AK COMMERCIAL FISHING & AG BANK; LOANS, the official text

Enrolled SB 156 
 Relating to the Department of Commerce, Community, and Economic Development; relating 
 to the Alaska Commercial Fishing and Agriculture Bank; relating to certain loans made by the 
 Alaska Commercial Fishing and Agriculture Bank; relating to certain commercial fishing 
 loans; and providing for an effective date. 
 _______________ 
 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 
 to read: 
 ALASKA COMMERCIAL FISHING AND AGRICULTURE BANK; LOANS. (a) 
 Subject to legislative appropriation, the Department of Commerce, Community, and 
 Economic Development shall purchase nonvoting, preferred shares issued by the Alaska 
 Commercial Fishing and Agriculture Bank established under AS 44.81.010 for the purpose of 
 enabling the bank to make loans to persons involved in the state's commercial fishing industry 
 under AS 44.81.215. Except as provided in (d) of this section, the bank shall repurchase 
 shares the department purchased under this section 20 years after the purchase. If the bank

fails to repurchase the shares 20 years after the purchase by the department, the commissioner 
 of commerce, community, and economic development may appoint a receiver to direct, 
 manage, and operate the bank until the shares have been repurchased. Upon voluntary or 
 involuntary liquidation of the bank, and upon repayment of all legal debts and obligations of 
 the bank, all nonvoting, preferred shares owned by the department have priority for 
 redemption over all other forms and amounts of ownership of the bank. 
 (b) The Alaska Commercial Fishing and Agriculture Bank may not originate or 
 refinance a loan under this section unless the loan is secured, or secured in part, by a limited 
 entry permit issued under AS 16.43 that has been pledged by the holder as collateral. A loan 
 made by the bank using funds provided by the Department of Commerce, Community, and 
 Economic Development's purchase of shares under this section 
 (1) shall have a fixed term of 15 years; 
 (2) shall have a fixed interest rate; 
 (3) may not bear interest 
 (A) exceeding the prime rate, as defined in AS 44.88.599, plus two 
 percentage points; or 
 (B) at a rate of more than 5.25 percent a year. 
 (c) On the effective date of sec. 4, ch. 25, SLA 2024, the Alaska Commercial Fishing 
 and Agriculture Bank shall provide the division within the Department of Commerce, 
 Community, and Economic Development that is responsible for banking and securities a list 
 of each loan originated or refinanced under (b) of this section, with confidential borrower 
 information redacted. The list must include, for each loan, 
 (1) the loan number, principal balance, interest rate, and loan term; 
 (2) a copy of the loan agreement; 
 (3) an amortization schedule, including the comparison made under (4) of this 
 subsection; 
 (4) a comparison of 
 (A) the loan's baseline interest earnings, calculated as the projection of 
 the refinanced or originated loan's interest using the principal and the interest rate in 
 effect for the loan before it was refinanced, or the interest rate and term that the loan 
 would have had if the loan had not been made by the Alaska Commercial Fishing and

Agriculture Bank under (b) of this section, amortized over a 15-year term assuming 
 timely loan payments; and 
 (B) the loan's post-refinance or post-origination interest earnings, 
 calculated as the loan's projected interest earnings using the loan's principal, the loan's 
 actual interest rate as originated or refinanced under (b) of this section, and a 15-year 
 term assuming timely loan repayments; and 
 (5) any other information that the division may need to complete the review. 
 (d) Within 120 days after the Alaska Commercial Fishing and Agriculture Bank 
 provides the Department of Commerce, Community, and Economic Development the list 
 required under (c) of this section, the department shall conduct a one-time review of the listed 
 information. If the department determines that the difference in projected interest earnings for 
 all loans originated or refinanced under (b) of this section for the Alaska Commercial Fishing 
 and Agriculture Bank, as calculated under (c) of this section, is less than the par value of the 
 shares purchased by the department under (a) of this section, the department shall request that 
 the bank repay the difference to the department by buying back the requisite quantity of 
 shares. 
 (e) If the Department of Commerce, Community, and Economic Development 
 requests that the Alaska Commercial Fishing and Agriculture Bank buy back the shares under 
 (d) of this section, the bank shall buy back the shares within 30 days. 
 (f) Subject to appropriation, the Department of Commerce, Community, and 
 Economic Development shall purchase shares issued by the Alaska Commercial Fishing and 
 Agriculture Bank under (a) of this section using an amount equal to the amount that was in the 
 former Alaska capstone avionics revolving loan fund (former AS 44.33.650 - 44.33.690) and 
 was unobligated on July 1, 2020. 
 * Sec. 2. Section 1 of this Act is repealed January 1, 2027. 
 * Sec. 3. This Act takes effect immediately under AS 01.10.070(c).