AB 1547: State finance: financing authorities.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2018-09-21
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent and requires fees to be charged to cover the costs of the commission in carrying out these provisions. Existing law requires these fees to be deposited in the Industrial Development Fund, which is available, upon appropriation, to the commission for expenses.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage. The bill would transfer any moneys, including interest earned, in the Industrial Development Fund to the California Debt Limit Allocation Committee Fund, established in existing law, and appropriate those moneys to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the abolishment of the California Industrial Development Financing Advisory Commission, as specified, and also to the California Debt Limit Allocation Committee.
(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the eligible costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of tangible personal property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(5)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent and requires fees to be charged to cover the costs of the commission in carrying out these provisions. Existing law requires these fees to be deposited in the Industrial Development Fund, which is available, upon appropriation, to the commission for expenses.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage. The bill would transfer any moneys, including interest earned, in the Industrial Development Fund to the California Debt Limit Allocation Committee Fund, established in existing law, and appropriate those moneys to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the abolishment of the California Industrial Development Financing Advisory Commission, as specified, and also to the California Debt Limit Allocation Committee.
(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the eligible costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of tangible personal property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(5)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent and requires fees to be charged to cover the costs of the commission in carrying out these provisions. Existing law requires these fees to be deposited in the Industrial Development Fund, which is available, upon appropriation, to the commission for expenses.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage. The bill would transfer any moneys, including interest earned, in the Industrial Development Fund to the California Debt Limit Allocation Committee Fund, established in existing law, and appropriate those moneys to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the abolishment of the California Industrial Development Financing Advisory Commission, as specified, and also to the California Debt Limit Allocation Committee.
(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the eligible costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act establishes the California Alternative Energy and Advanced Transportation Financing Authority (authority). The act authorizes the authority to provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, alternative energy sources, or projects for the development and commercialization of advanced transportation technologies, as defined.This bill would authorize the authority to additionally provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, water efficiency measures.(5)(4)The act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of tangible personal property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(6)Existing law requires the authority to establish a Property Assessed Clean Energy (PACE) Reserve program to reduce the overall costs to property owners of a Property Assessed Clean Energy Reserve bond, or PACE bond, issued by an applicant that has established a Property Assessed Clean Energy program, or PACE program, by providing a reserve of no more than 10% of the initial amount of the PACE bond. Existing law requires a PACE program to meet certain requirements in order to receive assistance under the PACE Reserve program, including that the program requires that the improvement financed is for a residential project of 3 units or fewer.This bill would, instead, require a PACE program seeking assistance under the PACE Reserve program to require that the improvement financed be for a residential project of 4 units or fewer.(5)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent and requires fees to be charged to cover the costs of the commission in carrying out these provisions. Existing law requires these fees to be deposited in the Industrial Development Fund, which is available, upon appropriation, to the commission for expenses.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage. The bill would transfer any moneys, including interest earned, in the Industrial Development Fund to the California Debt Limit Allocation Committee Fund, established in existing law, and appropriate those moneys to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the abolishment of the California Industrial Development Financing Advisory Commission, as specified, and also to the California Debt Limit Allocation Committee.
(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the eligible costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act establishes the California Alternative Energy and Advanced Transportation Financing Authority (authority). The act authorizes the authority to provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, alternative energy sources, or projects for the development and commercialization of advanced transportation technologies, as defined.
This bill would authorize the authority to additionally provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, water efficiency measures.
(5)The act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of tangible personal property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(6)Existing law requires the authority to establish a Property Assessed Clean Energy (PACE) Reserve program to reduce the overall costs to property owners of a Property Assessed Clean Energy Reserve bond, or PACE bond, issued by an applicant that has established a Property Assessed Clean Energy program, or PACE program, by providing a reserve of no more than 10% of the initial amount of the PACE bond. Existing law requires a PACE program to meet certain requirements in order to receive assistance under the PACE Reserve program, including that the program requires that the improvement financed is for a residential project of 3 units or fewer.
This bill would, instead, require a PACE program seeking assistance under the PACE Reserve program to require that the improvement financed be for a residential project of 4 units or fewer.
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage.
(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act establishes the California Alternative Energy and Advanced Transportation Financing Authority (authority). The act authorizes the authority to provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, alternative energy sources, or projects for the development and commercialization of advanced transportation technologies, as defined.
This bill would authorize the authority to additionally provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, water efficiency measures.
(5)The act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of a tangible personal project, property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(6)Existing law requires the authority to establish a Property Assessed Clean Energy (PACE) Reserve program to reduce the overall costs to property owners of a Property Assessed Clean Energy Reserve bond, or PACE bond, issued by an applicant that has established a Property Assessed Clean Energy program, or PACE program, by providing a reserve of no more than 10% of the initial amount of the PACE bond. Existing law requires a PACE program to meet certain requirements in order to receive assistance under the PACE Reserve program, including that the program requires that the improvement financed is for a residential project of 3 units or fewer.
This bill would, instead, require a PACE program seeking assistance under the PACE Reserve program to require that the improvement financed be for a residential project of 4 units or fewer.
(1)Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines tax-exempt for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that tax-exempt for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage.
Existing(2)Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3)Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term qualified building for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a qualified small business and qualified residential property owner to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term qualified building to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a qualified small business or a qualified residential property owner to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4)The California Alternative Energy and Advanced Transportation Financing Authority Act establishes the California Alternative Energy and Advanced Transportation Financing Authority (authority). The act authorizes the authority to provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, alternative energy sources, or projects for the development and commercialization of advanced transportation technologies, as defined.
This bill would authorize the authority to additionally provide financial assistance to a participating party for a project that utilizes, or is designed to utilize, water efficiency measures.
(5)The act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of a tangible personal project, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(6)Existing law requires the authority to establish a Property Assessed Clean Energy (PACE) Reserve program to reduce the overall costs to property owners of a Property Assessed Clean Energy Reserve bond, or PACE bond, issued by an applicant that has established a Property Assessed Clean Energy program, or PACE program, by providing a reserve of no more than 10% of the initial amount of the PACE bond. Existing law requires a PACE program to meet certain requirements in order to receive assistance under the PACE Reserve program, including that the program requires that the improvement financed is for a residential project of 3 units or fewer.
This bill would, instead, require a PACE program seeking assistance under the PACE Reserve program to require that the improvement financed be for a residential project of 4 units or fewer.
Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to include a business instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources, and sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to include a business that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources, and would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act establishes the California Industrial Development Financing Advisory Commission, and authorizes the commission to carry out specified powers and duties related to the act.The California Pollution Control Financing Authority Act establishes the California Pollution Control Financing Authority, with specified powers and duties, and authorizes the authority to approve financing for projects or pollution control facilities to prevent or reduce environmental pollution.Existing law establishes the California Alternative Energy and Advanced Transportation Financing Authority to provide financial assistance for projects that promote the use of alternative energies. Existing law, until January 1, 2021, authorizes the authority to approve a project for financial assistance in the form of a sales and use tax exclusion, subject to certain requirements.This bill would, commencing on March 15, 2019, abolish the above entities, and transfer all duties, powers, purposes, responsibilities, and jurisdiction of those entities into the California Development Financing Authority, which would be established by this bill.Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act establishes the California Industrial Development Financing Advisory Commission, and authorizes the commission to carry out specified powers and duties related to the act.
The California Pollution Control Financing Authority Act establishes the California Pollution Control Financing Authority, with specified powers and duties, and authorizes the authority to approve financing for projects or pollution control facilities to prevent or reduce environmental pollution.
Existing law establishes the California Alternative Energy and Advanced Transportation Financing Authority to provide financial assistance for projects that promote the use of alternative energies. Existing law, until January 1, 2021, authorizes the authority to approve a project for financial assistance in the form of a sales and use tax exclusion, subject to certain requirements.
This bill would, commencing on March 15, 2019, abolish the above entities, and transfer all duties, powers, purposes, responsibilities, and jurisdiction of those entities into the California Development Financing Authority, which would be established by this bill.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p)Public agency means any county, city and county, city, or redevelopment agency.
(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.SEC. 4.Section 91532 of the Government Code is repealed.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)(A)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project.
(B)Eligible cost shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 16.Any moneys, including interest earned, in the Industrial Development Fund established pursuant to Section 91553 of the Government and repealed by the act adding this section are hereby transferred to the California Debt Limit Allocation Committee Fund established pursuant to Section 8869.90 of the Government Code and are hereby appropriated to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the elimination of the California Industrial Development Financing Advisory Commission, as described in the interagency agreement entered into between the authority and the commission for this purpose. Any remaining moneys subject to this transfer from the Industrial Development Fund are hereby appropriated to the California Debt Limit Allocation Committee for purposes described in Section 8869.90 of the Government Code.
SEC. 17.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to assist businesses in making Americans with Disabilities Act, water efficiency, and earthquake- related building changes as soon as possible, it is necessary for this act to take effect immediately as an urgency statute.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p)Public agency means any county, city and county, city, or redevelopment agency.
(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.SEC. 4.Section 91532 of the Government Code is repealed.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)(A)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project.
(B)Eligible cost shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 16.Any moneys, including interest earned, in the Industrial Development Fund established pursuant to Section 91553 of the Government and repealed by the act adding this section are hereby transferred to the California Debt Limit Allocation Committee Fund established pursuant to Section 8869.90 of the Government Code and are hereby appropriated to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the elimination of the California Industrial Development Financing Advisory Commission, as described in the interagency agreement entered into between the authority and the commission for this purpose. Any remaining moneys subject to this transfer from the Industrial Development Fund are hereby appropriated to the California Debt Limit Allocation Committee for purposes described in Section 8869.90 of the Government Code.
SEC. 17.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to assist businesses in making Americans with Disabilities Act, water efficiency, and earthquake- related building changes as soon as possible, it is necessary for this act to take effect immediately as an urgency statute.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p)Public agency means any county, city and county, city, or redevelopment agency.
(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.SEC. 4.Section 91532 of the Government Code is repealed.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)(A)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project.
(B)Eligible cost shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:(i)Microelectronics and nanoelectronics, including semiconductors.(ii)Advanced materials.(iii)Integrated computational materials engineering.(iv)Nanotechnology.(v)Additive manufacturing.(vi)Industrial biotechnology.(B)Advanced manufacturing includes any of the following:(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:(i)Utilizes, or is designed to utilize, an alternative source.(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.(iii)Utilizes, or is designed to utilize, water efficiency measures.(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.(10)Water efficiency measures means equipment designed to increase the efficient use of water.(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.SEC. 16.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.(3)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:(i)Utilizes, or is designed to utilize, an alternative source.(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.(iii)Utilizes, or is designed to utilize, water efficiency measures.(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.(9)Water efficiency measures means equipment designed to increase the efficient use of water.(b)This section shall become operative on January 1, 2021.SEC. 17.Section 26011.8 of the Public Resources Code is amended to read:26011.8.(a)The purpose of this section is to promote the creation of California-based manufacturing, California-based jobs, advanced manufacturing, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption. In furtherance of this purpose, the authority may approve a project for financial assistance in the form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code.(b)For purposes of this section, the following terms have the following meanings:(1)Project means tangible personal property if at least 50 percent of its use is either to process recycled feedstock that is intended to be reused in the production of another product or using recycled feedstock in the production of another product or soil amendment, or tangible personal property that is used in the state for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, water efficiency measures, or alternative source products, components, or systems, as defined in Section 26003. Project does not include tangible personal property that processes or uses recycled feedstock in a manner that would constitute disposal as defined in subdivision (b) of Section 40192.(2)Recycled feedstock means materials that would otherwise be destined for disposal, having completed their intended end use and product lifecycle.(3)Soil amendments may include compost, as defined in Section 14525 of the Food and Agricultural Code, fertilizing material, as defined in Section 14533 of the Food and Agricultural Code, gypsum or phosphatic sulfate gypsum, as those terms are defined in Section 14537 of the Food and Agricultural Code, or a substance distributed for the purpose of promoting plant growth or improving the quality of crops by conditioning soils through physical means.(c)The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority.(d)The authority shall evaluate project applications based upon all of the following criteria:(1)The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California.(2)The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion.(3)The extent to which the project will create new, permanent jobs in California.(4)To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by federal or state law or regulation.(5)The extent of unemployment in the area in which the project is proposed to be located.(6)Any other factors the authority deems appropriate in accordance with this section.(e)At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance.(f)Notwithstanding subdivision (j), and without regard to the actual date of any transaction between a participating party and the authority, any project approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code before March 24, 2010, shall not be subject to this section.(g)The Legislative Analysts Office shall report to the Joint Legislative Budget Committee on the effectiveness of this program, on or before January 1, 2019, by evaluating factors, including, but not limited to, the following:(1)The number of jobs created by the program in California.(2)The number of businesses that have remained in California or relocated to California as a result of this program.(3)The amount of state and local revenue and economic activity generated by the program.(4)The types of advanced manufacturing, as defined in paragraph (1) of subdivision (a) of Section 26003, utilized.(5)The amount of reduction in greenhouse gases, air pollution, water pollution, or energy consumption.(h)The exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year.(i)(1)The authority shall study the efficacy and cost benefit of the sales and use tax exemption as it relates to advanced manufacturing projects. The study shall include the number of jobs created, the costs of each job, and the annual salary of each job. The study shall also consider a dynamic analysis of the economic output to the state that would occur without the sales and use tax exemption. Before January 1, 2017, the authority shall submit to the Legislature, consistent with Section 9795 of the Government Code, the result of the study.(2)Before January 1, 2015, the authority shall, consistent with Section 9795 of the Government Code, submit to the Legislature an interim report on the efficacy of the program conducted pursuant to this section. The study shall include recommendations on program changes that would increase the programs efficacy in creating permanent and temporary jobs, and whether eligibility for the program should be extended or narrowed to other manufacturing types. The authority may work with the Legislative Analysts Office in preparing the report and its recommendations.(j)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2021, deletes or extends that date. The sale or purchase of tangible personal property of a project approved before January 1, 2021, shall continue to be excluded from sales and use taxes pursuant to Section 6010.8 of the Revenue and Taxation Code for the period of time set forth in the authoritys resolution approving the project pursuant to this section.SEC. 18.Section 26061 of the Public Resources Code is amended to read:26061.To qualify for assistance pursuant to this chapter, the PACE program shall require all of the following:(a)The interest rate on the PACE bond does not exceed a percentage as determined by the authority to be appropriate.(b)Minimum legal financing structure and credit underwriting criteria as determined by the authority are met.(c)Proceeds of the PACE bonds are used to finance qualified energy and water efficiency, electric vehicle charging infrastructure, and clean energy improvements.(d)The improvement financed is for a residential project of four units or fewer, or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total.SEC. 19.SEC. 15.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 20.SEC. 16.Any moneys, including interest earned, in the Industrial Development Fund established pursuant to Section 91553 of the Government and repealed by the act adding this section are hereby transferred to the California Debt Limit Allocation Committee Fund established pursuant to Section 8869.90 of the Government Code and are hereby appropriated to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the elimination of the California Industrial Development Financing Advisory Commission, as described in the interagency agreement entered into between the authority and the commission for this purpose. Any remaining moneys subject to this transfer from the Industrial Development Fund are hereby appropriated to the California Debt Limit Allocation Committee for purposes described in Section 8869.90 of the Government Code.
SEC. 17.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to assist businesses in making Americans with Disabilities Act, water efficiency, and earthquake- related building changes as soon as possible, it is necessary for this act to take effect immediately as an urgency statute.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p)Public agency means any county, city and county, city, or redevelopment agency.
(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.SEC. 4.Section 91532 of the Government Code is repealed.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.91561.3.(a)Each local authority shall be empowered to enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests after receiving commission approval, and pursuant to Section 11256.(b)The commission shall be designated as the agency to administer such agreements pursuant to Section 6506.SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)(A)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, project. and
(B)Eligible cost shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:
(i)Microelectronics and nanoelectronics, including semiconductors.
(ii)Advanced materials.
(iii)Integrated computational materials engineering.
(iv)Nanotechnology.
(v)Additive manufacturing.
(vi)Industrial biotechnology.
(B)Advanced manufacturing includes any of the following:
(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.
(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.
(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.
