00 HOUSE CS FOR CS FOR SENATE BILL NO. 23(L&C) 01 "An Act relating to the dividends from the Alaska Industrial Development and Export 02 Authority; relating to the meaning of 'net income' and 'unrestricted net income' for 03 purposes of the Alaska Industrial Development and Export Authority; authorizing the 04 Alaska Industrial Development and Export Authority to provide financing and issue 05 bonds for a liquefied natural gas production system and natural gas distribution system; 06 and providing for an effective date." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08  * Section 1. AS 44.88.088(a) is amended to read: 09 (a) The authority shall adopt a policy for payment of a dividend from the  10 revolving fund and a dividend from the Alaska Industrial Development and  11 Export Authority sustainable energy transmission and supply development fund  12 (AS 44.88.660) to the state each fiscal year [. THE AMOUNT OF THE DIVIDEND 13 FOR A FISCAL YEAR MAY NOT BE LESS THAN 25 PERCENT NOR MORE 01 THAN 50 PERCENT OF THE NET INCOME OF THE AUTHORITY FOR THE 02 BASE FISCAL YEAR. IN NO EVENT, HOWEVER, SHALL THE DIVIDEND FOR 03 A FISCAL YEAR EXCEED THE TOTAL UNRESTRICTED NET INCOME OF 04 THE AUTHORITY FOR THE BASE FISCAL YEAR]. The dividends [DIVIDEND] 05 for a fiscal year shall be made available by the authority before the end of that fiscal 06 year. The authority shall notify the commissioner of revenue when the dividends 07 [DIVIDEND] for a fiscal year are [IS] available for appropriation. The amount of the  08 dividend payable from the  09 (1) revolving fund for a fiscal year may not be less than 25 percent  10 nor more than 50 percent of the net income of the revolving fund for the base  11 fiscal year; however, in no event, may the dividend payable from the revolving  12 fund for a fiscal year exceed the total unrestricted net income of the revolving  13 fund for the base year;  14 (2) Alaska Industrial Development and Export Authority  15 sustainable energy transmission and supply development fund (AS 44.88.660) for  16 a fiscal year may not be less than 25 percent nor more than 50 percent of the net  17 income of the Alaska Industrial Development and Export Authority sustainable  18 energy transmission and supply development fund for the base fiscal year;  19 however, in no event, shall the dividend payable from the Alaska Industrial  20 Development and Export Authority sustainable energy transmission and supply  21 development fund for a fiscal year exceed the total unrestricted net income of the  22 Alaska Industrial Development and Export Authority sustainable energy  23 transmission and supply development fund for the base year. 24  * Sec. 2. AS 44.88.088(b)(2) is amended to read: 25 (2) "net income" means the [AUTHORITY'S] change in net position,  26 or the equivalent term under generally accepted accounting principles, of the  27 revolving fund or the change in net position of the Alaska Industrial  28 Development and Export Authority sustainable energy transmission and supply  29 development fund (AS 44.88.660) [ASSETS] as set out in the audited financial 30 statements of the authority for the base fiscal year, excluding amounts attributable to 31 intergovernmental transfers, capital contributions, grants, or impairment losses on 01 development projects financed under AS 44.88.172; 02  * Sec. 3. AS 44.88.088(b)(3) is amended to read: 03 (3) "unrestricted net income" means the [AUTHORITY'S] unrestricted 04 change in net position, or the equivalent term under generally accepted  05 accounting principles, of the revolving fund or the Alaska Industrial  06 Development and Export Authority sustainable energy transmission and supply  07 development fund (AS 44.88.660) [ASSETS] as set out in the audited financial 08 statements of the authority for the base fiscal year, excluding amounts attributable to 09 intergovernmental transfers, capital contributions, grants, or impairment losses on 10 development projects financed under AS 44.88.172. 11  * Sec. 4. AS 44.88.105(d) is amended to read: 12 (d) The chair [CHAIRMAN] of the authority shall annually, not [NO] later 13 than January 2, certify in writing to the governor and the legislature the amount, if 14 any, required to restore a capital reserve fund to the capital reserve fund requirement. 15 The legislature may appropriate to the authority the amount certified by the chair 16 [CHAIRMAN] of the authority. The authority shall deposit the amounts appropriated 17 under this subsection during a fiscal year in the proper capital reserve fund. Nothing in 18 this section creates a debt or liability of the state. In this subsection, "capital reserve 19 fund" means a capital reserve fund that 20 (1) is created under this section on or before January 1, 1989; 21 (2) secures refunding bonds if the refunding bonds are issued to refund 22 bonds that are secured by a capital reserve fund created under this section on or before 23 January 1, 1989; [OR] 24 (3) secures bonds issued on or after August 11, 1993, for a power 25 transmission intertie; or 26 (4) secures bonds issued on or after July 1, 2013, for a qualified  27 energy development project financed under AS 44.88.650 - 44.88.690. 