CSHB 170(FIN): "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(FIN) 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. The uncodified law of the State of Alaska is amended by adding a new section 09 to read: 10 SHORT TITLE. This Act may be known as the Alaska Green Bank Act. 11 * Sec. 2. AS 39.25.110 is amended by adding a new paragraph to read: 12 (46) an analyst employed in a professional capacity by the Alaska 13 Energy Authority under AS 44.83.055.
01 * Sec. 3. AS 44.83 is amended by adding a new section to article 1 to read: 02 Sec. 44.83.055. Analyst position. The authority may hire one analyst to assist 03 underserved communities with the technical development of projects and applications 04 for funding from the Alaska clean energy fund and program under AS 44.88.450 - 05 44.88.456. 06 * Sec. 4. AS 44.88.030(a) is amended to read: 07 (a) The membership of the authority consists of 08 (1) the commissioner of revenue and the commissioner of commerce, 09 community, and economic development; and 10 (2) five public members [APPOINTED BY THE GOVERNOR], each 11 of whom has expertise in private sector business or industry, or both, and possesses 12 demonstrated leadership skills, appointed by the governor, subject to confirmation 13 by a majority of the members of the legislature in joint session. 14 * Sec. 5. AS 44.88.030(c) is amended to read: 15 (c) Public members of the authority described in (a)(2) of this section serve 16 staggered five-year [AT THE PLEASURE OF THE GOVERNOR FOR TWO- 17 YEAR] terms. A member appointed under (a)(2) of this section may only be 18 removed for cause. 19 * Sec. 6. AS 44.88.070 is amended to read: 20 Sec. 44.88.070. Purpose of the authority. The purpose of the authority is to 21 promote, develop, and advance the general prosperity and economic welfare of the 22 people of the state, to relieve problems of unemployment, and to create additional 23 employment by 24 (1) providing various means of financing and means of facilitating the 25 financing, in cooperation with federal, state, and private institutions, of industrial, 26 manufacturing, energy, sustainable energy development, export, small business, and 27 business enterprises and the other facilities referred to in AS 44.88.010(a) in the state; 28 (2) owning and operating or providing development project financing 29 for the enterprises and other facilities described in AS 44.88.172; 30 (3) fostering the expansion of exports of goods, services, and raw 31 materials of the state;
01 (4) cooperating and acting in conjunction with other organizations, 02 public and private, the objects of which are the promotion and advancement of export 03 trade activities in the state; 04 (5) establishing a source of funding credit guarantees and insurance, 05 not otherwise available, to support export development; 06 (6) providing and cooperating or participating with federal, state, and 07 private institutions to provide actual and potential state exporters, particularly small- 08 and medium-sized exporters, with financial assistance in support of export 09 transactions. 10 * Sec. 7. AS 44.88.159(a) is amended to read: 11 (a) The interest rate on a loan purchased from the proceeds of tax-exempt 12 bonds secured by the Alaska Industrial Development and Export Authority sustainable 13 energy transmission and supply development fund (AS 44.88.660) under 14 AS 44.88.650 - 44.88.690, [OR] by the Arctic infrastructure development fund 15 (AS 44.88.810) under AS 44.88.800 - 44.88.840, or by the Alaska clean energy fund 16 (AS 44.88.452) under AS 44.88.450 - 44.88.456, or a loan participation purchased 17 from the proceeds of tax-exempt bonds or expected by the authority to be purchased 18 from the proceeds of tax-exempt bonds under AS 44.88.155 shall be determined under 19 the regulations adopted by the authority under AS 44.88.085(g)(2)(C) and shall be not 20 less than the cost of funds to the authority. In this subsection, "cost of funds" means 21 the true interest cost expressed as a rate on tax-exempt bonds of the authority plus an 22 additional percentage as determined by the authority to represent the allocable 23 expenses of operation, costs of issuance, and loan servicing costs. 24 * Sec. 8. AS 44.88.159(b) is amended to read: 25 (b) The interest rate on a loan purchased from the proceeds of taxable bonds 26 secured by the Alaska Industrial Development and Export Authority sustainable 27 energy transmission and supply development fund (AS 44.88.660) under 28 AS 44.88.650 - 44.88.690, [OR] by the Arctic infrastructure development fund 29 (AS 44.88.810) under AS 44.88.800 - 44.88.840, or by the Alaska clean energy fund 30 (AS 44.88.452) under AS 44.88.450 - 44.88.456, or a loan participation purchased 31 from the proceeds of taxable bonds under AS 44.88.155 or expected by the authority
