BILL NUMBER: AB 1382 CHAPTERED 10/12/01 CHAPTER 752 FILED WITH SECRETARY OF STATE OCTOBER 12, 2001 APPROVED BY GOVERNOR OCTOBER 11, 2001 PASSED THE ASSEMBLY SEPTEMBER 12, 2001 PASSED THE SENATE SEPTEMBER 10, 2001 AMENDED IN SENATE SEPTEMBER 7, 2001 AMENDED IN SENATE JUNE 7, 2001 AMENDED IN ASSEMBLY APRIL 17, 2001 INTRODUCED BY Assembly Members Liu and Runner (Coauthors: Assembly Members Diaz, Havice, Nakano, Negrete McLeod, Pavley, Shelley, and Wyman) (Coauthors: Senators O'Connell and Scott) FEBRUARY 23, 2001 An act to add Sections 15333.6, 15333.7, and 15333.8 to, and to repeal Sections 15333.3 and 15333.4 of, the Government Code, relating to economic development, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 1382, Liu. Space industry development. Existing law provides for the California Space and Technology Alliance and the California Space Flight Competitive Grant Program administered by the alliance, and the Highway to Space Competitive Grant Program administered by the Western Commercial Space Center under the Highway to Space Program. Applications for grants under these programs are evaluated according to specified criteria by an impartial review panel established by the respective entity, and grants are awarded based on these evaluations by the Secretary of Technology, Trade, and Commerce. Both the alliance and the center may establish an advisory committee to provide input and recommendations on the respective programs and other space-flight related issues. This bill would delete these provisions and instead, subject to the availability of funds appropriated for that purpose, require the Technology, Trade, and Commerce Agency to implement a space industry development program. The agency would be required to contract with a nonprofit corporation to assist in its administration of these activities, according to specified criteria. The corporation would be required to issue solicitations for the California Space Industry Competitive Grant Program established by the bill, and evaluate grant proposals with the assistance of an impartial review panel to be established by the corporation, according to specified criteria. The Secretary of the Technology, Trade, and Commerce Agency would be required to award grants based upon these criteria. This bill would establish the California Space Industry Advisory Committee within the agency, to be composed of a specified membership, to provide input and recommendations on the competitive grant program established by the bill, and to provide recommendations on space industry issues. This bill would declare that it is to take effect immediately as an urgency statute. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 15333.3 of the Government Code is repealed. SEC. 2. Section 15333.4 of the Government Code is repealed. SEC. 3. Section 15333.6 is added to the Government Code, to read: 15333.6. (a) Subject to the availability of funds appropriated for that purpose, the Technology, Trade, and Commerce Agency shall implement a space industry development program to foster activities that increase the competitiveness of the industry in California, including, but not limited to, the commercial use of space, space vehicle launches, space launch infrastructure, manufacturing, applied research, technology development, economic diversification, and business development. (b) The agency may contract with other state or private agencies, nonprofit corporations, universities, firms, or individuals for the performance of technical or specialized work, or for services related to space industry development programs. (c) The Secretary of the Technology, Trade, and Commerce Agency shall select a California nonprofit corporation to assist the agency in its administration of space industry-related economic development activities through programs, projects, grants, partnerships, networks, and collaboration. The corporation shall be selected through a solicitation process established by the agency. The solicitation process shall include criteria for selection of the corporation, which shall include, but not be limited to, demonstrated experience in the space industry and the ability to perform the space industry development activities described in subdivision (d). (d) The corporation may perform one or more of the following activities, as determined contractually between the agency and the corporation: (1) Serve as the California Spaceport Authority with responsibilities specified in Section 15348.5. (2) Pursue grants from the federal government or from private businesses, foundations, or individuals, for California space industry activities, including, but not limited to, studies, services, infrastructure improvements and modernization, and defense transition programs, to the extent permitted by law. (3) Identify science and technology trends that are significant to the space industry and the state and act as a clearinghouse for space industry-related issues and information. (4) Develop and implement a state strategy for applying and commercializing technology to create jobs, respond to industry changes, and foster innovation and competitiveness in the space industry. (5) Provide information to the secretary relevant to changes in federal, state, and local statutes and regulations that will enhance the development of the California space industry. (6) Provide information to the secretary, regarding the development of laws, regulations, decisions, or determinations affecting the economic and employment impacts of the California space industry. (7) Provide recommendations to the secretary for appropriate state funding mechanisms and amounts to promote development of the California space industry, including education and workforce development. (8) Provide recommendations to the secretary in the form of strategic planning documents. (9) Review applications for, and promote, the California Space Industry Competitive Grant Program established by Section 15333.7. (e) (1) The agency and the corporation shall enter into an annual contract specifying the activities to be performed by the corporation. (2) Pursuant to the contract, the corporation shall submit to the agency quarterly reports of its activities and finances. The quarterly reports shall be of sufficient detail for the agency to determine whether the corporation is in compliance with the annual contract between the agency and the corporation. (3) The annual contract shall include conflict of interest requirements developed by the agency. (4) Failure of the corporation to comply with the conditions in the annual contract, as evidenced in the quarterly reports and any supplemental monitoring of the corporation by the agency, shall result in the cancellation of the annual contract and deselection of the corporation. Upon the deselection of the corporation, the agency shall utilize the solicitation process set forth in subdivision (c) to select a replacement corporation. SEC. 4. Section 15333.7 is added to the Government Code, to read: 15333.7. (a) The California Space Industry Competitive Grant Program is hereby established within the Technology, Trade, and Commerce Agency, to provide funding, upon appropriation by the Legislature, for the development of the California space industry. For purposes of this section, space industry activities shall include, but are not limited to, the commercial use of space, space vehicle launches, space launch infrastructure, manufacturing, applied research, technology development, economic diversification, and business development. Entities conducting activities in California intended to improve the competitiveness of the California space