Opinion No. 73-177 (1973) Ag

RATE OF INTEREST — LEASE RENTAL CONTRACTS A rate of interest in excess of six per cent (6%) per annum may not be charged on lease-rental contracts on road machinery or equipment entered into by the counties. This is to acknowledge receipt of your letter dated April 26, 1973, wherein you ask the following questions: "Question 1. May a rate of interest in excess of Six per cent (6%) per annum be charged on lease-rental contracts on road machinery or equipment to be paid by the counties?" "Question 2. If the above question be answered in the affirmative, what is the maximum rate of interest that may be charged in said contracts?" In your letter, you state additional facts in that you state that your office is presently engaged in an audit of the books, records and fiscal accounts, particularly lease-rental contracts of road machinery and equipment. You find a number of contracts providing for the payment of interest at a rate in excess of six per cent (6%) on the lease-rental contracts entered into by County Commissioners. In your letter, you refer to Attorney General Opinion 69-231, which, in effect, held that the interest rate schedules in the Uniform Consumer Credit Code, Title 14A O.S. 1-101 [14A-1-101] through 14A O.S. 9-102 [14A-9-102] (1971) do not apply to lease-rental contracts entered into by the counties. Title 62 O.S. 430.1 [62-430.1] (1971) states in part: "The Board of County Commissioners of any county, the governing board of any city or town, the school board or board of education of any school district, is hereby authorized to rent on a monthly basis, . . . and in no event shall the lease be extended so as to cause payment of more than the original purchase price of said buildings or equipment plus interest not to exceed the legal rate . . ." (Emphasis added) Title 15 O.S. 266 [15-266] (1971) states: "The legal rate of interest shall be six per cent (6%) in the absence of any contract as to the rate of interest, and by contract the parties may agree to any rate as may be authorized by law, now in effect or hereinafter enacted." Title 62 O.S. 431 [62-431] (1971), in effect, states that the interest rate paid on the equipment shall not exceed the legal rate, and Title 15 O.S. 266 [15-266] (1971) states that the legal rate shall be six per cent (6%) in the absence of any agreement as to the rate of interest. A previous Attorney General Opinion to Robert L. Wheeler, County Attorney, Tulsa County, dated October 16, 1954, states in the last paragraph: ". . . and that said monthly rentals shall not be paid over a longer period than is necessary to pay said purchase price plus interest on said amount at an agreed rate not to exceed six per cent (6%) per annum." The effect of this previous Attorney General opinion is to define the legal rate of interest as a rate not in excess of six per cent (6%). Based upon the two statutes cited above, this office is in agreement with the previous Attorney General opinion in that the legal rate of interest on these lease purchase contracts entered into by the counties shall not exceed six per cent (6%). It is, therefore, the opinion of the Attorney General that your first question be answered in the negative in that a rate of interest in excess of six per cent (6%) per annum may not be charged on lease-rental contracts on road machinery or equipment entered into by the counties. Since the first question was answered in the negative, it is not necessary to answer the second question. (Todd Markum) ** SEE: OPINION NO. 76-324 (1976) **