(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(10)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 16.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(3)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(9)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall become operative on January 1, 2021.
SEC. 17.Section 26011.8 of the Public Resources Code is amended to read:26011.8.(a)The purpose of this section is to promote the creation of California-based manufacturing, California-based jobs, advanced manufacturing, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption. In furtherance of this purpose, the authority may approve a project for financial assistance in the form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code.
(b)For purposes of this section, the following terms have the following meanings:
(1)Project means tangible personal property if at least 50 percent of its use is either to process recycled feedstock that is intended to be reused in the production of another product or using recycled feedstock in the production of another product or soil amendment, or tangible personal property that is used in the state for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, water efficiency measures, or alternative source products, components, or systems, as defined in Section 26003. Project does not include tangible personal property that processes or uses recycled feedstock in a manner that would constitute disposal as defined in subdivision (b) of Section 40192.
(2)Recycled feedstock means materials that would otherwise be destined for disposal, having completed their intended end use and product lifecycle.
(3)Soil amendments may include compost, as defined in Section 14525 of the Food and Agricultural Code, fertilizing material, as defined in Section 14533 of the Food and Agricultural Code, gypsum or phosphatic sulfate gypsum, as those terms are defined in Section 14537 of the Food and Agricultural Code, or a substance distributed for the purpose of promoting plant growth or improving the quality of crops by conditioning soils through physical means.
(c)The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority.
(d)The authority shall evaluate project applications based upon all of the following criteria:
(1)The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California.
(2)The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion.
(3)The extent to which the project will create new, permanent jobs in California.
(4)To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by federal or state law or regulation.
(5)The extent of unemployment in the area in which the project is proposed to be located.
(6)Any other factors the authority deems appropriate in accordance with this section.
(e)At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance.
(f)Notwithstanding subdivision (j), and without regard to the actual date of any transaction between a participating party and the authority, any project approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code before March 24, 2010, shall not be subject to this section.
(g)The Legislative Analysts Office shall report to the Joint Legislative Budget Committee on the effectiveness of this program, on or before January 1, 2019, by evaluating factors, including, but not limited to, the following:
(1)The number of jobs created by the program in California.
(2)The number of businesses that have remained in California or relocated to California as a result of this program.
(3)The amount of state and local revenue and economic activity generated by the program.
(4)The types of advanced manufacturing, as defined in paragraph (1) of subdivision (a) of Section 26003, utilized.
(5)The amount of reduction in greenhouse gases, air pollution, water pollution, or energy consumption.
(h)The exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year.
(i)(1)The authority shall study the efficacy and cost benefit of the sales and use tax exemption as it relates to advanced manufacturing projects. The study shall include the number of jobs created, the costs of each job, and the annual salary of each job. The study shall also consider a dynamic analysis of the economic output to the state that would occur without the sales and use tax exemption. Before January 1, 2017, the authority shall submit to the Legislature, consistent with Section 9795 of the Government Code, the result of the study.
(2)Before January 1, 2015, the authority shall, consistent with Section 9795 of the Government Code, submit to the Legislature an interim report on the efficacy of the program conducted pursuant to this section. The study shall include recommendations on program changes that would increase the programs efficacy in creating permanent and temporary jobs, and whether eligibility for the program should be extended or narrowed to other manufacturing types. The authority may work with the Legislative Analysts Office in preparing the report and its recommendations.
(j)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2021, deletes or extends that date. The sale or purchase of tangible personal property of a project approved before January 1, 2021, shall continue to be excluded from sales and use taxes pursuant to Section 6010.8 of the Revenue and Taxation Code for the period of time set forth in the authoritys resolution approving the project pursuant to this section.
SEC. 18.Section 26061 of the Public Resources Code is amended to read:26061.To qualify for assistance pursuant to this chapter, the PACE program shall require all of the following:
(a)The interest rate on the PACE bond does not exceed a percentage as determined by the authority to be appropriate.
(b)Minimum legal financing structure and credit underwriting criteria as determined by the authority are met.
(c)Proceeds of the PACE bonds are used to finance qualified energy and water efficiency, electric vehicle charging infrastructure, and clean energy improvements.
(d)The improvement financed is for a residential project of four units or fewer, or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total.
SEC. 19.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 20.Any moneys, including interest earned, in the Industrial Development Fund established pursuant to Section 91553 of the Government and repealed by the act adding this section are hereby transferred to the California Debt Limit Allocation Committee Fund established pursuant to Section 8869.90 of the Government Code and are hereby appropriated to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the elimination of the California Industrial Development Financing Advisory Commission, as described in the interagency agreement entered into between the authority and the commission for this purpose. Any remaining moneys subject to this transfer from the Industrial Development Fund are hereby appropriated to the California Debt Limit Allocation Committee for purposes described in Section 8869.90 of the Government Code.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p)Public agency means any county, city and county, city, or redevelopment agency.
(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.SEC. 4.Section 91532 of the Government Code is repealed.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.91561.3.(a)Each local authority shall be empowered to enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests after receiving commission approval, and pursuant to Section 11256.
(b)The commission shall be designated as the agency to administer such agreements pursuant to Section 6506.
SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, and shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:
(i)Microelectronics and nanoelectronics, including semiconductors.
(ii)Advanced materials.
(iii)Integrated computational materials engineering.
(iv)Nanotechnology.
(v)Additive manufacturing.
(vi)Industrial biotechnology.
(B)Advanced manufacturing includes any of the following:
(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.
(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.
(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.
(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(10)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 16.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(3)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(9)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall become operative on January 1, 2021.
SEC. 17.Section 26011.8 of the Public Resources Code is amended to read:26011.8.(a)The purpose of this section is to promote the creation of California-based manufacturing, California-based jobs, advanced manufacturing, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption. In furtherance of this purpose, the authority may approve a project for financial assistance in the form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code.
(b)For purposes of this section, the following terms have the following meanings:
(1)Project means tangible personal property if at least 50 percent of its use is either to process recycled feedstock that is intended to be reused in the production of another product or using recycled feedstock in the production of another product or soil amendment, or tangible personal property that is used in the state for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, water efficiency measures, or alternative source products, components, or systems, as defined in Section 26003. Project does not include tangible personal property that processes or uses recycled feedstock in a manner that would constitute disposal as defined in subdivision (b) of Section 40192.
(2)Recycled feedstock means materials that would otherwise be destined for disposal, having completed their intended end use and product lifecycle.
(3)Soil amendments may include compost, as defined in Section 14525 of the Food and Agricultural Code, fertilizing material, as defined in Section 14533 of the Food and Agricultural Code, gypsum or phosphatic sulfate gypsum, as those terms are defined in Section 14537 of the Food and Agricultural Code, or a substance distributed for the purpose of promoting plant growth or improving the quality of crops by conditioning soils through physical means.
(c)The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority.
(d)The authority shall evaluate project applications based upon all of the following criteria:
(1)The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California.
(2)The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion.
(3)The extent to which the project will create new, permanent jobs in California.
(4)To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by federal or state law or regulation.
(5)The extent of unemployment in the area in which the project is proposed to be located.
(6)Any other factors the authority deems appropriate in accordance with this section.
(e)At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance.
(f)Notwithstanding subdivision (j), and without regard to the actual date of any transaction between a participating party and the authority, any project approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code before March 24, 2010, shall not be subject to this section.
(g)The Legislative Analysts Office shall report to the Joint Legislative Budget Committee on the effectiveness of this program, on or before January 1, 2019, by evaluating factors, including, but not limited to, the following:
(1)The number of jobs created by the program in California.
(2)The number of businesses that have remained in California or relocated to California as a result of this program.
(3)The amount of state and local revenue and economic activity generated by the program.
(4)The types of advanced manufacturing, as defined in paragraph (1) of subdivision (a) of Section 26003, utilized.
(5)The amount of reduction in greenhouse gases, air pollution, water pollution, or energy consumption.
(h)The exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year.
(i)(1)The authority shall study the efficacy and cost benefit of the sales and use tax exemption as it relates to advanced manufacturing projects. The study shall include the number of jobs created, the costs of each job, and the annual salary of each job. The study shall also consider a dynamic analysis of the economic output to the state that would occur without the sales and use tax exemption. Before January 1, 2017, the authority shall submit to the Legislature, consistent with Section 9795 of the Government Code, the result of the study.
(2)Before January 1, 2015, the authority shall, consistent with Section 9795 of the Government Code, submit to the Legislature an interim report on the efficacy of the program conducted pursuant to this section. The study shall include recommendations on program changes that would increase the programs efficacy in creating permanent and temporary jobs, and whether eligibility for the program should be extended or narrowed to other manufacturing types. The authority may work with the Legislative Analysts Office in preparing the report and its recommendations.
(j)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2021, deletes or extends that date. The sale or purchase of tangible personal property of a project approved before January 1, 2021, shall continue to be excluded from sales and use taxes pursuant to Section 6010.8 of the Revenue and Taxation Code for the period of time set forth in the authoritys resolution approving the project pursuant to this section.
SEC. 17. SEC. 18.Section 26061 of the Public Resources Code is amended to read:26061.To qualify for assistance pursuant to this chapter, the PACE program shall require all of the following:
(a)The interest rate on the PACE bond does not exceed a percentage as determined by the authority to be appropriate.
(b)Minimum legal financing structure and credit underwriting criteria as determined by the authority are met.
(c)Proceeds of the PACE bonds are used to finance qualified energy and water efficiency, electric vehicle charging infrastructure, and clean energy improvements.
(d)The improvement financed is for a residential project of four units or fewer, or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total.
SEC. 18. SEC. 19.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Commission means the California Industrial Development Financing Advisory Commission established pursuant to Article 3 (commencing with Section 91550).(h)(g)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(i)(h)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(j)(i)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(k)(j)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(l)(k)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(m)(l)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(n)(m)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(o)(n)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(p)(o)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(q)(p)Public agency means any county, city and county, city, or redevelopment agency.
(r)(q)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(s)(r)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. purposes, or is otherwise entitled to any federal tax advantage.
(t)(s)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
SEC. 2.Section 91529 of the Government Code is amended to read:91529.Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a)Such financial, legal, and other information as is required by an authority.
(b)An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c)Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented supplemented, or clarified from time to time, with such any information as that is required for the making of the determinations desired at the time time, in accordance with commission procedures. procedures established by the authority.
SEC. 3.Section 91531 of the Government Code is repealed.91531.(a)At any time following adoption of the resolution of intention, the board shall request that the commission make the determinations authorized by this section and shall provide for transmission to the commission of the fee required by the commission and such information as may be required by the commission.(b)The commission shall review the submission and shall, by express findings on the basis of the submission, determine compliance with the following criteria:(1)Public benefits, determined in accordance with the policy stated in Section 91502.1, from the use of the facilities, including equipment, likely will substantially exceed any public detriment from issuance of bonds in the estimated principal amount proposed in the application.(2)Neither the completion of the project nor the operation of the facilities will have the proximate effect of relocation of any substantial operations of the company from one area of the state to another or in the abandonment of any substantial operations of the company within other areas of the state, or, if the completion or operation will have either of the effects, then the completion or operation is reasonably necessary to prevent the relocation of any substantial operations of the company from an area within the state to an area outside the state.(3)The proposed issuance of bonds qualifies for issuance under the provisions of Article 5 (commencing with Section 91570).(c)For those projects qualified under Section 1401 of the American Recovery and Reinvestment Act of 2009 (Public Law 111-5), or any amendments thereto, the commission shall review the submission and shall, by express findings on the basis of the submission, determine compliance with criteria contained in that act.(d)Written notification of the determinations of the commission shall be given to the authority.(e)Upon failure of the commission to make determinations as to compliance with the criteria within 60 days of the receipt of the submission, unless the time is extended by written consent of the authority, the commission shall lose jurisdiction to make the determinations, and the authority shall determine compliance with the criteria.(f)A proposed issuance of refunding bonds shall be evaluated solely under the requirement of paragraph (3) of subdivision (b), upon request of the board following the determination provided for in subdivision (j) of Section 91527.(g)Determinations of the commission or of an authority as provided in subdivision (j) of Section 91527, Section 91530, and this section shall be final and conclusive.(h)The authority shall not deliver bonds for the project until this section has been complied with.(i)It is the intention of the Legislature that submissions be reviewed by the commission individually and not comparatively and that determinations be made generally in the order of receipt of the submissions. To the extent consistent with accomplishment of the public purposes as provided in Section 91502, priority consideration shall be given submissions on behalf of small and medium-size companies. To the extent that the public benefits finding under paragraph (1) of subdivision (b) of this section is based on employment benefits under paragraph (1) of subdivision (b) of Section 91502.1, the following considerations, as alternatives to each other, may in accordance with the submission, additionally be considered in making such finding:(1)The willingness of the company to provide for the screening for employment of (i) individuals affected by industrial relocations or abandonments, (ii) new entrants or reentrants to the workforce, (iii) unemployed or partially unemployed individuals who are registered for work at a public employment office or other approved place pursuant to Section 1253 of the Unemployment Insurance Code, or (iv) individuals participating in job training or placement programs directly calculated to increase employability or improve the employment of these individuals.(2)The location of the facilities in or conveniently accessible to a portion of the workforce residing within an economically distressed area of the state or an area of the state affected by industrial depression or decline.An adverse finding shall not be made merely because each of such alternative considerations is inapplicable if the facilities are located in or are conveniently accessible to a portion of the workforce residing within a pocket of economic distress or an area of the state largely rural in character.SEC. 4.Section 91532 of the Government Code is repealed.91532.(a)The commission may provide, by regulation, that at the option of an authority, the commission will make determinations pursuant to subdivision (b) of Section 91531 under any of the three criteria, separately, without at the same time making determinations under the remaining criteria.(b)In the event an authority elects to request determinations under less than all of the three criteria, the 60-day period of subdivision (d) of Section 91531 is applicable only to determinations under the designated criteria and the commission retains jurisdiction to make determinations under the remaining criteria, upon request, and prior to the expiration of a 60-day period applicable to each separate determination requested.(c)The commission may provide that at the option of an authority, the commission will make a determination with regard to the qualification of bonds for issuance under the provisions of Article 5 (commencing with Section 91570), upon the basis of statements and descriptions. In such event bonds shall not be delivered in return for the purchase price until the submission is supplemented with proposed forms of project agreements, indentures and other proceedings not differing substantially from the statements and descriptions.(d)An authority acting pursuant to subdivision (d) of Section 91531 may follow the same procedures as are followed by the commission pursuant to this section.SEC. 5.Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.SEC. 6.The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:4.3.Small Business FinancingSEC. 7.Section 91560 of the Government Code is amended to read:91560.(a)The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authoritys services available to various small businesses that may be otherwise unable to use them.
(b)For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, the commission pursuant to this section or an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Prior to Before levying any of these fees or charges or requiring deposits, the commission or an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c)Subject to any prior contractual obligations to any of its bondholders, the commission or an authority may establish one or more common reserve funds for any or all of its bonds. The commission shall establish its own liability limits of the common reserve fund with respect to any single issue of bonds issued by the commission, and each Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority subject to the approval of the commission. authority.
(d)Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.
SEC. 8.Section 91561 of the Government Code is repealed.91561.Upon the request of an authority, the commission may act as a pooling agent in the issuance of bonds for the benefit of small businesses, when it is more expedient for the commission to do so, or at the request of the local authority, or both. As a pooling agent, the commission shall issue pooled bonds pursuant to Sections 91520, and following, of this code, based on a combination by the commission, or by an authority, of small business loan requests. Pooled bond issues shall be in multiples of one million dollars ($1,000,000).SEC. 9.Section 91561.3 of the Government Code is amended to read:91561.3.Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.
SEC. 10.Section 91561.5 of the Government Code is amended to read:91561.5.Small For purposes of this article, small business means small business as defined in Section 14837.
SEC. 11.Section 91562.5 of the Government Code is repealed.91562.5.The commission shall consider small business requests on a quarterly basis.91561.3.(a)Each local authority shall be empowered to enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests after receiving commission approval, and pursuant to Section 11256.
(b)The commission shall be designated as the agency to administer such agreements pursuant to Section 6506.