industry, including public, private, educational, commercial, nonprofit, or for-profit entities may apply for grants. (b) (1) If program funding is appropriated by the Legislature, the corporation selected pursuant to subdivision (c) of Section 15333.6 shall, at least annually, issue solicitations. No solicitation shall be issued without the prior review and approval by the agency. If the corporation has not issued a solicitation within 180 days of the appropriation of funds, the agency shall issue the solicitation. (2) Solicitations developed by the corporation shall include minimum eligibility and requirements. Additional requirements may be added to each year's grant solicitation. The solicitation shall address at least all of the following: (A) Jobs created and retained by the implementation of the project. (B) Cost sharing by other project participants, which should include at least one of the following: (i) A private sector company or companies. (ii) One or more foundations, industry associations, or nonprofit cooperative associations, or any combination thereof. (iii) In-kind support, which may include staff and facilities. (iv) Federal or local government funding. (C) A condition that grant funds will not be used to supplant other project funds. (D) A demonstration that a majority of the project will be undertaken in California. (E) An agreement among all project participants as to intellectual property rights relative to the project. (F) The potential impact on the state's economy. (G) The cost-effectiveness of the project. (H) The importance of state funding for the viability of the project. (I) A demonstration of technical feasibility and an assessment of programmatic risk. (c) In evaluating grant proposals, the corporation shall establish an impartial review panel composed of technical and scientific experts and government representatives to review grant applications. The panel shall be composed of members from throughout the state who are knowledgeable about activities related to the space industry. No more than 30 percent of the panel members shall be government representatives, and all other members shall either be actively involved in, or be technical and scientific experts in activities related to, the space industry. No more than 30 percent of the panel members shall be members of, or on the board of directors of, the corporation. (d) (1) The review panel shall review all applications received by the deadline specified in the solicitation in order to determine the applications that are complete and that meet the criteria set forth in the solicitation. The review panel may rely on experts who are not part of the panel in order to determine compliance with one or more criteria. (2) All applications meeting the criteria set forth in paragraph (1) shall be submitted to the agency. (3) The agency may remove one or more applications from those submitted by the review panel upon a determination that the application did not meet the criteria set forth in paragraph (1). The agency shall rank the grant applications received from the review panel, minus any applications removed by the agency because of failure to meet the criteria. The ranking shall be based upon criteria stated in the solicitation. The ranking shall include recommendations as to the amount of state funding for each grant application. (e) The secretary shall award program grants based upon the criteria set forth in paragraph (1) of subdivision (d) and recommendations of the committee established in Section 15333.8. (f) The funding determination shall be transmitted to the Governor and the chairpersons of the Senate and Assembly fiscal committees and shall be subject to the availability of funds appropriated for that purpose. (g) The solicitation process set forth in this section shall not be subject to Chapter 3.5 (commencing with Section 11340) of Part 1. (h) The Legislature hereby finds and declares that the granting of funds to private entities serves a public purpose by assisting an industry vital to the health and welfare of the State of California. SEC. 5. Section 15333.8 is added to the Government Code, to read: 15333.8. (a) The California Space Industry Advisory Committee is hereby established in the Technology, Trade, and Commerce Agency. The committee shall consist of nine members. The Speaker of the Assembly and the Senate Committee on Rules shall each appoint two members. The Governor shall appoint the remaining members of the committee upon nomination by the Secretary of the Technology, Trade, and Commerce Agency, and shall appoint one member as chair. All members of the committee shall be California residents. One-third of the members shall be residents of northern California, one-third of the members shall be residents of southern California, and one-third of the members shall be residents of central California. A majority of the members of the committee shall be from the California space industry. The committee may include representatives from labor, local government, and special districts, public and private institutions of higher learning, and federal laboratories located in the State of California. One of the initial appointments by the Speaker of the Assembly, one by the Senate Committee on Rules, and two by the Governor shall be for a term of two years. The remaining initial appointments, and all subsequent appointments, shall be for a term of four years. (b) Each committee member shall serve without compensation but may be reimbursed for actual and necessary travel and telecommunication expenses incurred when attending committee meetings. (c) The committee shall advise the agency regarding both of the following: (1) Provide input, evaluation, program funding recommendations, and other recommendations on the California Space Industry Competitive Grant Program established by Section 15333.7. (2) Provide recommendations on space industry issues, as requested by the secretary. (d) Staff for the committee shall be supplied by the agency, and records of the committee shall be maintained by the agency. (e) The committee shall be subject to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2). However, the Legislature finds and declares that it is important that committee members are active in the space industry, and it is expected that several of the committee members may also be members of other organizations. (f) This section shall only be implemented to the extent funds are appropriated for that purpose. SEC. 6. The Technology, Trade, and Commerce Agency may adopt emergency regulations to implement this act. The adoption of emergency regulations shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health and safety, and general welfare for purposes of Section 11349.6 of the Government Code. Notwithstanding subdivision (c) of Section 11346.1 of the Government Code, an emergency regulation adopted pursuant to this section shall be repealed 180 days after the effective date of the regulation, unless the department acts to make the regulation permanent pursuant to subdivision (e) of Section 11346.1 of the Government Code. SEC. 7. Funding for the purposes described in Sections 15333.6, 15333.7, and 15333.8 of the Government Code, as added by this act, shall be contingent upon funding in the annual Budget Act. SEC. 8. 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 Constitution and shall go into immediate effect. The facts constituting the necessity are: In order that the state may take all necessary steps to protect and expand the vital California space industry at the earliest possible time, it is necessary that this act take effect immediately.