00 CS FOR SENATE BILL NO. 67(L&C) 01 "An Act establishing the commercial charter fisheries revolving loan fund and the 02 mariculture revolving loan fund, and relating to those funds and loans from those funds; 03 and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05  * Section 1. AS 16.10 is amended by adding new sections to read: 06 Article 13. Commercial Charter Fisheries Revolving Loan Fund.  07 Sec. 16.10.801. Commercial charter fisheries revolving loan fund. (a) The 08 commercial charter fisheries revolving loan fund is created in the Department of 09 Commerce, Community, and Economic Development to carry out the purposes of 10 AS 16.10.801 - 16.10.890. 11 (b) The commercial charter fisheries revolving loan fund consists of the 12 following: 13 (1) money appropriated to, transferred to, or received by gift, grant, 14 devise, bequest, or donation to the fund; 01 (2) principal and interest payments or other income earned on loans or 02 investments of the fund; 03 (3) money chargeable to principal or interest that is collected through 04 liquidation by foreclosure or other process on loans made under AS 16.10.801 - 05 16.10.890. 06 (c) Money in the fund may be used by the legislature to make appropriations 07 for costs of administering AS 16.10.801 - 16.10.890. 08 Sec. 16.10.805. Powers and duties of the department. The department may 09 (1) make loans to eligible applicants under AS 16.10.801 - 16.10.890 10 (A) for the purchase of charter halibut permits; 11 (B) for the purchase or construction of a charter halibut fishing 12 vessel; 13 (C) to upgrade existing charter halibut fishing vessels and gear 14 for the purpose of improving engine fuel efficiency; 15 (D) to refinance debt obligations made by other lenders more 16 than 12 months before the department received the loan application and 17 incurred by an applicant for the purchase of charter halibut fishing vessels or 18 gear if the applicant otherwise qualifies for a loan under AS 16.10.801 - 19 16.10.890; the department may collect a refinancing loan origination charge as 20 provided by regulation; 21 (2) receive, take, hold, and administer any appropriation, transfer, gift, 22 grant, bequest, devise, or donation of money for the fund; 23 (3) establish amortization plans for repayment of loans, including 24 extensions of the terms of loans; 25 (4) allow an assumption of a loan if 26 (A) the applicant meets the requirements established under this 27 section; and 28 (B) approval of the assumption would be consistent with the 29 purposes of AS 16.10.801 - 16.10.890; 30 (5) establish the rate of interest for loans consistent with law; 31 (6) charge and collect fees for services provided under AS 16.10.801 - 01 16.10.890; 02 (7) adopt regulations under AS 44.62 necessary to carry out the 03 provisions of AS 16.10.801 - 16.10.890, including regulations to establish reasonable 04 fees for services provided; and 05 (8) designate agents and delegate powers as necessary to the agents. 06 Sec. 16.10.810. Eligibility. (a) For an applicant to be eligible for a loan under 07 AS 16.10.801 - 16.10.890, the applicant shall be a resident of the state, as determined 08 under (c) of this section, and shall 09 (1) qualify for the purchase of a charter halibut permit under applicable 10 law; 11 (2) qualify as a transferee for a charter halibut permit under applicable 12 law; 13 (3) purchase or construct a charter halibut fishing vessel; or 14 (4) upgrade an existing charter halibut fishing vessel or gear for the 15 purpose of improving engine fuel efficiency. 16 (b) In addition to the requirements set out in (a) of this section, the applicant 17 (1) may not be eligible for financing from other recognized 18 commercial lending institutions; or 19 (2) shall be able to obtain only a portion of the total loan request from 20 a recognized commercial lending institution. 21 (c) To meet the residency requirements of (a) of this section, the applicant 22 (1) shall physically reside in this state and maintain a domicile in this 23 state during the 24 consecutive months preceding the date of application for the 24 program; and 25 (2) may not have 26 (A) declared or established residency in another state; or 27 (B) received residency or a benefit based on residency from 28 another state. 