§214.  Purposes of loans; authorized actions.  (a)  The department may make loans from revolving funds to any lessee or native Hawaiian to whom, or any cooperative association to which, a lease has been issued under section 207(a) of this Act or a license has been issued under section 207(c)(1)(B) of this Act.  Such loans may be made for the following purposes:

     (1)  The repair or maintenance or purchase or erection of dwellings on any tract, and the undertaking of other permanent improvements thereon;

     (2)  The purchase of livestock, swine, poultry, fowl, aquaculture stock, and farm and aquaculture equipment;

     (3)  Otherwise assisting in the development of tracts and of farm, ranch, and aquaculture operations, including:

          (A)  The initial and on-going development, improvement, operation, and expansion of homestead farms, ranches, and aquaculture enterprises;

          (B)  The liquidation of indebtedness incurred for any of the foregoing purposes relating to farm loans aged less than five years;

          (C)  The payment of normal and reasonable living expenses of a full-time farmer;

          (D)  The planning, layout, and installation of soil and water conservation practices; and

          (E)  Providing relief and rehabilitation to homestead farmers and ranchers due to damage by rain and windstorms, droughts, tidal wave, earthquake, volcanic eruption, and other natural catastrophes, and for livestock disease, epidemics, crop blights, and serious effects of prolonged shipping and dock strikes;

     (4)  The cost of breaking up, planting, and cultivating land and harvesting crops, the cost of excavating or constructing aquaculture ponds and tanks, the purchase of seeds, fertilizers, feeds, insecticides, medicines, and chemicals for disease and pest control for animals, fish, shellfish, and crops, and the related supplies required for farm, ranch, and aquaculture operations, the erection of fences and other permanent improvements for farm, ranch, and aquaculture purposes and the expense of marketing; and

     (5)  To assist licensees in the operation or erection of theaters, garages, service stations, markets, stores, and other mercantile establishments, all of which shall be owned by native Hawaiians or by organizations formed and controlled by native Hawaiians.

     (b)  In addition the department may:

     (1)  Use moneys in the Hawaiian home operating fund, with the prior approval of the governor, to match federal, state, or county funds available for the same purposes and to that end, enter into an undertaking, agree to conditions, transfer funds therein available for expenditure, and do and perform other acts and things, as may be necessary or required, as a condition to securing matching funds for the department's projects or works;

     (2)  Loan or guarantee the repayment of or otherwise underwrite any authorized loan or portion thereof to lessees in accordance with section 215;

     (3)  Loan or guarantee the repayment of or otherwise underwrite any authorized loan or portion thereof to a cooperative association in accordance with section 215;

     (4)  Permit and approve loans made to lessees by government agencies or private lending institutions, where the department assures the payment of these loans; provided that upon receipt of notice of default in the payment of the assured loans, the department may, upon failure of the lessee to cure the default within sixty days, cancel the lease and pay the outstanding balance in full or may permit the new lessee to assume the outstanding debt; and provided further that the department shall reserve the following rights:

          (A)  The right of succession to the lessee's interest and assumption of the contract of loan;

          (B)  The right to require that written notice be given to the department immediately upon default or delinquency of the lessee; and

          (C)  Any other rights enumerated at the time of assurance necessary to protect the monetary and other interests of the department;

     (5)  Secure, pledge, or otherwise guarantee the repayment of moneys borrowed by the department from government agencies or private lending institutions and pay the interim interest or advances required for loans; provided that the State's liability, contingent or otherwise, either on moneys borrowed by the department or on departmental guarantees of loans made to lessees under this paragraph and paragraphs (2), (3), and (4) of this subsection, shall at no time exceed $100,000,000; the department's guarantee of repayment shall be adequate security for a loan under any state law prescribing the nature, amount, or form of security or requiring security upon which loans may be made;

     (6)  Use available loan fund moneys or other funds specifically available for guarantee purposes as cash guarantees when required by lending agencies;

     (7)  Exercise the functions and reserved rights of a lender of money or mortgagee of residential property in all direct loans made by government agencies or by private lending institutions to lessees the repayment of which is assured by the department.  The functions and reserved rights shall include but not be limited to, the purchasing, repurchasing, servicing, selling, foreclosing, buying upon foreclosure, guaranteeing the repayment, or otherwise underwriting, of any loan, the protecting of security interest, and after foreclosures, the repairing, renovating, or modernization and sale of property covered by the loan and mortgage;

     (8)  Pledge receivables of loan accounts outstanding as collateral to secure loans made by government agencies or private lending institutions to the department, the proceeds of which shall be used by the department to make new loans to lessees or to finance the development of available lands for purposes permitted by this Act; provided that any loan agreement entered into under this paragraph by the department shall include a provision that the money borrowed by the department is not secured directly or indirectly by the full faith and credit or the general credit of the State or by any revenues or taxes of the State other than the receivables specifically pledged to repay the loan; provided further that in making loans or developing available lands out of money borrowed under this paragraph, the department may establish, revise, charge, and collect fees, premiums, and charges as necessary, reasonable, or convenient, to assure repayment of the funds borrowed, and the fees, premiums, and charges shall be deposited into the Hawaiian home trust fund; and provided further that no moneys of the Hawaiian home loan fund may be pledged as security under this paragraph; and

     (9)  Notwithstanding any other provisions of this Act to the contrary, transfer into the Hawaiian home trust fund any available and unpledged moneys from any loan funds, the Hawaiian loan guarantee fund, or any fund or account succeeding thereto, except the Hawaiian home loan fund, for use as cash guarantees or reserves when required by a federal agency authorized to insure or guarantee loans to lessees. [Am L 1962, c 14, §3; am L 1963, c 207, §2; am L 1969, c 259, §2; am L 1972, c 76, §2; am L 1978, c 229, §2; am L 1979, c 209, §2; am L 1981, c 90, §5 and c 203, §2; am L 1986, c 85, §1 and c 249, §3; am L 1987, c 283, §1; am L 1989, c 28, §1; am L 1996, c 232, §1; am L 2011, c 114, §1]