan or intermediary loan.

(h) "Collection guaranty" means a guaranty of a specified percentage of net loan principal and up to 120 days of interest at the same percentage. "Net loan principal" means the amount of loan principal remaining outstanding after the lender has fully complied with the collection procedures described in sections 8261 and 8262 of this subchapter.

(i) "Community Care Licensing Division" means the same as "licensing agency" which means the State Department of Social Services, or its contractor.

(j) "Contractor" means a public or private entity under contract to the department or the department's contractor for the purpose of administering loan guaranties, direct loans or microenterprise.

(k) "Creditworthy" means that with the loan, the borrower will have the ability to, for the reasonably foreseeable future, remain a going concern, and repay the loan on the agreed to terms.

(l) "Default" means:

(1) either a delinquency, or a nonmonetary breach of the lender's loan documents, or

(2) that the borrower is in bankruptcy.

(m) "Delinquency" means the failure of the borrower to make any payment when due, pursuant to the terms of the promissory note.

(n) "Demand" means a request for payment of all outstanding loan principal and interest, and other fees due, on a guarantied loan, direct loan, or microenterprise assistance.

(o) "Demand letter" means a letter containing a demand for payment delivered pursuant to section 8261 of this subchapter.

(p) "Department" means the California Department of Housing and Community Development.

(q) "Direct loan" means a loan made to an applicant by the department or its contractor in a principal amount of not less than $25,000.

(r) "Direct Loan Fund" means the Child Care and Development Facilities Direct Loan Fund established by subdivision (b) of Education Code section 8277.5.

(s) "Direct loan program" refers, collectively, to those provisions of the statutes and this subchapter relating to the making of loans using funds from the Direct Loan Fund.

(t) "Environmental survey" means an assessment to be completed by the applicant, or other individuals familiar with the project, which will give the lender an indication of the possible risks from any hazardous substance that may be encountered relative to the project. "Hazardous substance," for the purpose of this subchapter shall have the same meaning as set forth in paragraph (2) of subdivision (e) of section 2929.5 of the Civil Code.

(u) "Facility" means the same thing as "child care and development facility."

(v) "Family child care home" means a facility which is a residence at which child care and development services are provided for more than six (6) children.

(w) "Guaranty" means a written agreement between a lender and another entity whereby the entity agrees to pay the lender a percentage of a loan if the borrower for that loan fails to perform. Every guaranty shall be either a "collection guaranty" or a "loan guaranty."

(x) "Guarantied loan" means a loan made by a lender to a borrower for which a guaranty has been issued pursuant to this subchapter.

(y) "Improvement" means a physical change to real property which increases its utility to the owner for the provision of child care and development services.

(z) "Intermediary" means an entity selected by the department to receive a loan from the Microenterprise Set Aside and which awards microenterprise assistance to ultimate recipients and monitors and services that assistance.

(aa) "Intermediary loan" means a loan from the department from the Microenterprise Set Aside to an Intermediary to operate a micrenterprise relending program.

(bb) "Lender" means a banking organization, including banks and trust companies and state chartered commercial banks, savings and loan associations, credit unions, state insurance companies, mutual insurance companies, retirement and insurance companies, and other lending entities authorized to conduct business in California, and includes the department or its contractor for direct loans made pursuant to this Subchapter.

(cc) "Lender certification" means a written statement by a lender certifying that:

(1) the loan being guarantied would not be made without the guaranty; and

(2) the lender will not charge loan fees or charges other than those charged for similar loans.

(dd) "License" means the license required by Health and Safety Code section 1596.80 to operate a child day care facility (as defined by Health and Safety Code section 1596.750) and issued by the Community Care Licensing Division of the State Department of Social Services, or its contractor.

(ee) "Licensed child care and development facility" means a facility operating under a valid license.

(ff) "Loan" means a direct loan made to a borrower by the department or its contractor, a microenterprise assistance loan made to a borrower by an intermediary, or a loan made to a borrower by a lender and guarantied by the department or its contractor, and which loan has been made or guarantied pursuant to this subchapter.

(gg) "Loan Agreement" means an agreement for a loan entered into between a lender and a borrower.

(hh) "Loan Guaranty" means a guaranty of a specified percentage of loan principal and up to one hundred twenty (120) days interest at the same percentage as specified in the underlying guaranty.

(ii) "Loan Guaranty Fund" means the Child Care and Development Facilities Loan Guaranty Fund established by subdivision (b) of section 8277.5 of the Education Code.

(jj) "Guaranty program" collectively refers to those provisions in the statutes and this subchapter relating to the making of guaranties backed by funds from the Loan Guaranty Fund.

(kk) "Lower Income" means the same thing as "income eligible" as set forth in Section 8263.1 of the California Education Code.

(ll) "Microenterprise business" means a business with five or fewer employees, including the owner.

(mm) "Microenterprise assistance loan" means a loan of not more than $24,999 and made by an intermediary to an ultimate recipient.

(nn) "Microenterprise Assistance program" means the program set forth in Article 5 of this subchapter.

(oo) "Microenterprise Assistance Set Aside" means the funds set aside by the department from the Direct Loan Fund for the purpose of the Microenterprise Assistance program.

(pp) "Note" or "promissory note" means a promise in writing and executed by a borrower to pay a specified amount during a limited time or on demand.

(qq) "Program assistance" means a direct loan, a guarantied loan, or assistance provided through the Microenterprise Assistance Program to an ultimate recipient.

(rr) "Project" means the activity for which the loan is being requested.

(ss) "Rural area" or "rural community" means any area or community located in a county with fewer than 400 residents per square mile as determined from the most recent decennial census.

(tt) "Security" means the same thing as "collateral."

(uu) "Statutes" means Education Code sections 8277.5 and 8277.6.

(vv) "Surplus Money Investment Fund" means the Surplus Money Investment Fund referenced in Government Code section 14671.

(ww)" " Ultimate recipient" means a family child care home provider serving more than six children and which has received assistance through an intermediary from the Microenterprise Assistance Program.

Cal. Code Regs. Tit. 25, § 8251

1. New section filed 4-16-99 as an emergency; operative 4-16-99 (Register 99, No. 16). A Certificate of Compliance must be transmitted to OAL by 10-13-99 pursuant to Education Code section 8277.6 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 10-1-99 as an emergency; operative 10-13-99 (Register 99, No. 40). A Certificate of Compliance must be transmitted to OAL by 2-10-2000 or emergency language will be repealed by operation of law on the following day.
3. Repealed by operation of Government Code section 11346.1(g) (Register 2000, No. 9).
4. New section filed 2-2-2001; operative 2-2-2001 pursuant to Government Code section 11343.4(c) (Register 2001, No. 5).

Note: Authority cited: Section 8277.6(g), Education Code. Reference: Sections 8208(g), 8208(i), 8277.5 and 8277.6, Education Code.