SEC. 12.Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.SECTION 1.SEC. 13.Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:44559.13.(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, and shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SEC. 14.Section 44559.14 of the Health and Safety Code is amended to read:44559.14.(a)(1)It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2)The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Seismic retrofit construction means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. Seismic retrofit construction includes, but is not limited to, all of the following:
(A)Anchoring the structure to the foundation.
(B)Bracing cripple walls.
(C)Bracing hot water heaters.
(D)Installing automatic gas shutoff valves.
(E)Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F)Anchoring fuel storage.
(G)Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H)Strengthening a buildings lateral load resisting system.
(2)Eligible costs means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. Eligible costs do not include costs paid or incurred for any of the following:
(A)Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B)Repair, including repair of earthquake damage.
(C)Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D)Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E)Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F)Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G)Bracing or securing nonpermanent building contents.
(H)The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3)Eligible project means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4)Qualified building means a residential or commercial building that is certified identified by the appropriate local building code enforcement authority official for the jurisdiction in which the building is located as hazardous and in danger of collapse a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake. earthquake or a building constructed before 1981.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6)Qualified small business means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns and occupies, or intends to occupy, a qualified building for the operation of the business. regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7)Qualified residential property owner means either an owner and occupant of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building. building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c)(1)The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to small business shall include qualified residential property owner, as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include both of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii)Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e)The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.
SEC. 15.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:
(i)Microelectronics and nanoelectronics, including semiconductors.
(ii)Advanced materials.
(iii)Integrated computational materials engineering.
(iv)Nanotechnology.
(v)Additive manufacturing.
(vi)Industrial biotechnology.
(B)Advanced manufacturing includes any of the following:
(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.
(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.
(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.
(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source, or that is source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(10)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 16.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(3)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, meets one of the following:
(i)Utilizes, or is designed to utilize, an alternative source, or that is source.
(ii)Is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(iii)Utilizes, or is designed to utilize, water efficiency measures.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(9)Water efficiency measures means equipment designed to increase the efficient use of water.
(b)This section shall become operative on January 1, 2021.
SEC. 17.Section 26061 of the Public Resources Code is amended to read:26061.To qualify for assistance pursuant to this chapter, the PACE program shall require all of the following:
(a)The interest rate on the PACE bond does not exceed a percentage as determined by the authority to be appropriate.
(b)Minimum legal financing structure and credit underwriting criteria as determined by the authority are met.
(c)Proceeds of the PACE bonds are used to finance qualified energy and water efficiency, electric vehicle charging infrastructure, and clean energy improvements.
(d)The improvement financed is for a residential project of three four units or fewer, or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total.
SEC. 18.Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:6010.8.(a)(1)Sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any participating party. As
(2)On and after the operative date of the act adding this paragraph, sale and purchase do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b)As used in this section, project has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and participating party has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(b)(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, and shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business referred to in subdivisions (i) and (m) of Section 44559.1, that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A)It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(a)It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article with the additional program requirements specified under this section.
(b)For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1)Americans with Disabilities Act means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2)California Americans with Disabilities Act Small Business Capital Access Loan Program Fund or fund means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3)Eligible cost means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, and shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4)Eligible project means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5)Qualified loan means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6)Small business or qualified business means a business referred to in subdivisions (i) and (m) of Section 44559.1, that meets both of the following additional criteria:
(A)Fifteen It has 30 or fewer full-time equivalent employees. employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B)Less than five million dollars ($5,000,000) in total gross annual income from all sources.(C)Does(B)It does not provide overnight accommodations.
(c)(1)The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(2)All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A)Program expenditures shall include all of the following:
(i)Contributions paid by the authority in support of qualified loans.
(ii)Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii)Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B)Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(i)Personnel costs.
(ii)Service and vending contracts necessary to carry out the program.
(iii)Other reasonable direct and indirect administrative costs.
(3)The authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d)The authority shall adopt regulations pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to:
(1)Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2)Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3)Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4)Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5)Limit the term of loss coverage for each qualified loan to no more than five years.
(6)Recapture from the loss reserve account the authoritys contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
SECTION 1.Section 91504 of the Government Code is amended to read:91504.Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.(c)Authority means any industrial development authority established pursuant to this title.(d)Board means the board of directors of an authority.(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.(g)Commission means the California Industrial Development Financing Advisory Commission established pursuant to Article 3 (commencing with Section 91550).(h)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.(i)Cost as applied to any project, may embrace:(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.(6)The cost of issuance of any bonds and of financing, interest before, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.(10)Except as provided in paragraph (9), cost does not otherwise include working capital.(j)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.(k)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.(l)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.(m)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.(n)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.(o)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.(p)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.(q)Public agency means any county, city and county, city, or redevelopment agency.(r)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.(s)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes.(t)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.(u)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.SEC. 2.Section 91504 is added to the Government Code, to read:91504.Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.(c)Authority means any industrial development authority established pursuant to this title.(d)Board means the board of directors of an authority.(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.(g)Commission means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600).(h)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.(i)Cost as applied to any project, may embrace:(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.(6)The cost of issuance of any bonds and of financing, interest before, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.(10)Except as provided in paragraph (9), cost does not otherwise include working capital.(j)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.(k)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.(l)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.(m)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.(n)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.(o)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.(p)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.(q)Public agency means any county, city and county, city, or redevelopment agency.(r)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.(s)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes.(t)Taxable means, with respect to any bonds, that the bonds are not tax-exempt. (u)This section shall become operative on March 15, 2019.SEC. 3.Section 91550 of the Government Code is amended to read:91550.There is in state government the California Industrial Development Financing Advisory Commission, consisting of five members, as follows:(a)The Treasurer, who shall serve as chairperson.(b)The Controller.(c)The Director of Finance.(d)The Director of the Governors Office of Business and Economic Development.(e)The Commissioner of Business Oversight.Members of the commission may each designate a deputy or employee in his or her agency to act for him or her at all meetings of the commission. The first meeting shall be convened by the Treasurer.This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.SEC. 4.Title 10.5 (commencing with Section 91600) is added to the Government Code, to read:10.5.California Development Financing Authority91600.(a)There is in the state government the California Development Financing Authority. The authority constitutes a public instrumentality and the exercise by the authority of powers conferred by this title is the performance of an essential public function.(b)The authority shall consist of four members, as follows:(1)The Director of Finance.(2)The Director of the Governors Office of Business and Economic Development.(3)The Controller.(4)The Treasurer, who shall serve as the chairperson of the authority.(c)The members listed in paragraphs (1) to (4), inclusive, of subdivision (b) may each designate a deputy or clerk in his or her agency to act for and represent the member at all meetings of the authority.(d)Three members shall constitute a quorum.(e)The authority may establish one or more policy and technical advisory committees, which may include, but are not limited to, the Chairperson of the State Energy Resources Conversation and Development Commission or his or her representative, the President of the Public Utilities Commission or his or her representative, or the Commissioner of Business Oversight or his or her representative.(f)All members of the authority shall serve thereon without compensation. (g)(1)Unless the context clearly requires otherwise, the California Development Financing Authority shall succeed to and is vested with all the duties, powers, purposes, responsibilities, and jurisdiction vested in the former California Industrial Development Financing Advisory Commission, California Pollution Control Financing Authority, and the Alternative Energy and Advanced Transportation Financing Authority.(2)Unless the context clearly requires otherwise, whenever the terms California Industrial Development Financing Advisory Commission, California Pollution Control Financing Authority, or Alternative Energy and Advanced Transportation Financing Authority appears in any statute, regulation, or contract, or any other code, it shall be construed to refer to the California Development Financing Authority.(h)This title shall become operative on March 15, 2019.SEC. 5.Section 44504 of the Health and Safety Code is amended to read:44504.Authority means the California Pollution Control Financing Authority established pursuant to Section 44515 and any board, commission, department, or officer succeeding to the functions thereof or to whom the powers conferred upon the authority by this division shall be given by law.This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.SEC. 6.Section 44504 is added to the Health and Safety Code, to read:44504.Authority means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600) of the Government Code and any board, commission, department, or officer succeeding to the functions thereof or to whom the powers conferred upon the authority by this division shall be given by law. This section shall become operative on March 15, 2019SEC. 7.Section 44515 of the Health and Safety Code is amended to read:44515.There is in the state government the California Pollution Control Financing Authority. The authority constitutes a public instrumentality and a political subdivision of the State of California, and the exercise by the authority of the powers conferred by this division shall be deemed and held to be the performance of an essential public function. The authority shall consist of three members: the Director of Finance, the Treasurer, and the Controller.The Director of Finance may designate a deputy or other official in the Department of Finance to act for him or her and represent him or her at all meetings of the authority.The first meeting of the authority shall be convened by the Director of Finance.This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.SEC. 8.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:(i)Microelectronics and nanoelectronics, including semiconductors.(ii)Advanced materials.(iii)Integrated computational materials engineering.(iv)Nanotechnology.(v)Additive manufacturing.(vi)Industrial biotechnology.(B)Advanced manufacturing includes any of the following:(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest before, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.(b)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.SEC. 9.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.(3)Authority means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600) of the Government Code, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.(b)This section shall become operative on January 1, 2021.SEC. 10.Section 26003 is added to the Public Resources Code, to read:26003.(a)As used in this division, unless the context otherwise requires:(1)(A) Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:(i)Microelectronics and nanoelectronics, including semiconductors.(ii)Advanced materials.(iii)Integrated computational materials engineering.(iv)Nanotechnology.(v)Additive manufacturing.(vi)Industrial biotechnology.(B)Advanced manufacturing includes any of the following:(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.(ii)(I) Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.(2)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.(3)(A) Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.(4)Authority means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600) of the Government Code, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest before, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.(7)(A) Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.(B)(i) For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.(8)(A) Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.(b)This section shall become operative on March 15, 2019.(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed.SEC. 11.Section 26004 of the Public Resources Code is amended to read:26004.(a)There is in the state government the California Alternative Energy and Advanced Transportation Financing Authority. The authority constitutes a public instrumentality and the exercise by the authority of powers conferred by this division is the performance of an essential public function.(b)The authority shall consist of five members, as follows:(1)The Director of Finance.(2)The Chairperson of the State Energy Resources Conservation and Development Commission.(3)The President of the Public Utilities Commission.(4)The Controller.(5)The Treasurer, who shall serve as the chairperson of the authority.(c)The members listed in paragraphs (1) to (5), inclusive, of subdivision (b) may each designate a deputy or clerk in his or her agency to act for and represent the member at all meetings of the authority.(d)The first meeting of the authority shall be convened by the Treasurer.(e)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Commission means the California Industrial Development Financing Advisory Commission established pursuant to Article 3 (commencing with Section 91550).
(h)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(i)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest prior to, before, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(j)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(k)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(l)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(m)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(n)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(o)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(p)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(q)Public agency means any county, city and county, city, or redevelopment agency.
(r)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(s)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes.
(t)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
(u)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
SEC. 2.Section 91504 is added to the Government Code, to read:91504.Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a)Acquire and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b)Administration expenses means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c)Authority means any industrial development authority established pursuant to this title.
(d)Board means the board of directors of an authority.
(e)Bonds means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f)Bond proceeds means all amounts received by an authority upon sale or other disposition of any bonds.
(g)Commission means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600).
(h)Company means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(i)Cost as applied to any project, may embrace:
(1)The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2)The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3)The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4)The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5)The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6)The cost of issuance of any bonds and of financing, interest before, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7)The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8)The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9)In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10)Except as provided in paragraph (9), cost does not otherwise include working capital.
(j)Facilities mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(k)Governing body means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(l)Indenture means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(m)Proceedings means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(n)Project means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(o)Project agreements means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(p)Property means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(q)Public agency means any county, city and county, city, or redevelopment agency.
(r)Revenues means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(s)Tax-exempt means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes.
(t)Taxable means, with respect to any bonds, that the bonds are not tax-exempt.
(u)This section shall become operative on March 15, 2019.
SEC. 3.Section 91550 of the Government Code is amended to read:91550.There is in state government the California Industrial Development Financing Advisory Commission, consisting of five members, as follows:
(a)The Treasurer, who shall serve as chairperson.
(b)The Controller.
(c)The Director of Finance.
(d)The Director of the Governors Office of Business and Economic Development.
(e)The Commissioner of Business Oversight.
Members of the commission may each designate a deputy or employee in his or her agency to act for him or her at all meetings of the commission. The first meeting shall be convened by the Treasurer.
This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
SEC. 4.Title 10.5 (commencing with Section 91600) is added to the Government Code, to read:10.5.California Development Financing Authority91600.(a)There is in the state government the California Development Financing Authority. The authority constitutes a public instrumentality and the exercise by the authority of powers conferred by this title is the performance of an essential public function.
(b)The authority shall consist of four members, as follows:
(1)The Director of Finance.
(2)The Director of the Governors Office of Business and Economic Development.
(3)The Controller.
(4)The Treasurer, who shall serve as the chairperson of the authority.
(c)The members listed in paragraphs (1) to (4), inclusive, of subdivision (b) may each designate a deputy or clerk in his or her agency to act for and represent the member at all meetings of the authority.
(d)Three members shall constitute a quorum.
(e)The authority may establish one or more policy and technical advisory committees, which may include, but are not limited to, the Chairperson of the State Energy Resources Conversation and Development Commission or his or her representative, the President of the Public Utilities Commission or his or her representative, or the Commissioner of Business Oversight or his or her representative.
(f)All members of the authority shall serve thereon without compensation.
(g)(1)Unless the context clearly requires otherwise, the California Development Financing Authority shall succeed to and is vested with all the duties, powers, purposes, responsibilities, and jurisdiction vested in the former California Industrial Development Financing Advisory Commission, California Pollution Control Financing Authority, and the Alternative Energy and Advanced Transportation Financing Authority.
(2)Unless the context clearly requires otherwise, whenever the terms California Industrial Development Financing Advisory Commission, California Pollution Control Financing Authority, or Alternative Energy and Advanced Transportation Financing Authority appears in any statute, regulation, or contract, or any other code, it shall be construed to refer to the California Development Financing Authority.
(h)This title shall become operative on March 15, 2019.
SEC. 5.Section 44504 of the Health and Safety Code is amended to read:44504.Authority means the California Pollution Control Financing Authority established pursuant to Section 44515 and any board, commission, department, or officer succeeding to the functions thereof or to whom the powers conferred upon the authority by this division shall be given by law.
This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
SEC. 6.Section 44504 is added to the Health and Safety Code, to read:44504.Authority means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600) of the Government Code and any board, commission, department, or officer succeeding to the functions thereof or to whom the powers conferred upon the authority by this division shall be given by law.
This section shall become operative on March 15, 2019
SEC. 7.Section 44515 of the Health and Safety Code is amended to read:44515.There is in the state government the California Pollution Control Financing Authority. The authority constitutes a public instrumentality and a political subdivision of the State of California, and the exercise by the authority of the powers conferred by this division shall be deemed and held to be the performance of an essential public function. The authority shall consist of three members: the Director of Finance, the State Treasurer, and the State Controller.
The Director of Finance may designate a deputy or other official in the Department of Finance to act for him or her and represent him or her at all meetings of the authority.
The first meeting of the authority shall be convened by the Director of Finance.
This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
SEC. 8.Section 26003 of the Public Resources Code, as amended by Section 257 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A)Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:
(i)Microelectronics and nanoelectronics, including semiconductors.
(ii)Advanced materials.
(iii)Integrated computational materials engineering.
(iv)Nanotechnology.
(v)Additive manufacturing.
(vi)Industrial biotechnology.
(B)Advanced manufacturing includes any of the following:
(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.
(ii)(I)Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.
(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.
(2)(A)Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(3)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(4)Authority means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, before, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(7)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(8)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.(b)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
SEC. 9.Section 26003 of the Public Resources Code, as amended by Section 258 of Chapter 86 of the Statutes of 2016, is amended to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(2)(A)Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(3)Authority means the California Alternative Energy and Advanced Transportation Financing Authority Development Financing Authority established pursuant to Section 26004, Title 10.5 (commencing with Section 91600) of the Government Code, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(4)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(5)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(6)(A)Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i)For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(7)(A)Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(8)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(b)This section shall become operative on January 1, 2021.
SEC. 10.Section 26003 is added to the Public Resources Code, to read:26003.(a)As used in this division, unless the context otherwise requires:
(1)(A) Advanced manufacturing means manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models utilizing any of the following technology areas:
(i)Microelectronics and nanoelectronics, including semiconductors.
