(a) The authority may guarantee a loan under AS 44.88.700 — 44.88.799 if the

1. (1) loan

   1. (A) is commercially reasonable;
   2. (B) contains payment provisions satisfactory to the authority; and
   3. (C) is secured by acceptable collateral;

2. (2) project

   1. (A) is allocated new markets tax credits by a qualified community development entity;
   2. (B) promotes economic development in the state; and
   3. (C) is not a housing project;

3. (3) borrower demonstrates the ability to repay the loan from either or both of the following:

   1. (A) net cash flow of the borrower;
   2. (B) proceeds from the sale of current assets that are collateral for the loan if the sale or receipt of proceeds from the sale is an event that creates a payment obligation; in this subparagraph, “current asset” means property that will be or could be converted into cash within one year in the normal operation of a business;
4. (4) term of the loan does not exceed 10 years;
5. (5) loan is originated with and serviced by a financial institution.