BILL NUMBER: SB 390 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Kehoe
FEBRUARY 26, 2009
An act to amend Sections 42023.1, 42023.2, 42023.4, 42023.5, and
42023.6 of, and to repeal Section 42023.3 of, the Public Resources
Code, relating to solid waste, and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
SB 390, as introduced, Kehoe. Solid waste: recycling market
development.
(1) The California Integrated Waste Management Act of 1989, which
is administered by the California Integrated Waste Management Board,
establishes an integrated waste management program. The act creates
the Recycling Market Development Revolving Loan Subaccount in the
Integrated Waste Management Account and continuously appropriates the
funds deposited in the subaccount to the board for making loans for
the purposes of the Recycling Market Development Revolving Loan
Program (program). Existing law makes the provisions regarding the
loan program, the creation of the subaccount, and expenditures
therefrom inoperative on July 1, 2011, and repeals them as of January
1, 2012, and provides for disposition of funds remaining after
inoperation and repeal.
This bill would delete the inoperative and repeal dates, thereby
indefinitely continuing the program and the continuous appropriation,
and thereby making an appropriation, and would delete the provisions
providing for disposition of funds remaining after inoperation and
repeal.
(2) The act requires, upon authorization by the Legislature in the
annual Budget Act, the Controller to transfer a sum that does not
exceed $5,000,000 from the account to the subaccount as necessary to
meet anticipated loan demand under the program. The act provides that
the transferred amount is a loan to the subaccount, repayable with
interest to the account.
This bill would delete the limitation of the transfer to
$5,000,000 and the requirement that the amount transferred be a loan
to the subaccount, repayable with interest.
(3) The act requires the board under the program to finance by a
recycling market development loan not more than 3/4 of the cost of
each project, or not more than $2,000,000 for each project, whichever
is less.
This bill, instead, would authorize the board to expend not more
than 50% of the amount available in the subaccount at the beginning
of each fiscal year for loans that do not exceed the lesser of
$2,000,000 or 3/4 of the cost of the project to be funded by the
loan, and to expend not more than 50% of the amount available in the
subaccount at the beginning of each fiscal year for loans that are
greater than $2,000,000, but do not exceed $5,000,000, and do not
exceed 3/4 of the cost of the project to be funded by the loan.
Vote: majority. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 42023.1 of the Public Resources Code is amended
to read:
42023.1. (a) The Recycling Market Development Revolving Loan
Subaccount is hereby created in the account for the purpose of
providing loans for purposes of the Recycling Market Development
Revolving Loan Program established pursuant to this article.
(b) Notwithstanding Section 13340 of the Government Code, the
funds deposited in the subaccount are hereby continuously
appropriated to the board without regard to fiscal year for making
loans pursuant to this article.
(c) The board may expend interest earnings on funds in the
subaccount for administrative expenses incurred in carrying out the
Recycling Market Development Revolving Loan Program, upon the
appropriation of funds in the subaccount for that purpose in the
annual Budget Act.
(d) The money from any loan repayments and
fees, including, but not limited to, principal and interest
repayments, fees and points, recovery of collection costs, income
earned on any an asset recovered
pursuant to a loan default, and funds collected through foreclosure
actions, shall be deposited in the subaccount.
(e) All interest accruing on interest payments from loan
applicants shall be deposited in the subaccount.
(f) The board may expend the money in the subaccount to make loans
to local governing bodies, private businesses, and nonprofit
entities within recycling market development zones, or in areas
outside zones where partnerships exist with other public entities to
assist local jurisdictions to comply with Section 40051.
(g) The board shall establish and collect fees for applications
for loans authorized by this section. The application fee shall be
set at a level that is sufficient to fund the board's cost of
processing applications for loans. In addition, the board shall
establish a schedule of fees, or points, for loans which
that are entered into by the board, to fund the
board's administration of the revolving loan program.
(h) The board may expend money in the subaccount for the
administration of the Recycling Market Development Revolving Loan
Program, upon the appropriation of funds in the subaccount for that
purpose in the annual Budget Act. In addition, the board may expend
money in the account to administer the revolving loan program, upon
the appropriation of funds in the subaccount for that purpose in the
annual Budget Act. However, funding for the administration of the
revolving loan program from the account shall be provided only if
there are not sufficient funds in the subaccount to fully fund the
administration of the program.
(i) The board, pursuant to subdivision (a) of Section 47901, may
set aside funds for the purposes of paying costs necessary to protect
the state's position as a lender-creditor. These costs shall be
broadly construed to include, but not be limited to, foreclosure
expenses, auction fees, title searches, appraisals, real estate
brokerage fees, attorney fees, mortgage payments, insurance payments,
utility costs, repair costs, removal and storage costs for
repossessed equipment and inventory, and additional expenditures to
purchase a senior lien in foreclosure or bankruptcy proceedings.
(j) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2011, and as of January 1, 2012, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2012, deletes or extends the dates on which it
becomes inoperative and is repealed.
(2) The repeal of this section pursuant to paragraph (1) shall not
extinguish any loan obligation or the authority of the state to
pursue appropriate actions for the collection of a loan.
