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SB2309
THE SENATE
S.B. NO.
2309
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII
A BILL FOR AN ACT
relating
to agricultural loans
.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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SECTION 1.
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The legislature finds that the department of
agriculture and biosecurity's agricultural loan division has experienced
significant demand following the enactment of Act 69, Session Laws of Hawaii
2025 (Act 69), which, among other things, expanded access to farm loans at
favorable interest rates.
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Within two
months of Act 69's implementation, the agricultural loan division approved ten
loans totaling nearly $5,000,000 and received an additional $10,000,000 in loan
application requests that were not funded due to the existing $5,000,000 annual
ceiling on the agricultural loan revolving fund.
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Thus, applications have been placed on hold
further limiting the department's ability to meet the financing needs of Hawaii
farmers and agricultural enterprises.
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The legislature further finds that
authorizing the agricultural loan division to sell portions of its loan
portfolio, valued at approximately $11,000,000, to permitted third parties
would generate additional capital that may be reinvested into the agricultural loan
revolving fund.
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Increasing the revolving
fund ceiling would also expand lending capacity and support the continued
implementation of Act 69, strengthening the State's economy and advancing food
security and self-sufficiency goals.
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The purpose of this Act is to:
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(1)
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Require the
agricultural loan division to sell portions of its loan portfolio to permitted
third parties, with proceeds to be deposited into the agricultural loan
revolving fund; and
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(2)
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Appropriate funds
out of the agricultural loan revolving fund to increase its expenditure ceiling
and thereby expand access to agricultural loan financing and support local food
production.
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SECTION 2.
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The agricultural loan division of the department of agriculture and
biosecurity shall sell portions of its loan portfolio having an appraised value
of approximately $11,000,000 to permitted third parties; provided that the
proceeds from the sale shall be reinvested in the agricultural loan revolving
fund and made available for loan funding.
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SECTION
3.
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There is appropriated out of the agricultural
loan revolving fund the sum of $10,000,000 or so much thereof as may be
necessary for fiscal year 2026-2027 to increase the expenditure ceiling of the
revolving fund and thereby expand access to agricultural loan financing and
support local food production pursuant to part I of chapter 155, Hawaii Revised
Statutes.
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The sum
appropriated shall be expended by the department of agriculture and biosecurity
for the purposes of this Act.
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SECTION 4.
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This Act shall take effect on July 1, 2026.
INTRODUCED BY:
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Report Title:
Agricultural
Loan Division; DAB; Agricultural Loan Revolving Fund; Loan Portfolio; Increase
Ceiling; Appropriation
Description:
Requires the Agricultural Loan Division to sell portions
of its loan portfolio to permitted third parties, with proceeds to be deposited
into the agricultural loan revolving fund.
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Appropriates funds out of the Agricultural Loan Revolving Fund to
increase its expenditure ceiling and thereby expand access to agricultural loan
financing and support local food production.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.