(ii)Advanced materials.
(iii)Integrated computational materials engineering.
(iv)Nanotechnology.
(v)Additive manufacturing.
(vi)Industrial biotechnology.
(B)Advanced manufacturing includes any of the following:
(i)Systems that result from substantive advancement, whether incremental or breakthrough, beyond the current industry standard, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as smart or intelligent manufacturing systems, which integrate computational predictability and operational efficiency.
(ii)(I) Sustainable manufacturing systems and manufacturing technologies that minimize the use of resources while maintaining or improving cost and performance.
(II)Sustainable manufacturing systems and manufacturing technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this clause are met.
(2)(A) Advanced transportation technologies means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value-added jobs for Californians while enhancing the states commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(B)Advanced transportation technologies does not include those projects required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority regarding projects that are excluded pursuant to this subparagraph.
(3)(A) Alternative sources means devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, distributed generation and energy storage technologies eligible under the self-generation incentive program pursuant to Section 379.6 of the Public Utilities Code, as determined by the Public Utilities Commission, or a facility designed for the production of renewable fuels, the efficient use of which reduces the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases.
(B)Alternative sources does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits.
(4)Authority means the California Development Financing Authority established pursuant to Title 10.5 (commencing with Section 91600) of the Government Code, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given.
(5)Cost as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest before, during, and for a period after, completion of construction as determined by the authority; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of constructing any project or incidental to the construction, acquisition, or financing of a project.
(6)Financial assistance includes, but is not limited to, loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.
(7)(A) Participating party means a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.
(B)(i) For purposes of Section 6010.8 of the Revenue and Taxation Code, participating party means an entity specified in subparagraph (A) that seeks financial assistance pursuant to Section 26011.8.
(ii)For purposes of Section 6010.8 of the Revenue and Taxation Code, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance pursuant to Section 26011.8 if the participating party commits to, and demonstrates that, the party will be opening a manufacturing facility in the state.
(iii)It is the intent of the Legislature by adding clause (ii) to clarify existing law and ensure that an out-of-state entity or overseas entity is eligible to apply for financial assistance pursuant to Section 26011.8.
(8)(A) Project means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment utilized in the state, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies or alternative source components.
(B)Project, for purposes of Section 26011.8 and Section 6010.8 of the Revenue and Taxation Code, is defined in Section 26011.8.
(9)Revenue means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority.
(b)This section shall become operative on March 15, 2019.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 11.Section 26004 of the Public Resources Code is amended to read:26004.(a)There is in the state government the California Alternative Energy and Advanced Transportation Financing Authority. The authority constitutes a public instrumentality and the exercise by the authority of powers conferred by this division is the performance of an essential public function.
(b)The authority shall consist of five members, as follows:
(1)The Director of Finance.
(2)The Chairperson of the State Energy Resources Conservation and Development Commission.
(3)The President of the Public Utilities Commission.
(4)The Controller.
(5)The Treasurer, who shall serve as the chairperson of the authority.
(c)The members listed in paragraphs (1) to (5), inclusive, of subdivision (b) may each designate a deputy or clerk in his or her agency to act for and represent the member at all meetings of the authority.
(d)The first meeting of the authority shall be convened by the Treasurer.
(e)This section shall become inoperative on March 15, 2019, and, as of January 1, 2020, is repealed.
|
Date
|
Status
|
|---|---|
| Sep 21, 2018 | Chaptered by Secretary of State - Chapter 645, Statutes of 2018. |
| Sep 21, 2018 | Approved by the Governor. |
| Sep 11, 2018 | Enrolled and presented to the Governor at 4:30 p.m. |
| Aug 31, 2018 | Urgency clause adopted. Senate amendments concurred in. To Engrossing and Enrolling. |
| Aug 31, 2018 | In Assembly. Concurrence in Senate amendments pending. |
| Aug 31, 2018 | Read third time. Urgency clause adopted. Passed. Ordered to the Assembly. |
| Aug 29, 2018 | Read third time. Urgency clause refused adoption. |
| Aug 27, 2018 | Read second time. Ordered to third reading. |
| Aug 24, 2018 | Read third time and amended. Ordered to second reading. |
| Aug 20, 2018 | Read second time. Ordered to third reading. |
| Aug 17, 2018 | From committee: Amend, and do pass as amended. (Ayes 7. Noes 0.) (August 16). |
| Aug 6, 2018 | In committee: Referred to APPR. suspense file. |
| Jun 26, 2018 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 0.) (June 25). Re-referred to Com. on APPR. |
| Jun 18, 2018 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B., P. & E.D. |
| May 1, 2018 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B., P. & E.D. |
| Apr 19, 2018 | Referred to Com. on B., P. & E.D. |
| Jan 29, 2018 | In Senate. Read first time. To Com. on RLS. for assignment. |
| Jan 29, 2018 | Read third time. Passed. Ordered to the Senate. |
| Jan 22, 2018 | Read second time. Ordered to third reading. |
| Jan 18, 2018 | From committee: Do pass. (Ayes 17. Noes 0.) (January 18). |
| Jan 12, 2018 | Re-referred to Com. on APPR. |
| Jan 11, 2018 | Read second time and amended. |
| Jan 10, 2018 | From committee: Amend, and do pass as amended and re-refer to Com. on APPR. (Ayes 6. Noes 0.) (January 9). |
| Jan 4, 2018 | Re-referred to Com. on J., E.D., & E. |
| Jan 3, 2018 | From committee chair, with author's amendments: Amend, and re-refer to Com. on J., E.D., & E. Read second time and amended. |
| Mar 16, 2017 | Referred to Com. on J., E.D., & E. |
| Feb 19, 2017 | From printer. May be heard in committee March 21. |
| Feb 17, 2017 | Read first time. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Aug 31, 2018 | AB 1547 Quirk-Silva Concurrence - Urgency Added | Assembly Floor |
Passed |
|
| Aug 31, 2018 | Assembly 3rd Reading AB1547 Quirk-Silva et al. By Roth Urgency Clause | Senate Floor |
Passed |
|
| Aug 29, 2018 | Assembly 3rd Reading AB1547 Quirk-Silva et al. By Roth Reconsider | Senate Floor |
Passed |
|
| Aug 29, 2018 | Assembly 3rd Reading AB1547 Quirk-Silva et al. By Roth Urgency Clause | Senate Floor |
Passed |
|
| Aug 16, 2018 | Do pass as amended | Senate Standing Committee on Appropriations |
Passed |
|
| Aug 6, 2018 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
|
| Jun 25, 2018 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Business, Professions and Economic Development |
Passed |
|
| Jan 29, 2018 | AB 1547 QUIRK-SILVA Assembly Third Reading | Assembly Floor |
Passed |
|
| Jan 18, 2018 | Set, [First] hearing. Referred to suspense file. | Assembly Standing Committee on Appropriations |
Passed |
|
| Jan 18, 2018 | Do pass. | Assembly Standing Committee on Appropriations |
Passed |
|
| Jan 9, 2018 | Do pass as amended and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Jobs, Economic Development, and the Economy |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| California Association For Local Economic Development | ** Support | Aug 30, 2018 |
| California Enterprise Development Authority | ** Support | Aug 30, 2018 |
| City Of Palmdale | ** Support | Aug 30, 2018 |
| Del Norte Economic Development Corporation | ** Support | Aug 30, 2018 |
| Disability Rights California | ** Support | Aug 30, 2018 |
| Maya Cinemas North America | ** Support | Aug 30, 2018 |
| Small Business Development Corporation of Orange County | ** Support | Aug 30, 2018 |
| Tuolumne County Economic Development Authority | ** Support | Aug 30, 2018 |
CONCURRENCE IN SENATE AMENDMENTS
CSA1 Bill Id:AB 1547
Author:(Quirk-Silva)
As Amended Ver:August 24, 2018
2/3 vote. Urgency
ASSEMBLY: | 77-0 | (January 29, 2018) | SENATE: | 38-0 | (August 31, 2018) |
Original Committee Reference: J., E.D., & E.
SUMMARY: Abolishes the California Industrial Development Financing Advisory Commission, while retaining the California Debt Limit Allocation Committee with substantially overlapping duties relative to industrial development bonds.
The bill also updates definitions and provisions of three programs to better meet market conditions, including the California Small Business Capital Access Loan Program for Americans with Disabilities Act (CalCAP for ADA), the California Small Business Capital Access Loan Program for Seismic Safety (CalCAP for Seismic Safety), and the California Sales and Use Tax Exclusion Program.
As passed by the Assembly, this bill made changes to the CalCAP for ADA by expanding the definitions of a "small business" and "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources. Existing law limits the number of full-time equivalent employees to 15 and also requires a business to also have less than $5 million in total gross annual income from all sources.
The Senate amendments:
- Abolish the California Industrial Development Financing Advisory Commission.
- Modify provisions of CalCAP for Seismic Safety, including:
- Expanding the definition of "eligible borrower" to include a nonresident owner;
- Expanding the definition of "seismic retrofit construction" to include the strengthening of a building’s lateral load resisting system; and
- Modifying the definition of "eligible building" to include property that is identified by a local building code official as being in need of seismic retrofitting and either (1) being potentially vulnerable in a catastrophic earthquake or (2) constructed before 1981. Existing law limits eligible building to only those that a local building code official certifies as hazardous and in danger of collapse in the event of a catastrophic earthquake.
- Make a technical change to the Sales and Use Tax Exclusion program to allow a contractor or other designated party to utilize the exemption when purchasing equipment for the approved project.
- Add an urgency clause.
EXISTING LAW:
- Establishes the California Industrial Development Financing Advisory Commission with the responsibility of assisting industrial development bond authorities and state agencies in the process of selling bonds; maintaining contact with municipal bond underwriters, credit rating agencies, investors, and others to improve the market for government debt issues; studying methods of reducing the cost of state and local issues; and recommending changes in state law and local practices to improve the sale and servicing of bonds.
- Establishes the California Debt Limited Allocation Committee (CDLAC) with the responsibility, among other provisions, to review and approve applications from state and local agencies desiring to issue private activity bonds.
- Establishes CalCAP for ADA, administered by the California Pollution Control Financing Authority (CPCFA), for the purpose of encouraging private financial institutions to provide small business loans for activities related to compliance with the requirements of the ADA.
- Establishes CalCAP for Seismic Safety, administered by CPCFA, for the purpose of assisting residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings.
- Establishes the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) for the purpose advancing the state’s goals of reducing the levels of greenhouse gas emissions, increasing the deployment of sustainable and renewable energy sources, implementing measures that increase energy efficiency, creating high quality employment opportunities, and lessening the state’s dependence on fossil fuels. Among other programs, CAETFA administers the Sales and Use Tax Exclusion Program, which reimburses manufacturers for the local and/or state sales tax on specified equipment.
FISCAL EFFECT: According to the Senate Appropriations Committee, this bill will result in an unknown impact, potentially significant for expanding the definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources.
The bill would also eliminate the California Industrial Development Financing Advisory Commission. Doing so would not result in a direct fiscal impact, as this Commission currently has ceased spending money on personnel.
COMMENTS: This bill makes program improvements and removes implementation barriers, which have been identified through public review and evaluation by the CPCFA and CAETFA.
California Industrial Development Financing Advisory Commission: This bill abolishes the California Industrial Development Financing Advisory Commission. This provision is the result of several years of negotiations between local industrial development bond issuers and the State Treasurer's Office. According to the California Association for Local Economic Development, the elimination of the Commission removes an unnecessary local finance hurdle and additional fees, thus reducing the time and cost of financing manufacturing facilities.
California Capital Access Program (CalCAP) for Americans with Disabilities: This bill modifies the definition of a "small business" for the purposes of CalCAP for ADA by:
- Increasing the maximum number of full-time employees from 15 to 30; and
- Aligning the program eligibility criteria with federal tax credit requirements.
These two modifications will expand the number of businesses that qualify for loans under CalCAP for ADA, providing a participating lender with a larger and more diverse loan portfolio.
In 2015, the Legislature appropriated $10 million to capitalize CalCAP for ADA. To date, there are only three lenders which have agreed to participate in the program and no loans have been enrolled.
California Capital Access Program for Seismic Safety: AB 1547 modifies several definitions under CalCAP for Seismic Safety, including:
- Expanding the definition of "eligible borrower" to include a nonresident owner of a commercial or residential building; and
- Modifying the definition of "eligible building" to include property that is identified by a local building code official as being in need of seismic retrofitting. The bill also requires that the building be identified by the local building code official as either potentially vulnerable in a catastrophic earthquake or constructed prior to 1981.
The current requirement that seismic safety improvements may only be made to buildings certified by a local building code official as hazardous and in danger of collapse in the event of a catastrophic earthquake has proved to be too limited. Further, owners of rental property are currently excluded from financing under the program, which threatens the safety of tenants who occupy those buildings.
CalCAP for Seismic Safety was established through 2016 legislation, including an appropriation of $10 million. To date, there is only one lender which has agreed to participate in the program and no loans have been enrolled. The author and State Treasurer's Office believe that the original goals of CalCAP for Seismic Safety will be better met through the changes proposed in this bill.
Sales and Use Tax Exclusion (STE) Program: This bill clarifies statute to enable contractors and others designated by specified participating parties to claim the sales and use tax exclusion when purchasing equipment under the project. The State Treasurer's Office reports that the current process creates unnecessary artificial barriers and a cumbersome process for manufacturers to effectively use their awards. This modification is consistent with those previously made by the Board of Equalization and will streamline the experience for end-users and reduce staff costs.
Analysis Prepared by: Toni Symonds / J., E.D., & E. / (916) 319-2090 FN: 0005170
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB |
THIRD READING
Bill No: AB 1547
:
SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 6/25/18
AYES: Hill, Fuller, Allen, Dodd, Galgiani, Glazer, Hernandez, Pan, Wilk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/16/18
AYES: Portantino, Bates, Beall, Bradford, Hill, Nielsen, Wiener
SENATE FLOOR: 26-1, 8/29/18 (FAIL)
AYES: Allen, Atkins, Beall, Bradford, De León, Delgado, Dodd, Galgiani, Glazer, Hernandez, Hertzberg, Hill, Hueso, Jackson, Lara, Leyva, McGuire, Mitchell, Monning, Pan, Portantino, Roth, Skinner, Stern, Wieckowski, Wiener
NOES: Moorlach
NO VOTE RECORDED: Anderson, Bates, Berryhill, Cannella, Chang, Fuller, Gaines, Morrell, Nguyen, Nielsen, Stone, Vidak, Wilk
ASSEMBLY FLOOR: 77-0, 1/29/18 - See last page for vote
DIGEST:
This bill modifies the definitions related to qualifying for the California Americans with Disabilities Act Small Business Capital Access Loan Program (CalCAP/ADA) and the California Seismic Safety Capital Access Loan Program (CalCAP/Seismic Safety); abolishes the California Industrial Development Financing Authority Commission (Commission); adds water efficiency measures under the purview of the California Alternative Energy and Advanced Transportation Authority (CAEATFA); enables contractors working on CAEATFA projects, as defined, to participate in the Sales & Use Tax Exclusion Program; and permits four-unit residential projects to qualify for the PACE Loss Reserve Program.
Senate Floor Amendments of 8/24/18 strike provisions related to the water efficiency expansion of the Sales & Use Tax Exclusion Program and add an urgency clause.
Existing law:
- Establishes the Commission with the responsibility of assisting authorities and state agencies in the process of selling bonds; maintaining contact with municipal bond underwriters, credit rating agencies, investors, and other to improve the market for local government debt issues; studying methods of reducing the cost of state and local issues; and recommending changes in state law and local practices to improve the sale and servicing of bonds (Government Code (GC) Section §§ 91550 et seq).
- Establishes the California Debt Limited Allocation Committee (CDLAC) with the responsibility, among other provisions, to prepare application forms and announce procedures for receipt and review of applications from state and local agencies desiring to issue private activity bonds. (GOV §§ 8869.80 et seq.)