01 to be purchased from the proceeds of taxable bonds under AS 44.88.155 shall be 02 determined under the regulations adopted by the authority under 03 AS 44.88.085(g)(2)(C) and shall be not less than the cost of funds to the authority. In 04 this subsection, "cost of funds" means the true interest cost expressed as a rate on 05 taxable bonds, plus an additional percentage as determined by the authority to 06 represent the allocable expenses of operation, costs of issuance, and loan servicing 07 costs. 08 * Sec. 9. AS 44.88.159(g) is amended to read: 09 (g) The authority may, in the regulations adopted by the authority under 10 AS 44.88.085(g)(2)(C), establish a program to pay to borrowers of loan participations 11 determined by the authority to meet sufficient job creation, rural development, Arctic 12 infrastructure development, renewable energy development, sustainable energy 13 development, or other economic development criteria incentive rate rebates of not 14 more than one percent of the interest rate charged on the authority's portion of a loan 15 participation. The following standards apply to the program: 16 (1) the payment of an incentive rate rebate may reduce the interest rate 17 to a rate that is less than the minimum interest rate required under (a), (b), or (e) of this 18 section; 19 (2) the authority may not commit to pay an incentive rate rebate for a 20 proposed loan participation if the total of the amount of the proposed loan 21 participation plus the combined outstanding balance of all loan participations for 22 which the authority has committed to pay incentive rate rebates would exceed five 23 percent of the total of the amount of the proposed loan participation plus the combined 24 outstanding balance of all loan participations of the authority; 25 (3) an incentive rate rebate may not accrue for more than five years 26 after the date the loan participation is purchased; 27 (4) the authority may establish a separate account for the incentive rate 28 rebate program. 29 * Sec. 10. AS 44.88.178 is amended to read: 30 Sec. 44.88.178. Creation of subsidiaries. The authority may create one or 31 more subsidiary corporations for the purpose of acquiring, constructing, owning,
01 operating, or financing a project financed under AS 44.88.172 or one or more 02 subsidiary corporations, limited liability companies, or limited partnerships for 03 the purpose of administering, operating, or expanding the Alaska clean energy 04 program. A subsidiary corporation created under this section may be incorporated 05 under AS 10.20.146 - 10.20.166. Subject to limitations for the use of the economic 06 development account under AS 44.88.172 and the Alaska clean energy fund 07 under AS 44.88.450 - 44.88.456, the [THE] authority may transfer assets of the 08 authority to a subsidiary created under this section. A subsidiary created under this 09 section may borrow money and issue bonds as evidence of that borrowing, and has all 10 the powers of the authority that the authority grants to it. Unless otherwise provided by 11 the authority, the debts, liabilities, and obligations of a subsidiary corporation, limited 12 liability company, or limited partnership created under this section are not the 13 debts, liabilities, or obligations of the authority. 14 * Sec. 11. AS 44.88 is amended by adding new sections to read: 15 Sec. 44.88.450. Alaska clean energy program. (a) The Alaska clean energy 16 program is created in the authority to make loans and provide other forms of financing 17 for sustainable energy development in the state. 18 (b) The Alaska clean energy program advisory board is established and 19 consists of 20 (1) the governor or the governor's designee; and 21 (2) eight members appointed by the governor as follows: 22 (A) one member who represents a 23 (i) tribe; 24 (ii) tribal nonprofit organization or consortium; or 25 (iii) regional housing authority; 26 (B) one member who represents an Alaska Native corporation; 27 (C) one member who represents an Alaska nonprofit 28 corporation specializing in cold climate housing research; 29 (D) one member who has experience in 30 (i) renewable energy; 31 (ii) electric transportation; or
01 (iii) similar sustainable energy development; 02 (E) four members who have experience in 03 (i) finance; 04 (ii) marketing of financial products; 05 (iii) construction science and efficiencies; 06 (iv) renewable energy; 07 (v) electric transportation; or 08 (vi) other sustainable energy development. 09 (c) The advisory board established under (b) of this section shall make 10 recommendations to the authority regarding 11 (1) the design of the Alaska clean energy program; 12 (2) a public education program for the Alaska clean energy program; 13 (3) best practices of funds designed to address sustainable energy 14 development; and 15 (4) other matters intended to increase the use and viability of the 16 Alaska clean energy fund. 17 (d) A member of the advisory board appointed under (b) of this section serves 18 without compensation but is entitled to travel and per diem expenses as provided in 19 AS 39.20.180. 20 Sec. 44.88.452. Alaska clean energy fund. (a) The Alaska clean energy fund 21 is established in the authority. The Alaska clean energy fund is for the uses and 22 purposes of AS 44.88.450 - 44.88.456. 