CSHB 170(L&C): "An Act relating to exempt employees; relating to the powers of the Alaska Energy Authority; relating to the membership of the Alaska Industrial Development and Export Authority; relating to the duties of the Alaska Industrial Development and Export Authority; establishing the Alaska clean energy program and the Alaska clean energy fund in the Alaska Industrial Development and Export Authority; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 170(L&C) 01 "An Act relating to exempt employees; relating to the powers of the Alaska Energy 02 Authority; relating to the membership of the Alaska Industrial Development and Export 03 Authority; relating to the duties of the Alaska Industrial Development and Export 04 Authority; establishing the Alaska clean energy program and the Alaska clean energy 05 fund in the Alaska Industrial Development and Export Authority; and providing for an 06 effective date." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08 * Section 1. AS 39.25.110 is amended by adding a new paragraph to read: 09 (46) an analyst employed in a professional capacity by the Alaska 10 Energy Authority under AS 44.83.055. 11 * Sec. 2. AS 44.83 is amended by adding a new section to article 1 to read: 12 Sec. 44.83.055. Analyst position. The authority may hire one analyst to assist 13 underserved communities with the technical development of projects and applications
01 for funding from the Alaska clean energy fund and program under AS 44.88.450 - 02 44.88.456. 03 * Sec. 3. AS 44.88.030(a) is amended to read: 04 (a) The membership of the authority consists of 05 (1) the commissioner of revenue and the commissioner of commerce, 06 community, and economic development; and 07 (2) five public members [APPOINTED BY THE GOVERNOR], each 08 of whom has expertise in private sector business or industry, or both, and possesses 09 demonstrated leadership skills, appointed by the governor, subject to confirmation 10 by a majority of the members of the legislature in joint session. 11 * Sec. 4. AS 44.88.030(c) is amended to read: 12 (c) Public members of the authority described in (a)(2) of this section serve 13 staggered five-year [AT THE PLEASURE OF THE GOVERNOR FOR TWO- 14 YEAR] terms. A member appointed under (a)(2) of this section may only be 15 removed for cause. 16 * Sec. 5. AS 44.88.070 is amended to read: 17 Sec. 44.88.070. Purpose of the authority. The purpose of the authority is to 18 promote, develop, and advance the general prosperity and economic welfare of the 19 people of the state, to relieve problems of unemployment, and to create additional 20 employment by 21 (1) providing various means of financing and means of facilitating the 22 financing, in cooperation with federal, state, and private institutions, of industrial, 23 manufacturing, energy, sustainable energy development, export, small business, and 24 business enterprises and the other facilities referred to in AS 44.88.010(a) in the state; 25 (2) owning and operating or providing development project financing 26 for the enterprises and other facilities described in AS 44.88.172; 27 (3) fostering the expansion of exports of goods, services, and raw 28 materials of the state; 29 (4) cooperating and acting in conjunction with other organizations, 30 public and private, the objects of which are the promotion and advancement of export 31 trade activities in the state;
01 (5) establishing a source of funding credit guarantees and insurance, 02 not otherwise available, to support export development; 03 (6) providing and cooperating or participating with federal, state, and 04 private institutions to provide actual and potential state exporters, particularly small- 05 and medium-sized exporters, with financial assistance in support of export 06 transactions. 07 * Sec. 6. AS 44.88.159(a) is amended to read: 08 (a) The interest rate on a loan purchased from the proceeds of tax-exempt 09 bonds secured by the Alaska Industrial Development and Export Authority sustainable 10 energy transmission and supply development fund (AS 44.88.660) under 11 AS 44.88.650 - 44.88.690, [OR] by the Arctic infrastructure development fund 12 (AS 44.88.810) under AS 44.88.800 - 44.88.840, or by the Alaska clean energy fund 13 (AS 44.88.452) under AS 44.88.450 - 44.88.456, or a loan participation purchased 14 from the proceeds of tax-exempt bonds or expected by the authority to be purchased 15 from the proceeds of tax-exempt bonds under AS 44.88.155 shall be determined under 16 the regulations adopted by the authority under AS 44.88.085(g)(2)(C) and shall be not 17 less than the cost of funds to the authority. In this subsection, "cost of funds" means 18 the true interest cost expressed as a rate on tax-exempt bonds of the authority plus an 19 additional percentage as determined by the authority to represent the allocable 20 expenses of operation, costs of issuance, and loan servicing costs. 