HB2188

Report Title:

Residential Solar Hot Water Heaters; Loan Guarantee; DBEDT

Description:

Allows the DBEDT to guarantee up to 90% of the principal balance of a loan, plus interest due thereon, made to a qualified homeowner for the acquisition and installation of a residential solar hot water heater.

HOUSE OF REPRESENTATIVES	H.B. NO.	2188
TWENTY-FIRST LEGISLATURE, 2002
STATE OF HAWAII

A BILL FOR AN ACT

 

relating to renewable energy.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Chapter 196, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§196- Loans guaranteed by the department of business, economic development, and tourism. (a) The department of business, economic development, and tourism may guarantee up to ninety per cent of the principal balance of a loan, plus interest due thereon, made to a qualified homeowner; provided that at no time shall the aggregate amount of the State's liability, contingent or otherwise, on loans guaranteed under this section exceed $        .

(b) Loans guaranteed under this section shall be limited to the acquisition and installation of residential solar hot water heaters by qualified homeowners.

(c) Interest charged on a guaranteed loan made under this section shall not be more than          percentage points above the prime rate charged by the lender.

(d) When the application for a guaranteed loan has been approved by the department, the department shall issue to the lender a guaranty for that percentage of the loan on which it guarantees payment of principal and interest. The lender shall collect all payments from the borrower and otherwise service the loan.

(e) In return for the department's guaranty, the lender shall remit a one-time insurance fee of          per cent on the principal amount of the guaranteed portion of the loan, at the time the loan is booked, except that for the following loans a reduced fee of          per cent shall be paid:

(1) Loans of $         or less with a maturity exceeding          months;

(2) All guaranteed loans with a maturity of          months or less.

The borrower as a cost may pay this fee for the loan.

(f) When any installment of principal and interest has been due for sixty days and has not been paid by the borrower, the department shall issue, on request of the lender, a check for the percentage of the overdue payment guaranteed, thereby acquiring a division of interest in the collateral pledged by the borrower in proportion to the amount of the payment. The department shall be reimbursed for any amounts so paid plus interest at the applicable rate, where payment is collected from the borrower.

(g) Under conditions specified in department rules, the lender may request that a portion or all of the guaranteed percentage of the principal balance of the loan be converted to a participating share held by the department.

(h) Should the lender deem that foreclosure proceedings are necessary to collect moneys due from the borrower, it shall so notify the department. Within thirty days of the notification, the department may elect to request an assignment of the loan on payment in full to the lender of the principal balance and interest due. Foreclosure proceedings shall be held in abeyance in the interim.

(i) The lender may reduce the percentage of the principal balance guaranteed under this section at any time."

SECTION 2. New statutory material is underscored.

SECTION 3. This Act shall take effect on July 1, 2002.

INTRODUCED BY:	_____________________________