CSHB 105(FIN): "An Act relating to the programs and bonds of the Alaska Industrial Development and Export Authority; relating to the Alaska Industrial Development and Export Authority sustainable energy transmission and supply development fund; requiring the Alaska Industrial Development and Export Authority to deliver to the legislature reports relating to the Interior energy project; relating to the financing authorization through the Alaska Industrial Development and Export Authority of a liquefied natural gas production plant and natural gas energy projects and distribution systems in the state; amending and repealing bond authorizations granted to the Alaska Industrial Development and Export Authority; authorizing the Alaska Industrial Development and Export Authority to issue bonds to finance the infrastructure and construction costs of the Sweetheart Lake hydroelectric project; authorizing the Alaska Industrial Development and Export Authority to issue bonds to finance the infrastructure and construction costs of rebuilding transmission between the Hope substation and Portage, rebuilding transmission between Powerline Pass to Indian, and the Eklutna hydroelectric transmission system upgrade project; relating to legislative approval for loans from the power project fund to the City of King Cove; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 105(FIN) 01 "An Act relating to the programs and bonds of the Alaska Industrial Development and 02 Export Authority; relating to the Alaska Industrial Development and Export Authority 03 sustainable energy transmission and supply development fund; requiring the Alaska 04 Industrial Development and Export Authority to deliver to the legislature reports 05 relating to the Interior energy project; relating to the financing authorization through 06 the Alaska Industrial Development and Export Authority of a liquefied natural gas 07 production plant and natural gas energy projects and distribution systems in the state; 08 amending and repealing bond authorizations granted to the Alaska Industrial 09 Development and Export Authority; authorizing the Alaska Industrial Development and 10 Export Authority to issue bonds to finance the infrastructure and construction costs of 11 the Sweetheart Lake hydroelectric project; authorizing the Alaska Industrial 12 Development and Export Authority to issue bonds to finance the infrastructure and
01 construction costs of rebuilding transmission between the Hope substation and Portage, 02 rebuilding transmission between Powerline Pass to Indian, and the Eklutna 03 hydroelectric transmission system upgrade project; relating to legislative approval for 04 loans from the power project fund to the City of King Cove; and providing for an 05 effective date." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 08 to read: 09 LEGISLATIVE INTENT. It is the intent of the legislature that the financing 10 authorized in sec. 10 of this Act be used only for the Interior energy project described in sec. 11 10 of this Act. 12 * Sec. 2. AS 44.88.095(c) is amended to read: 13 (c) Before entering into a lease or other agreement under AS 44.88.090(e) 14 regarding a project for which the authority agrees to issue bonds in an amount in 15 excess of $10,000,000 [$6,000,000], there must be filed with the authority a certified 16 copy of a resolution of the governing body of the political subdivision of the state, if 17 any, in which the project is to be located, consenting to the location of the project. The 18 consent need only refer to the general nature of the project ultimately to be acquired or 19 financed, as set out in a request of the proposed project applicant. Before entering into 20 a lease or other agreement under AS 44.88.090(e) regarding a project, the authority 21 shall find, on the basis of all information reasonably available to it, that 22 (1) the project and its development under this chapter will be 23 economically advantageous to the state and the general public welfare and will 24 contribute to the economic growth of the state; 25 (2) the project applicant is financially responsible; 26 (3) provision to meet increased demand on [UPON] public facilities 27 that might result from the project is reasonably assured; and 28 (4) the project will provide, or retain, employment reasonably related 29 to the amount of the financing by the authority, considering the amount of investment