29 Sec. 16.10.815. Limitations on loans. (a) Except as provided in (b) of this 30 section, a loan under AS 16.10.801 - 16.10.890 31 (1) may not exceed $100,000; 01 (2) may not exceed a term of 15 years, except for extensions under 02 AS 16.10.805; 03 (3) may not bear interest at a rate greater than the prime rate, as 04 defined in AS 44.88.599, plus two percentage points, but which may not be less than 05 three percent a year and not more than 10 1/2 percent a year; 06 (4) must be secured by a first priority lien on collateral acceptable to 07 the commissioner; 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 (b) The interest rate for loans for the improvement of engine fuel efficiency 12 must be two percentage points below the prime rate, as defined in AS 44.88.599, but 13 may not be less than three percent a year and not more than 10 1/2 percent a year. 14 (c) The total balances outstanding on loans made to a borrower under 15 AS 16.10.805 may not exceed $300,000. 16 Sec. 16.10.820. Default. If the borrower defaults on a note, the department 17 shall notify the borrower of the default and the consequences of default by mailing a 18 notice to the borrower's most recent address provided to the department by the 19 borrower or obtained by the department. 20 Sec. 16.10.825. Special account established. (a) The foreclosure expense 21 account is established as a special account within the commercial charter fisheries 22 revolving loan fund. 23 (b) The department may expend money credited to the foreclosure expense 24 account when necessary to protect the state's security interest in collateral on loans 25 granted under AS 16.10.815 or to defray expenses incurred during foreclosure 26 proceedings after an obligor defaults. 27 Sec. 16.10.830. Disposal of property acquired after default. The department 28 shall dispose of property acquired through default of a loan made under AS 16.10.801 29 - 16.10.890. Disposal must be made in a manner that serves the best interest of the 30 state and may include the amortization of payments over a period of years. 31 Sec. 16.10.835. Waiver of confidentiality. The commissioner may release 01 information about the borrower's loan to any individual if release of the information 02 has been authorized by the borrower. 03 Sec. 16.10.890. Definitions. In AS 16.10.801 - 16.10.890, 04 (1) "commissioner" means the commissioner of commerce, 05 community, and economic development; 06 (2) "department" means the Department of Commerce, Community, 07 and Economic Development. 08 Article 14. Mariculture Revolving Loan Fund.  09 Sec. 16.10.900. Mariculture revolving loan fund. (a) The mariculture 10 revolving loan fund is created within the Department of Commerce, Community, and 11 Economic Development to carry out the purposes of AS 16.10.900 - 16.10.945. 12 (b) The mariculture revolving loan fund consists of the following: 13 (1) money appropriated to, transferred to, or received by gift, grant, 14 devise, bequest, or donation to the fund; 15 (2) principal and interest payments or other income earned on loans or 16 investments of the fund; and 17 (3) money chargeable to principal or interest that is collected through 18 liquidation by foreclosure or other process on loans made under AS 16.10.900 - 19 16.10.945. 20 (c) Money in the fund may be used by the legislature to make appropriations 21 for costs of administering AS 16.10.900 - 16.10.945. 22 Sec. 16.10.905. Powers and duties of the department. The department may 23 (1) make loans to eligible applicants under AS 16.10.900 - 16.10.945 24 for the planning, construction, and operation of a mariculture business; 25 (2) receive, take, hold, and administer any appropriation, transfer, gift, 26 grant, bequest, devise, or donation of money for the fund; 27 (3) establish amortization plans for repayment of loans, including 28 extensions of the terms of loans; 29 (4) allow an assumption of a loan if 30 (A) the applicant meets the requirements established under this 31 section; and 01 (B) approval of the assumption would be consistent with the 02 purposes of AS 16.10.900 - 16.10.945; 03 (5) establish the rate of interest for loans consistent with law; 04 (6) charge and collect fees for services provided under AS 16.10.900 - 05 16.10.945; 06 (7) adopt regulations under AS 44.62 necessary to carry out the 07 provisions of AS 16.10.900 - 16.10.945, including regulations to establish reasonable 08 fees for services provided; and 09 (8) designate agents and delegate powers as necessary to the agents. 