21 * Sec. 7. AS 44.88.159(b) is amended to read: 22 (b) The interest rate on a loan purchased from the proceeds of taxable bonds 23 secured by the Alaska Industrial Development and Export Authority sustainable 24 energy transmission and supply development fund (AS 44.88.660) under 25 AS 44.88.650 - 44.88.690, [OR] by the Arctic infrastructure development fund 26 (AS 44.88.810) under AS 44.88.800 - 44.88.840, or by the Alaska clean energy fund 27 (AS 44.88.452) under AS 44.88.450 - 44.88.456, or a loan participation purchased 28 from the proceeds of taxable bonds under AS 44.88.155 or expected by the authority 29 to be purchased from the proceeds of taxable bonds under AS 44.88.155 shall be 30 determined under the regulations adopted by the authority under 31 AS 44.88.085(g)(2)(C) and shall be not less than the cost of funds to the authority. In
01 this subsection, "cost of funds" means the true interest cost expressed as a rate on 02 taxable bonds, plus an additional percentage as determined by the authority to 03 represent the allocable expenses of operation, costs of issuance, and loan servicing 04 costs. 05 * Sec. 8. AS 44.88.159(g) is amended to read: 06 (g) The authority may, in the regulations adopted by the authority under 07 AS 44.88.085(g)(2)(C), establish a program to pay to borrowers of loan participations 08 determined by the authority to meet sufficient job creation, rural development, Arctic 09 infrastructure development, renewable energy development, sustainable energy 10 development, or other economic development criteria incentive rate rebates of not 11 more than one percent of the interest rate charged on the authority's portion of a loan 12 participation. The following standards apply to the program: 13 (1) the payment of an incentive rate rebate may reduce the interest rate 14 to a rate that is less than the minimum interest rate required under (a), (b), or (e) of this 15 section; 16 (2) the authority may not commit to pay an incentive rate rebate for a 17 proposed loan participation if the total of the amount of the proposed loan 18 participation plus the combined outstanding balance of all loan participations for 19 which the authority has committed to pay incentive rate rebates would exceed five 20 percent of the total of the amount of the proposed loan participation plus the combined 21 outstanding balance of all loan participations of the authority; 22 (3) an incentive rate rebate may not accrue for more than five years 23 after the date the loan participation is purchased; 24 (4) the authority may establish a separate account for the incentive rate 25 rebate program. 26 * Sec. 9. AS 44.88.178 is amended to read: 27 Sec. 44.88.178. Creation of subsidiaries. The authority may create one or 28 more subsidiary corporations for the purpose of acquiring, constructing, owning, 29 operating, or financing a project financed under AS 44.88.172 or one or more 30 subsidiary corporations, limited liability companies, or limited partnerships for 31 the purpose of administering, operating, or expanding the Alaska clean energy
01 program. A subsidiary corporation created under this section may be incorporated 02 under AS 10.20.146 - 10.20.166. Subject to limitations for the use of the economic 03 development account under AS 44.88.172 and the Alaska clean energy fund 04 under AS 44.88.450 - 44.88.456, the [THE] authority may transfer assets of the 05 authority to a subsidiary created under this section. A subsidiary created under this 06 section may borrow money and issue bonds as evidence of that borrowing, and has all 07 the powers of the authority that the authority grants to it. Unless otherwise provided by 08 the authority, the debts, liabilities, and obligations of a subsidiary corporation, limited 09 liability company, or limited partnership created under this section are not the 10 debts, liabilities, or obligations of the authority. 11 * Sec. 10. AS 44.88 is amended by adding new sections to read: 12 Sec. 44.88.450. Alaska clean energy program. (a) The Alaska clean energy 13 program is created in the authority to make loans and provide other forms of financing 14 for sustainable energy development in the state. 15 (b) The Alaska clean energy program advisory board is established and 16 consists of 17 (1) the governor or the governor's designee; and 18 (2) eight members appointed by the governor as follows: 19 (A) one member who represents a 20 (i) tribe; 21 (ii) tribal nonprofit organization or consortium; or 22 (iii) regional housing authority; 23 (B) one member who represents an Alaska Native corporation; 24 (C) one member who represents an Alaska nonprofit 25 corporation specializing in cold climate housing research; 26 (D) one member who has experience in 27 (i) renewable energy; 28 (ii) electric transportation; or 29 (iii) similar sustainable energy development; 30 (E) four members who have experience in 31 (i) finance;
