BILL NUMBER: ABX6 3	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Members Blakeslee and Solorio
   (Coauthors: Assembly Members Adams, Conway, Fletcher, Furutani,
Garrick, Gilmore, Hagman, Hall, Nava, Portantino, Silva, Tran, and
Villines)
   (Coauthors: Senators Ashburn, Denham, Huff, and Walters)

                        NOVEMBER 3, 2009

   An act to amend Section 7074.2 of the Government Code, and to
amend Section 26003 of, and to add Section 26011.7 to, the Public
Resources Code, relating to economic development.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 3, as introduced, Blakeslee. Economic development.
   (1) The Enterprise Zone Act provides for the designation of
enterprise zones by the Department of Community Housing and
Development based on the department's approval of applications from a
city, county, or city and county with a geographic area meeting
certain criteria. Certain entities within a designated enterprise
zone may receive regulatory, tax, and other incentives for private
investment and employment. Existing law provides that no more than 42
enterprise zones be designated at any one time pursuant to the act.
Upon the expiration or termination of a designation, existing law
authorizes the department to designate another enterprise zone to
maintain a total of 42 enterprise zones.
   This bill would authorize the department to designate one special
enterprise zone within the City of Fremont consisting of a
geographical area encompassing a facility that manufactures
automobiles and to designate, until 90 days after the act takes
effect, an additional 10 special enterprise zones limited to one
nonrenewable 15-year term. The bill would exclude these enterprise
zones from the calculation of the overall number of enterprise zones
authorized under the act. The bill would also make legislative
findings and declarations as to the necessity of a special statute.
   (2) The California Alternative Energy and Advanced Transportation
Financing Authority Act established the California Alternative Energy
and Advanced Transportation Financing Authority. The authority is
authorized to do all things necessary and convenient to carry out the
purposes of the act. The authority is also required to establish a
renewable energy program to provide financial assistance, as defined,
to certain entities for projects to generate new and renewable
energy sources, develop clean and efficient distributed generation,
and demonstrate the economic feasibility of new technologies.
Existing law provides that the transfer of title of tangible personal
property constituting a project under the act to the authority by a
participating party or the lease or transfer of tangible personal
property constituting a project under the act by the authority to a
participating party pursuant to the act is not a "sale" or "purchase"
for the purposes of the Sales and Use Tax Law.
   This bill would include as a project, machinery, or equipment that
is utilized for the design, technology transfer, manufacture,
production, assembly, distribution, or service of an alternative
source component. The bill would include as "financial assistance"
for the purposes of the act purchases, sales, or lease arrangements
that qualify for exclusion from the Sales and Use Tax Law. The bill
would require the authority to consider specified criteria in
approving a project for which the purchase, sale, or lease of
tangible personal property qualifies for the sales and use tax
exclusion. The bill would require, when the sales and use tax
exclusion for projects approved by the authority exceed $100,000,000
annually, the authority to provide a 20-day notice to the Legislature
for additional project approval.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 7074.2 of the Government Code is amended to
read:
   7074.2.  (a) Notwithstanding any other  provision of
 law, a city, county, or a city and county may designate a
joint powers authority to administer an enterprise zone.
   (b) No more than 42 enterprise zones may be designated at any one
time pursuant to this chapter, including those deemed designated
pursuant to subdivision (e) of Section 7073. Upon the expiration or
termination of a designation, the department may designate another
enterprise zone to maintain a total of 42 enterprise zones. 
   (c) Notwithstanding subdivision (b), the department may designate
one special enterprise zone pursuant to this chapter within the City
of Fremont that consists of a geographical area encompassing a
facility that manufactures automobiles. The enterprise zone
designated under this subdivision shall not be included in the
calculation of the overall number of enterprise zones authorized
under this chapter. The applicant and application shall comply with
the provisions of this chapter and the department's regulations
governing enterprise zones specified in Title 25 (commencing with
Section 8430) of the California Code of Regulations, except that the
application shall not be subject to a competitive application
process.  
   (d) Notwithstanding subdivision (b), the department may, until 90
days after the act amending this section takes effect, designate an
additional 10 special enterprise zones limited to one nonrenewable
15-year term. Enterprise zones designated under this subdivision
shall not be included in the calculation of the overall number of
enterprise zones authorized under this chapter. If the department has
completed its 2009 competitive designation process as of the date
the act amending this section goes into effect, it may use the
results of that process to select the additional 10 special
enterprise zones.  
   (c) 
    (e)  Notwithstanding any other provision of law, an
expiring enterprise zone that applies for a new enterprise zone
designation pursuant to Section 7073 or 7073.1, and receives a
conditional designation letter from the department, may offer, and a
taxpayer doing business within the geographic boundaries of the new
zone referenced in the conditional designation letter shall be
eligible to receive, all enterprise zone benefits until the
department makes a final designation or declines to redesignate the
zone. The department shall make the effective date of the new zone
the date of expiration of the previous designation and the term of
the new zone shall begin on that date.