01 for each [PER] employee for comparable facilities and other relevant factors. 02 * Sec. 3. AS 44.88.095(g) is amended to read: 03 (g) The authority may issue bonds in an amount greater than $25,000,000 04 [$10,000,000] to assist in the financing of a development project under AS 44.88.172 - 05 44.88.177 only if approved by the legislature [LAW], excluding refunding bonds. 06 Refunding bonds may be issued without further approval by the legislature [LAW] in 07 a principal amount sufficient to provide funds for the payment of all bonds to be 08 refunded by them and, in addition, for the payment of all other amounts that the 09 authority considers appropriate in connection with the refunding, including expenses 10 incident to the redeeming, calling, retiring, or paying of the outstanding bonds, the 11 funding of reserves, and the issuance of the refunding bonds. 12 * Sec. 4. AS 44.88.155(d) is amended to read: 13 (d) A loan participation purchased by the authority with assets of the 14 enterprise development account or with proceeds of bonds secured by assets of the 15 enterprise development account 16 (1) may not exceed $25,000,000 [$20,000,000]; however, in the case 17 of a loan participation for qualified energy development, the loan participation may 18 exceed $25,000,000 [$20,000,000] with legislative approval; 19 (2) may not be purchased unless 20 (A) the project applicant is not, or, if the applicant is not a 21 single proprietorship, all members of the business enterprise or enterprises 22 constituting the project applicant are not, in default on another loan made by 23 the state or by a public corporation of the state; and 24 (B) at least 10 percent of the principal amount of the loan is 25 retained by the loan originator, or the loan is for financing improvements in 26 energy efficiency; 27 (3) may not be purchased if the loan to be purchased exceeds 75 28 percent of the appraised value of the collateral offered as security for the loan unless 29 the amount of the loan in excess of this limit is federally insured or guaranteed or is 30 insured by a qualified mortgage insurance company, except that the loan to be 31 purchased under this paragraph may not exceed the total of loan proceeds used to
01 refinance an existing debt plus the cost of new construction, expansion, or acquisition 02 unless the proceeds from the additional amounts of the loan to be purchased are 03 restricted to uses approved by the authority to finance commercial activity in the state 04 by a business enterprise; 05 (4) may not be purchased if the participation in the loan to be 06 purchased is for a term longer than the following, except that a loan under (A) or (C) 07 of this paragraph may not have a term longer than three-quarters of the authority's 08 estimate of the life of the collateral offered as security for the loan: 09 (A) 40 years from the date the loan is made in the case of a 10 loan participation for a project described in AS 44.88.900(11)(E); 11 (B) 50 years from the date the loan is made in the case of a loan 12 participation for qualified energy development; 13 (C) 25 years from the date the loan is made in the case of a loan 14 participation for other projects; 15 (5) may be made only if the participation in the loan to be purchased 16 contains amortization provisions; the amortization provisions 17 (A) must be complete and satisfactory to the authority and 18 require periodic payments by the borrower; 19 (B) may allow the loan originator to amortize the portion of the 20 loan retained by the loan originator using a shorter amortization schedule than 21 the amortization schedule for the portion of the loan held by the authority if 22 (i) in the authority's opinion, the project financed can 23 support the increased debt service; and 24 (ii) the accelerated amortization schedule is required to 25 induce the originator to make the loan; 26 (6) may be made only if the participation in the loan to be purchased is 27 in the form and contains the terms and provisions with respect to insurance, repairs, 28 alterations, payment of taxes and assessments, default reserves, delinquency charges, 29 default remedies, acceleration of maturity, secondary liens, and other matters the 30 authority prescribes; and 31 (7) may be made only if the participation in the loan to be purchased is
