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CSSB 67(L&C): "An Act establishing the commercial charter fisheries revolving loan fund and the mariculture revolving loan fund, and relating to those funds and loans from those funds; and providing for an effective date."

00                       CS FOR SENATE BILL NO. 67(L&C)                                                                    
01 "An Act establishing the commercial charter fisheries revolving loan fund and the                                       
02 mariculture revolving loan fund, and relating to those funds and loans from those funds;                                
03 and providing for an effective date."                                                                                   
04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
05    * Section 1. AS 16.10 is amended by adding new sections to read:                                                   
06           Article 13. Commercial Charter Fisheries Revolving Loan Fund.                                               
07            Sec. 16.10.801. Commercial charter fisheries revolving loan fund. (a) The                                  
08       commercial charter fisheries revolving loan fund is created in the Department of                                  
09       Commerce, Community, and Economic Development to carry out the purposes of                                        
10       AS 16.10.801 - 16.10.890.                                                                                         
11            (b)  The commercial charter fisheries revolving loan fund consists of the                                    
12       following:                                                                                                        
13                 (1)  money appropriated to, transferred to, or received by gift, grant,                                 
14       devise, bequest, or donation to the fund;                                                                         
01                 (2)  principal and interest payments or other income earned on loans or                                 
02       investments of the fund;                                                                                          
03                 (3)  money chargeable to principal or interest that is collected through                                
04       liquidation by foreclosure or other process on loans made under AS 16.10.801 -                                    
05       16.10.890.                                                                                                        
06            (c)  Money in the fund may be used by the legislature to make appropriations                                 
07       for costs of administering AS 16.10.801 - 16.10.890.                                                              
08            Sec. 16.10.805. Powers and duties of the department. The department may                                    
09                 (1)  make loans to eligible applicants under AS 16.10.801 - 16.10.890                                   
10                      (A)  for the purchase of charter halibut permits;                                                  
11                      (B)  for the purchase or construction of a charter halibut fishing                                 
12            vessel;                                                                                                      
13                      (C)  to upgrade existing charter halibut fishing vessels and gear                                  
14            for the purpose of improving engine fuel efficiency;                                                         
15                      (D)  to refinance debt obligations made by other lenders more                                      
16            than 12 months before the department received the loan application and                                       
17            incurred by an applicant for the purchase of charter halibut fishing vessels or                              
18            gear if the applicant otherwise qualifies for a loan under AS 16.10.801 -                                    
19            16.10.890; the department may collect a refinancing loan origination charge as                               
20            provided by regulation;                                                                                      
21                 (2)  receive, take, hold, and administer any appropriation, transfer, gift,                             
22       grant, bequest, devise, or donation of money for the fund;                                                        
23                 (3)  establish amortization plans for repayment of loans, including                                     
24       extensions of the terms of loans;                                                                                 
25                 (4)  allow an assumption of a loan if                                                                   
26                      (A)  the applicant meets the requirements established under this                                   
27            section; and                                                                                                 
28                      (B)  approval of the assumption would be consistent with the                                       
29            purposes of AS 16.10.801 - 16.10.890;                                                                        
30                 (5)  establish the rate of interest for loans consistent with law;                                      
31                 (6)  charge and collect fees for services provided under AS 16.10.801 -                                 
01       16.10.890;                                                                                                        
02                 (7)  adopt regulations under AS 44.62 necessary to carry out the                                        
03       provisions of AS 16.10.801 - 16.10.890, including regulations to establish reasonable                             
04       fees for services provided; and                                                                                   
05                 (8)  designate agents and delegate powers as necessary to the agents.                                   