  SEC. 2.  Section 26003 of the Public Resources Code is amended to
read:
   26003.  As used in this division, unless the context otherwise
requires:
   (a) "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.
   (b) "Cost" as applied to a project or portion thereof 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 therein, 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; the cost of the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011;
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 incident to determining the feasibility of
constructing any project or incident to the construction,
acquisition, or financing of a project.
   (c) (1) "Alternative sources" means the application of
cogeneration technology, as defined in Section 25134; the
conservation of energy; or the use of solar, biomass, wind,
geothermal, hydroelectricity under 30 megawatts, or any other source
of energy, the efficient use of which will reduce the use of fossil
and nuclear fuels, and is intended primarily to offset part or all of
the customer's own electrical requirements.
   (2) "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.
   (d) "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 state's
commitment to energy conservation, pollution reduction, and
transportation efficiency. Those technologies may include, but are
not limited to, any of the following:
   (1) Intelligent vehicle highway systems.
   (2) Advanced telecommunications for transportation.
   (3) Command, control, and communications for public transit
vehicles and systems.
   (4) Electric vehicles and ultralow-emission vehicles.
   (5) High-speed rail and magnetic levitation passenger systems.
   (6) Fuel cells.
   (e) "Financial assistance" includes, but is not limited to,
either, or any combination, of the following:
   (1) Loans, loan loss reserves, interest rate reductions, proceeds
of bonds issued by the authority, insurance, guarantees or other
credit enhancements or liquidity facilities, contributions of money,
property, labor, or other items of value, or any combination thereof,
as determined by, and approved by the resolution of, the 
board   authority  . 
   (2) Purchases, sales, or lease arrangements that qualify for
exclusion from the sales and use tax pursuant to Section 6010.8 of
the Revenue and Taxation Code.  
   (2) 
    (3)  Any other type of assistance the authority
determines is appropriate.
   (f) "Participating party" means either of the following:
   (1) A person or an entity or group of entities engaged in business
or operations in the state, whether organized for profit or not for
profit, that does either of the following:
   (A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
   (B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
   (2) A public agency or nonprofit corporation that does either of
the following:
   (A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
   (B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
   (g) "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, 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,  alternative source
components,  or an arrangement for the purchase, including
prepayment, or sale of energy derived from an alternative source
pursuant to subdivision (g) of Section 26011.
   (h) "Public agency" means a federal or state agency, department,
board, authority, state or community college, university, or
commission, or a county, city and county, city, regional agency,
public district, school district, or other political entity.
   (i) (1) "Renewable energy" means a device or technology that
conserves or produces heat, processes heat, space heating, water
heating, steam, space cooling, refrigeration, mechanical energy,
electricity, or energy in any form convertible to these uses, that
does not expend or use conventional energy fuels, and that uses any
of the following electrical generation technologies:
   (A) Biomass.
   (B) Solar thermal.
   (C) Photovoltaic.
   (D) Wind.
   (E) Geothermal.
   (2) For purposes of this subdivision, "conventional energy fuel"
means any fuel derived from petroleum deposits, including, but not
limited to, oil, heating oil, gasoline, fuel oil, or natural gas,
including liquefied natural gas, or nuclear fissionable materials.
   (3) Notwithstanding paragraph (1), for purposes of this section,
"renewable energy" also means ultralow-emission equipment for energy
generation based on thermal energy systems such as natural gas
turbines and fuel cells.
   (j) "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.
  SEC. 3.  Section 26011.7 is added to the Public Resources Code, to
read:
   26011.7.  (a) To promote the creation of jobs and reduction of
greenhouse gases, the authority may approve a project for which the
purchase, sale, or lease of tangible personal property qualifies for
the sales and use tax exclusion pursuant to Section 6010.8 of the
Revenue and Taxation Code.
   (b) In approving a project for which the purchase, sale, or lease
of tangible personal property qualifies for the sales and use tax
exclusion pursuant to Section 6010.8 of the Revenue and Taxation
Code, the authority shall consider all of the following criteria:
   (1) 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.
   (2) The extent to which the project will create new, permanent
jobs in California.
   (3) The extent to which the project is consistent with local and
state planning.
   (4) The extent to which the project will produce quantifiable,
verifiable, and sustainable reductions in the emissions of greenhouse
gases as defined in subdivision (g) of Section 38505 of the Health
and Safety Code.
   (5) Any other factors that the authority deems appropriate.
   (c) Once exclusions granted pursuant to Section 6010.8 of the
Revenue and Taxation Code for projects approved by the authority
pursuant to this section exceed one hundred million dollars
($100,000,000) annually, the authority shall provide a 20-day notice
to the Legislature for additional approvals made pursuant to this
section.
  SEC. 4.  Due to the unique circumstances of the City of Fremont,
with respect to the need for sustained employment and business
development in the area, the Legislature hereby finds and declares
that a general statute cannot be made applicable within the meaning
of Section 16 of Article IV of the California Constitution.