BILL ANALYSIS
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|Hearing Date:April 27, 2009 | |
| | Bill No: SB 675 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Gloria Negrete McLeod, Chair
Bill No: SB 675Author:Steinberg
As Amended:April 2, 2009 Fiscal: Yes
SUBJECT: Energy job training.
SUMMARY: Enacts Clean Technology and Renewable Energy Job Training,
Career Technical Education, and Dropout Prevention Act of 2010 to
provide funds to qualifying entities for construction or reconfiguring
facilities to provide program participants with skills and knowledge
necessary for successful employment related to clean technology,
renewable energy or energy efficiency.
Existing law:
1)Establishes the California Energy Commission (Commission) as the
state's primary energy and planning agency.
2)Within the Commission, creates the Public Interest Research,
Development and Demonstration program (PIER), funded by deposits from
electrical utility and natural gas corporations, to grant awards to
support cost-effective energy efficient and conversation projects and
programs and public interest research and development to improve
environmental quality, enhance electrical system reliability,
increase efficiency of energy using technologies, lower electrical
system costs or other tangible benefits.
This bill:
1) Creates the Clean Technology and Renewable Energy Job Training,
Career Technical Education and Dropout Prevention Act of 2010.
2) Makes a number of legislative declarations and findings
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regarding renewable energy, energy conservation, clean technology and
climate change policies, with a focus on California's leadership in
those areas, the need to use renewable energy and the technologies it
requires to reduce high school dropout and joblessness rates for the
state's young people and to develop the state's renewable energy
resources.
3) States legislative intent to stimulate the state's economy,
create tens of thousands of good paying jobs in industries and
businesses that are in compliance with the state's environmental
protection laws and regulations, to provide entrepreneurs and
employers the best-trained workforce in the United States and to
prepare young people and adults to work in clean, green industries
and professions.
4) Creates the Clean Technology and Renewable Energy Job Training,
Career Technical Education and Dropout Prevention Fund (Fund) in the
State Treasury to provide competitive grants for the purpose of
constructing or reconfiguring new facilities with a useful life
expectancy of at least 20 years or the length of bond maturity to
provide program participants with skills and knowledge necessary for
successful employment related to clean technology, renewable energy
or energy efficiency.
5) Defines the following terms in the bill:
a) Board refers to the State Allocation Board.
b) Clean technology projects refers to the following
i) Energy audits determine energy savings that can be achieved
from projects funded under this program and that can be
recovered through utility bill financing.
ii) Retrofitting and weatherization activities that increase
energy efficiency and conservation.
iii) Energy and water efficient public buildings.
iv) Retrofitting and installing energy efficient household
appliances, windows, doors, insulation and lighting.
v) Retrofitting and installing water and energy conservation
technologies in existing residential, industrial, commercial and
public structures to improve efficiency, including the use of
energy and water management technologies and control systems.
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vi) The manufacture, sale, assembly, installation, construction
and maintenance of energy efficient technologies and renewable
energy facilities or the components of renewable energy
technologies.
vii) Projects related to energy efficient technologies or
practices and renewable energy production or the component parts
of renewable energy plants and energy distribution, including
energy storage, energy infrastructure, transportation, clean
vehicle technology, clean heat and power and water and
wastewater.
viii) Natural resource conservation projects related to climate
change such as fish and wildlife restoration, reforestation,
native species restoration, invasive species eradication,
community tree planting and other projects that fight climate
change.
c) Disadvantaged community : A community with a median household
income that is less than 89 percent of the statewide average.
Severely disadvantaged community means a community with a median
household income that is less than 60 percent of the statewide
average.
d) Council : The Clean Technology and Renewable Energy Job
Training, Career Technical Education and Dropout Prevention
Council comprised of the Secretaries' of the Natural Resources
Agency, Labor and Workforce Development, Environmental Protection,
the Superintendent of Public Instruction, the Chancellor of the
California Community Colleges, two members appointed by the Senate
Rules Committee (one who is a renewable energy projects employer
and another who is a member of a nonprofit environmental advocacy
organization) and two members appointed by the Assembly Speaker
(one who represents disadvantage communities and another from a
labor organization that provides state approved renewable energy
development pre-apprenticeship or apprenticeship programs)
e) Eligible entity : Those eligible to apply for the competitive
grants to include a public school serving any of grades 7-12, a
California community college, a public entity providing career
technical education including a county office of education or
school agency joint powers authority, a publicly or investor owned
facility, a non-profit organization, a labor organization, a
business entity, a state-approved apprenticeship program, a
regional collaborative, the California Conservation Corps or a
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certified local conservation corps, a public postsecondary
educational institution or any other entity approved by the
Council.
f) Program Participants . Those served by the eligible entities
including middle or high school pupils, community college
students, job trainees, incumbent workers, members of the
California Conservation Corps or certified local conversation
corps, minors or adults under 22 years of age either on probation
or participating in programs that include career technical
education as an alternative to conviction, incarceration or
adjudication, as specified.
