BILL NUMBER: SB 390 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 20, 2009
AMENDED IN SENATE MAY 5, 2009
AMENDED IN SENATE APRIL 22, 2009
AMENDED IN SENATE APRIL 13, 2009
INTRODUCED BY Senator Kehoe
FEBRUARY 26, 2009
An act to amend Sections 42023.1, 42023.2, 42023.3, 42023.5, and
42023.6 of, and to amend, add, and repeal Section 42023.4 of, the
Public Resources Code, relating to solid waste, and making an
appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
SB 390, as amended, 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 prohibit the board from funding a loan under the
program until it determines that the applicant has obtained all
significantly, as determined by the board, applicable federal,
state, and local permits and would extend the program and the
continuous appropriation to July 1, 2021, and the repeal date to
January 1, 2022, thereby making an appropriation.
(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. The bill would
retroactively delete the requirement that the amount transferred from
the account to the subaccount be repaid 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 would authorize the board, until July 1, 2016, and if
the money in the subaccount is in excess of $5,000,000, to provide
loans that do not exceed the lesser of $5,000,000 or 3/4 of the cost
of the project.
(4) The act requires the board to give highest priority for
funding to certain projects and to approve only those loan
applications demonstrating loan repayment ability.
This bill would delete this requirement.
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 loan repayments and fees, including, but not
limited to, principal and interest repayments, fees and points,
recovery of collection costs, income earned on 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 not fund a loan until it determines that the
applicant has obtained all significantly applicable
federal, state, and local permits. The board shall determine
which applicable federal, state, and local permits are significant.
(h) 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 that are entered
into by the board, to fund the board's administration of the
revolving loan program.
(i) 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.
(j) 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.
(k) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2021, and as of January 1, 2022, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2022, deletes or extends the date 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, as available, from
the account to the subaccount as necessary to meet anticipated loan
demand under the program.
(b) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2021, and as of January 1, 2022, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2022, deletes or extends the date on which it
becomes inoperative and is repealed.
(2) (A) 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.
(B) The board shall not be obligated to pay interest on the amount
appropriated from the account to the subaccount pursuant to
subdivision (a). This subparagraph shall apply retroactively from
January 1, 1992.
SEC. 3. Section 42023.3 of the Public Resources Code is amended to
read:
42023.3. (a) All money remaining in the subaccount on July 1,
2021, and all money received as repayment and interest on loans
shall, as of July 1, 2021, be transferred to the account and any
money due and outstanding on loans as of July 1, 2021, 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, 2021, and as of January 1, 2022, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2022, 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) A loan made pursuant to Section 42023.1 shall be
subject to all of the following requirements:
(1) The terms of 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, 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 money received as
repayment and interest on loans made pursuant to this section shall
be deposited in the subaccount.
(2) The term of 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) (A) Except as provided in subparagraph (B), the board shall
not finance more than three-fourths of the cost of a project or two
million dollars ($2,000,000), whichever is less.
(B) Notwithstanding subparagraph (A), if the board determines that
there is money in the subaccount in excess of five million dollars
($5,000,000), then the board may finance a loan or loans in an amount
that is greater than two million dollars ($2,000,000), but does not
exceed five million dollars ($5,000,000) and does not exceed
three-fourths of the project cost from that excess amount.
(b) The Department of Finance may audit the expenditure of the
proceeds of a loan made pursuant to Section 42023.1 and this section.
(c) This section shall become inoperative on July 1, 2016, and as
of January 1, 2017, is repealed, unless a later enacted statute,
which becomes effective on or before January 1, 2017, deletes or
extends the date on which it becomes inoperative and is repealed.
SEC. 5. Section 42023.4 is added to the Public Resources Code, to
read:
42023.4. (a) A loan made pursuant to Section 42023.1 shall be
subject to all of the following requirements:
(1) The terms of 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, 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 money received as
repayment and interest on loans made pursuant to this section shall
be deposited in the subaccount.
(2) The term of 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 not finance more than three-fourths of the
cost of a project or two million dollars ($2,000,000), whichever is
less.
(b) The Department of Finance may audit the expenditure of the
proceeds of a loan made pursuant to Section 42023.1 and this section.
(c) This section shall become operative on July 1, 2016.
(d) (1) Except as provided in paragraph (2), this section shall
become inoperative on July 1, 2021, and as of January 1, 2022, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2022, deletes or extends the date 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. 6. 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, 2021, and as
of January 1, 2022, is repealed, unless a later enacted statute,
which becomes effective on or before January 1, 2022, deletes or
extends the date on which it becomes inoperative and is repealed.
SEC. 7. 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 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, 2021, and as of January 1, 2022, is
repealed, unless a later enacted statute, which becomes effective on
or before January 1, 2022, deletes or extends the date 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.