Another question - ORS 86.245 states:
(1) As in this section, “discount rate” means the auction average rate on 91-day United States Treasury Bills, as established by the most recent auction of such Treasury Bills, as published by the US Department of the Treasury, Bureau of the Public Debt, less 100 basis points.
(2) Except as provided in subsections (5) and (7) of this section, any lender who requires a lender’s security protection provision in connection with a real estate loan agreement shall pay interest to the borrower on funds deposited in the account at a rate not less than the discount rate. The discount rate shall be determined with reference to the most recent auction date before May 15 and November 15 each year.
Am I correct in the following scenario? If the 91 day Treasury Bill rate is .12, then the floor we must pay on the account is .12 and not .12 minus 100 basis points or 0%? I guess I need verification that the "discount" rate is the average auction rate AND THEN deduct the 100 basis points. Not .12 minus 100 basis points is the "discount rate." I can't believe we would be allowed to pay 0%. Thank you.