BILL ANALYSIS
AB 1106
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CONCURRENCE IN SENATE AMENDMENTS
AB 1106 (Fuentes)
As Amended August 17, 2010
2/3 vote. Urgency
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|ASSEMBLY: | |(June 1, 2009) |SENATE: |29-3 |(August 20, |
| | | | | |2010) |
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(vote not relevant)
Original Committee Reference: U. & C.
SUMMARY : Authorizes the California Energy Resources
Conservation and Development Commission (CEC) to contract with
small business financial development corporations (FDCs) to
expend Alternative and Renewable Fuels and Vehicle Technology
Program (ARF Program) funds. Specifically, this bill :
1)Authorizes CEC to contract with FDCs, which have been
designated by the Business, Transportation and Housing Agency
(BTH), to expend ARF Program funds through the Small Business
Loan Guarantee Program, as specified.
2)Removes the sunset on the CEC's authority to contract with the
State Treasurer (Treasurer) to expend ARF Program moneys
through programs administered by the Treasurer.
3)Makes technical and nonsubstantive related changes including
double-jointing with SB 1340 (Kehoe) relating to electrical
vehicle charging infrastructure.
4)Contains an urgency clause allowing this bill to take effect
immediately upon enactment.
EXISTING LAW :
1)Establishes the ARF Program, administered by the CEC, for the
purpose of providing competitive grants, revolving loans, loan
guarantees, loans, or other appropriate funding measures to
specified public and private entities for the purpose of
developing and deploying innovative technologies that result
in the transformation of California fuel and vehicle types to
help attain the state's climate change policies.
AB 1106
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2)Provides, upon appropriation by the Legislature, approximately
$120 million annually through 2015 for the ARF Program.
Program moneys come from additional fees on vehicle
registrations, special identification plates for various
vehicles, and vessel registrations, plus $10 million annually
from the Public Interest Research, Development, and
Demonstration Fund, which is derived from a portion of
electric utility rates.
3)Authorizes the CEC to contract with the Treasurer's Office
until January 1, 2012, to expend program funds.
4)Provides that moneys allocated through the ARF Program shall
be awarded based on a set of priorities put forward in a
commission approved investment plan.
5)Establishes a small business loan guarantee program,
administered through BTH for the purpose of assisting small
businesses in obtaining long-term loans or lines of credit
from conventional financial institutions. Under this program,
the 11 state approved FDCs are to serve as financial
intermediaries between the state, the small business, and the
financial institution.
AS PASSED BY THE ASSEMBLY , this bill required the California
Public Utilities Commission to develop a feed-in tariff for
eligible renewable electric generation that is less than 20
megawatt in size.
FISCAL EFFECT : According to the Senate Appropriations'
Committee, implementation of this measure would have $100,000 in
ongoing administrative costs to the CEC and BTH. Unknown amount
of administration fees to the FDCs to deliver the program.
COMMENT : FDCs are nonprofit corporations that have been
designated by BTH to market its small business capital program,
coordinate the packaging of the loan and loan guarantee
applications between the small business and financial
institution, issue the loan guarantees, and ensure that private
lenders have followed required procedures before requesting
payment on defaulted loans. A total of 11 FDCs operate
throughout the state.
This bill permits the CEC to utilize FDCs in the implementation
of the ARF Program. By authorizing the use of FDCs to implement
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an additional state business capital program, the state gains a
strong regionally-based community development partner that has a
demonstrated ability to work with small businesses and private
lending institutions.
The language that appeared in the measure as it passed the
Assembly has been deleted and these new provisions were added in
the Senate Appropriations Committee. Subsequent policy and
fiscal committee hearings were held on the new language.
Analysis Prepared by : Toni Symonds / J., E.D. & E. / (916)
319-2090
FN: 0006331