Alaska Administrative Code › Title 3 - Commerce, Community, and Economic Development › Part 16 - Division of Community and Regional Affairs › Chapter 170 - Rural Development Initiative Fund › 3 AAC 170.040 - Reserve accounts

Current through May 31, 2024
(a) If the division determines that it will
				purchase a participation interest in a loan which is expected to be guaranteed
				by the Alaska Industrial Development and Export Authority under
				3 AAC 99.700 -
				3 AAC 99.785, the division will establish a reserve
				account within the fund for that loan. Before the division purchases the
				participation interest in the loan, but after the loan is guaranteed as
				described in this subsection, the division will transfer from the fund into the
				reserve account created for that loan an amount equal to 180 days of interest
				on the guaranteed portion of the loan at the interest rate applicable to that
				portion of the loan or a lesser amount if necessary under (b) of this section.
				The division will transfer money to a reserve account as provided in this
				section only in conjunction with the purchase of a participation interest in
				the loan under
				3 AAC 170.030, and the amount deposited in the reserve
				account for a loan will not exceed the amount paid by the division for the
				purchase of the participation interest.
(b) If there is insufficient money in the
				fund to purchase a participation in a loan described in (a) of this section and
				to transfer money to a reserve account for the loan as described in (a) of this
				section, the division will notify the eligible lender of that fact. At the
				request of the eligible lender, the division will, depending upon the
				availability of money in the fund, (1) purchase a smaller participation in the
				loan, (2) transfer money to the reserve account at a smaller amount, or (3)
				both.
(c) The division will use
				money held in a reserve account created under this section solely for the
				purpose of paying accrued and unpaid interest on the guaranteed portion of the
				loan in the event of a default with respect to the loan. The division will make
				the payment of interest when the Alaska Industrial Development and Export
				Authority has paid the guaranteed portion of the loan. To the extent that the
				division uses any amount in a reserve account as described in this subsection,
				the division will be entitled to seek recovery of that amount, together with
				interest on that amount from the date of payment by the division, from the
				borrower. The division must be a secured party under, or an assignee of the
				eligible lender's interest in, any security agreements or documents relating to
				the loan.
(d) From time to time,
				the division will review the amount held in each reserve account established
				under this section and, to the extent the amount in a reserve account exceeds
				180 days of interest, or the lesser amount established for a loan under (b) of
				this section, with respect to the loan for which the reserve account was
				established, the division will transfer the excess from the reserve account in
				to the fund. If there is money remaining in a reserve account after the loan
				for which the reserve account is created is fully paid, the division will
				transfer the money out of the reserve account and back into the fund.
Authority:
AS 44.33.765
AS 44.33.770