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(a) The authority may guarantee a new loan or a loan to refinance existing debt if the loan is made to an Alaska business enterprise whose majority interest is held by individual state residents.
(b) The borrower must have the financial and business ability, as determined by the authority, to successfully repay the loan.
(c) Guarantees for loans may be issued only if the loans
(1) are for commercially reasonable purposes;
(2) will help to stabilize the economic base of the area and create or maintain employment; and
(3) allow the borrower to create additional economic opportunity, improve the economic viability of the borrower's domestic/or export business, and/or facilitate business expansion.
(d) The authority will ensure that all loan guarantees are distributed statewide in an equitable manner.
(1) One-half of the total available guarantee dollars is allocated on the basis of geographic distribution and one-half of the total available guarantee dollars is allocated on the basis of population distribution. The authority will annually determine and report to the board the allocations of total available guarantee dollars between the following seven economic regions used by the State of Alaska, Department of Labor and Workforce Development in reporting population information:
(A) The Municipality of Anchorage.
(B) The Matanuska-Susitna Borough.
(C) The Gulf Coast Region which includes the Kenai Peninsula Borough, the Kodiak Island Borough, and the Valdez-Cordova Census Area.
(D) The Interior Region which includes the Denali Borough, The Fairbanks North Star Borough, the Southeast Fairbanks Census Area, and the Yukon-Koyukuk Census Area.
(E) The Northern Region which includes the Nome Census Area, the North Slope Borough, and the Northwest Arctic Borough.
(F) The Southeast Region which includes the Haines Borough, the Juneau Borough, the Ketchikan Gateway Borough, the Prince of Wales-Outer Ketchikan Census Area, the Sitka Borough, the Skagway-Hoonah-Angoon Census Area, the Wrangell-Petersburg Census Area, and the Yakutat Borough.
(G) The Southwest Region which includes the Aleutians East Borough, the Aleutians West Census Area, the Bethel Census Area, the Bristol Bay Borough, the Dillingham Census Area, the Lake and Peninsula Borough, and the Wade Hampton Census Area.
(2) The authority may, in its discretion, reallocate among the seven economic regions described in subsection (1) the amounts of available guarantee dollars, taking into consideration economic and other pertinent factors.
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(e) Within each region, when the total cumulative dollar amount of guarantees reaches the total amount of available guarantee dollars allocated to the region pursuant to (d) of this section, no further loan guarantees will be issued for loans allocated to that region. The authority will allocate a loan guarantee to a region based on the location of the project financed or refinanced by the guaranteed loan.
(f) The authority will allocate 10 percent of the regional allocation to loan guarantees of $100,000 or less with respect to new loans.
(g) The authority will monitor the size of its guarantees to ensure compliance with AS 44.88.540 . Issuance of loan guarantees in amounts exceeding $500,000 per loan will be suspended when the total initial principal amount of all loans having an initial guarantee exceeding $500,000 reaches $25,000,000.
(h) The authority will not guarantee a loan to refinance a loan that was originally financed by outstanding bonds issued under the authority's loan participation programs described in 3 AAC 99.200 - 3 AAC 99.390, unless the bonds are subject to optional redemption at par by the authority at the time the guarantee is issued.
(i) The authority will not guarantee a loan made before issuance of a guarantee authorization under 3 AAC 99.740(b) .
History: Eff. 8/1/88, Register 107; am 11/30/90, Register 118; am 7/19/91, Register 119; am 9/25/92, Register 124; am 10/23/96, Register 141; am 2/11/99, Register 150; am 11/1/99, Register 153; am 2/8/2001, Register 158
Authority: AS 44.88.080
Editor's note: As of Register 151 (October 1999), the regulations attorney made technical revisions under AS 44.62.125 (b)(6) to reflect the name change of the Department of Labor to the Department of Labor and Workforce Development made by ch. 58, SLA 1999 and the corresponding title change of the commissioner of labor.
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Last modified 7/05/2006