- Establishes the California Pollution Control Financing Authority Act (CPCFA Act) with the purpose of providing industry within the state, irrespective of company size, with an alternative method of financing in providing, acquiring, enlarging, or installing facilities for establishing pollution control, providing supplies of clean water, and producing energy from alternative or renewable sources, that are needed to accomplish the purposes of this division; to assist economically distressed counties and cities to develop and implement growth policies and programs that reduce pollution hazards and the degradation of the environment or promote infill development; and, to assist with the financing of the costs of assessment, remedial planning and reporting, technical assistance, and the cleanup, remediation, or development of brownfield sites, or other similar or related costs. (Health and Safety Code (HSC) § 44502)
- Establishes the Capital Access Loan Program for Small Businesses (CalCAP) which encourages banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing. (HSC §§ 44559 - 44559.12)
This bill:
- Removes provisions relating to the Commission in statute.
- Revises the definition of “small business” or “qualified business” for the purposes of qualifying for CalCAP/ADA to be a business that is independently owned and operated and not dominant in its field with: (a) 30 or fewer, rather than 15 fewer, full-time equivalent employees or less than $5 million in total gross annual income from all sources; and (b) not providing overnight accommodations.
- Adds “strengthening a building’s lateral load resisting system” to list of procedures that qualifies as “seismic retrofit construction” for the purposes of CalCAP/Seismic Safety.
- Revises the definition of “qualified building” for the purposes of CalCAP/Seismic Safety to mean a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as: (a) a building in need of seismic retrofitting; and (b) either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
- Makes various technical changes and states the urgency of this bill in order to assist businesses in making Americans with Disabilities Act, water efficiency and earthquake-related building changes as soon as possible.
Background
California Pollution Control Financing Authority (CPCFA). CPCFA is located in the State Treasurer’s Office and aids in providing low-cost financing to California’s businesses. Among other programs, CPCFA administers CalCAP which was established in 1994 to encourage financial institutions to make loans to small businesses. CPCFA also administers a number of specialty programs, including the CalCAP/ADA, which provides financing for small businesses to become ADA complaint, and CalCAP/Seismic Safety, which provides financing to help seismically retrofit residences and small businesses.
California Industrial Development Financing Advisory Commission. The Commission advises local governments and independently reviews industrial development bonds (IDBs) applications that are used for public benefit. IDBs are tax-exempt securities issued on behalf of a private company to provide money for the acquisition, construction and rehabilitation of facilities or the purchase of equipment. Local agencies, cities, counties, and joint powers authorities can approve IDB projects and then submit the project for Commission approval. As part of the Commission approval process, the project must provide public benefit and job creation. This bill eliminates the Commission, which will transfer the responsibility of approving IDBs application to the CDLAC. The CDLAC is statutorily mandated to oversee preparing and reviewing applications from state and local agencies issuing private activity bonds, such as the Waste Recycling Exempt Facilities Financing Program.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
According to the Senate Appropriations Committee, this bill will result in an unknown impact, potentially significant for expanding definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources and a potentially significant cost pressure to expand a sales tax exclusion program capped at $100 million annually.
California Association for Local Economic Development
California Enterprise Development Authority
City of Palmdale
Del Norte Economic Development Corporation
Disability Rights California
Maya Cinemas North America
Small Business Development Corporation of Orange County
Tuolumne County Economic Development Authority
OPPOSITION: (Verified 8/24/18)
None received
ARGUMENTS IN SUPPORT: The California Enterprise Development Authority writes that “with the existence of definitive public benefit criteria under the California debt limitation allocation committee’s (CDLAC) procedures for the awarding of volume cap allocation, there is no value in continuing the CIDFAC review and approval process of IDBs, particularly with a CIDFAC issuance fee of .25% of the principal amount of bonds issues for a new project or refunding project. Currently IDB volume is low; however, eliminating barriers like the CIDFAC review and fee may help increase the number of manufacturers interested in using IDBs to expand and grow in California.”
The California Association for Local Economic Development states that “local issuers have expressed that CIDFAC is problematic because it requires manufacturers to be subjected to duplicative review process and adds a .25% free to the principal amount of bonds issued (e.g. a $10 million issued bond incurs a $25,000 fee). This ultimately reduces manufacturers’ interest in industrial developement Bonds (IDBs). The elimination of CIDFAC creates streamlined access to capital, via IDBs, for California manufacturers to expand. This change makes the process more efficient for manufacturers to apply for IDBs. It also significantly reduces the fees associated with the process, while ensuring projects still meet a public benefit requirement.”
The City of Palmdale writes that “by making the IDB program more accessible to manufactures, it helps them finance and equipment and buildings at a lower cost, often making it possible for manufacturers to create permanent homes for their businesses in California. Better access to financing can encourage growth and revitalization of manufacturing in California.”
Disability Rights California “supports AB 1547 because the change in the definition of the small business size for purposes of loan eligibility advances disability access compliance. It is a proactive measure that provides resources and compliance. It is a proactive measure that proves resources and incentives to more businesses to comply with the law and promotes equal access for individuals with disabilities.”
ASSEMBLY FLOOR: 77-0, 1/29/18
AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon
8/30/18 10:22:27
**** END ****
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB |
THIRD READING
Bill No: AB 1547
:
SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 6/25/18
AYES: Hill, Fuller, Allen, Dodd, Galgiani, Glazer, Hernandez, Pan, Wilk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/16/18
AYES: Portantino, Bates, Beall, Bradford, Hill, Nielsen, Wiener
ASSEMBLY FLOOR: 77-0, 1/29/18 - See last page for vote
DIGEST:
This bill modifies the definitions related to qualifying for the California Americans with Disabilities Act Small Business Capital Access Loan Program (CalCAP/ADA) and the California Seismic Safety Capital Access Loan Program (CalCAP/Seismic Safety); abolishes the California Industrial Development Financing Authority Commission (Commission); adds water efficiency measures under the purview of the California Alternative Energy and Advanced Transportation Authority (CAEATFA); enables contractors working on CAEATFA projects, as defined, to participate in the Sales & Use Tax Exclusion Program; and permits four-unit residential projects to qualify for the PACE Loss Reserve Program.
Existing law:
- Establishes the Commission with the responsibility of assisting authorities and state agencies in the process of selling bonds; maintaining contact with municipal bond underwriters, credit rating agencies, investors, and other to improve the market for local government debt issues; studying methods of reducing the cost of state and local issues; and recommending changes in state law and local practices to improve the sale and servicing of bonds (Government Code (GC) Section §§ 91550 et seq).
- Establishes the California Debt Limited Allocation Committee (CDLAC) with the responsibility, among other provisions, to prepare application forms and announce procedures for receipt and review of applications from state and local agencies desiring to issue private activity bonds. (GOV §§ 8869.80 et seq.)
- Establishes the California Pollution Control Financing Authority Act (CPCFA Act) with the purpose of providing industry within the state, irrespective of company size, with an alternative method of financing in providing, acquiring, enlarging, or installing facilities for establishing pollution control, providing supplies of clean water, and producing energy from alternative or renewable sources, that are needed to accomplish the purposes of this division; to assist economically distressed counties and cities to develop and implement growth policies and programs that reduce pollution hazards and the degradation of the environment or promote infill development; and, to assist with the financing of the costs of assessment, remedial planning and reporting, technical assistance, and the cleanup, remediation, or development of brownfield sites, or other similar or related costs. (Health and Safety Code (HSC) § 44502)
- Establishes the Capital Access Loan Program for Small Businesses (CalCAP) which encourages banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing. (HSC §§ 44559 - 44559.12)
- Establishes the California Alternative Energy and Advanced Transportation Financing Authority Act (Act) and defines terms for the purposes of the Act. (Public Resources Code (PRC) §§ 26000, 26003)
- Requires the CAEATFA to establish a PACE Loss Reserve program and specifies the requirements to qualify for assistance through the Program. (PRC §§ 26060-26061)
- Establishes the rates and provisions relating to sales and use taxes. (Revenue and Tax Code (RTC) §§ 6051-7176)
This bill:
- Removes provisions relating to the Commission in statute.
- Revises the definition of “small business” or “qualified business” for the purposes of qualifying for CalCAP/ADA to be a business that is independently owned and operated and not dominant in its field with: (a) 30 or fewer, rather than 15 fewer, full-time equivalent employees or less than $5 million in total gross annual income from all sources; and (b) not providing overnight accommodations.
- Adds “strengthening a building’s lateral load resisting system” to list of procedures that qualifies as “seismic retrofit construction” for the purposes of CalCAP/Seismic Safety.
- Revises the definition of “qualified building” for the purposes of CalCAP/Seismic Safety to mean a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as: (a) a building in need of seismic retrofitting; and (b) either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
- Defines “water efficiency measures” as equipment designed to increase the efficient use of water for the purposes of the Act.
- Adds “water efficiency measures” of to the list of uses for tangible personal property that qualify as a “project” for the purposes of the Act.
- Increases the number of units required for a residential project to qualify as a PACE Program project from three units to four units.
- Expands the sales and use tax exemption to include the lease or transfer of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project, as defined for purposes of the Act.
- Makes various technical changes.
Background
California Pollution Control Financing Authority (CPCFA). CPCFA is located in the State Treasurer’s Office and aids in providing low-cost financing to California’s businesses. Among other programs, CPCFA administers CalCAP which was established in 1994 to encourage financial institutions to make loans to small businesses. CPCFA also administers a number of specialty programs, including the CalCAP/ADA, which provides financing for small businesses to become ADA complaint, and CalCAP/Seismic Safety, which provides financing to help seismically retrofit residences and small businesses.
California Industrial Development Financing Advisory Commission. The Commission advises local governments and independently reviews industrial development bonds (IDBs) applications that are used for public benefit. IDBs are tax-exempt securities issued on behalf of a private company to provide money for the acquisition, construction and rehabilitation of facilities or the purchase of equipment. Local agencies, cities, counties, and joint powers authorities can approve IDB projects and then submit the project for Commission approval. As part of the Commission approval process, the project must provide public benefit and job creation. This bill eliminates the Commission, which will transfer the responsibility of approving IDBs application to the CDLAC. The CDLAC is statutorily mandated to oversee preparing and reviewing applications from state and local agencies issuing private activity bonds, such as the Waste Recycling Exempt Facilities Financing Program.
California Alternative Energy and Advanced Transportation Financing Authority. CAEATFA helps provides financing solutions for California businesses to increase their use of renewable energy sources, energy efficiency, and advanced transportation and manufacturing technologies to reduce air pollution, conserve energy, and promote economic development jobs. This bill includes water efficiency measures under the CAEATFA’s scope. The CAEATFA administers a number of programs, including the Sales and Use Tax Exclusion (STE) established pursuant to RTC Section 6010.8, which allows manufacturers that purchase specified property related to renewable resources to be exempt from sales and use taxes. This bill allows contracts purchasing property for specified projects to also qualify for the STE program. The PACE Loss Reserve program, also administered by the CAEATFA, helps property owners gain access to PACE financing for energy or water efficiency and clean energy improvements.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
According to the Senate Appropriations Committee, this bill will result in an unknown impact, potentially significant for expanding definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources and a potentially significant cost pressure to expand a sales tax exclusion program capped at $100 million annually.
California Association for Local Economic Development
California Enterprise Development Authority
City of Palmdale
Del Norte Economic Development Corporation
Disability Rights California
Maya Cinemas North America
Small Business Development Corporation of Orange County
Tuolumne County Economic Development Authority
OPPOSITION: (Verified 8/17/18)
None received
ARGUMENTS IN SUPPORT: The California Enterprise Development Authority writes that “with the existence of definitive public benefit criteria under the California debt limitation allocation committee’s (CDLAC) procedures for the awarding of volume cap allocation, there is no value in continuing the CIDFAC review and approval process of IDBs, particularly with a CIDFAC issuance fee of .25% of the principal amount of bonds issues for a new project or refunding project. Currently IDB volume is low; however, eliminating barriers like the CIDFAC review and fee may help increase the number of manufacturers interested in using IDBs to expand and grow in California.”
The California Association for Local Economic Development states that “local issuers have expressed that CIDFAC is problematic because it requires manufacturers to be subjected to duplicative review process and adds a .25% free to the principal amount of bonds issued (e.g. a $10 million issued bond incurs a $25,000 fee). This ultimately reduces manufacturers’ interest in industrial developement Bonds (IDBs). The elimination of CIDFAC creates streamlined access to capital, via IDBs, for California manufacturers to expand. This change makes the process more efficient for manufacturers to apply for IDBs. It also significantly reduces the fees associated with the process, while ensuring projects still meet a public benefit requirement.”
The City of Palmdale writes that “by making the IDB program more accessible to manufactures, it helps them finance and equipment and buildings at a lower cost, often making it possible for manufacturers to create permanent homes for their businesses in California. Better access to financing can encourage growth and revitalization of manufacturing in California.”
Disability Rights California “supports AB 1547 because the change in the definition of the small business size for purposes of loan eligibility advances disability access compliance. It is a proactive measure that provides resources and compliance. It is a proactive measure that proves resources and incentives to more businesses to comply with the law and promotes equal access for individuals with disabilities.”
ASSEMBLY FLOOR: 77-0, 1/29/18
AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon
8/20/18 10:40:12
**** END ****
SENATE COMMITTEE ON
Senator Anthony Portantino, Chair
2017 - 2018 Regular Session
AB 1547 (Quirk-Silva) - State finance: financing authorities
Version: | Policy Vote: |
Urgency: | Mandate: |
Hearing Date: | Consultant: |
Bill Summary:
AB 1547 would enact a series of changes to programs administered by specified entities within the State Treasurer’s Office (STO).
*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********
The following information is revised to reflect amendments
adopted by the committee on August 16, 2018
Fiscal Impact:
- This bill would expand the definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources, resulting in a cost pressure from likely increased participation in the small business loan program. The magnitude is unknown, but potentially significant (special fund).
- This bill would expand a sales tax exclusion program capped at $100 million annually. Because expanding the program to include new applicants may crowd out current ones seeking an exemption under that cap, this bill would result in a cost pressure to increase the exclusion program’s cap. In 2017, a total of 42 projects were approved for the exclusion, such that the $100 million cap will be reached each year through 2020. The magnitude of the bill’s resulting cost pressure is unknown, potentially significant, and would likely come from the General Fund.
- The bill would eliminate the California Industrial Development Financing Advisory Commission (CIDFAC). Doing so would not result in a direct fiscal impact, as this Commission currently has ceased spending money on personnel. However, under the bill as currently drafted, this Commission’s fund in the State Treasury would not be eliminated, and its current balance (estimated to be $36,000 in 2018-19) would be unavailable for other uses.
- None of the other affected entities within STO would incur increased administrative costs as a result of the bill.
Author Amendments:
Specify that any remaining monies in the special fund that supports CIDFAC would be appropriated to the California Debt Limit Allocation Committee.
-- END --
SENATE COMMITTEE ON
Senator Anthony Portantino, Chair
2017 - 2018 Regular Session
AB 1547 (Quirk-Silva) - State finance: financing authorities
Version: | Policy Vote: |
Urgency: | Mandate: |
Hearing Date: | Consultant: |
This bill meets the criteria for referral to the Suspense File.
Bill Summary:
AB 1547 would enact a series of changes to programs administered by specified entities within the State Treasurer’s Office (STO).
Fiscal Impact:
- This bill would expand the definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources, resulting in a cost pressure from likely increased participation in the small business loan program. The magnitude is unknown, but potentially significant (special fund).
- This bill would expand a sales tax exclusion program capped at $100 million annually. Because expanding the program to include new applicants may crowd out current ones seeking an exemption under that cap, this bill would result in a cost pressure to increase the exclusion program’s cap. In 2017, a total of 42 projects were approved for the exclusion, such that the $100 million cap will be reached each year through 2020. The magnitude of the bill’s resulting cost pressure is unknown, potentially significant, and would likely come from the General Fund.
- The bill would eliminate the California Industrial Development Financing Advisory Commission. Doing so would not result in a direct fiscal impact, as this Commission currently has ceased spending money on personnel. However, under the bill as currently drafted, this Commission’s fund in the State Treasury would not be eliminated, and its current balance (estimated to be $36,000 in 2018-19) would be unavailable for other uses.