10 Sec. 16.10.910. Eligibility. (a) For an applicant to be eligible for a loan under 11 AS 16.10.900 - 16.10.945, the applicant shall 12 (1) be a resident of the state, as determined under (c) of this section; 13 (2) have a permitted mariculture farm location in this state; and 14 (3) have experience or training in the mariculture industry. 15 (b) In addition to the requirements set out in (a) of this section, the applicant 16 (1) may not be eligible for financing from other recognized 17 commercial lending institutions; or 18 (2) shall be able to obtain only a portion of the total loan request from 19 a recognized commercial lending institution. 20 (c) To meet the residency requirements of (a) of this section, the applicant 21 (1) shall physically reside in this state and maintain a domicile in this 22 state during the 24 consecutive months preceding the date of application for the 23 program; and 24 (2) may not have 25 (A) declared or established residency in another state; or 26 (B) received residency or a benefit based on residency from 27 another state. 28 Sec. 16.10.915. Limitations on loans. (a) Except as provided in (b) and (c) of 29 this section, a loan under AS 16.10.900 - 16.10.945 30 (1) may not exceed $100,000 a year; 31 (2) may not exceed a term of 20 years, except for extensions under 01 AS 16.10.905; 02 (3) may not bear interest at a rate greater than the prime rate, as 03 defined in AS 44.88.599, plus one percentage point, but which may not be less than 04 five percent a year and not more than nine percent a year; 05 (4) must be secured by a first priority lien on collateral acceptable to 06 the department; and 07 (5) may not be made to a person who has a past due child support 08 obligation established by court order or by the child support services agency under 09 AS 25.27.160 - 25.27.220 at the time of application. 10 (b) Subsequent loans may be made to the borrower under AS 16.10.910 if the 11 total of the balances outstanding on the loans received by the borrower does not 12 exceed $300,000. 13 (c) A loan under AS 16.10.910 may be made for the purchase of boats or 14 vessels determined to be integral to the operation of the farm. 15 Sec. 16.10.920. Repayment of principal of and interest on loans. The 16 department may not require the repayment of principal on a loan made under 17 AS 16.10.910 during the first six years of the loan. Interest on the principal of a loan 18 made under AS 16.10.910 does not accrue during the first six years of the loan. 19 Sec. 16.10.925. Default. If the borrower defaults on a note, the department 20 shall notify the borrower of the default and the consequences of default by mailing a 21 notice to the borrower's most recent address provided to the department by the 22 borrower or obtained by the department. 23 Sec. 16.10.930. Special account established. (a) The foreclosure expense 24 account is established as a special account in the mariculture revolving loan fund. 25 (b) The department may expend money credited to the foreclosure expense 26 account when necessary to protect the state's security interest in collateral on loans 27 granted under AS 16.10.910 or to defray expenses incurred during foreclosure 28 proceedings after an obligor defaults. 29 Sec. 16.10.935. Disposal of property acquired after default. The department 30 shall dispose of property acquired through default of a loan made under AS 16.10.900 31 - 16.10.945. Disposal must be made in a manner that serves the best interest of the 01 state and may include the amortization of payments over a period of years. 02 Sec. 16.10.940. Waiver of confidentiality. The commissioner may release 03 information about the borrower's loan to any individual if release of the information 04 has been authorized by the borrower. 05 Sec. 16.10.945. Definitions. In AS 16.10.900 - 16.10.945, 06 (1) "commissioner" means the commissioner of commerce, 07 community, and economic development; 08 (2) "department" means the Department of Commerce, Community, 09 and Economic Development; 10 (3) "mariculture" means the farming of shellfish and aquatic plants as 11 defined in AS 16.40.199. 12  * Sec. 2. This Act takes effect immediately under AS 01.10.070(c).