23 (b) The fund consists of appropriations made by the legislature, loans or other 24 assets transferred to the fund by the authority, unrestricted loan repayments, interest, 25 or other income earned on loans, investments, or assets of the fund, and available 26 federal funding. 27 (c) The fund is not an account in the revolving loan fund established in 28 AS 44.88.060. The authority shall account for the fund separately from the revolving 29 fund. The authority may create additional accounts in the Alaska clean energy fund. 30 Subject to agreements made with the holders of the authority's bonds or with other 31 persons, the authority may transfer amounts in an account in the fund to another
01 account in the fund. 02 (d) The authority has custody of the fund and shall be responsible for its 03 management. The authority is the fiduciary of the fund under AS 37.10.071 and may 04 invest amounts in the fund in accordance with an investment policy adopted by the 05 authority. To promote sustainable energy development in the state, the investment 06 policy adopted by the authority may deviate from the prudent investor rule and 07 traditional institutional financing criteria. Notwithstanding AS 37.10.010 - 37.10.050, 08 the authority may make disbursements from the fund in accordance with 09 AS 37.25.050. Notwithstanding AS 37.05.130 and 37.05.140, the authority shall report 10 disbursements from the fund annually in accordance with AS 44.88.205(b)(2). An 11 appropriation made to the fund by the legislature shall be transferred to the authority 12 for deposit in the fund. 13 (e) Nothing in this section creates a dedicated fund. 14 Sec. 44.88.454. Sustainable energy development; powers and duties of the 15 authority. (a) The authority shall 16 (1) consider the energy policies of the state described in AS 44.99.115 17 and prioritize programs that support energy efficiency and renewable energy projects 18 for residential buildings, commercial buildings, and community facilities in managing 19 the operations of the Alaska clean energy program and fund under AS 44.88.450 - 20 44.88.456; 21 (2) annually prepare a report containing information regarding the 22 implementation and operation of the Alaska clean energy program and fund under 23 AS 44.88.450 - 44.88.456, including the amount of loans made, the amount available 24 to be loaned, the amount loaned in communities that receive, or have a resident who 25 receives, power cost equalization under AS 42.45.100 - 42.45.150, the scope of 26 projects financed, and actions taken by the authority in response to recommendations 27 from the advisory board established under AS 44.88.450(b), and deliver the report to 28 the senate secretary and the chief clerk of the house of representatives and notify the 29 legislature that the report is available; 30 (3) in consultation with the advisory board established in 31 AS 44.88.450, establish financing programs and products the authority determines
01 necessary to encourage and promote sustainable energy development in the state. 02 (b) Subject to the requirements of AS 44.88.450 - 44.88.456, the authority 03 may 04 (1) establish a subsidiary entity subject to the requirements of 05 AS 44.88.178; 06 (2) invest in eligible sustainable energy development independently or 07 with other investors, including private capital providers; 08 (3) provide capital and fund management to eligible sustainable energy 09 development in the form of 10 (A) senior, mezzanine, and subordinated debt; 11 (B) loan guarantees on third-party financing; 12 (C) credit enhancements, including loan loss reserves and 13 interest rate buy-downs; 14 (D) aggregation and warehousing; 15 (E) equity capital; 16 (F) securitization of financings; 17 (G) financing techniques that make use of loan liquidity; and 18 (H) other financial products or services approved by the 19 authority; 20 (4) make and execute contracts and other instruments to implement 21 AS 44.88.450 - 44.88.456; 22 (5) charge reasonable fees established by the authority in regulation for 23 the products and services the authority provides under AS 44.88.450 - 44.88.456; 24 (6) acquire real or personal property by purchase, transfer, or 25 foreclosure when the acquisition is necessary to protect the authority's interest in a 26 loan or other financial product; 27 (7) subject to AS 36.30.085, enter into lease-purchase agreements; 28 (8) defer principal payments or capitalize interest on loans; 29 (9) provide financing and services to municipal energy improvement 30 assessment programs established in accordance with AS 29.55.100; and 31 (10) exercise other powers necessary to implement AS 44.88.450 -