01 (ii) marketing of financial products; 02 (iii) construction science and efficiencies; 03 (iv) renewable energy; 04 (v) electric transportation; or 05 (vi) other sustainable energy development. 06 (c) The advisory board established under (b) of this section shall make 07 recommendations to the authority regarding 08 (1) the design of the Alaska clean energy program; 09 (2) a public education program for the Alaska clean energy program; 10 (3) best practices of funds designed to address sustainable energy 11 development; and 12 (4) other matters intended to increase the use and viability of the 13 Alaska clean energy fund. 14 (d) A member of the advisory board appointed under (b) of this section serves 15 without compensation but is entitled to travel and per diem expenses as provided in 16 AS 39.20.180. 17 Sec. 44.88.452. Alaska clean energy fund. (a) The Alaska clean energy fund 18 is established in the authority. The Alaska clean energy fund is for the uses and 19 purposes of AS 44.88.450 - 44.88.456. 20 (b) The fund consists of appropriations made by the legislature, loans or other 21 assets transferred to the fund by the authority, unrestricted loan repayments, interest, 22 or other income earned on loans, investments, or assets of the fund, and available 23 federal funding. 24 (c) The fund is not an account in the revolving loan fund established in 25 AS 44.88.060. The authority shall account for the fund separately from the revolving 26 fund. The authority may create additional accounts in the Alaska clean energy fund. 27 Subject to agreements made with the holders of the authority's bonds or with other 28 persons, the authority may transfer amounts in an account in the fund to another 29 account in the fund. 30 (d) The authority has custody of the fund and shall be responsible for its 31 management. The authority is the fiduciary of the fund under AS 37.10.071 and may
01 invest amounts in the fund in accordance with an investment policy adopted by the 02 authority. To promote sustainable energy development in the state, the investment 03 policy adopted by the authority may deviate from the prudent investor rule and 04 traditional institutional financing criteria. Notwithstanding AS 37.10.010 - 37.10.050, 05 the authority may make disbursements from the fund in accordance with 06 AS 37.25.050. Notwithstanding AS 37.05.130 and 37.05.140, the authority shall report 07 disbursements from the fund annually in accordance with AS 44.88.205(b)(2). An 08 appropriation made to the fund by the legislature shall be transferred to the authority 09 for deposit in the fund. 10 (e) Nothing in this section creates a dedicated fund. 11 Sec. 44.88.454. Sustainable energy development; powers and duties of the 12 authority. (a) The authority shall 13 (1) consider the energy policies of the state described in AS 44.99.115 14 in managing the operations of the Alaska clean energy program and fund under 15 AS 44.88.450 - 44.88.456; 16 (2) annually prepare a report containing information regarding the 17 implementation and operation of the Alaska clean energy program and fund under 18 AS 44.88.450 - 44.88.456, including the amount of loans made, the amount available 19 to be loaned, the scope of projects financed, and actions taken by the authority in 20 response to recommendations from the advisory board established under 21 AS 44.88.450(b), and deliver the report to the senate secretary and the chief clerk of 22 the house of representatives and notify the legislature that the report is available. 23 (b) Subject to the requirements of AS 44.88.450 - 44.88.456, the authority 24 may 25 (1) establish a subsidiary entity subject to the requirements of 26 AS 44.88.178; 27 (2) in consultation with the advisory board established in 28 AS 44.88.450, establish financing programs and products the authority determines 29 necessary to encourage and promote sustainable energy development in the state; 30 (3) invest in eligible sustainable energy development independently or 31 with other investors, including private capital providers;
01 (4) provide capital and fund management to eligible sustainable energy 02 development in the form of 03 (A) senior, mezzanine, and subordinated debt; 04 (B) loan guarantees on third-party financing; 05 (C) credit enhancements, including loan loss reserves and 06 interest rate buy-downs; 07 (D) aggregation and warehousing; 08 (E) equity capital; 09 (F) securitization of financings; 10 (G) financing techniques that make use of loan liquidity; and 11 (H) other financial products or services approved by the 12 authority; 13 (5) make and execute contracts and other instruments to implement 14 AS 44.88.450 - 44.88.456; 15 (6) charge reasonable fees established by the authority in regulation for 16 the products and services the authority provides under AS 44.88.450 - 44.88.456; 17 (7) acquire real or personal property by purchase, transfer, or 18 foreclosure when the acquisition is necessary to protect the authority's interest in a 19 loan or other financial product; 20 (8) subject to AS 36.30.085, enter into lease-purchase agreements; 21 (9) defer principal payments or capitalize interest on loans; 22 (10) provide financing and services to municipal energy improvement 23 assessment programs established in accordance with AS 29.55.100; and 24 (11) exercise other powers necessary to implement AS 44.88.450 - 25 44.88.456. 26 (c) The authority shall adopt regulations to implement AS 44.88.450 - 27 44.88.456, including 28 (1) an application process for acquiring financing under the Alaska 29 clean energy program; 30 (2) qualifications for applicants applying for financing under the 31 Alaska clean energy program;
