SB 34: "An Act establishing the Alaska small business revolving loan fund; relating to the fund and loans from the fund; and providing for an effective date."
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 - 13 44.33.990. 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 09 fund; 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 - 30 44.33.990; 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; 07 and 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; 14 and 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 20 read: 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.