06            Sec. 16.10.810. Eligibility. (a) For an applicant to be eligible for a loan under                          
07       AS 16.10.801 - 16.10.890, the applicant shall be a resident of the state, as determined                           
08       under (c) of this section, and shall                                                                              
09                 (1)  qualify for the purchase of a charter halibut permit under applicable                              
10       law;                                                                                                              
11                 (2)  qualify as a transferee for a charter halibut permit under applicable                              
12       law;                                                                                                              
13                 (3)  purchase or construct a charter halibut fishing vessel; or                                         
14                 (4)  upgrade an existing charter halibut fishing vessel or gear for the                                 
15       purpose of improving engine fuel efficiency.                                                                      
16            (b)  In addition to the requirements set out in (a) of this section, the applicant                           
17                 (1)  may not be eligible for financing from other recognized                                            
18       commercial lending institutions; or                                                                               
19                 (2)  shall be able to obtain only a portion of the total loan request from                              
20       a recognized commercial lending institution.                                                                      
21            (c)  To meet the residency requirements of (a) of this section, the applicant                                
22                 (1)  shall physically reside in this state and maintain a domicile in this                              
23       state during the 24 consecutive months preceding the date of application for the                                  
24       program; and                                                                                                      
25                 (2)  may not have                                                                                       
26                      (A)  declared or established residency in another state; or                                        
27                      (B)  received residency or a benefit based on residency from                                       
28            another state.                                                                                               
29            Sec. 16.10.815. Limitations on loans. (a) Except as provided in (b) of this                                
30       section, a loan under AS 16.10.801 - 16.10.890                                                                    
31                 (1)  may not exceed $100,000;                                                                           
01                 (2)  may not exceed a term of 15 years, except for extensions under                                     
02       AS 16.10.805;                                                                                                     
03                 (3)  may not bear interest at a rate greater than the prime rate, as                                    
04       defined in AS 44.88.599, plus two percentage points, but which may not be less than                               
05       three percent a year and not more than 10 1/2 percent a year;                                                     
06                 (4)  must be secured by a first priority lien on collateral acceptable to                               
07       the commissioner; and                                                                                             
08                 (5)  may not be made to a person who has a past due child support                                       
09       obligation established by court order or by the child support services agency under                               
10       AS 25.27.160 - 25.27.220 at the time of application.                                                              
11            (b)  The interest rate for loans for the improvement of engine fuel efficiency                               
12       must be two percentage points below the prime rate, as defined in AS 44.88.599, but                               
13       may not be less than three percent a year and not more than 10 1/2 percent a year.                                
14            (c)  The total balances outstanding on loans made to a borrower under                                        
15       AS 16.10.805 may not exceed $300,000.                                                                             
16            Sec. 16.10.820. Default. If the borrower defaults on a note, the department                                
17       shall notify the borrower of the default and the consequences of default by mailing a                             
18       notice to the borrower's most recent address provided to the department by the                                    
19       borrower or obtained by the department.                                                                           
20            Sec. 16.10.825. Special account established. (a) The foreclosure expense                                   
21       account is established as a special account within the commercial charter fisheries                               
22       revolving loan fund.                                                                                              
23            (b)  The department may expend money credited to the foreclosure expense                                     
24       account when necessary to protect the state's security interest in collateral on loans                            
25       granted under AS 16.10.815 or to defray expenses incurred during foreclosure                                      
26       proceedings after an obligor defaults.                                                                            
27            Sec. 16.10.830. Disposal of property acquired after default. The department                                
28       shall dispose of property acquired through default of a loan made under AS 16.10.801                              
29       - 16.10.890. Disposal must be made in a manner that serves the best interest of the                               
30       state and may include the amortization of payments over a period of years.                                        
31            Sec. 16.10.835. Waiver of confidentiality. The commissioner may release                                    
01       information about the borrower's loan to any individual if release of the information                             
02       has been authorized by the borrower.                                                                              
03            Sec. 16.10.890. Definitions. In AS 16.10.801 - 16.10.890,                                                  
04                 (1)  "commissioner" means the commissioner of commerce,                                                 
05       community, and economic development;                                                                              
06                 (2)  "department" means the Department of Commerce, Community,                                          
07       and Economic Development.                                                                                         
08                 Article 14. Mariculture Revolving Loan Fund.                                                          
09            Sec. 16.10.900. Mariculture revolving loan fund. (a) The mariculture                                       
10       revolving loan fund is created within the Department of Commerce, Community, and                                  
11       Economic Development to carry out the purposes of AS 16.10.900 - 16.10.945.                                       
12            (b)  The mariculture revolving loan fund consists of the following:                                          
13                 (1)  money appropriated to, transferred to, or received by gift, grant,                                 
14       devise, bequest, or donation to the fund;                                                                         
15                 (2)  principal and interest payments or other income earned on loans or                                 
16       investments of the fund; and                                                                                      
17                 (3)  money chargeable to principal or interest that is collected through                                
18       liquidation by foreclosure or other process on loans made under AS 16.10.900 -                                    
19       16.10.945.                                                                                                        
20            (c)  Money in the fund may be used by the legislature to make appropriations                                 
21       for costs of administering AS 16.10.900 - 16.10.945.                                                              
22            Sec. 16.10.905. Powers and duties of the department. The department may                                    
23                 (1)  make loans to eligible applicants under AS 16.10.900 - 16.10.945                                   
24       for the planning, construction, and operation of a mariculture business;                                          
25                 (2)  receive, take, hold, and administer any appropriation, transfer, gift,                             
26       grant, bequest, devise, or donation of money for the fund;                                                        
27                 (3)  establish amortization plans for repayment of loans, including                                     
28       extensions of the terms of loans;                                                                                 
29                 (4)  allow an assumption of a loan if                                                                   
30                      (A)  the applicant meets the requirements established under this                                   
31            section; and                                                                                                 
01                      (B)  approval of the assumption would be consistent with the                                       
02            purposes of AS 16.10.900 - 16.10.945;                                                                        
03                 (5)  establish the rate of interest for loans consistent with law;                                      
04                 (6)  charge and collect fees for services provided under AS 16.10.900 -                                 
05       16.10.945;                                                                                                        
06                 (7)  adopt regulations under AS 44.62 necessary to carry out the                                        
07       provisions of AS 16.10.900 - 16.10.945, including regulations to establish reasonable                             
08       fees for services provided; and                                                                                   
09                 (8)  designate agents and delegate powers as necessary to the agents.                                   