- None of the other affected entities within STO would incur increased administrative costs as a result of the bill.
Background:
The California Industrial Development Financing Advisory Commission (CIDFAC) advises local governments and independently reviews industrial development bond (IDBs) applications that are used for public benefit. IDBs are tax-exempt securities issued on behalf of a private company to provide money for the acquisition, construction and rehabilitation of facilities or the purchase of equipment. Local agencies, cities, counties, and joint powers authorities can approve IDB projects and then submit the project for CIDFAC approval. As part of the CIDFAC approval process, the project must provide public benefit and job creation.
The California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) provides financing through various means for facilities that use alternative energy sources and technologies or engage in advanced manufacturing. CAEATFA’s Board decides which projects to assist, and it has developed and administered various programs, including the following.
- The Sales and Use Tax Exclusion Program provides a sales and use tax exclusion (STE) on equipment and machinery used (1) in an advanced manufacturing process, (2) for the “design, manufacture, production or assembly” of advanced transportation technologies or alternative source products, components or systems, or (3) to process or utilize recycled feedstock. For all project types under the STE Program, current law requires CAEATFA to evaluate project applications for eligibility based upon certain criteria that encourages manufacturing facilities and jobs located in California and the reduction of greenhouse gases beyond the reduction required by federal or state law or regulation. Projects must meet the “net benefits test” by showing that the new project will create jobs in the state. No more than $100 million in tax exemptions may be approved by CAEATFA in any calendar year.
- The Property Assessed Clean Energy (PACE) Loss Reserve Program (the Program) was authorized in September 2013 to assist residential single family PACE financing by helping to increase its acceptance in the marketplace and protect against the risk of default and foreclosure. PACE allows local jurisdictions to finance renewable energy installations, energy and water efficiency retrofits, and electric vehicle charging infrastructure by issuing bonds that are repaid by participating property owners through their property tax assessments.
The California Pollution Control Financing Authority (CPCFA) aids in providing low-cost financing to California’s businesses. Among other programs, CPCFA administers CalCAP which was established in 1994 to encourage financial institutions to make loans to small businesses. CPCFA also administers a number of specialty programs, including the CalCAP/ADA, which provides financing for small businesses to become ADA complaint, and CalCAP/Seismic Safety, which provides financing to help seismically retrofit residences and small businesses.
- Specifically, in 2015, AB 1230 (Gomez) established the Small Business ADA Program for small businesses to access loans through CalCAP within STO, which insures loans that are made by participating financial institutions to small businesses. The legislation was introduced in response to concerns about the large number of businesses that endure predatory lawsuits over ADA compliance, lawsuits which can effectively close businesses and create a greater burden on the disabled community that seeks to be served by local business. The Small Business ADA Program was intended to help small businesses that continue to be challenged in acquiring sufficient capital for proactive facility upgrades, retrofits, and other improvements to ensure they are complying with the ADA. The program was also intended to expand access to financing resources and financial institutions for small businesses seeking the necessary capital required to retrofit and make alterations to their facility in order to maintain ADA compliance.
- SB 837 (Committee on Budget and Fiscal Review, 2016) established within CPCFA the California Seismic Safety Capital Access Loan Program, which provides a loan loss reserve facility to cover losses on qualified loans to participating lenders for loans made to residential and small business owners for seismic retrofit construction. The program was funded with a one-time appropriation of $10 million.
Proposed Law:
This bill would, among other things, do the following:
- Remove provisions from statute relating to CIDFAC.
- Revise the definition of “small business” or “qualified business” for the purposes of qualifying for CalCAP/ADA to be a business that is independently owned and operated and not dominant in its field with: (1) 30 or fewer, rather than 15 fewer, full-time equivalent employees or less than $5,000,000 in total gross annual income from all sources; and (2) not providing overnight accommodations.
- Add “strengthening a building’s lateral load resisting system” to list of procedures that qualifies as “seismic retrofit construction” for the purposes of CalCAP/Seismic Safety.
- Revise the definition of “qualified building” for the purposes of CalCAP/Seismic Safety to mean a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as: (1) a building in need of seismic retrofitting; and (2) either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
- Add “water efficiency measures”, as defined, to the list of uses for tangible personal property that qualify as a “project” for the purposes of the Act.
- Increase the number of units required for a residential project to qualify as a PACE Program project from three units to four units.
- Expand the sales and use tax exemption to include the lease or transfer of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project, as defined for purposes of the Act.
Related Legislation:
- AB 1553 (Cervantes, Chapter 944, Statutes of 2017) expanded the gross annual income limits in the definition of “small business” and “qualified business” from $1 million to $5 million under CalCAP. The bill also authorizes the use of monies in the Small Business Assistance Fund to provide direct incentives to borrowers or financial institutions to participate in the Program.
- AB 1230 (Gomez, Chapter 787, Statutes of 2015) establishes the California Small Business ADA Program to provide loans to small businesses so they can comply with the requirements of the ADA.
- SB 199 (Eggman, Chapter 768, Statutes of 2015) expanded the sales and use tax (SUT) exclusion under the CAEATFA by revising the definition of a "project" to include tangible personal property (TPP) that primarily processes or uses "recycled feedstock."
- AB 14 (Skinner, Chapter 9, Statutes of 2011) authorizes the CAEATFA to provide financial support to lenders to facilitate projects for energy and water conservation and renewable energy through.
Staff Comments:
As noted above, this bill would (1) abolish CIDFAC, (2) enable contractors working on CAEATFA projects, as defined, to participate in the STE Program, (3) permit four-unit residential projects to qualify for the PACE Loss Reserve Program, (4) add water efficiency measures under the purview CAEATFA , and (5) modify the definitions related to qualifying for CalCAP/ADA and CalCAP/Seismic Safety.
This bill would eliminate CIDFAC, which would transfer the responsibility of approving IDB applications to a different entity within STO, the California Debt Limit Allocation Committee (CDLAC). CDLAC is statutorily mandated to oversee preparing and reviewing applications from state and local agencies issuing private activity bonds, such as the Waste Recycling Exempt Facilities Financing Program. In 2016, there was one IDB issuance approved by CIDFAC, and zero applications in 2017 and 2018. Due to the shrinking volume of IDB issuances statewide, CIDFAC has operated much of the past few years without any paid staff, and instead has utilized CPCFA staff to administer CIDFAC’s responsibilities and prepare applications for the Commission’s review. This bill would eliminate the inefficiency of having CIDFAC as a single-purpose agency with a five member board. The state would continue to provide state level oversight of locally issued IDBs through CDLAC’s management of the state’s allocation of tax-exempt bonds.
CAEATFA helps provides financing solutions for California businesses to increase their use of renewable energy sources, energy efficiency, and advanced transportation and manufacturing technologies to reduce air pollution, conserve energy, and promote economic development jobs. This bill would include water efficiency measures under the CAEATFA’s scope. This bill would allow contracts purchasing property for specified projects to also qualify for the STE program. The PACE Loss Reserve program, also administered by the CAEATFA, helps property owners gain access to PACE financing for energy or water efficiency and clean energy improvements.
By expanding eligibility for coverage under the Pace Program, CAEATFA may enroll more financings than would otherwise occur. California residential PACE saw significant and rapid growth when the Pace Program first launched in 2014, but since then the rate of growth has been significantly decreasing, and now the most recent reports from enrolled PACE programs show that origination activity has actually declined. There has also be extensive changes to PACE consumer protection requirements, including mandatory disclosures and underwriting that includes a property owner’s ability to repay, and PACE administrator and contractor regulation, all of which will likely significantly reduce residential PACE participation.
CAEATFA’s one-time appropriation of $10 million currently supports over 145,000 financings with an outstanding value of approximately $3.5 billion.
This bill would modify the definition of a “small business” by increasing the maximum number of full-time employees from 15 to 30; and align the program eligibility criteria with federal tax credit requirements allowing for either a maximum number of employees, or a maximum annual revenue, for a business to qualify for this incentive. Currently, a business needs to meet both criteria, making it difficult to qualify. These two modifications would expand the number of businesses that qualify for CalCAP loans under the ADA program, resulting in the aforementioned cost pressure.
As noted above, CAEATFA can STEs up to $100 million. Because expanding the program to include new applicants may crowd out current ones seeking an exemption under that cap, Legislative Counsel has determined that the measure increases a tax on any taxpayer for the purposes of Section Three of Article XIIIA of the California Constitution. Consequently, the measure is keyed a 2/3 vote.
-- END --
SENATE COMMITTEE ON
BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT
Senator Jerry Hill, Chair
2017 - 2018 Regular
Bill No: AB 1547 Hearing Date: June 25, 2018
Author: | Quirk-Silva | ||
Version: |
| ||
Urgency: | Fiscal: | ||
Consultant: | |||
Subject: State finance: financing authorities
SUMMARY:
Modifies the definitions related to qualifying for the California Americans with Disabilities Act Small Business Capital Access Loan Program (CalCAP/ADA) and the California Seismic Safety Capital Access Loan Program (CalCAP/Seismic Safety); abolishes the California Industrial Development Financing Authority Commission (Commission); adds water efficiency measures under the purview of the California Alternative Energy and Advanced Transportation Authority (CAEATFA); enables contractors working on CAEATFA projects, as defined, to participate in the Sales & Use Tax Exclusion Program; and permits four-unit residential projects to qualify for the PACE Loss Reserve Program.
Existing law:
- Established the Commission with the responsibility of assisting authorities and state agencies in the process of selling bonds; maintaining contact with municipal bond underwriters, credit rating agencies, investors, and other to improve the market for local government debt issues; studying methods of reducing the cost of state and local issues; and recommending changes in state law and local practices to improve the sale and servicing of bonds (Government Code (GC) Section §§ 91550 et seq).
- Permits a public agency to issues revenue bonds to accomplish projects for the mutual benefit of the people of California and to protect their health, welfare, and safety. (GOV §§ 91520(a), 91502)
- Establishes the California Debt Limited Allocation Committee (CDLAC) with the responsibility, among other provisions, to prepare application forms and announce procedures for receipt and review of applications from state and local agencies desiring to issue private activity bonds. (GOV §§ 8869.80 et seq.)
- Establishes the California Pollution Control Financing Authority Act (CPCFA Act) with the purpose of providing industry within the state, irrespective of company size, with an alternative method of financing in providing, acquiring, enlarging, or installing facilities for establishing pollution control, providing supplies of clean water, and producing energy from alternative or renewable sources, that are needed to accomplish the purposes of this division; to assist economically distressed counties and cities to develop and implement growth policies and programs that reduce pollution hazards and the degradation of the environment or promote infill development and; to assist with the financing of the costs of assessment, remedial planning and reporting, technical assistance, and the cleanup, remediation, or development of brownfield sites, or other similar or related costs.
(Health and Safety Code (HSC) § 44502) - Establishes the Capital Access Loan Program for Small Businesses (CalCAP) which encourages banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing. (HSC §§ 44559 - 44559.12)
- Establishes the Small Business ADA Program, administered by the CPFCA, subject to the terms and conditions for CalCAP, to assist small businesses in complying with the ADA. Specifies that it is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the ADA. Defines “Small business” or “qualified business” for purposes of the Small Business ADA Program as a business that has fewer than 15 full-time equivalent employees, less than $5 million dollars in total gross annual income from all sources and does not provide overnight accommodations. Establishes the Small Business ADA Program Fund (Fund) in the State Treasury to be administered by CPCFA and provides a continuous appropriation for carrying out the purposes of the Small Business ADA Program. (HSC § 44559.13.)
- Defines “small business” or “qualified” business for purposes of qualifying for CalCAP/ADA as a business with: (1) 15 or fewer full time equivalent employees; (2) less than $5,000,000 in total gross annual income from all sources; and (3) not providing overnight accommodations. (HSC § 44559.13(b)(6))
- Establishes the CalCAP/Seismic Safety to assist residential property owners and small business in seismically retrofitting residences and small businesses. (HSC § 44559.14(a))
- Defines “qualified building” for the purposes of qualifying for CalCAP/Seismic Safety as a building that is certified by the local building code enforcement authority for the jurisdiction in which the build. (HSC § 44559.14(b)(4))
- Establishes the California Alternative Energy and Advanced Transportation Financing Authority Act (Act) and defines terms for the purposes of the Act. (Public Resources Code (PRC) §§ 26000, 26003)
- Defines “project” for purposes of the Act and sales and use tax exclusion as tangible personal property where at least 50 percent of its use is either to process recycled feedstock that is intended to be reused in the production of another product or soil amendment, or tangible personal property that is used in the state for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, or alternative source products, components, or systems. (PRC § 26011.8(b)(1))
- Requires the CAEATFA to establish a PACE Loss Reserve program and specifies the requirements to qualify for assistance through the Program. (PRC §§ 26060-26061)
- Establishes the rates and provisions relating to sales and use taxes. (Revenue and Tax Code (RTC) §§ 6051-7176)
- Defines “sale” for purposes of sales taxes as any transfer or title or possession, exchange, or barter, conditional or otherwise, in a manner or by any means whatsoever, of tangible personal property for a consideration. (RTC § 6006(a))
- Defines “purchase” for the purpose of use taxes as any transfer of title or possession, exchange, or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration. (RTC § 6010(a))
- Specifies that the sales and use tax exemptions includes any lease or transfer of title of tangible personal property constituting any project, as defined, to any participating party. (RTC § 6010.8(a))
This bill:
- Removes provisions relating to the Commission in statute.
- Revises the definition of “small business” or “qualified business” for the purposes of qualifying for CalCAP/ADA to be a business that is independently owned and operated and not dominant in its field with: (1) 30 or fewer, rather than 15 fewer, full-time equivalent employees or less than $5,000,000 in total gross annual income from all sources; and (2) not providing overnight accommodations.
- Adds “strengthening a building’s lateral load resisting system” to list of procedures that qualifies as “seismic retrofit construction” for the purposes of CalCAP/Seismic Safety.
- Revises the definition of “qualified building” for the purposes of CalCAP/Seismic Safety to mean a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as: (1) a building in need of seismic retrofitting; and (2) either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
- Defines “water efficiency measures” as equipment designed to increase the efficient use of water for the purposes of the Act.
- Adds “water efficiency measures” of to the list of uses for tangible personal property that qualify as a “project” for the purposes of the Act.
- Increases the number of units required for a residential project to qualify as a PACE Program project from three units to four units.
- Expands the sales and use tax exemption to include the lease or transfer of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project, as defined for purposes of the Act.
- Makes various technical changes.
FISCAL EFFECT:
This bill is keyed fiscal by Legislative Counsel. According to the Assembly Appropriations Committee analysis dated January 18, 2018, by expanding the definition of “small business” or “qualified small business” to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources, CalCAP/ADA will be able to expend the $10 million appropriated for this purpose. In doing so, the program presents future cost pressures if the program is not adequately supported by loan recapture fund.
COMMENTS:
- Purpose. The Author is the sponsor of this bill. According to the Author, AB 1547 is to address specific program improvements or implementation barriers identified through continuous review and evaluation, to streamline program delivery and make the programs even more effective for industry stakeholders.
The Author states that AB 1547 would “expand the types of businesses that qualify for CalCAP loans under the ADA program, providing the participating lenders a stronger loan portfolio and enabling more small businesses to participate in this program and expand their accessibility to Californians with disabilities” and help more participating lenders in the CalCAP/Seismic Safety Program “help more eligible borrowers strengthen the seismic safety of California’s building stock, so that after a catastrophic earthquake people can remain safe in the buildings in which they live and work.”
According to the Author, this bill would also abolish the California Industrial Development Financing Advisory Commission and transfer the responsibility of providing state level oversight of industrial development bonds (IDBs) to the California Debt limited Allocation Committee (CDLAC). “Given the shrinking volume of IDB issuances statewide, it makes good government sense to eliminate a single-purpose agency like CIDFAC and rely on CDLAC’s existing oversight of the issuance of IDBs.”
The Author also states that this bill would “expand the eligible measures that the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) can support to include water efficiency measures” which would “remove unnecessary hurdles and artificial silos for stakeholders wishing to implement comprehensive energy efficiency projects” and include water efficiency measures “in the project definition for the Sales and Use Tax Exclusion Program.”
