CSHB 296(RES): "An Act relating to the Board of Agriculture and Conservation; relating to loans and limitations under the Alaska Agricultural Loan Act; relating to federal crop insurance contributions; relating to a report to the legislature on municipal and state procurement preferences for agricultural products harvested in the state and fisheries products harvested or processed in the state; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 296(RES) 01 "An Act relating to the Board of Agriculture and Conservation; relating to loans and 02 limitations under the Alaska Agricultural Loan Act; relating to federal crop insurance 03 contributions; relating to a report to the legislature on municipal and state procurement 04 preferences for agricultural products harvested in the state and fisheries products 05 harvested or processed in the state; and providing for an effective date." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. AS 03.09.030 is amended to read: 08 Sec. 03.09.030. Quorum. Four [FIVE] members of the Board of Agriculture 09 and Conservation constitute a quorum for the transaction of business or the exercise of 10 a power or function at a meeting of the board. 11 * Sec. 2. AS 03.10.020(a) is amended to read: 12 (a) The Board of Agriculture and Conservation (AS 03.09.010) may 13 (1) make a loan to
01 (A) an individual resident farmer, homesteader, or a partnership 02 or corporation composed of farmers and homesteaders for 03 (i) clearing land for agricultural purposes; 04 (ii) development of farms; 05 (iii) storage and processing of farm produce; [OR] 06 (iv) the purchase of livestock or machinery; 07 (v) the cost of shipping to and within the state for the 08 purposes listed in (i) - (iv) of this subparagraph; or 09 (vi) in-state manufacturing of food or production of 10 animal feed; 11 (B) an individual state resident, or a partnership or corporation 12 for 13 (i) storage and processing plants for agricultural 14 products; 15 (ii) the commercial production or processing of 16 horticultural products in the state; 17 (iii) the commercial production or processing of animal 18 feed in the state; [OR] 19 (iv) the raising or care of animals in the state for the 20 purpose of marketing their fur; 21 (v) the cost of shipping to and within the state for the 22 purposes listed in (i) - (iv) of this subparagraph; or 23 (vi) in-state manufacturing of food or production of 24 animal feed; 25 (2) designate agents and delegate its powers to them as necessary; 26 (3) adopt regulations necessary to carry out its functions, including 27 regulations to establish reasonable fees for services provided and charges for 28 collecting the fees; 29 (4) establish amortization plans for repayment of loans, which may 30 include delayed payments of principal and interest for not to exceed five years; 31 (5) enter into agreements with private lending institutions, other state
01 agencies, or agencies of the federal government to carry out the purposes of this 02 chapter; 03 (6) collect the fees and collection charges established under this 04 subsection; 05 (7) refinance a debt obligation incurred by a borrower under this 06 section or through another lender for a purpose authorized under (1) of this 07 subsection if the borrower otherwise qualifies for a loan under AS 03.10.010 - 08 03.10.060. 09 * Sec. 3. AS 03.10.030(a) is amended to read: 10 (a) A [THE] farm development, chattel, or irrigation loan made under this 11 chapter 12 (1) may not exceed a term of 30 years, except that a chattel loan may 13 not exceed a term of seven years; 14 (2) may not, when added to the outstanding balance of other loans 15 made under this chapter, exceed a total outstanding balance of $3,000,000, adjusted 16 annually for inflation on July 1 of each year based on the percentage increase in 17 the Consumer Price Index for all urban consumers for urban Alaska during the 18 previous calendar year, as determined by the United States Department of 19 Labor, Bureau of Labor Statistics [$1,000,000]; 20 (3) shall be secured by a real estate or chattel mortgage of any priority, 21 except that the portion of a loan that exceeds $500,000, when added to prior 22 indebtedness that is secured by the same property, must be secured by a first 23 mortgage; 24 (4) shall bear interest at a fixed rate comparable to that charged by 25 other agricultural lending institutions in the state for loans similar to those referred to 26 in this subsection. 27 * Sec. 4. AS 03.10.030(c) is amended to read: 28 (c) A short-term loan, to be amortized within one year, not to exceed, for 29 [$350,000 TO] any one borrower, an amount set by the Board of Agriculture and 30 Conservation in regulation, may be made for operating purposes, except that a loan 31 made under this subsection may not exceed $500,000 [$200,000] unless the loan is