01 secured as to repayment by a mortgage or other security instrument in the manner the 02 authority determines is feasible to assure timely repayment under the loan documents 03 entered into with the borrower. 04 * Sec. 5. AS 44.88.170(a) is amended to read: 05 (a) Except as provided in (c) of this section, nothing [NOTHING] in this 06 chapter prevents the inclusion in a lease or other agreement relating to a project of a 07 provision granting the right to purchase the project, or to renew or extend the lease or 08 agreement, upon the terms and conditions that [WHICH] may be provided for in the 09 lease or agreement. 10 * Sec. 6. AS 44.88.170 is amended by adding a new subsection to read: 11 (c) The authority, without first obtaining legislative approval, may not enter 12 into a gas supply contract with a natural gas producer to provide natural gas to Interior 13 Alaska as a primary market unless the contract is for the benefit of a natural gas 14 liquefaction or distribution utility that is owned by the authority or a subsidiary of the 15 authority and the contract is for the natural gas producer to provide the utility, and 16 only the utility, with a natural gas supply that the utility uses to serve customers in 17 Interior Alaska. 18 * Sec. 7. AS 44.88.690(a) is amended to read: 19 (a) Unless the authority has obtained legislative approval by law, the authority 20 may not use the Alaska Industrial Development and Export Authority sustainable 21 energy transmission and supply development fund established in AS 44.88.660 to 22 [MAKE] 23 (1) make a loan for more than one-third of the capital cost of qualified 24 energy development; [OR] 25 (2) make a loan guarantee if the amount of the guarantee exceeds 26 $20,000,000; or 27 (3) purchase or acquire gas reserves or a gas lease or become a 28 working interest owner of a natural gas lease. 29 * Sec. 8. AS 44.88.900(16) is amended to read: 30 (16) "qualified energy development" means a development in the state 31 that involves
01 (A) transmission, generation, conservation, storage, or 02 distribution of heat or electricity; 03 (B) liquefaction, regasification, distribution, storage, or use of 04 natural gas, propane, or propane and air mixture; in this subparagraph, 05 "distribution" does not include [EXCEPT] a natural gas pipeline project for 06 transporting natural gas from the North Slope or Cook Inlet to market unless 07 the pipeline has a diameter of 12 inches or less and transports the natural 08 gas to Interior Alaska; 09 (C) distribution or storage of refined petroleum products; 10 * Sec. 9. Section 2(a), ch. 27, SLA 1993, as amended by sec. 19, ch. 111, SLA 1996, is 11 amended to read: 12 (a) The Alaska Industrial Development and Export Authority may issue bonds 13 to finance the acquisition, design, and construction of a port facility and [RELATED 14 LOADING AND CONVEYOR] equipment related to the development and operation 15 of a bulk commodity loading and shipping terminal, to be located at Point 16 MacKenzie [. THE TERMINAL MAY BE LOCATED ANYWHERE WITHIN 17 COOK INLET]. The facility will be owned by the authority. The principal amount of 18 the bonds may not exceed $50,000,000. 19 * Sec. 10. The uncodified law of the State of Alaska enacted by sec. 11(a), ch. 26, SLA 20 2013, is amended to read: 21 (a) The Alaska Industrial Development and Export Authority, through the 22 Alaska Industrial Development and Export Authority sustainable energy transmission 23 and supply development fund (AS 44.88.660), may provide financing up to a principal 24 amount of $275,000,000 for the development, construction, and installation of, and the 25 start-up costs of operation and maintenance for, a liquefied natural gas production 26 plant and system and affiliated infrastructure in the state that will provide natural 27 gas to Interior Alaska as a primary market [ON THE NORTH SLOPE] and [A] 28 natural gas delivery and distribution systems [SYSTEM] and affiliated infrastructure 29 that will provide natural gas to [IN] Interior Alaska, if the members of the Alaska 30 Industrial Development and Export Authority approve by resolution a project 31 plan. The project plan must
01 (1) identify the source of the natural gas or propane; 02 (2) include the estimated cost of the project; and 03 (3) include the estimated price of natural gas supplied to natural 04 gas utilities in Interior Alaska before distribution to consumers. 05 * Sec. 11. The uncodified law of the State of Alaska enacted by sec. 25, ch. 123, SLA 1990, 06 as repealed and reenacted by sec. 1, ch. 3, FSSLA 1992, is amended to read: 07 Sec. 25. The Alaska Industrial Development and Export Authority may issue 08 bonds to finance the acquisition, design, and construction of aircraft maintenance air 09 cargo/air transport support facilities located at Anchorage International Airport, to be 10 owned by the Authority. The principal amount of the bonds may not exceed $28,000,000 11 [$85,000,000]. This section grants the legislative approval required by AS 44.88.095. 