01 (3) record-keeping requirements for the authority to accumulate and 02 track measurable data related to the Alaska clean energy fund (AS 44.88.452); and 03 (4) fiscal controls for the Alaska clean energy fund (AS 44.88.452). 04 Sec. 44.88.456. Limitations on financing; use as security. (a) Unless the 05 authority has obtained legislative approval, the authority may not use the Alaska clean 06 energy fund established in AS 44.88.452 to make a loan guarantee if the amount of the 07 guarantee exceeds $20,000,000. 08 (b) Financing under AS 44.88.454 is limited to the life of eligible sustainable 09 energy development, and, financing is limited by the estimated useful life of the 10 project. 11 (c) Notwithstanding (a) of this section, the authority may use the Alaska clean 12 energy fund established in AS 44.88.452 as security for a bond guarantee. 13 (d) A guarantee or other security provided by the authority under 14 AS 44.88.450 - 44.88.456 does not constitute a debt, liability, or obligation of the state 15 or a political subdivision of the state. 16 (e) At least 35 percent of the funds used for loans and other forms of financing 17 for sustainable energy development made over a three-year period under AS 44.88.450 18 - 44.88.456 must be made in communities that receive, or that have residents who 19 receive, power cost equalization under AS 42.45.100 - 42.45.150. 20 * Sec. 11. AS 44.88.900 is amended by adding new paragraphs to read: 21 (20) "eligible sustainable energy development" means activity 22 approved by the authority to be consistent with the Alaska clean energy program and 23 for which the authority will issue a loan or other financial product; 24 (21) "sustainable energy development" means 25 (A) renewable energy generation from sources that are 26 continually replenished by nature, including the sun, wind, water, and 27 biological processes; 28 (B) building energy efficiency, including switching from fuel 29 to renewable fuels and electrification; 30 (C) industrial decarbonization; 31 (D) electrical infrastructure incorporating
01 (i) energy storage to support clean or more efficient 02 energy distribution, including remote and non-remote microgrids and 03 smart-grid applications; and 04 (ii) other sustainable technologies including distributed 05 generation, advanced battery, and combined heat and power; 06 (E) greenhouse gas emissions reduction through processes that 07 include regenerative agriculture, reforestation, afforestation, and forestry 08 management; 09 (F) clean transportation, including battery-operated electric 10 vehicles, hydrogen vehicles, plug-in hybrid electric vehicles, and other zero- 11 emissions vehicles for consumers, businesses, government, and public transit; 12 (G) electric vehicle charging and fueling infrastructure for 13 emissions reductions; and 14 (H) other emissions reductions or energy-efficient technologies 15 the authority determines to be consistent with the Alaska clean energy program 16 established under AS 44.88.450. 17 * Sec. 12. The uncodified law of the State of Alaska is amended by adding a new section to 18 read: 19 ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY AND 20 ALASKA ENERGY AUTHORITY; TRANSITION. (a) The terms of members of the Alaska 21 Industrial Development and Export Authority under AS 44.88.030(a)(2), as that statute read 22 before the effective date of this Act, and the Alaska Energy Authority under AS 44.83.030 23 expire on the effective date of this Act. 24 (b) Notwithstanding AS 44.88.030(a), as amended by sec. 3 of this Act, and 25 AS 39.05.055, members of the Alaska Industrial Development and Export Authority under 26 AS 44.88.030(a), as amended by sec. 3 of this Act, and the Alaska Energy Authority under 27 AS 44.83.030, are appointed to initial terms as follows: 28 (1) one member shall serve a one-year term; 29 (2) one member shall serve a two-year term; 30 (3) one member shall serve a three-year term; 31 (4) one member shall serve a four-year term;
01 (5) one member shall serve a five-year term. 02 (c) Nothing in this section prevents the appointment of a person whose term expires 03 under (a) of this section to the Alaska Industrial Development and Export Authority if the 04 person meets the qualifications in AS 44.88.030(a), as amended by sec. 3 of this Act. 05 * Sec. 13. This Act takes effect January 1, 2022.