10            Sec. 16.10.910. Eligibility. (a) For an applicant to be eligible for a loan under                          
11       AS 16.10.900 - 16.10.945, the applicant shall                                                                     
12                 (1)  be a resident of the state, as determined under (c) of this section;                               
13                 (2)  have a permitted mariculture farm location in this state; and                                      
14                 (3)  have experience or training in the mariculture industry.                                           
15            (b)  In addition to the requirements set out in (a) of this section, the applicant                           
16                 (1)  may not be eligible for financing from other recognized                                            
17       commercial lending institutions; or                                                                               
18                 (2)  shall be able to obtain only a portion of the total loan request from                              
19       a recognized commercial lending institution.                                                                      
20            (c)  To meet the residency requirements of (a) of this section, the applicant                                
21                 (1)  shall physically reside in this state and maintain a domicile in this                              
22       state during the 24 consecutive months preceding the date of application for the                                  
23       program; and                                                                                                      
24                 (2)  may not have                                                                                       
25                      (A)  declared or established residency in another state; or                                        
26                      (B)  received residency or a benefit based on residency from                                       
27            another state.                                                                                               
28            Sec. 16.10.915. Limitations on loans. (a) Except as provided in (b) and (c) of                             
29       this section, a loan under AS 16.10.900 - 16.10.945                                                               
30                 (1)  may not exceed $100,000 a year;                                                                    
31                 (2)  may not exceed a term of 20 years, except for extensions under                                     
01       AS 16.10.905;                                                                                                     
02                 (3)  may not bear interest at a rate greater than the prime rate, as                                    
03       defined in AS 44.88.599, plus one percentage point, but which may not be less than                                
04       five percent a year and not more than nine percent a year;                                                        
05                 (4)  must be secured by a first priority lien on collateral acceptable to                               
06       the department; and                                                                                               
07                 (5)  may not be made to a person who has a past due child support                                       
08       obligation established by court order or by the child support services agency under                               
09       AS 25.27.160 - 25.27.220 at the time of application.                                                              
10            (b)  Subsequent loans may be made to the borrower under AS 16.10.910 if the                                  
11       total of the balances outstanding on the loans received by the borrower does not                                  
12       exceed $300,000.                                                                                                  
13            (c)  A loan under AS 16.10.910 may be made for the purchase of boats or                                      
14       vessels determined to be integral to the operation of the farm.                                                   
15            Sec. 16.10.920. Repayment of principal of and interest on loans. The                                       
16       department may not require the repayment of principal on a loan made under                                        
17       AS 16.10.910 during the first six years of the loan. Interest on the principal of a loan                          
18       made under AS 16.10.910 does not accrue during the first six years of the loan.                                   
19            Sec. 16.10.925. Default. If the borrower defaults on a note, the department                                
20       shall notify the borrower of the default and the consequences of default by mailing a                             
21       notice to the borrower's most recent address provided to the department by the                                    
22       borrower or obtained by the department.                                                                           
23            Sec. 16.10.930. Special account established. (a) The foreclosure expense                                   
24       account is established as a special account in the mariculture revolving loan fund.                               
25            (b)  The department may expend money credited to the foreclosure expense                                     
26       account when necessary to protect the state's security interest in collateral on loans                            
27       granted under AS 16.10.910 or to defray expenses incurred during foreclosure                                      
28       proceedings after an obligor defaults.                                                                            
29            Sec. 16.10.935. Disposal of property acquired after default. The department                                
30       shall dispose of property acquired through default of a loan made under AS 16.10.900                              
31       - 16.10.945. Disposal must be made in a manner that serves the best interest of the                               
01       state and may include the amortization of payments over a period of years.                                        
02            Sec. 16.10.940. Waiver of confidentiality. The commissioner may release                                    
03       information about the borrower's loan to any individual if release of the information                             
04       has been authorized by the borrower.                                                                              
05            Sec. 16.10.945. Definitions. In AS 16.10.900 - 16.10.945,                                                  
06                 (1)  "commissioner" means the commissioner of commerce,                                                 
07       community, and economic development;                                                                              
08                 (2)  "department" means the Department of Commerce, Community,                                          
09       and Economic Development;                                                                                         
10                 (3)  "mariculture" means the farming of shellfish and aquatic plants as                                 
11       defined in AS 16.40.199.                                                                                          
12    * Sec. 2. This Act takes effect immediately under AS 01.10.070(c).