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CSHB 76(FSH): "An Act relating to the mariculture revolving loan fund and loans and grants from the fund; and providing for an effective date."

00                       CS FOR HOUSE BILL NO. 76(FSH)                                                                     
01 "An Act relating to the mariculture revolving loan fund and loans and grants from the                                   
02 fund; and providing for an effective date."                                                                             
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1. AS 16.10 is amended by adding a new section to article 14 to read:                                    
05            Sec. 16.10.890. Declaration of policy. It is the policy of the state, under                                
06       AS 16.10.890 - 16.10.945, to promote mariculture and the enhancement of the state's                               
07       shellfish fisheries by means of grants and long-term, low-interest loans.                                         
08    * Sec. 2. AS 16.10.900 is amended to read:                                                                         
09            Sec. 16.10.900. Mariculture revolving loan fund. (a) The mariculture                                       
10       revolving loan fund is created in [WITHIN] the Department of Commerce,                                        
11       Community, and Economic Development to carry out the purposes of AS 16.10.890 -                               
12       16.10.945 [AS 16.10.900 - 16.10.945].                                                                         
13            (b)  The mariculture revolving loan fund consists of the following:                                          
14                 (1)  money appropriated to, transferred to, or received by gift, grant,                                 
01       devise, bequest, or donation to the fund;                                                                         
02                 (2)  principal and interest payments or other income earned on loans or                                 
03       investments of the fund; and                                                                                      
04                 (3)  money chargeable to principal or interest that is collected through                                
05       liquidation by foreclosure or other process on loans made under AS 16.10.890 -                                
06       16.10.945 [AS 16.10.900 - 16.10.945].                                                                         
07            (c)  Money in the fund may be used by the legislature to make appropriations                                 
08       for costs of administering AS 16.10.890 - 16.10.945 [AS 16.10.900 - 16.10.945].                               
09    * Sec. 3. AS 16.10.900 is amended by adding a new subsection to read:                                              
10 (d)  Of the total amount available annually to the department to carry out the                                          
11 purposes of AS 16.10.890 - 16.10.945, less any funds appropriated under (c) of this                                     
12 section, 60 percent shall be available solely for making loans under                                                    
13 AS 16.10.910(a)(1) and the remainder shall be available solely for making loans under                                   
14       AS 16.10.910(a)(2) and grants under AS 16.10.905(9).                                                              
15    * Sec. 4. AS 16.10.905 is amended to read:                                                                         
16            Sec. 16.10.905. Powers and duties of the department. The department may                                    
17 (1)  make loans to eligible applicants under AS 16.10.890 - 16.10.945                                               
18       [AS 16.10.900 - 16.10.945] for the planning, construction, and operation of a                                     
19                      (A)  mariculture business;                                                                   
20 (B)  hatchery that artificially propagates marine aquatic                                                           
21            plants or shellfish; or                                                                                  
22                      (C)  a shellfish enhancement project;                                                          
23 (2)  receive, take, hold, and administer any appropriation, transfer, gift,                                             
24       grant, bequest, devise, or donation of money for the fund;                                                        
25 (3)  establish amortization plans for repayment of loans, including                                                     
26       extensions of the terms of loans;                                                                                 
27                 (4)  allow an assumption of a loan if                                                                   
28 (A)  the applicant meets the requirements established under this                                                        
29            section; and                                                                                                 
30 (B)  approval of the assumption would be consistent with the                                                            
31            purposes of AS 16.10.890 - 16.10.945 [AS 16.10.900 - 16.10.945];                                         
01                 (5)  establish the rate of interest for loans consistent with law;                                      
02                 (6)  charge and collect fees for services provided under AS 16.10.890 -                             
03       16.10.945 [AS 16.10.900 - 16.10.945];                                                                         
04                 (7)  adopt regulations under AS 44.62 necessary to carry out the                                        
05       provisions of AS 16.10.890 - 16.10.945 [AS 16.10.900 - 16.10.945], including                                  
06       regulations to establish reasonable fees for services provided; [AND]                                             
07                 (8)  designate agents and delegate powers as necessary to the agents;                               
08                 (9)  make one-time grants for organizational and planning                                           
09       purposes to nonprofit organizations eligible for loans under AS 16.10.910(a)(2) in                            