SEC. 2. Section 42023.2 of the Public Resources Code is amended to
read:
42023.2. (a) Upon
authorization by the Legislature in the annual Budget Act, the
Controller shall transfer a sum not to exceed five million
dollars ($5,000,000) , as available, from the
account to the subaccount as necessary to meet anticipated loan
demand under the program. Those amounts shall be a loan to
the subaccount, repayable with interest to the account at the rate of
return for money in the Surplus Money Investment Fund.
(b) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2011, and as of January 1, 2012, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2012, deletes or extends the dates on which it
becomes inoperative and is repealed.
(2) The repeal of this section pursuant to paragraph (1) shall not
extinguish any loan obligation or the authority of the state to
pursue appropriate actions for the collection of a loan.
SEC. 3. Section 42023.3 of the Public Resources Code is repealed.
42023.3. (a) All money remaining in the subaccount on July 1,
2011, and all money received as repayment and interest on loans
shall, as of July 1, 2011, be transferred to the account and any
money due and outstanding on loans as of July 1, 2011, shall be
repaid to the board and deposited by the board in the account until
paid in full, except that, upon authorization by the Legislature in
the annual Budget Act, interest earnings may be expended for
administrative costs associated with the collection of outstanding
loan accounts.
(b) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2011, and as of January 1, 2012, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2012, deletes or extends the dates on which it
becomes inoperative and is repealed.
(2) The repeal of this section pursuant to paragraph (1) shall not
extinguish any loan obligation or the authority of the state to
pursue appropriate actions for the collection of a loan.
SEC. 4. Section 42023.4 of the Public Resources Code is amended to
read:
42023.4. (a) Loans A loan made
pursuant to Section 42023.1 shall be subject to all of the following
requirements:
(1) The terms of any an approved
loan shall be specified in a loan agreement between the borrower and
the board. The loan agreement shall include a requirement that the
failure to comply with the agreement shall result in any remaining
unpaid amount of the loan, with accrued interest, being immediately
due and payable. Notwithstanding any term of the agreement,
any a recipient of a loan that the board
approves shall repay the principal amount, plus interest on the basis
of the rate of return for money in the Surplus Money Investment Fund
at the time of the loan commitment. Except as provided in
subdivision (a) of Section 42023.3, all All
money received as repayment and interest on loans made pursuant to
this section shall be deposited in the subaccount.
(2) The term of any a loan made
pursuant to this section shall be not more than 10 years when
collateralized by assets other than real estate, or not more than 15
years when partially or wholly collateralized by real estate.
(3) The board shall approve only those loan applications that
demonstrate the applicant's ability to repay the loan. The highest
priority for funding shall be given to projects which
that demonstrate that the project will increase
market demand for recycling the project's type of postconsumer waste
material.
(4) The board shall finance not more than three-fourths of the
cost of each project, or not more than two million dollars
($2,000,000) for each project, whichever is less.
(b) (1) The board may expend not more than 50 percent of the
amount available in the subaccount as of the beginning of each fiscal
year for loans that do not exceed the lesser of two million dollars
($2,000,000) or three-fourths of the cost of the project to be funded
by the loan.
(2) The board may expend not more than 50 percent of the amount
available in the subaccount as of the beginning of each fiscal year
for loans that are greater than two million dollars ($2,000,000), but
do not exceed five million dollars ($5,000,000), and do not exceed
three-fourths of the cost of the project to be funded by the loan.
(3) A loan made pursuant to paragraph (1) or (2) shall promote
market demand for priority materials, as determined by the board.
(5)
(c) The Department of Finance may audit the expenditure
of the proceeds of any a loan made
pursuant to Section 42023.1 and this section.
(b) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2011, and as of January 1, 2012, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2012, deletes or extends the dates on which it
becomes inoperative and is repealed.
(2) The repeal of this section pursuant to paragraph (1) shall not
extinguish any loan obligation or the authority of the state to
pursue appropriate actions for the collection of a loan.
SEC. 5. Section 42023.5 of the Public Resources Code is amended to
read:
42023.5. (a) The board
shall, as part of the annual report to the Legislature, pursuant to
Section 40507, include a report on the performance of the Recycling
Market Development Revolving Loan Program, including the number and
size of loans made, characteristics of loan recipients, projected
loan demand, and the cost of administering the program.
(b) This section shall become inoperative on July 1, 2011, and as
of January 1, 2012, is repealed, unless a later enacted statute,
which becomes effective on or before January 1, 2012, deletes or
extends the dates on which it becomes inoperative and is repealed.
SEC. 6. Section 42023.6 of the Public Resources Code is amended to
read:
42023.6. (a) The board shall encourage applicants to seek
participation from private financial institutions or other public
agencies. For purposes of enabling the board and local agencies to
comply with Sections 40051 and 41780, the board may participate, in
an amount not to exceed five hundred thousand dollars ($500,000), in
the Capital Access Loan Program as provided in Article 8 (commencing
with Section 44559) of Chapter 1 of Division 27 of the Health and
Safety Code.
(b) For purposes of participating in the Capital Access Loan
Program, as specified in subdivision (a), or in any
a program that leverages subaccount funds, the
board may operate both inside and outside the recycling market
development zones.
(c) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2011, and as of January 1, 2012, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2012, deletes or extends the dates on which it
becomes inoperative and is repealed.
(2) The repeal of this section pursuant to paragraph (1) shall not
extinguish any loan obligation or the authority of the state to
pursue appropriate actions for the collection of a loan.