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e .~ • <br />.„ , . .. ,~ . . . . • .. . . <br />(2) The Public. Agency has adopted the Loan Program, the <br />Environmental Quality Commission has approved the Loan Program <br />and the Environmental Quality Commission has approved all <br />amendinents to the Loan Program. <br />.(3) The Public Agency's sewage collection system meets <br />the requixements of Section 2 of Article XI-H of the Oregon <br />Constitution and is eligible for financing with pollution control <br />bond funds. <br />K. Covenants.of the Public Agenc <br />(1) The Public Agency shall administer the program in a <br />manner designed to.maximize timeiy and full repayment of the <br />loans to the Department. ~ ' <br />(2) .The~Public Agency w.ill comply with the provisions <br />of the Fo"reclosure Policy and this Agreement. The Public Agency <br />shall nof renegotiate the terms of any of its Contracts without <br />the consent of tti`e Department. <br />(3) To the extent permitted by law, the Public Agency <br />agrees to indemnify and reimburse~the Department for any payments <br />made or Tosses suffered by ttie Department on behalf of the Public <br />Agency as a resu~lt of the Public Agency's negligence, omissions <br />or breach of any co"venant.or cond~ition of this Agreement. The <br />Public Agency shall no:t meige, dissolve or consolidate in any way <br />which would fiave an adverse affect on the ability of of the <br />PubTie Agency to perform it.s duties hereunder, or which in any <br />manner would decrease the security for the Advances, without the <br />prior written consen€ of t'he Department. This Section shall not <br />be deemed to prevent mergers or consolidations initiated or <br />commenced a"s a result of,proceedings authorized by the <br />legislative assembly of the State of Oregon. <br />(4) The Public Agency will comply with applicable state <br />laws and the rules and regulations of the Department. <br />(5) The Department will fund the Advances with proceeds <br />of previously issued bond~s. The Public Agency agrees to operate <br />the Loan Program arid use the money from the advances in ways <br />which.will not ~ause the interest on such bonds to be taxable <br />under the Internal Revenue Code of 1954 or includable in gross " <br />income under the"Internal Revenue Code of 1986. The Public <br />Agency specifically covenants that: <br />(i) all facilities financed with loan funds shall <br />be owned and operated by~the Public.Agency and shall not be <br />used by any nongovernment except as a member of the general <br />public; ~ <br />~ Page b- Assessment Deferral Loan Agreement <br />