01 made to a borrower in a farm disaster area declared under AS 03.10.058. The loan 02 shall bear interest at a fixed rate comparable to that charged by other agricultural 03 lending institutions in the state for loans similar to those referred to in this subsection. 04 An applicant for a short-term loan may be required to purchase insurance through the 05 Federal Crop Insurance Act (7 U.S.C. 1501 - 1520) as a condition of the loan. The 06 term of a loan made under this subsection may be extended for up to three years by the 07 Board of Agriculture and Conservation, in the discretion of the board, upon 08 application by the borrower. 09 * Sec. 5. AS 03.10.030(f) is amended to read: 10 (f) A farm product processing loan may not exceed $500,000 [$250,000]. A 11 mortgage that secures a farm product processing loan may be of any priority if the 12 total indebtedness on the real estate, including the secured farm product processing 13 loan, does not exceed $500,000 [$250,000]. A farm product processing loan that, if 14 made, would raise the existing indebtedness on the real estate securing the loan above 15 $500,000 [$250,000], or a farm product processing loan on real estate that has a prior 16 indebtedness of $500,000 [$250,000] or more, may be made only if all prior 17 mortgagees agree to subordinate their mortgages to that of the state for the amount of 18 the farm product processing loan that exceeds the $500,000 [$250,000] indebtedness 19 limit on the real estate. A farm product processing loan may not exceed a term of 30 20 years or bear interest at a rate that is less than a fixed rate comparable to that charged 21 by other agricultural lending institutions in the state for similar loans, and shall be 22 secured by a real estate or chattel mortgage or both. 23 * Sec. 6. AS 03.10.030(g) is amended to read: 24 (g) A loan for clearing land may not 25 (1) exceed an amount set by the Board of Agriculture and 26 Conservation in regulation [$250,000]; 27 (2) bear interest at a rate that is less than a fixed rate comparable to 28 that charged by other agricultural lending institutions in the state for similar loans; 29 (3) have a term in excess of 20 years; or 30 (4) be made for clearing land other than land that has been classified 31 by the United States Department of Agriculture, Natural Resources Conservation
01 Service, under the Land Capability Classification System as having agricultural 02 potential for the production of annual crops or hay [,] or for pasture. 03 * Sec. 7. AS 03.13.030 is repealed and reenacted to read: 04 Sec. 03.13.030. State contribution; limitation. Except as provided in 05 AS 03.13.040(b), the state shall pay a percentage of the covered producer's revenue 06 protection policy premium, as calculated by the corporation, equivalent to the amount 07 required to obtain 08 (1) 85 percent revenue protection for the first two policy years; 09 (2) 80 percent revenue protection for the third policy year; 10 (3) 75 percent revenue protection for the fourth policy year; and 11 (4) if a producer purchases a minimum of 55 percent revenue 12 protection coverage, 70 percent revenue protection for a policy year after the fourth 13 policy year. 14 * Sec. 8. AS 03.13.040(b) is amended to read: 15 (b) If for any year the amount appropriated is insufficient to fully fund the 16 contribution required by AS 03.13.030 [AS 03.13.020], the department shall allocate 17 funds on a first come basis. 18 * Sec. 9. AS 03.13 is amended by adding a new section to read: 19 Sec. 03.13.045. Regulations. The department may adopt regulations under 20 AS 44.62 (Administrative Procedure Act) to carry out this chapter, including 21 regulations to establish reasonable fees for services provided by the department. 22 * Sec. 10. AS 03.13.050 is amended to read: 23 Sec. 03.13.050. Definitions. In this chapter, 24 (1) "corporation" means the Federal Crop Insurance Corporation (7 25 U.S.C. 1503); 26 (2) "revenue protection" has the meaning given in 7 C.F.R. 457.8. 27 * Sec. 11. AS 03.13.020 is repealed. 28 * Sec. 12. The uncodified law of the State of Alaska is amended by adding a new section to 29 read: 30 REPORT TO THE LEGISLATURE. Not later than the 30th legislative day of the 31 First Regular Session of the Thirty-Fourth Alaska State Legislature, the Department of
01 Administration, with the assistance of the Department of Commerce, Community, and 02 Economic Development, shall prepare and present to the legislative committees having 03 jurisdiction over procurement a report evaluating the procurement preferences established 04 under AS 29.71.040(a) and (b) and AS 36.15.050(a) and (b). The report must include 05 (1) annual data and year-over-year comparisons of 06 (A) the total value of Alaska products purchased; 07 (B) the type of products purchased, including raw and value-added 08 products, and the amount purchased by volume or units; 09 (C) the number of businesses participating in the state; and 10 (D) the number of businesses in the state with sales to institutional 11 buyers, including state agencies, school districts, or local governments; and 12 (2) a recommendation from the Department of Administration, with input 13 from the Department of Commerce, Community, and Economic Development, addressing 14 potential statutory changes to make purchase preference programs more effective at 15 stimulating state agriculture. 16 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 17 read: 18 TRANSITION: REGULATIONS. The Board of Agriculture and Conservation and the 19 Department of Natural Resources may adopt regulations necessary to implement the changes 20 made by secs. 2 - 11 of this Act. The regulations take effect under AS 44.62 (Administrative 21 Procedure Act) but not before the effective date of the law implemented by the regulation. 22 * Sec. 14. Sections 1 and 13 of this Act take effect immediately under AS 01.10.070(c). 23 * Sec. 15. Section 3 of this Act takes effect July 1, 2024. 24 * Sec. 16. Sections 2 and 4 - 11 of this Act take effect July 1, 2025.