2010-02-26                     Senate Journal                      Page 1666
SB 302                                                                                                                        
SENATE BILL NO. 302 BY THE SENATE RULES COMMITTEE                                                                               
BY REQUEST OF THE GOVERNOR, entitled:                                                                                           
                                                                                                                                
          "An Act establishing the Alaska microloan revolving                                                                   
          fund; making loans for commercial purposes from the                                                                   
          fund; and relating to the fund and loans; and                                                                         
          providing for an effective date."                                                                                     
                                                                                                                                
                                                                                                                                

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was read the first time and referred to the Labor and Commerce and                                                              
Finance Committees.                                                                                                             
                                                                                                                                
The following fiscal information was published today:                                                                           
 Fiscal Note No. 1, Department of Commerce, Community and                                                                       
  Economic Development                                                                                                          
                                                                                                                                
Governor's transmittal letter dated February 25:                                                                                
                                                                                                                                
Dear President Stevens:                                                                                                         
                                                                                                                                
Under the authority of Art. III, Sec. 18, of the Alaska Constitution, I                                                         
am transmitting a bill establishing the Alaska micro loan revolving                                                             
fund; making loans for commercial purposes from the fund; and                                                                   
relating to the fund and loans.                                                                                                 
                                                                                                                                
In an effort to promote economic development in the state by helping                                                            
small businesses access critically needed capital, a new loan program                                                           
has been developed that is modeled after a program currently operated                                                           
through the federal Small Business Administration (SBA). The SBA                                                                
program, known as the micro loan program, provides small, short-term                                                            
loans to small businesses. This federal program, however, is not                                                                
currently available in the state because an intermediary lender is                                                              
required and to date no lenders meeting the SBA's qualifications have                                                           
been identified in the state.                                                                                                   
                                                                                                                                
This bill will create the Alaska micro loan revolving program in the                                                            
Department of Commerce, Community, and Economic Development.                                                                    
The program will be set up as a revolving loan fund so that all                                                                 
earnings and loan payments will be retained by the fund for future                                                              
loans. All operating expenses will also be paid from earnings of the                                                            
fund.                                                                                                                           
                                                                                                                                
An applicant for the loan must be a resident of the state and provide a                                                         
reasonable amount of money from other non-state sources for use on                                                              
projects for which money from a loan will be used. Loans under this                                                             
program may not exceed $35,000 to one person, or $70,000 to two or                                                              
more persons. A loan under the program bears interest at the rate of                                                            
prime plus one percentage point, but may not be less than six percent                                                           
per year and not more than eight percent per year. The maximum term                                                             

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for a loan under this program will be six years, however extensions                                                             
may be granted. Finally, a loan must be secured by collateral                                                                   
acceptable to the commissioner of the Department of Commerce,                                                                   
Community, and Economic Development.                                                                                            
                                                                                                                                
I urge your prompt and favorable action on this measure.                                                                        
                                                                                                                                
Sincerely,                                                                                                                      
/s/                                                                                                                             
Sean Parnell                                                                                                                    
Governor