HB 338: "An Act relating to the power project fund and the bulk fuel revolving loan fund; authorizing the Alaska Energy Authority to borrow money from the power project fund for the bulk fuel revolving loan fund and to repay money borrowed; and providing for an effective date."
00 HOUSE BILL NO. 338 01 "An Act relating to the power project fund and the bulk fuel revolving loan fund; 02 authorizing the Alaska Energy Authority to borrow money from the power project fund 03 for the bulk fuel revolving loan fund and to repay money borrowed; and providing for 04 an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 42.45.010(b) is amended to read: 07 (b) The authority may make loans from the power project fund 08 (1) to electric utilities, regional electric authorities, municipalities, 09 regional and village corporations, village councils, and independent power producers 10 [, AND NONPROFIT MARKETING COOPERATIVES] to pay the costs of 11 (A) reconnaissance studies, feasibility studies, license and 12 permit applications, preconstruction engineering, and design of power projects; 13 and 14 (B) constructing, equipping, modifying, improving, and
01 expanding small-scale power production facilities that are designed to produce 02 less than 10 megawatts of power, bulk fuel storage facilities, and transmission 03 and distribution facilities, including energy production, transmission and 04 distribution, waste energy, energy conservation, energy efficiency, and 05 alternative energy facilities and equipment; [AND 06 (C) RECONNAISSANCE STUDIES, PRECONSTRUCTION 07 ENGINEERING, DESIGN, CONSTRUCTION, EQUIPPING, 08 MODIFICATION, AND EXPANSION OF POTABLE WATER SUPPLY 09 INCLUDING SURFACE STORAGE AND GROUNDWATER SOURCES 10 AND TRANSMISSION OF WATER FROM SURFACE STORAGE TO 11 EXISTING DISTRIBUTION SYSTEMS;] 12 (2) to a borrower for a power project or for bulk fuel, waste energy, 13 energy conservation, energy efficiency, or alternative energy facilities or equipment if 14 (A) the loan is entered into under a leveraged lease financing 15 arrangement; 16 (B) the party that will be responsible for the power project or 17 the bulk fuel, waste energy, energy conservation, energy efficiency, or 18 alternative energy facilities or equipment is an electric utility, regional electric 19 authority, municipality, regional or village corporation, village council, or 20 independent power producer [, OR NONPROFIT MARKETING 21 COOPERATIVE]; and 22 (C) the borrower seeking the loan demonstrates to the authority 23 that the financing arrangement for the power project or the bulk fuel, waste 24 energy, energy conservation, energy efficiency, or alternative energy facilities 25 or equipment will reduce financing costs for the project, facilities, or 26 equipment below costs of comparable public power projects, facilities, or 27 equipment; 28 (3) to the bulk fuel revolving loan fund for the purposes described 29 in AS 42.45.250(m) under terms, including interest, that the authority determines 30 are appropriate to maintain the viability of the power project fund and the bulk 31 fuel revolving loan fund; however, the authority may not make a loan under this
01 paragraph if 02 (A) the cumulative outstanding balance of the loans would 03 exceed the lesser of $2,000,000 or 10 percent of the cash balance of the 04 power project fund on June 30 of the preceding fiscal year; or 05 (B) if the cash balance of the power project fund is less than 06 $5,000,000. 07 * Sec. 2. AS 42.45.010(f) is amended to read: 08 (f) A loan for power [POWER] projects and bulk fuel, waste energy, 09 energy conservation, energy efficiency, and alternative energy facilities or 10 equipment [ARE SUBJECT TO THE FOLLOWING LIMITATIONS ON 11 INTEREST AND SPECIFIC RESTRICTIONS:] 12 (1) [POWER PROJECTS FOR WHICH LOANS ARE 13 OUTSTANDING FROM THE FORMER WATER RESOURCES REVOLVING 14 LOAN FUND (FORMER AS 45.86) ON JULY 13, 1978, MAY RECEIVE 15 ADDITIONAL FINANCING FROM THE POWER PROJECT FUND; IF 16 GRANTED, 17 (A) THE TERM OF THE ADDITIONAL FINANCING MAY 18 NOT EXCEED 50 YEARS; 19 (B) THE INTEREST OF THE ADDITIONAL FINANCING 20 MUST BE AT A RATE OF NOT LESS THAN THREE OR MORE THAN 21 FIVE PERCENT A YEAR ON THE UNPAID BALANCE; 22 (C) THE GRANT OF THE ADDITIONAL FINANCING 23 MUST BE CONDITIONED ON THE REPAYMENT OF LOAN PRINCIPAL 24 AND INTEREST TO BEGIN ON THE EARLIER OF 25 (i) THE DATE OF THE START OF COMMERCIAL 26 OPERATION OF THE PROJECT; OR 27 (ii) 10 YEARS FROM THE DATE THE LOAN IS 28 GRANTED; 29 (2) A LOAN FOR A POWER PROJECT 30 (A)] may not be granted for a term that exceeds 50 years; and 31 (2) [(B)] shall be granted at an interest rate that is not less than zero
01 percent and that is the lesser of 02 (A) [(i)] a rate equal to the percentage that is the average 03 weekly yield of municipal bonds for the 12 months preceding the date of the 04 loan, as determined by the authority from municipal bond yield rates reported 05 in the 30-year revenue index of The [THE WEEKLY] Bond Buyer; or 06 (B) [(ii)] a rate determined by the authority that allows the 07 project to meet criteria of financial feasibility established under (c) of this 08 section. 09 * Sec. 3. AS 42.45.250(f) is amended to read: 10 (f) Interest may be charged on a loan made from the bulk fuel revolving loan 11 fund. Interest shall be charged on a loan at a rate equal to the percentage of the 12 average weekly yield of municipal bonds for the 12 months preceding the date of the 13 loan, as determined by the authority from municipal bond yield rates reported in the 14 30-year revenue index of The [THE WEEKLY] Bond Buyer. However, if the 15 authority finds that a community cannot afford to repay a portion of interest on a loan, 16 and makes a determination in writing, the authority may reduce or eliminate the 17 interest rate applicable to the loan. 18 * Sec. 4. AS 42.45.250 is amended by adding a new subsection to read: 19 (m) Subject to the limitations of AS 42.45.010(b)(3), the authority may 20 borrow money from the power project fund (AS 42.45.010) when necessary to meet 21 commitments for loans from the bulk fuel revolving loan fund. The authority shall use 22 the money in the bulk fuel revolving loan fund to repay the money borrowed from the 23 power project fund and any interest charged on the money borrowed. 24 * Sec. 5. This Act takes effect immediately under AS 01.10.070(c).