BILL NUMBER: SB 71 CHAPTERED
BILL TEXT
CHAPTER 10
FILED WITH SECRETARY OF STATE MARCH 24, 2010
APPROVED BY GOVERNOR MARCH 24, 2010
PASSED THE SENATE MARCH 22, 2010
PASSED THE ASSEMBLY MARCH 22, 2010
AMENDED IN ASSEMBLY MARCH 22, 2010
INTRODUCED BY Senators Padilla, Alquist, and Strickland
(Principal coauthors: Assembly Members Fuentes, Blumenfield,
Buchanan, and Huber)
(Coauthors: Assembly Members Adams, Ammiano, Arambula, Beall, Bill
Berryhill, Tom Berryhill, Blakeslee, Block, Bradford, Brownley,
Caballero, Charles Calderon, Carter, Conway, Coto, Davis, Emmerson,
Eng, Evans, Feuer, Fletcher, Furutani, Gaines, Galgiani, Gilmore,
Hall, Hayashi, Jones, Knight, Bonnie Lowenthal, Ma, Monning, Nava,
Nestande, Nielsen, John A. Perez, V. Manuel Perez, Salas, Smyth,
Solorio, Audra Strickland, Swanson, Torres, Tran, Villines, and
Yamada)
JANUARY 20, 2009
An act to amend Section 26003 of, and to add and repeal Section
26011.8 of, the Public Resources Code, relating to economic
development, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 71, Padilla. Economic development: sales and use tax
exclusions: environmental technology project.
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, for purposes of the act until January 1, 2021,
expand the definition of "alternative sources" and "projects," as
specified. The bill would, until January 1, 2021, authorize the
authority to evaluate project applications, and to approve projects,
as defined, for financial assistance under the existing exclusion
from a "sale" or "purchase" subject to sales or use tax, as provided.
This bill would require the Legislative Analyst's Office to submit a
report to the Joint Legislative Budget Committee, as provided.
The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes
counties and cities to impose local sales and use taxes in conformity
with the Sales and Use Tax Law, and districts, as specified, may
impose transactions and use taxes in accordance with the Transactions
and Use Tax Law, which conforms to the Sales and Use Tax Law.
Amendments to the Sales and Use Tax Law are automatically
incorporated into these laws.
Section 2230 of the Revenue and Taxation Code provides that the
state will reimburse counties and cities for revenue losses caused by
the enactment of sales and use tax exemptions.
This bill would provide that, notwithstanding Section 2230 of the
Revenue and Taxation Code, no appropriation is made and the state
shall not reimburse local agencies for sales and use tax revenues
lost by them pursuant to this bill.
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 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 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; 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.
(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.
(2) 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) (1) "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, or an arrangement for the
purchase, including prepayment, or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
(2) "Project," for the purposes of Section 26011.8, means any
tangible personal property that is utilized for the design,
manufacture, production, or assembly of advanced transportation
technologies or alternative source products, components, or systems.
(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. 2. Section 26011.8 is added to the Public Resources Code, to
read:
26011.8. (a) The purpose of this section is to promote the
creation of California-based manufacturing, California-based jobs,
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) (1) For purposes of this section, "project" means a project as
defined in paragraph (2) of subdivision (g) of Section 26003.
(2) For purposes of this section, "alternative sources" also
includes advanced electric distributive generation technology as
defined in Section 379.8 of the Public Utilities Code or energy
storage technologies and their component materials.
(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 any 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 as defined in subdivision (g) of Section 26003
approved by the authority by resolution for the sales and use tax
exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code
prior to the effective date of this section, shall not be subject to
this section.
(g) The Legislative Analyst's 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 amount of reduction in greenhouse gases, air pollution,
water pollution, or energy consumption.
(h) Once the 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 prior to making additional approvals pursuant to
this section.
(i) The authority shall make every effort to expedite the
operation of this section, and shall adopt regulations for purposes
of implementing the section 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.
(j) This section shall remain in effect only until January 1,
2021, and as of that date is repealed. The sale or purchase of
tangible personal property of a project approved prior to 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 authority's resolution approving the project
pursuant to this section.
SEC. 3. Notwithstanding Section 2230 of the Revenue and Taxation
Code, no appropriation is made by this act and the state shall not
reimburse any local agency for any sales and use tax revenues lost by
it under this act.
SEC. 4. 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 to create jobs to stimulate the economy, it is necessary
that this act go into immediate effect.