00 SENATE BILL NO. 34
01 "An Act establishing the Alaska small business revolving loan fund; relating to the fund
02 and loans from the fund; and providing for an effective date."
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
04 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section
05 to read:
06 SHORT TITLE. This Act may be known as the Alaska Small Business Act.
07 * Sec. 2. AS 44.33 is amended by adding new sections to read:
08 Article 15. Alaska Small Business Revolving Loan Fund.
09 Sec. 44.33.950. Alaska small business revolving loan fund. (a) A revolving
10 loan fund to be known as the Alaska small business revolving loan fund is created in
11 the general fund. The Department of Commerce, Community, and Economic
12 Development may use money in the fund to carry out the purposes of AS 44.33.950 -
14 (b) The fund consists of the following:
01 (1) money appropriated to the fund, including money appropriated
02 from the following sources:
03 (A) interest payments or other income earned on loans or
04 investments of the fund;
05 (B) money chargeable to interest that is collected through
06 liquidation by foreclosure or other process on loans made under AS 44.33.950
07 - 44.33.990; and
08 (C) money received by gift, devise, bequest, or donation to the
10 (2) principal payments on loans from the fund;
11 (3) money chargeable to principal that is collected through liquidation
12 by foreclosure or other process on loans made under AS 44.33.950 - 44.33.990.
13 (c) Money in the fund may be used by the legislature to make appropriations
14 for costs of administering AS 44.33.950 - 44.33.990.
15 Sec. 44.33.955. Powers and duties of the department. The department may
16 (1) make loans from the fund to eligible applicants under
17 AS 44.33.960 to be used for working capital, equipment, construction, or other
18 commercial purposes by a business located in the state;
19 (2) receive, take, hold, and administer any appropriation, gift, grant,
20 bequest, devise, or donation of money for the fund;
21 (3) establish amortization plans for repayment of loans, including
22 extensions of the terms of loans;
23 (4) allow an assumption of a loan if
24 (A) the applicant meets the requirements established under
25 AS 44.33.960; and
26 (B) approval of the assumption would be consistent with the
27 purposes of this section;
28 (5) establish the rate of interest for loans consistent with law;
29 (6) charge and collect fees for services provided under AS 44.33.950 -
31 (7) adopt regulations under AS 44.62 necessary to carry out the
01 provisions of AS 44.33.950 - 44.33.990, including regulations to establish reasonable
02 fees for services provided; and
03 (8) designate agents and delegate powers as necessary to the agents.
04 Sec. 44.33.960. Eligibility. (a) For an applicant to be eligible for a loan under
05 AS 44.33.950 - 44.33.990, the applicant must
06 (1) be a resident of the state as determined under (b) of this section;
08 (2) provide from a source that is not a state agency or a public
09 corporation of the state 20 percent of the money to be used on the project or enterprise
10 for which money from a loan will be used.
11 (b) To meet the residency requirements of (a) of this section, the applicant
12 (1) must physically reside in this state and maintain a domicile in this
13 state during the 12 consecutive months before the date of application for the program;
15 (2) may not have
16 (A) declared or established residency in another state; or
17 (B) received residency or a benefit based on residency from
18 another state in the previous 12 months.
19 Sec. 44.33.965. Limitations on loans. (a) The department may use money
20 from the fund to make loans of up to $50,000 to one individual or loans of up to
21 $100,000 to two or more individuals.
22 (b) A loan established under AS 44.33.950 - 44.33.990
23 (1) may not exceed a term of six years, except for extensions
24 authorized under AS 44.33.955 or regulations adopted under AS 44.33.955;
25 (2) may not bear interest exceeding the prime rate, as defined in
26 AS 44.88.599, plus one percentage point, but interest may not be less than six percent
27 a year;
28 (3) must be secured by collateral acceptable to the commissioner; and
29 (4) may not be made to an individual who has a past due child support
30 obligation established by court order or by the child support services agency under
31 AS 25.27.160 - 25.27.220 at the time of application.
01 Sec. 44.33.970. Special account established. (a) The foreclosure expense
02 account is established as a special account in the fund.
03 (b) The department may expend money credited to the foreclosure expense
04 account when necessary to protect the state's security interest in collateral on loans
05 granted under AS 44.33.965 or to defray expenses incurred during foreclosure
06 proceedings after a default by an obligor.
07 Sec. 44.33.975. Disposal of property acquired by default or foreclosure.
08 The department shall dispose of property acquired through default or foreclosure of a
09 loan made under AS 44.33.950 - 44.33.990. Disposal must be made in a manner that
10 serves the best interest of the state and may include the amortization of payments over
11 a period of years.
12 Sec. 44.33.990. Definitions. In AS 44.33.950 - 44.33.990, unless the context
13 otherwise requires,
14 (1) "commissioner" means the commissioner of commerce,
15 community, and economic development;
16 (2) "department" means the Department of Commerce, Community,
17 and Economic Development;
18 (3) "fund" means the Alaska small business revolving loan fund.
19 * Sec. 3. The uncodified law of the State of Alaska is amended by adding a new section to
21 TRANSITION: REGULATIONS. The Department of Commerce, Community, and
22 Economic Development may immediately proceed to adopt regulations under AS 44.62
23 (Administrative Procedure Act) necessary to implement the changes made in sec. 2 of this
24 Act. The regulations take effect under AS 44.62 but not before July 1, 2011.
25 * Sec. 4. Section 3 of this Act takes effect immediately under AS 01.10.070(c).
26 * Sec. 5. Except as provided in sec. 4 of this Act, this Act takes effect July 1, 2011.