(a) If the education loan fund (AS 14.42.210) is unable to fully finance loan demand in a fiscal year, the commissioner may invest in the education loan fund for the purpose of financing education loans under AS 14.43.161 - 14.43.175, 14.43.600 - 14.43.750, and AS 14.44.040. The commissioner shall require the corporation to secure the investment of state money.
(b) The commissioner may make investments under (a) of this section only when the commissioner determines that market conditions relating to tax-exempt private activity revenue bonds make the issuance of the bonds by the corporation impracticable or uneconomical for the purpose of financing education loans under AS 14.43.161 - 14.43.175, 14.43.600 - 14.43.750, and AS 14.44.040.
(c) The corporation shall repay money invested under (a) of this section under terms established by the commissioner and agreed to by the corporation. Except as provided in this section, the terms must be consistent with the duties of a fiduciary set out in AS 37.10.071(c).
(d) Notwithstanding any other provision of this section, the commissioner is authorized to enter into an agreement with the corporation to provide a bond purchase agreement and a letter of credit when market conditions relating to those credit enhancement mechanisms are uneconomical. The commissioner may require the corporation to pay the costs associated with providing credit enhancement and may charge the corporation a fee for this service.
(e) The commissioner may charge the corporation interest on the investments under (a) of this section. The rate of interest may not exceed the five-year average return on the state's general fund.
(f) The commissioner may charge the corporation an annual fee for the services provided under (d) of this section. The annual fee may not exceed 0.15 percent of the average principal outstanding and interest covered by the bond purchase agreement and the letter of credit.
(g) If a draw on the bond purchase agreement and the letter of credit occurs under this section, the commissioner may charge the corporation an additional annual rate of interest not to exceed three percent on the bonds held under the bond purchase agreement and letter of credit.
(h) The term of the investment under (a) of this section may not exceed four years and the commitment under (d) of this section may not exceed four years from the commencement of the initial investment, bond purchase agreement, and letter of credit.
(i) The maximum amount of the investment under (a) of this section may not exceed $100,000,000. The maximum amount of the commitment under (d) of this section may not exceed $106,000,000.
(j) The commissioner may adopt regulations under AS 44.62 to implement this section.
(k) In this section,
(1) “commissioner” means the commissioner of revenue;
(2) “corporation” means the Alaska Student Loan Corporation created under AS 14.42.100.
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