“AB 1547 would also clarify statute to enable contractors and others designated by approved participating parties to claim the sales and use tax exclusion when purchasing equipment under the project. The current process creates unnecessary artificial barriers and a cumbersome process for manufacturers to effectively use their awards. This modification is consistent with those recently made by the Board of Equalization, and will streamline the experience for end-users and reduce staff costs.”
Lastly, the Author writes that “AB 1547 would make the PACE Program’s definition of a residential property consistent with industry standard by allowing the Program to cover PACE financings for projects on residential properties of four units or fewer, rather than three units or fewer. This will create consistency and align with the industry and remove confusion from the PACE marketplace.”
- Background.
California Pollution Control Financing Authority (CPCFA). CPCFA is located in the State Treasurer’s Office and aids in providing low-cost financing to California’s businesses. Among other programs, CPCFA administers CalCAP which was established in 1994 to encourage financial institutions to make loans to small businesses. CPCFA also administers a number of specialty programs, including the CalCAP/ADA, which provides financing for small businesses to become ADA complaint, and CalCAP/Seismic Safety, which provides financing to help seismically retrofit residences and small businesses.
California Industrial Development Financing Advisory Commission (CIDFAC). The CIDFAC advises local governments and independently reviews industrial development bonds (IDBs) applications that are used for public benefit. IDBs are tax-exempt securities issued on behalf of a private company to provide money for the acquisition, construction and rehabilitation of facilities or the purchase of equipment. Local agencies, cities, counties, and joint powers authorities can approve IDB projects and then submit the project for CIDFAC approval. As part of the CIDFAC approval process, the project must provide public benefit and job creation. This bill would eliminate the CIDFAC, which would transfer the responsibility of approving IDBs application to the CDLAC. The CDLAC is statutorily mandated to oversee preparing and reviewing applications from state and local agencies issuing private activity bonds, such as the Waste Recycling Exempt Facilities Financing Program.
California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA.) CAEATFA helps provides financing solutions for California businesses to increase their use of renewable energy sources, energy efficiency, and advanced transportation and manufacturing technologies to reduce air pollution, conserve energy, and promote economic development jobs. This bill would include water efficiency measures under the CAEATFA’s scope. The CAEATFA administers a number of programs, including the Sales and Use Tax Exclusion (STE) established pursuant to RTC § 6010.8, which allows manufacturers that purchase specified property related to renewable resources to be exempt from sales and use taxes. This bill would allow contracts purchasing property for specified projects to also qualify for the STE program. The PACE Loss Reserve program, also administered by the CAEATFA, helps property owners gain access to PACE financing for energy or water efficiency and clean energy improvements.
- Prior Related Legislation. AB 1553 (Cervantes and Gomez, Chapter 944, Statutes of 2017) expanded the gross annual income limits in the definition of “small business” and “qualified business” from $1 million to $5 million under CalCAP. The bill also authorizes the use of monies in the Small Business Assistance Fund to provide direct incentives to borrowers or financial institutions to participate in the Program.
AB 1230 (Gomez, Chapter 787, Statutes of 2015) establishes the California Small Business ADA Program to provide loans to small businesses so they can comply with the requirements of the ADA.
SB 199 (Eggman, Chapter 768, Statutes of 2015) expanded the sales and use tax (SUT) exclusion under the CAEATFA by revising the definition of a "project" to include tangible personal property (TPP) that primarily processes or uses "recycled feedstock."
AB 14 (Skinner, Chapter 9, Statutes of 2011) authorizes the CAEATFA to provide financial support to lenders to facilitate projects for energy and water conservation and renewable energy through.
- Arguments in Support. The California Enterprise Development Authority writes that “with the existence of definitive public benefit criteria under the California debt limitation allocation committee’s (CDLAC) procedures for the awarding of volume cap allocation, there is no value in continuing the CIDFAC review and approval process of IDBs, particularly with a CIDFAC issuance fee of .25% of the principal amount of bonds issues for a new project or refunding project. Currently IDB volume is low; however, eliminating barriers like the CIDFAC review and fee may help increase the number of manufacturers interested in using IDBs to expand and grow in California.”
The California Association for Local Economic Development states that “local issuers have expressed that CIDFAC is problematic because it requires manufacturers to be subjected to duplicative review process and adds a .25% free to the principal amount of bonds issued (e.g. a $10 million issued bond incurs a $25,000 fee). This ultimately reduces manufacturers’ interest in industrial developement Bonds (IDBs). The elimination of CIDFAC creates streamlined access to capital, via IDBs, for California manufacturers to expand. This change makes the process more efficient for manufacturers to apply for IDBs. It also significantly reduces the fees associated with the process, while ensuring projects still meet a public benefit requirement.”
The City of Palmdale writes that “by making the IDB program more accessible to manufactures, it helps them finance and equipment and buildings at a lower cost, often making it possible for manufacturers to create permanent homes for their businesses in California. Better access to financing can encourage growth and revitalization of manufacturing in California.”
Disability Rights California “supports AB 1547 because the change in the definition of the small business size for purposes of loan eligibility advances disability access compliance. It is a proactive measure that provides resources and compliance. It is a proactive measure that proves resources and incentives to more businesses to comply with the law and promotes equal access for individuals with disabilities.”
SUPPORT AND OPPOSITION:
Support:
California Enterprise Development Authority
California Association for Local Economic Development
City of Palmdale
Disability Rights California
Opposition:
None of file as of June 20, 2018.
-- END --
ASSEMBLY THIRD READING
ATR Bill Id:AB 1547
Author:(Quirk-Silva)
As Amended Ver:January 11, 2018
2/3 vote
Committee | Votes | Ayes | Noes |
Jobs | 6-0 | Quirk-Silva, Travis Allen, Berman, Cervantes, Patterson, Rodriguez | |
Appropriations | 17-0 | Gonzalez Fletcher, Bigelow, Bloom, Bonta, Brough, Calderon, Carrillo, Chau, Eggman, Fong, Friedman, Gallagher, Eduardo Garcia, Jones-Sawyer, Obernolte, Quirk, Reyes |
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SUMMARY: Modifies the definition of small business under the California Americans with Disabilities Act Small Business Capital Access Loan Program (Small Business ADA Program) for the purpose of increasing the number of eligible applicants.
Specifically, this bill expands the definitions of a "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources. Existing law limits the number of full-time equivalent employees to15 and requires a business to also have less than $5 million in total gross annual income from all sources.
EXISTING LAW:
- Establishes the Capital Access Loan Program for Small Businesses (CalCAP), administered by the California Pollution Control Financing Authority (CPCFA), for the purpose of encouraging banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing.
- Establishes the ADA Small Business Program, administered by the CPCFA, for the purpose of encouraging private financial institutions to provide small business loans for activities related to compliance with the requirements of the Americans with Disabilities Act (ADA). The ADA Small Business Program is required to follow the terms and conditions for the CalCAP with a limited number of additional program requirements, as specified.
- Appropriates a sum of $10 million from the General Fund to the California ADA Small Business Capital Access Loan Program Fund for the purpose of funding loss reserve accounts and administering the Small Business ADA Program.
FISCAL EFFECT: According to the Assembly Appropriations Committee, by expanding the definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources, the Small Business ADA Program will be able to expend the $10 million appropriated for this purpose. In doing so, the program presents future cost pressures if the program is not adequately supported by loan recapture fund.
COMMENTS: The federal ADA provides that no individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation. In California, the Unruh Civil Rights Act (Unruh), provides that all persons, regardless of sex, race, color, religion, ancestry, national origin, disability or medical condition, are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever. A violation of the ADA also constitutes a violation of Unruh, which subjects a person to actual damages incurred by an injured party, treble actual damages, and any attorney's fees as the court may determine to be proper.
The ADA and Unruh are important laws, and reflect essential American values of open opportunity and independence for all people. In retrofitting older buildings to meet the associated building and operation standards, some small business owners have had financial challenges. In 2015, the Legislature approved and funded ($10 million) a new loss reserve program at the CPCFA to assist very small-size business in accessing capital to make the necessary changes to meet ADA requirements. Unfortunately, to date, no loans have resulted from the program. This bill is intended to increase the number of eligible applicants.
California Capital Access Program for Small Businesses: CalCAP Loss Reserve Program was established through legislation enacted in 1994 for the purpose of incentivizing financial institutions to provide small businesses with the capital to maintain and grow their business.
The program uses a portfolio-based credit enhancement model, whereby a loss reserve account is established to offset losses incurred in connection with small business loans enrolled in the program. Funding in the loss reserve account consists of moneys paid by the participating borrower and financial institution, with CPCFA matching these contributions.
Under the loss reserve model, the amount of the default payment is based on the amount of funds available in the reserve account. This means a lender could potentially recover 100% of the value of the defaulted loan, if sufficient moneys are in the account. The model encourages lenders to maintain good underwriting practices because utilization of the loss reserve too often can quickly draw-down the reserve leaving little for future defaults.
In 2016, CalCAP's 39 lenders enrolled 1,933 small business loans for $96 million, representing $106 million in total loan dollars. Enrolled loans came from small business located in 44 California counties. Since 1994, CalCAP has enrolled 16,314 loans, representing cumulative loans of $1.68 billion.
Small Business ADA Program: The Small Business ADA Program was established in 2015 to assist small businesses in obtaining financing to make ADA-related repairs. Even though the Small Business ADA Program is separately capitalized with $10 million and builds upon the successful existing CalCAP Loss Reserve Program, the program has yet to enroll a single loan. Further, only three lenders have agreed to participate in the program, as compared to the 39 participating in the broader CalCAP Loss Reserve Program.
Last year, the State Treasurer sponsored AB 1553 (Cervantes), Chapter 644, statutes of 2017 to make certain program adjustments to address identified implementation challenges. This bill proposes additional changes to help utilize the appropriated funds. The policy analysis includes more detailed information about the two loss reserve programs.
Analysis Prepared by: Toni Symonds / J., E.D., & E. / (916) 319-2090 FN: 0002541
Date of Hearing: January 18, 2018
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez Fletcher, Chair
ABPCA Bill Id:AB 1547
Author:(Quirk-Silva) – As Amended Ver:January 11, 2018
Policy Committee: | Jobs, Economic Development, and the Economy | Vote: | 6 - 0 |
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Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill modifies the definition of small business under the California Americans with Disabilities Act Small Business Capital Access Loan Program (Small Business ADA Program) for the purpose of increasing the number of eligible applicants.
FISCAL EFFECT:
By expanding the definition of "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources, the Small Business ADA Program will be able to expend the $10 million appropriated for this purpose. In doing so, the program presents future cost pressures if the program is not adequately supported by loan recapture fund.
COMMENTS:
- Background and Purpose. Existing law establishes the ADA Small Business Program, administered by the California Pollution Control Financing Authority (CPCFA), for the purpose of encouraging private financial institutions to provide small business loans for activities related to compliance with the requirements of the Americans with Disabilities Act (ADA). The ADA Small Business Program is required to follow the terms and conditions for the Capital Access Loan Program for Small Businesses (CAL CAP). State law also requires a business participating in the ADA Small Business program to meet all of the following criteria: have 15 or fewer full-time equivalent employees; have less than $5 million in total gross annual income from all sources; and, not provide overnight accommodations.
Even though the Small Business ADA Program is funded with $10 million and builds upon a successful existing CalCAP Loss Reserve Program, the program has yet to enroll a single loan, and only three lenders have agreed to participate in the program. AB 1547 expands the definition for “small business” or “qualified business” by allowing a business to qualify under its number of employees or its total revenues.
- Prior Legislation. AB 1230 (Gomez), Chapter 787, Statutes of 2015 established the California Small Business ADA Program to provide loans to small businesses so they can comply with the requirements of the ADA.
AB 1553 (Cervantes and Gomez), Chapter 944, Statutes of 2017, expanded the gross annual income limits in the definition of "small business" and "qualified business" from $1 million to $5 million under CAL CAP. The bill also authorized the use of monies in the Small Business Assistance Fund to provide direct incentives to borrowers or financial institutions to participate in the Program.
Analysis Prepared by: Daisy Gonzales / APPR. / (916) 319-2081
Date of Hearing: January 9, 2018
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT, AND THE ECONOMY
Sharon Quirk-Silva, Chair
ABPCA Bill Id:AB 1547 (
Author:Quirk-Silva) – As Amended Ver:January 3, 2018
SUBJECT: California ADA Small Business Capital Access Loan Program
SUMMARY: Modifies the definition of small business under the California Americans with Disabilities Act Small Business Capital Access Loan Program (Small Business ADA Program) for the purpose of increasing the number of eligible applicants.
Specifically, this bill expands the definitions of a "small business" or "qualified small business" to include businesses with fewer than 30 full-time equivalent employees or having less than $5 million in total gross annual income from all sources. Existing law limits the number of full-time equivalent employees to15 and requires a business to also have less than $5 million in total gross annual income from all sources.
EXISTING LAW:
- Establishes the Capital Access Loan Program for Small Businesses (CalCAP), administered by the California Pollution Control Financing Authority (CPCFA), for the purpose of encouraging banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing.
- Establishes the ADA Small Business Program, administered by the CPCFA, for the purpose of encouraging private financial institutions to provide small business loans for activities related to compliance with the requirements of the Americans with Disabilities Act (ADA). The ADA Small Business Program is required to follow the terms and conditions for the CalCAP with additional program requirements, as specified.
- Defines "small business" and a "qualified business" as a business concern that has a primary location within the boundaries of the state and is:
- Independently owned and operated and which is not dominant in its field of operation;
- Legally authorized to conduct business in the state; and
- Legally organized as a corporation, partnership, cooperative, or other entity, whether that entity is a nonprofit entity or an entity established for profit.
- Specifies that a business participating in the ADA Small Business program must also meet all of the following criteria:
- Have 15 or fewer full-time equivalent employees;
- Have less than $5 million in total gross annual income from all sources; and,
- Does not provide overnight accommodations.
- Requires CPCFA adopt regulations that do the following:
- Establish a new loss reserve account for each participating lender enrolling loans in this program;
- Obtain a certification from each participating lender and small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project;
- Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections;
- Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by CPCFA as long as funds are available for this program;
- Limit the term of loss coverage for each qualified loan to no more than five years; and
- Recapture from the loss reserve account the authority's contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, which ever happens first, to be deposited in the fund and applied to program and administrative costs.
- Defines the following:
- "Eligible cost" means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest prior to, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations and improvements, the price of engineering, financial and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project, and shall not include costs not directly related to physical alterations necessary for compliance with the ADA;
- "Eligible project" means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the ADA, and the financing necessary to pay eligible costs of the project; and
- "Qualified loan" means a loan or portion of loan where the proceeds of the loan or portion of loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of loan does not exceed $50,000.
- Prohibits financing upgrades to a range of businesses and facilities, including those that offer overnight accommodation; gambling, liquor, tobacco, guns, escort services, speculative activities (wildcatting for oil and dealing in commodities futures); pyramid sales plans; or other similar activities.
- Appropriates a sum of $10 million from the General Fund to the California ADA Small Business Capital Access Loan Program Fund for the purpose of funding loss reserve accounts and administering the Small Business ADA Program.
FISCAL EFFECT: Unknown
POLICY FRAME: The federal ADA provides that no individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation. In California, the Unruh Civil Rights Act (Unruh), provides that all persons, regardless of sex, race, color, religion, ancestry, national origin, disability or medical condition, are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever. A violation of the ADA also constitutes a violation of Unruh, which subjects a person to actual damages incurred by an injured party, treble actual damages, and any attorney’s fees as the court may determine to be proper.
The ADA and Unruh are important laws, and reflect essential American values of open opportunity and independence for all people. In retrofitting older buildings to meet the associated building and operation standards, some small business owners have had financial challenges. In 2015, the Legislature approved and funded ($10 million) a new loss reserve program at the CPCFA to assist very small-size business in accessing capital to make the necessary changes to meet ADA requirements. Unfortunately, to date, no loans have resulted from the program.
This bill is intended to increase the number of eligible applicants. The analysis includes information on the California small business economy, the CalCap Program, the Small Business ADA Program, program oversight, and prior related legislation. Amendments are discussed in Comments 5 and 6.
