CSHB 177(FSH): "An Act relating to interest rates on loans from the commercial fishing revolving loan fund and the community quota entity revolving loan fund; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 177(FSH) 01 "An Act relating to interest rates on loans from the commercial fishing revolving loan 02 fund and the community quota entity revolving loan fund; and providing for an effective 03 date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 16.10.320(a) is amended to read: 06 (a) Except as permitted in (h), [AND] (l), and (n) of this section, a loan under 07 AS 16.10.300 - 16.10.370 08 (1) may not exceed a term of 15 years, except for extensions under 09 AS 16.10.310(a)(4); 10 (2) may not bear interest at a rate 11 (A) exceeding the prime rate, as defined by AS 44.88.599, plus 12 two percentage points; 13 (B) [AT A RATE] of more than 10 1/2 percent a year; [OR] 14 (C) that is less than the prime rate, as defined in
01 AS 44.88.599, minus three percentage points; or 02 (D) [AT A RATE] that is less than three percent a year [THE 03 COST OF FUNDS TO THE STATE]; 04 (3) must be secured by a first priority lien and appropriate security 05 agreement; 06 (4) may not exceed 80 percent of the appraised value of the collateral 07 used to secure the loan; 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 * Sec. 2. AS 16.10.320(j) is amended to read: 12 (j) All principal and interest payments, and any money chargeable to principal 13 or interest that is collected through liquidation by foreclosure or other process, on 14 loans made under AS 16.10.300 - 16.10.370, except loans made under 15 AS 16.10.310(a)(1)(E) after June 30, 2012, shall be paid into the commercial fishing 16 revolving loan fund. [ALL PRINCIPAL AND INTEREST PAYMENTS, AND ANY 17 MONEY CHARGEABLE TO PRINCIPAL OR INTEREST THAT IS COLLECTED 18 THROUGH LIQUIDATION BY FORECLOSURE OR OTHER PROCESS, ON 19 LOANS MADE UNDER AS 16.10.310(a)(1)(E) AFTER JUNE 30, 2012, SHALL BE 20 PAID INTO THE COMMUNITY QUOTA ENTITY REVOLVING LOAN FUND.] 21 * Sec. 3. AS 16.10.320(l) is amended to read: 22 (l) Until a community quota entity has used loans under this subsection to 23 purchase fishing quota shares cumulatively authorizing a total take of 50,000 pounds, 24 a loan or a portion of a loan made to that community quota entity under 25 AS 16.10.310(a)(1)(E) may not exceed 95 percent of the appraised value of the 26 collateral used to secure the loan or a portion of the loan. A loan to a community quota 27 entity under AS 16.10.310(a)(1)(E) 28 (1) may not exceed a term of 25 years, except for extensions under 29 AS 16.10.310(a)(4); 30 (2) may not bear interest 31 (A) at a rate exceeding
01 (i) the prime rate, as defined by AS 44.88.599, plus 02 two percentage points; or 03 (ii) 10 1/2 percent a year; 04 (B) at a rate that is less than 05 (i) the cost of funds to the state; or 06 (ii) three percent a year; 07 (3) [(2)] may not, alone or in combination with other loans to the 08 community quota entity under AS 16.10.310(a)(4), exceed $1,000,000 in loans to one 09 community quota entity; 10 (4) [(3)] may have terms that allow for a community quota entity to 11 defer interest payments for up to two years; and 12 (5) [(4)] is not eligible for refinancing by the department. 13 * Sec. 4. AS 16.10.320(m) is amended to read: 14 (m) In AS 16.10.320(l) [THIS SECTION], "cost of funds" means the true 15 interest cost expressed as a rate based on the prime rate plus one percentage point plus 16 an additional percentage determined by the department to represent risk of loss, term 17 of credit facility, the allocable expense of operation, cost of issuance, and loan 18 servicing costs. 19 * Sec. 5. AS 16.10.320 is amended by adding a new subsection to read: 20 (n) A loan made under AS 16.10.310(a)(1)(A)(ii), 16.10.310(a)(1)(A)(iii), or 21 16.10.310(a)(1)(B) to upgrade an existing vessel and gear for the purpose of 22 improving the quality of Alaska seafood products or for propulsion engine or 23 generator engine replacement on an existing vessel for the purpose of improving fuel 24 efficiency may not bear interest exceeding the prime rate, as defined by AS 44.88.599, 25 minus two percentage points, or at a rate exceeding 10 1/2 percent, and may not bear 26 interest at a rate of less than three percent. 27 * Sec. 6. AS 16.10.345 is amended by adding new subsections to read: 28 (c) The community quota entity revolving loan fund consists of the following: 29 (1) money appropriated to, transferred to, or received by gift, grant, 30 devise, bequest, or donation to the fund; 31 (2) principal and interest payments or other income earned on loans or
01 investments of the fund; and 02 (3) money chargeable to principal or interest that is collected through 03 liquidation by foreclosure or other process on loans made under 04 AS 16.10.310(a)(1)(E) and 16.10.345. 05 (d) Money in the fund may be used by the legislature to make appropriations 06 for costs of administering AS 16.10.310(a)(1)(E) and 16.10.345. 07 * Sec. 7. This Act takes effect immediately under AS 01.10.070(c).