01 44.88.456. 02 (c) The authority shall adopt regulations to implement AS 44.88.450 - 03 44.88.456, including 04 (1) an application process for acquiring financing under the Alaska 05 clean energy program; 06 (2) qualifications for applicants applying for financing under the 07 Alaska clean energy program; 08 (3) record-keeping requirements for the authority to accumulate and 09 track measurable data related to the Alaska clean energy fund (AS 44.88.452); and 10 (4) fiscal controls for the Alaska clean energy fund (AS 44.88.452). 11 (d) In this section, "community facility" means a water and sewer facility, 12 public outdoor lighting, a charitable educational facility, or another community 13 building whose operations are not paid for by the state, the federal government, or 14 private commercial interests. 15 Sec. 44.88.456. Limitations on financing; use as security. (a) Unless the 16 authority has obtained legislative approval, the authority may not use the Alaska clean 17 energy fund established in AS 44.88.452 to make a loan guarantee if the amount of the 18 guarantee exceeds $20,000,000. 19 (b) The authority may not use the Alaska clean energy fund established in 20 AS 44.88.452 for construction or renovation of power generation projects greater than 21 one megawatt that use fossil fuel combustion. 22 (c) Financing under AS 44.88.454 is limited to the life of eligible sustainable 23 energy development, and, financing is limited by the estimated useful life of the 24 project. 25 (d) Notwithstanding (a) of this section, the authority may use the Alaska clean 26 energy fund established in AS 44.88.452 as security for a bond guarantee. 27 (e) A guarantee or other security provided by the authority under 28 AS 44.88.450 - 44.88.456 does not constitute a debt, liability, or obligation of the state 29 or a political subdivision of the state. 30 * Sec. 12. AS 44.88.900 is amended by adding new paragraphs to read: 31 (20) "eligible sustainable energy development" means activity
01 approved by the authority to be consistent with the Alaska clean energy program and 02 for which the authority will issue a loan or other financial product; 03 (21) "sustainable energy development" means 04 (A) renewable energy generation from sources that are 05 continually replenished by nature, including the sun, wind, water, and 06 biological processes; 07 (B) building energy efficiency, including switching from fuel 08 to renewable fuels and electrification; 09 (C) industrial decarbonization; 10 (D) electrical infrastructure incorporating 11 (i) energy storage to support clean or more efficient 12 energy distribution, including remote and non-remote microgrids and 13 smart-grid applications; and 14 (ii) other sustainable technologies including distributed 15 generation, advanced battery, and combined heat and power; 16 (E) greenhouse gas emissions reduction through processes that 17 include regenerative agriculture, reforestation, afforestation, and forestry 18 management; 19 (F) clean transportation, including battery-operated electric 20 vehicles, hydrogen vehicles, plug-in hybrid electric vehicles, and other zero- 21 emissions vehicles for consumers, businesses, government, and public transit; 22 (G) electric vehicle charging and fueling infrastructure for 23 emissions reductions; and 24 (H) other emissions reductions or energy-efficient technologies 25 the authority determines to be consistent with the Alaska clean energy program 26 established under AS 44.88.450. 27 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 28 read: 29 CLEAN ENERGY FUND: INITIAL APPROPRIATION. At least 35 percent of the 30 initial appropriation made by the Thirty-Second Alaska State Legislature to the Alaska clean 31 energy fund for loans and other forms of financing for sustainable energy development under
01 AS 44.88.450 - 44.88.456 must be distributed in communities that receive, or that have 02 residents who receive, power cost equalization under AS 42.45.100 - 42.45.150. 03 * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 04 read: 05 ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY AND 06 ALASKA ENERGY AUTHORITY; TRANSITION. (a) The terms of members of the Alaska 07 Industrial Development and Export Authority under AS 44.88.030(a)(2), as that statute read 08 before the effective date of this Act, and the Alaska Energy Authority under AS 44.83.030 09 expire on the effective date of this Act. 10 (b) Notwithstanding AS 44.88.030(a), as amended by sec. 4 of this Act, and 11 AS 39.05.055, members of the Alaska Industrial Development and Export Authority under 12 AS 44.88.030(a), as amended by sec. 4 of this Act, and the Alaska Energy Authority under 13 AS 44.83.030, are appointed to initial terms as follows: 14 (1) one member shall serve a one-year term; 15 (2) one member shall serve a two-year term; 16 (3) one member shall serve a three-year term; 17 (4) one member shall serve a four-year term; 18 (5) one member shall serve a five-year term. 19 (c) Nothing in this section prevents the appointment of a person whose term expires 20 under (a) of this section to the Alaska Industrial Development and Export Authority if the 21 person meets the qualifications in AS 44.88.030(a), as amended by sec. 4 of this Act. 22 * Sec. 15. This Act takes effect January 1, 2023.