28  * Sec. 5. AS 44.88.172(a) is amended to read: 29 (a) The economic development account is established in the revolving fund. 30 The economic development account consists of money or assets appropriated, loaned, 31 or transferred to the authority for deposit in the account and other money or assets 01 deposited in the account by the authority. While money is on deposit in the economic 02 development account, the money may be used [ONLY] to finance, acquire, manage, 03 and operate development projects that the authority intends to own and operate. In this 04 subsection, 05 (1) "operate" includes operation directly by the authority, by an agent 06 of the authority, or by a person as determined under an agreement between the 07 authority and other owners of the development project; 08 (2) "own" includes ownership by the authority of all or a percentage of 09 a development project or all or a percentage of the shares of a corporation or 10 membership in a limited liability company for which the development project is the 11 sole asset of the corporation or limited liability company. 12  * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to 13 read: 14 LEGISLATIVE APPROVAL; FINANCING OF LIQUEFIED NATURAL GAS 15 PRODUCTION AND DISTRIBUTION FACILITIES. (a) The Alaska Industrial 16 Development and Export Authority, through the Alaska Industrial Development and Export 17 Authority sustainable energy transmission and supply development fund (AS 44.88.660), may 18 provide financing up to a principal amount of $275,000,000 for the development, 19 construction, and installation of, and the start-up costs of operation and maintenance for, a 20 liquefied natural gas production plant and system and affiliated infrastructure on the North 21 Slope and a natural gas distribution system and affiliated infrastructure. 22 (b) As a part of the financing authorized under (a) of this section, the Alaska 23 Industrial Development and Export Authority may issue bonds under AS 44.88.090 that are 24 secured by a capital reserve fund (AS 44.88.105). Notwithstanding AS 44.88.105, in 25 establishing a capital reserve fund for the bonds, the authority is not required to determine that 26 the capital reserve fund is necessary to enhance the marketability of the bonds. The authority 27 shall manage the capital reserve fund as provided in AS 44.88.105. The principal amount of 28 the bonds authorized in this section may not exceed $150,000,000 plus the cost of capitalized 29 interest, bond counsel fees, trustee fees, rating fees, financial advisor fees, escrow costs, and 30 other bond issuance costs that the authority considers reasonable and appropriate. 31 (c) Notwithstanding the interest rate requirements of AS 44.88.159, the interest rate 01 the authority may charge for financing authorized under (a) of this section provided from the 02 Alaska Industrial Development and Export Authority sustainable energy transmission and 03 supply development fund (AS 44.88.660) may not exceed three percent or the current market 04 rate for commercial loans at the time the bonds are issued, whichever is less. Notwithstanding 05 the interest rate requirements of AS 44.88.159, the interest rate for financing authorized under 06 (a) of this section provided from the proceeds of bonds authorized under this section may not 07 exceed the interest rate to be paid on the bonds, plus an allowance that the authority 08 establishes for its administrative expenses; however, the allowance for administrative 09 expenses may not exceed 25 basis points. Notwithstanding any contrary provision of law, the 10 interest rate limitations of this subsection supersede and replace any other requirements of law 11 regarding the interest rates that the authority may charge for the financing authorized under 12 (a) of this section. 13 (d) The authorization under (a) of this section constitutes legislative approval for the 14 authority to exceed the limitations of AS 44.88.690 in providing the financing approved under 15 (a) of this section. In providing the financing authorized under (a) of this section, the authority 16 may waive any limitations or requirements of its regulations that are otherwise applicable to 17 the Alaska Industrial Development and Export Authority sustainable energy transmission and 18 supply development fund (AS 44.88.660). 19 (e) The bonds authorized by this section may not be considered in calculating the 20 authority's bonding limitation for a 12-month period under AS 44.88.095(a). 21 (f) The authorization to issue bonds this section grants expires on June 30, 2018, if the 22 authority does not issue bonds before that date. Expiration of the authorization to issue bonds 23 does not affect bonds that the authority issues under this section before July 1, 2018. 24 (g) In this section, 25 (1) "authority" means the Alaska Industrial Development and Export 26 Authority; 27 (2) "financing" means any method or combination of methods of providing 28 funds for a qualified energy development project under AS 44.88.650 - 44.88.690. 29  * Sec. 7. This Act takes effect immediately under AS 01.10.070(c).