12 * Sec. 12. Section 3, ch. 27, SLA 1993; sec. 7, ch. 76, SLA 1995; sec. 24, ch. 111, SLA 13 1996; secs. 24(a) and 24(b), ch. 109, SLA 1998; sec. 24(d), ch. 109, SLA 1998, as amended 14 by sec. 1, ch. 93, SLA 2006; and sec. 1, ch. 37, SLA 2004, are repealed. 15 * Sec. 13. Section 2(a), ch. 27, SLA 1993, as amended by sec. 19, ch. 111, SLA 1996, and 16 sec. 9 of this Act is repealed June 30, 2019. 17 * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 18 read: 19 LEGISLATIVE APPROVAL; SWEETHEART LAKE HYDROELECTRIC 20 PROJECT. (a) The Alaska Industrial Development and Export Authority may issue bonds to 21 finance the infrastructure and construction costs of the Sweetheart Lake hydroelectric project. 22 The Sweetheart Lake hydroelectric facility shall be owned and operated by the authority or 23 financed under AS 44.88.172. The principal amount of the bonds provided by the authority 24 for the Sweetheart Lake hydroelectric project may not exceed $120,000,000 and may include 25 the costs of issuing bonds considered reasonable and appropriate by the Alaska Industrial 26 Development and Export Authority. 27 (b) This section constitutes legislative approval required by AS 44.88.095(g). 28 * Sec. 15. The uncodified law of the State of Alaska is amended by adding a new section to 29 read: 30 LEGISLATIVE APPROVAL; ALASKA RAILBELT COOPERATIVE 31 TRANSMISSION AND ELECTRIC COMPANY. (a) The Alaska Industrial Development
01 and Export Authority may issue bonds to finance the infrastructure and construction costs for 02 (1) rebuilding transmission between the Hope substation and Portage by the 03 Alaska Railbelt Cooperative Transmission and Electric Company; 04 (2) rebuilding transmission between Powerline Pass to Indian by the Alaska 05 Railbelt Cooperative Transmission and Electric Company; and 06 (3) the Eklutna hydroelectric transmission system upgrade project by the 07 Alaska Railbelt Cooperative Transmission and Electric Company. 08 (b) The projects listed in (a) of this section shall be owned and operated by the 09 authority or financed under AS 44.88.172. 10 (c) The principal amount of the bonds provided by the authority for the projects in 11 (a)(1) and (2) of this section may not exceed a combined total of $107,100,000, and may 12 include the costs of issuing bonds considered reasonable and appropriate by the Alaska 13 Industrial Development and Export Authority. 14 (d) The principal amount of the bonds provided by the authority for the project in 15 (a)(3) of this section may not exceed $20,400,000 and may include the costs of issuing bonds 16 considered reasonable and appropriate by the Alaska Industrial Development and Export 17 Authority. 18 (e) This section constitutes legislative approval required by AS 44.88.095(g). 19 * Sec. 16. The uncodified law of the State of Alaska is amended by adding a new section to 20 read: 21 LEGISLATIVE APPROVAL OF LOAN FROM THE POWER PROJECT FUND. If 22 the Alaska Energy Authority approves a loan to the City of King Cove for the Waterfall Creek 23 hydroelectric project, the legislature authorizes the Alaska Energy Authority to loan an 24 amount not to exceed $3,000,000 from the power project fund (AS 42.45.010) to the City of 25 King Cove for the Waterfall Creek hydroelectric project. This section constitutes legislative 26 approval under AS 42.45.010(j) for a loan from the fund for a project in which the cumulative 27 state involvement exceeds $5,000,000. 28 * Sec. 17. The uncodified law of the State of Alaska is amended by adding a new section to 29 read: 30 REPORT. (a) The Alaska Industrial Development and Export Authority shall submit 31 quarterly to the legislature a written report on the Interior energy project. The authority shall
01 deliver the report to the senate secretary and the chief clerk of the house of representatives 02 and notify the legislature that the report is available. The report must include 03 (1) a description of project progress on all components; 04 (2) an update on the status of local distribution infrastructure buildout; 05 (3) to-date and anticipated conversions; and 06 (4) a financial accounting of funds expended and funds anticipated to be spent, 07 including loans, grants, and bonds. 08 (b) If requested, the Alaska Industrial Development and Export Authority shall 09 provide a project briefing on the Interior energy project to the Legislative Budget and Audit 10 Committee. 11 * Sec. 18. Sections 14 - 16 of this Act are repealed June 30, 2019. 12 * Sec. 19. Section 17 of this Act is repealed June 30, 2020. 13 * Sec. 20. This Act takes effect immediately under AS 01.10.070(c).