10       amounts not exceeding $100,000.                                                                               
11    * Sec. 5. AS 16.10.905 is amended by adding a new subsection to read:                                              
12 (b) The department may not make more than $500,000 in aggregate grants                                                  
13       under (a)(9) of this section.                                                                                     
14    * Sec. 6. AS 16.10.910(a) is amended to read:                                                                      
15 (a)  For an applicant to be eligible for a loan under AS 16.10.890 - 16.10.945                                      
16       [AS 16.10.900 - 16.10.945], the applicant shall be                                                            
17                 (1)  [BE] a resident of the state who has                                                           
18 (A)  [, AS DETERMINED UNDER (c) OF THIS SECTION;                                                                    
19            (2) HAVE] a permitted mariculture farm location in this state; and                                           
20 (B) [(3)  HAVE] experience or training in the mariculture                                                           
21            industry; or                                                                                             
22 (2)  a resident of the state or entity organized under the laws of this                                             
23       state that                                                                                                    
24 (A)  holds a permit under AS 16.40.100 to operate a                                                                 
25            hatchery for the purpose of producing aquatic plants or shellfish; or                                    
26                      (B)  conducts shellfish enhancement projects.                                                  
27    * Sec. 7. AS 16.10.910(c) is amended to read:                                                                      
28 (c)  To meet the residency requirements of (a) of this section, an individual                                       
29       [THE] applicant                                                                                                   
30 (1)  shall physically reside in this state and maintain a domicile in this                                              
31 state during the 24 consecutive months preceding the date of application for the                                        
01       program; and                                                                                                      
02                 (2)  may not have                                                                                       
03                      (A)  declared or established residency in another state; or                                        
04                      (B)  received residency or a benefit based on residency from                                       
05            another state.                                                                                               
06    * Sec. 8. AS 16.10.915(a) is amended to read:                                                                      
07            (a)  Except as provided in (b) and (c) of this section, a loan under                                         
08       AS 16.10.890 - 16.10.945 [AS 16.10.900 - 16.10.945]                                                           
09                 (1)  may not exceed                                                                                     
10 (A)  $100,000 a year for an applicant under                                                                     
11            AS 16.10.910(a)(1); or                                                                                   
12 (B)  $1,000,000 a year for an applicant under                                                                       
13            AS 16.10.910(a)(2);                                                                                    
14                 (2)  may not, unless extended under AS 16.10.905, exceed a term of                                  
15                      (A)  20 years for an applicant under AS 16.10.910(a)(1); or                                
16 (B)  30 years for an applicant under AS 16.10.910(a)(2) [,                                                          
17            EXCEPT FOR EXTENSIONS UNDER AS 16.10.905];                                                                   
18 (3)  may not bear interest at a rate greater than the prime rate, as                                                    
19 defined in AS 44.88.599, plus one percentage point, but which may not be less than                                      
20       five percent a year or more than nine percent a year;                                                             
21 (4)  must be secured by a first priority lien on collateral acceptable to                                               
22       the department; and                                                                                               
23 (5)  may not be made to a person who has a past due child support                                                       
24 obligation established by court order or by the child support services agency under                                     
25       AS 25.27.160 - 25.27.220 at the time of application.                                                              
26    * Sec. 9. AS 16.10.915(b) is amended to read:                                                                      
27            (b)  Subsequent loans may be made to a [THE] borrower under                                              
28 (1)  AS 16.10.910(a)(1), [AS 16.10.910] if the total of the balances                                                
29       outstanding on the loans received by the borrower does not exceed $300,000; or                                
30 (2)  AS 16.10.910(a)(2), if the total of the balances outstanding on                                                
31       the loans received by the borrower does not exceed $1,000,000.                                                
01    * Sec. 10. AS 16.10.915(c) is amended to read:                                                                     
02            (c)  A loan under AS 16.10.910 may be made for the purchase of boats or                                      
03       vessels determined to be integral to the operation of the farm or hatchery.                                   
