Aquaculture Loans

Increases the maximum amount of moneys that applicants may borrow
for class A loans (aquaculture farm ownership and improvements
loans), class B loans (aquaculture operating loans), and class C
loans (aquaculture cooperative and corporation loans).  Extends
the loan term for class C loans from three to seven years.

HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  Section 219-6, Hawaii Revised Statutes, is
 2 amended to read as follows:
 3      "219-6 Loan; limitation and terms.  Loans made under this
 4 chapter shall be for the purposes and in accordance with the
 5 terms specified in classes "A", "B", "C", and "D" in paragraph
 6 (1), (2), (3), and (4) following and shall be made only to
 7 applicants who meet the eligibility requirements specified
 8 therein:
 9      (1)  Class A:  Aquaculture farm ownership and improvement
10           loans.  To provide for:
11           (A)  The purchase or improvement of aquaculture farm
12                land and waters;
13           (B)  The purchase, construction, or improvement of
14                adequate aquaculture farm dwellings, and other
15                essential aquaculture farm facilities; and
16           (C)  The liquidation of indebtedness incurred for any
17                of the foregoing purposes.
18           Such loans shall be for an amount not to exceed
19           [$100,000] $400,000 and for a term not to exceed forty
20           years.  To be eligible the applicant shall:

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                                     H.B. NO.           

 1                (i)  Derive, or present an acceptable plan to
 2                     derive, a major portion of the applicant's
 3                     income from and devote, or intend to devote,
 4                     most of the applicant's time to aquaculture
 5                     farming operations; and
 6               (ii)  Have or be able to obtain the operating
 7                     capital, including fishstock and equipment,
 8                     needed to successfully operate the
 9                     applicant's aquaculture farm;
10      (2)  Class B:  Aquaculture operating loans.  To carry on and
11           improve an aquaculture operation, including:
12           (A)  The purchase of aquaculture equipment and
13                fishstock;
14           (B)  The payment of production and marketing expenses
15                including materials, labor, and services;
16           (C)  The payment of living expenses; and
17           (D)  The liquidation of indebtedness incurred for any
18                of the foregoing purposes.
19           Such loans shall be for an amount not to exceed
20           [$75,000] $400,000 and for a term not to exceed ten
21           years.  To be eligible, an applicant shall derive or
22           present an acceptable plan to derive a major portion of
23           the applicant's income from and devote, or intend to

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                                     H.B. NO.           

 1           devote, most of the applicant's time to aquaculture
 2           operations;
 3      (3)  Class C:  Aquaculture cooperative and corporation
 4           loans.  To provide credit to aquaculturalists'
 5           cooperative associations and corporations engaged in
 6           marketing, purchasing, and processing, and providing
 7           farm business services, including:
 8           (A)  Facility loans to purchase or improve land,
 9                building, and equipment for an amount not to
10                exceed [$250,000] $500,000 and a term not to
11                exceed twenty years; and
12           (B)  Operating loans to finance inventories of
13                supplies, warehousing, and shipping commodities,
14                extension of consumer credit to justified farmer-
15                members, and other normal operating expenses for
16                an amount not to exceed [$150,000] $300,000 and a
17                term not to exceed [three] seven years.
18           To be eligible, a cooperative or corporation shall have
19           at least seventy-five per cent of its board of
20           directors and seventy-five per cent of its membership
21           as shareholders who meet the eligibility requirements
22           prescribed by the board and who devote most of their
23           time to aquaculture operations; and

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                                     H.B. NO.           

 1      (4)  Class D:  Emergency loans.  To provide relief and
 2           rehabilitation to qualified aquaculturalists without
 3           limit as to purpose:
 4           (A)  In areas stricken by extraordinary rainstorms,
 5                windstorms, droughts, tidal waves, earthquakes,
 6                volcanic eruptions, and other natural
 7                catastrophes;
 8           (B)  On farms stricken by aquatic diseases;
 9           (C)  On farms seriously affected by prolonged shipping
10                and dock strikes;
11           (D)  During economic emergencies such as those caused
12                by overproduction and excessive imports; and
13           (E)  During other emergencies as determined by the
14                board.
15           The maximum amounts and period for the loans shall be
16           determined by the board; provided that the board shall
17           require that any settlement or moneys received by
18           qualified aquaculturalists as a result of an emergency
19           declared under this section shall first be applied to
20           the repayment of an emergency loan made under this
21           chapter."
22      SECTION 2.  Statutory material to be repealed is bracketed.
23 New statutory material is underscored.

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                                     H.B. NO.           

 1      SECTION 3.  This Act shall take effect upon its approval.
 3                       INTRODUCED BY:  ___________________________