COMMENTS:
- The Role of Small Business within the California Economy: California's dominance in many economic areas is based, in part, on the significant role small businesses play in the state's $2.6 trillion economy. Among other advantages, small businesses are crucial to the state's international competitiveness and are an important means for dispersing the positive economic impacts of trade within the California economy.
Nonemployer firms make up the single largest component of businesses in California, 3.1 million out of an estimated 4.1 million firms in 2015, representing over $169 billion in revenues with the highest number of businesses in the professional, scientific, and technical services industry sector (548,841 establishments with $28 billion in receipts). As these nonemployer businesses grow, they continue to serve as an important component of California's dynamic economy. Excluding nonemployer firms, businesses with less than 20 employees comprise nearly 84% of all businesses and employ approximately 18% of all workers. These non-employer and small employer firms create jobs, generate taxes, and revitalize communities.
In hard economic times, smaller size businesses often function as economic engines. The trend continued in this most recent recession with the number of nonemployer firms increasing from 2.6 million firms ($137 billion in revenues) for 2008 to 2.8 million firms ($138 billion in revenues) for 2010. In the post-recession economy, small businesses are expected to become increasingly important due to their ability to be more flexible and better suited to meet niche market needs. Their small size, however, results in certain challenges in meeting regulatory requirements, accessing capital, and marketing their goods and services. California's network of technical assistance providers help businesses with a range of services, including access to quality training, one-on-one counseling, mentoring, marketing data, and other business development resources.
- California Capital Access Program for Small Businesses: CalCAP Loss Reserve Program was established through legislation enacted in 1994 for the purpose of incentivizing financial institutions to provide small businesses with the capital to maintain and grow their business.
The program uses a portfolio-based credit enhancement model, whereby a loss reserve account is established to offset losses incurred in connection with small business loans enrolled in the program. Funding in the loss reserve account consists of moneys paid by the participating borrower and financial institution, with CPCFA matching these contributions.
Unlike a loan guarantee which ensures payment based on a certain percentage of the defaulted loan (80% is covered in the state guarantee), under the loss reserve model, the amount of the default payment is based on the amount of funds available in the reserve account. This means a lender could potentially recover 100% of the value of the defaulted loan, if sufficient moneys are in the account. The model encourages lenders to maintain good underwriting practices because utilization of the loss reserve too often can quickly draw-down the reserve leaving little for future defaults.
CalCAP loans can be used to finance the acquisition of land, construction or renovation of buildings, the purchase of equipment, other capital projects and working capital. There are some limitations on real estate loans and loan refinancing. The maximum loan amount is $2.5 million. Lenders set the terms and conditions of the loans and decide which loans to enroll into CalCAP. Loan fees, which are used to capitalize the loss reserve account, are set by the lender and are in the range of 2% to 3.5% of the total loan amount. Loans can be short- or long-term, have fixed or variable rates, be secured or unsecured, and bear any type of amortization schedule.
In 2016, CalCAP had 39 lenders enrolled in the CalCAP Loss Reserve Program, including: 23 state-chartered banks; 3 federally-chartered banks; 1 credit union; 9 non-profit CDFIs; 1 for-profit CDFI; and 2 community development corporations. These lenders enrolled 1,933 small business loans for $96 million, representing $106 million in total loan dollars. The average size loan was $55,037. Enrolled loans came from small business located in 44 California counties. Since 1994, CalCAP has enrolled 16,314 loans, representing cumulative loans of $1.68 billion. CPCFA processed and approved 96 claims from lenders against their loss reserve account in 2016. This represents a 5% default rate, which is an increase in payments of 116% from 2015.
- Small Business ADA Program: In 2015, AB 1230 (Gomez) established the Small Business ADA Program to assist small businesses in obtaining financing to make ADA-related repairs. The Small Business ADA Program is administered through CPCFA's CalCAP Program, which serves as a credit enhancement to lower the default risk to traditional and nontraditional lenders.
The legislation was introduced as part of a larger response by the Legislature to address the need for greater ADA compliance within the commercial sector and an increasing number of "predatory lawsuits" for which the plaintiffs would agree to drop if financially compensated for their time. The Small Business ADA Program was intended to help small businesses proactively upgrade facilities and make other improvements necessary to comply with the ADA.
Eligible small business borrowers include those with fewer than 15 full-time equivalent employees and having an annual total income of under $5 million. Financing can be used to physically alter or retrofit the business' existing business facilities of less than 10,000 square feet and any other costs necessary for compliance with the ADA. Eligible costs may include predevelopment cost, such as the cost of surveying facilities, estimating and planning eligible alterations, and other related expenses. The credit enhancement offered through the Small Business ADA Program, however, may not be used for business expansion.
Similar to the broader CalCAP Loss Reserve Program, the terms of the individual loans are generally determined by the participating lender, however the size of enrolled loans are statutorily limited to smaller-size loans, $50,000 under the Small Business ADA Program v. $2.5 million under the broader program. Another program difference is the authority to recapture the full amount of the states contribution to the loss reserve fu d when the loan is paid off or five years whichever is less. There are also additional steps in acquiring financing. Prior to receiving money, the small business must obtain an ADA assessment and report from a certified access specialist, as well as a cost estimate for the alterations or retrofits.
Even though the Small Business ADA Program is separately capitalized with $10 million and builds upon a successful existing CalCAP Loss Reserve Program, the program has yet to enroll a single loan. Further, only three lenders have agreed to participate in the program, as compared to the 39 participating in the broader CalCAP Loss Reserve Program.
Last year, the State Treasurer sponsored AB 1553 (Cervantes and Gomez) Chapter 944, statutes of 2012 to make program adjustments to address certain implementation challenges, including:
- Authorizing direct payments to small businesses to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist; and
- Amending the definition of “small business” or “qualified business” by increasing the maximum gross annual income from $1 million to $5 million dollars.
According to the Senate policy analysis for AB 1533, the change to the size of business was appropriate in order to include more eligible applicants. "In determining eligibility, STO analyzed data for participants in that program and determined that only a very small number would qualify for a loan under the Small Business ADA Program and that the $1 million threshold may actually be too low to assist even very small businesses."
AB 1547 further expands the definition for “small business” or “qualified business” to include additional employees 15 to 30, as well as allowing a business to qualify under its number of employees or its total revenues. The bill increases the number of full-time equivalent employees from 15 to 30.
- Funding for Loss Reserve Programs: Moneys to operate CalCAP originally came from excess bond issuance fees. From 2004 to 2010, about $35 million was allocated by CPCFA to finance the CalCAP Loss Reserve Program. In 2010, CalCAP received its first General Fund moneys as part of a comprehensive $32 million small business budget proposal and in 2011 CalCAP was chosen to administer a portion of federal funds for a small business access to capital program. As noted earlier in the analysis, the Small Business ADA Program was separately capitalized when initially authorized. Currently, CalCAP Loss Reserve Program operates exclusively on funds received from federal and non-CPCFA sources.
2016 CalCap Loss Reserve Program – All Funding Sources | ||||
NAICS Sector | Description | Number of Enroll-ments | Dollars Loaned | Dollars Enrolled |
11 | Agriculture, Forestry, Fishing and Hunting | 15 | $804,492.21 | $392,182.00 |
21 | Mining, Quarrying, and Oil and Gas Extraction | 1 | $21,000.00 | $21,000.00 |
22 | Utilities | 2 | $37,242.45 | $37,242.45 |
23 | Construction | 132 | $5,929,329.77 | $5,685,290.93 |
31-33 | Manufacturing | 130 | $15,587,791.31 | $13,797,951.31 |
42 | Wholesale Trade | 71 | $7,686,876.64 | $7,257,627.08 |
44-45 | Retail Trade | 360 | $11,436,681.11 | $11,401,655.11 |
48-49 | Transportation and Warehousing | 364 | $17,001,771.57 | $13,088,079.62 |
51 | Information | 24 | $2,122,869.09 | $1,372,869.09 |
52 | Finance and Insurance | 23 | $1,355,709.71 | $1,355,709.71 |
53 | Real Estate and Rental and Leasing | 21 | $2,471,715.61 | $2,460,305.61 |
54 | Professional, Scientific, and Technical Services | 105 | $7,842,677.17 | $6,741,279.17 |
56 | Administrative and Support and Waste Management and Remediation Services | 126 | $4,611,271.31 | $3,963,062.31 |
61 | Educational Services | 23 | $1,600,319.83 | $1,600,319.83 |
62 | Health Care and Social Assistance | 71 | $6,933,192.36 | $6,863,192.36 |
71 | Arts, Entertainment, and Recreation | 22 | $1,083,250.88 | $1,083,250.88 |
72 | Accommodation and Food Services | 276 | $16,566,303.20 | $16,433,209.90 |
81 | Other Services (except Public Administration) | 167 | $3,293,597.03 | $3,227,097.03 |
Source: California Pollution Control Financing Authority June 16, 2017 | ||||
Among CalCAP's other programs capitalized by specially designated funding sources, the authority operates the On-Road Heavy-Duty Diesel Vehicle Program for small business truck owners; a Proposition 1B Loan Assistance Program to help finance 2007 or newer heavy-duty diesel or LNG fueled trucks; and a program to assist small businesses and homeowners make seismic safety related improvements.
- Oversight Hearing: The Assembly Committee on Jobs, Economic Development, and the Economy, is initiating a program review of the CPCFA, among other state financing authorities that were established and/or operate a program designed to serve the needs of California businesses, especially those related to manufacturing and small businesses. AB 1547 will serve as a vehicle for program changes that arise from this review.
In October 2017, the JEDE Committee met with the Treasure's staff to talk about the oversight process and to discuss potential recommendations for policy improvements. The California State Treasurer serves as the chair to several of the state's independent financing authorities, including the CPCFA, the California Alternative Energy and Advanced Transportation Financing Authority, and the California Industrial Development Financing Advisory Commission. Central to these discussions was whether the existing system of independent financing authorities best serves private sector financing needs. The expansion to the definition of small business under the Small Business ADA Program was an earlier recommendation from the Treasurer's office.
More recently (December 27, 2017), State Treasurer Chiang recommended that the California Industrial Development Financing Advisory Commission could be eliminated and its review authority could be delegated to the California Debt Limit Allocation Committee, which he also chairs.
This recommendation is in line with the introduced version of AB 1547 and the committee staff recommend that the JEDE Committee consider this as an amendment to the bill at the January 9, 2018 hearing.
- Suggested Technical Amendment to the Small Business ADA Program: Staff recommends that the Committee consider deleting the reference to a federal definition of "small business concern", and instead incorporate relevant portions of definition in state law. This method is used in other sections of law relating to small businesses, including small business provisions of state procurement law.
(b)(6) of Section 44559.13. of the health and Safety Code: “Small business” or “qualified business” means a business referred to in subdivisions (i) and is independently owned and operated and not dominate in its field (m) of Section 44559.1, that meets both of the following additional criteria:
(A) It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B) It does not provide overnight accommodations.
- Related Legislation: Below is a list of bills from the current and prior sessions.
- Current Session:
- AB 964 (Calderon, Gonzalez Fletcher, Gomez and Cervantes) California Affordable Clean Vehicle Program: This bill establishes the California Affordable Clean Vehicle Program within CPCFA's Capitol Loan Access Program to assist low-income individuals purchase or lease zero-emission vehicles or plug-in hybrid electric vehicles for personal or commercial use by providing affordable financing mechanisms. Status: Pending in the Senate Committee on Appropriations.
- AB 1553 (Cervantes and Gomez) Direct Payments to Borrowers: This bill expands the gross annual income limits in the definition of "small business" and "qualified business" from $1 million to $5 million under the California Americans with Disabilities Small Business Capital Access Loan Program, which is administered by the California Pollution Control Financing Authority. The bill also authorizes the use of monies in the Small Business Assistance Fund to provide direct incentives to borrowers or financial institutions to participate in the Program. Status: Signed by the Governor, Chapter 944, Statutes of 2017.
- SB 551 (Hueso) Transfer of the Loss Reserve Program: Transfers the California Capital Access Program to the California Small Business Finance Center, operated under the California Infrastructure and Economic Development Bank. Status: Pending in the Assembly Committee on Jobs, Economic Development, and the Economy.
- Prior Sessions:
- AB 796 (Blumenfield) Matching Funds: This bill, as it related to CPCFA, would have increased the maximum contribution by the financial institution to $200,000, if the matching contribution made by CPCFA is funded exclusively from funds made available pursuant to the federal Small Business Jobs Act of 2010. The bill would also have limited the amount of matching funds used for deposits exceeding $100,000 to not more than 50% of the available funds. Status: Vetoed by the Governor, 2012, for provisions unrelated to CFCFA.
- AB 901 (V. Manuel Pérez) Expand Financial Partners and Reporting Requirements: This bill expanded the CPCFA's CalCAP definition of financial institution and increased reporting requirements. CalCAP is one of the programs which received multimillions of dollars in federal and state funding for small business through the federal and state Small Business Jobs Act of 2010. Status: Signed by the Governor, Chapter 483, Statutes of 2011.
- AB 981 (Hueso) Expand Financial Partners: This bill expanded the California Capital Access Program's definition of financial institution, authorized the withdrawal of a lower portion of the interest or other income from a loss reserve account to cover program costs, and required additional financial assistance to qualified business in severely affected community such as an area with high unemployment. California Capital Access Program is one of the programs which received multimillions of dollars in federal and state funding for small business through the federal and state Small Business Jobs Act of 2010. Status: Signed by the Governor, Chapter 484, Statutes of 2011.
- AB 1230 (Gomez) ADA Program: Establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program to provide loans to small businesses so they can comply with the requirements of the Americans with Disabilities Act. Status: Signed by the Governor, Chapter 787, Statutes of 2015.
- AB 1393 (Burke) Expanded Loss Reserve Program Authority: This bill would have expanded the authority and program focus of the CPCFA from providing financial assistance to address the control and remediation of pollution and the capital access challenges of small businesses to offering unlimited types of financial products to an expansive list of public and private entities, as specified. Status: Held under submission on the Senate Appropriation Committees' Suspense File in 2015.
- AB 1632 (Blumenfield) Small Business Capital Infusion: This bill provided the necessary statutory changes in the area of job creation and small business development in order to implement the 2010 Budget Act. The bill transfers $32.4 million from the General Fund to support four small-business and jobs programs that exist in current law. The funding appropriated in this bill goes to the Small Business Loan Guarantee Program ($20 million); California Capital Access Fund ($6 million); Small Business Development Centers ($6 million); and the Federal Technology Centers ($350,000). Status: Signed by the Governor, Chapter 731, Statutes of 2010.
- SB 225 (Simitian) Loss Reserve Accounts Trucking: This bill authorized the authority to establish loss reserve accounts for the purposes of terminal rental adjustment clause leasing, if funds are available for contribution into the loss reserve account from any source other than the authority. Status: Signed by the Governor, Chapter 492, Statutes of 2011.
- SB 832 (Senate Committee on Environmental Quality) Code Maintenance: This bill revised, under the tax-related provisions, the terms "project" and "pollution control facility", as defined in the California Pollution Control Financing Authority Act that are eligible for the sales and use tax (SUT) exclusion and includes public agencies in the definition of "participating parties" that are eligible for financial assistance in connection with the projects designed to control or eliminate environmental pollution. Status: Signed by the Governor, Chapter 643, Statutes of 2009.
- SB 837 (Committee on Budget and Fiscal Review, Chapter 32, Statutes of 2016) Budget Trailer Bill: Authorized California Capital Access Program to implement a loan loss reserve program to benefit an individual person engaged in an activity that furthers the state’s policy objectives. Status: Singed by the Governor, Chapter 32, Statutes of 2016.
- SB 1311 (Simitian) Changes in Deposits and Withdrawls: This bill reduced the California Capital Access Program monetary contribution of the CPCFA to an amount equal to the amount of fees paid by a participating financial institution. The bill also authorizes the withdrawal of interest or other income from the loss reserve accounts for the purpose offsetting administrative costs and contributions. Status: The bill was signed by the Governor, Chapter 401, Statutes of 2008.
- Current Session:
REGISTERED SUPPORT / OPPOSITION:
Support
None on File
Opposition
None on File
Analysis Prepared by: Toni Symonds / J., E.D., & E. /
Bill Author