04    * Sec. 11. AS 16.10.915(d) is amended to read:                                                                     
05 (d)  For a loan made under AS 16.10.890 - 16.10.945 [AS 16.10.900 -                                                 
06 16.10.945], the department may provide a reduction of the interest rate of not more                                     
07 than two percent if at least 50 percent of the loan proceeds are used by the borrower                                   
08 for purchasing products manufactured or produced in the state. When the department                                      
09 offers a reduction under this subsection, the department shall provide the reduction to                                 
10 all loan applicants who meet the criterion described in this subsection. In this                                        
11 subsection, "manufactured or produced" means processing, developing, or making an                                       
12       item into a new item with a distinct character and use.                                                           
13    * Sec. 12. AS 16.10.915 is amended by adding a new subsection to read:                                             
14 (e)  The department may not make a loan to an applicant under                                                           
15 AS 16.10.910(a)(2) for a hatchery or shellfish enhancement project unless the                                           
16       department determines that the hatchery or enhancement project will                                               
17 (1)  be managed in a financially viable manner that is reasonably                                                       
18       expected to result in repayment of the loan; and                                                                  
19 (2)  provide a significant contribution to common property fisheries, or                                                
20       otherwise benefit the public interest.                                                                            
21    * Sec. 13. AS 16.10.920 is amended to read:                                                                        
22 Sec. 16.10.920. Repayment of principal of and interest on loans. The                                                  
23 department may not require the repayment of the principal of and interest on a loan                             
24 made under AS 16.10.910 during the first six years of the loan. Interest on the                                         
25 principal of a loan made under AS 16.10.910(a)(1) [AS 16.10.910] may not be                                     
26 deferred for a period of [NOT] more than the first six years of the loan. The                                       
27 department may defer principal of and interest on a loan made under                                                 
28 AS 16.10.910(a)(2) for a period of up to 11 years after the loan is made. The                                       
29 department may provide that interest on the principal of a loan made under                                          
30 AS 16.10.910(a)(2) may not accrue during a period of not less than six years and                                    
31       not more than 11 years after the loan is made.                                                                
01    * Sec. 14. AS 16.10 is amended by adding a new section to read:                                                    
02 Sec. 16.10.923. Voluntary assessment on sale of shellfish. (a) An association                                         
03 of persons who hold entry permits under AS 16.43 comprising at least 51 percent of                                      
04 the persons holding entry permits and actively participating in a fishery to be benefited                               
05 by a hatchery program may levy and collect an assessment from among its members                                         
06 for the purpose of securing and repaying a loan made under AS 16.10.890 - 16.10.945.                                    
07 (b)  Upon satisfactory demonstration to the department that an assessment                                               
08 levied under this section may reasonably be relied on to secure and repay a loan to be                                  
09       made under AS 16.10.890 - 16.10.945, the department may make the loan.                                            
10    * Sec. 15. AS 16.10.935 is amended to read:                                                                        
11 Sec. 16.10.935. Disposal of property acquired after default. The department                                           
12 shall dispose of property acquired through default of a loan made under AS 16.10.890                                
13 - 16.10.945 [AS 16.10.900 - 16.10.945]. Disposal must be made in a manner that                                      
14 serves the best interest of the state and may include the amortization of payments over                                 
15       a period of years.                                                                                                
16    * Sec. 16. AS 16.10.945 is amended to read:                                                                        
17 Sec. 16.10.945. Definitions. In AS 16.10.890 - 16.10.945 [AS 16.10.900 -                                          
18       16.10.945],                                                                                                       
19 (1)  "commissioner" means the commissioner of commerce,                                                                 
20       community, and economic development;                                                                              
21 (2)  "department" means the Department of Commerce, Community,                                                          
22       and Economic Development;                                                                                         
23                 (3)  "hatchery" has the meaning given in AS 16.40.199;                                              
24 (4)  "mariculture" means the farming of shellfish and aquatic plants as                                             
25       defined in AS 16.40.199;                                                                                      
26                 (5)  "shellfish enhancement project" means a project to                                             
27 (A)  augment the yield or harvest of shellfish above                                                                
28 naturally occurring levels using a natural, artificial, or semiartificial                                           
29            production system; or                                                                                    
30 (B)  rehabilitate a shellfish stock by restoring it to its                                                          
31            naturally occurring levels of productivity.                                                              
01    * Sec. 17. The uncodified law of the State of Alaska is amended by adding a new section to                         
02 read:                                                                                                                   
03       APPLICABILITY. Changes made by this Act to the terms of loans made under                                          
04 AS 16.10.890 - 16.10.945 do not apply to a loan made before the effective date of this Act.                             
05    * Sec. 18. This Act takes effect immediately under AS 01.10.070(c).