6) Outlines various elements of the competitive grants program
proposed by the bill. Specifically it does the following:
a) Requires the State Allocation Board (SAB) to administer grant
applications and to implement the program pursuant to regulations
and guidelines established by the Council.
b) Requires grants be allocated on a per square foot basis and
prohibits any requirement that students be unhoused or that
facilities meet any age requirements to receive a grant under the
program.
c) Establishes a maximum of $3 million per project per eligible
entity for new construction grants for either stand-alone projects
or as supplements to the per pupil allocation under the existing
new construction program.
d) Establishes a maximum of $1.5 million per project per eligible
entity for modernization grants for the purpose of reconfiguration
and provides that the grant be supplemental to the per pupil
allocation provided under the existing modernization program.
e) Requires the eligible entity to contribute toward the project
on a 50/50 match basis and authorizes the local contribution to
come from private industry groups, the school district or a joint
powers authority and authorizes the reduction, but not the
elimination of the match at the discretion of the Council.
f) Authorizes the repayment of the local contribution over time
but prohibits the SAB from waiving the local contribution on any
basis.
g) Requires applicants meet any criteria established by the
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Council and also enter into agreements, as specified, to engage in
specified activities related to education, job training, or
providing employment and career opportunities to program
participants.
h) Requires the Council to develop guidelines for awarding the
competitive grants, specifies a number of elements to be included
in the grant application and requires priority be given to
projects serving students in grades 7-12, dedicated to dropout
prevention and career technical education, in communities with
schools that rank in the bottom three deciles of the Academic
Performance Index (API), in communities with higher than average
rates of dropouts, low-income households, or other challenges, as
specified, and projects initiated by the California Conservation
Corps or a certified local conservation corps.
i) Authorizes the Council to use state agency personnel in
administering outreach, education, technical assistance, guideline
development and grant application review.
j) Requires every proposed activity or project financed be in
compliance with the California Environmental Quality Act and that
real property acquisitions are from willing sellers.
aa) Authorizes up to five percent of funds be allocated for
administrative costs of the program.
bb) Requires the body awarding a contract for a public works
project financed from these funds to adopt and enforce a labor
compliance program, as specified.
cc) Requires the Chair of the Council to provide for an annual
independent audit of expenditures from the fund.
7)Makes the following provisions for the funding of the grant program.
a) Authorizes the Council to incur indebtedness and issue and
renew negotiable bonds, notes, debentures or other securities of
any kind or class.
b) Requires all indebtedness incurred to be paid solely from
moneys from the Public Interest Research Development and
Demonstration Fund (PIER) and from funds appropriated by the
Legislature in the annual Budget Act for this purpose and requires
that proceeds from the sale of these instruments be deposited into
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the Clean Technology and Renewable Energy Job Training, Career
Technical Education and Dropout Prevention Fund.
c) Specifies the funds appropriated by the Legislature in the
annual Budget Act for this purpose shall not exceed an unspecified
amount.
d) Authorizes the Legislature by statute, to permit the Council to
issue bonds in excess of the unspecified amount provided for in
the bill.
e) Declares that bonds issued do not constitute a debt or
liability of the state or any political subdivision of the state
other than the Council and that the issuance of bonds under these
provisions does not obligate the state or any political
subdivision of the state to levy or pledge any form of taxation or
to make any appropriation for their payment.
FISCAL EFFECT: Unknown. This bill is keyed "fiscal" by Legislative
Counsel.
COMMENTS:
1.Purpose. According to the Sponsors, the California Labor Federation
and the State Building Trades and Construction Council of California ,
this measure promotes career technical education and incentives
innovative public-private education and workforce preparation
partnerships with businesses, high schools, community colleges and
union apprenticeship programs. They assert the measure ensures that
the investment in transportation, energy infrastructure, water,
industry, and many clean technologies produced by the implementation
of AB 32, voter approved infrastructure investment and the American
Recovery and Reinvestment Act, and also benefits California's most
underserved and at-risk communities.
The Sponsors also believe that all students benefit from academically
rigorous, relevant standards aligned in career technical education
(CTE) courses and further state that the public education system is
failing countless middle and high school students by not providing a
well-rounded education that engages and motivates students to finish
school. They point to the record high dropout rate as an example of
the disconnect between current college bound curriculum emphasized in
schools and the career aspirations of California's student
population.
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2.Background. California Department of Education (CDE) 2006-07 data
shows that, statewide, California has a 67.6 percent high school
graduation rate and 24.2 percent dropout rate. Graduation and
dropout rates vary among counties and the same data illustrates the
following dropout rate disparities among ethnic groups:
Ethnicity Graduation RateDropout
Rate
White 84.8% 15.2%
African American 58.4 41.6
American Indian 68.7 31.3
Asian 89.2 10.2
Filipino 88.1 11.9
Hispanic/Latino 69.7 30.3
Pacific Islander 72.1 27.9
Other CDE data on career technical education (CTE) indicates that the
number of CTE classes declined approximately 24 percent between
1997-98 and 2006-07. Recent research by Kenneth C. Gray and Edwin L.
Herr of Pennsylvania State University indicates that while many high
school students matriculate to college, relatively few go on to both
earn a college degree and work in a job requiring a college degree.
Gray and Herr argue that providing a range of educational coursework,
including opportunities for contextual and applied learning and
rigorous academics, creates more alternatives for high school
students and enables them to make more informed choices about career
pathways following high school.
3.California Research Bureau's (CRB) Careers Project Report. Earlier
this year, the CRB released its Careers Project report which examined
the preparation all students in public middle and high schools
receive to explore career options and the relationship between that
preparation and California's state and regional economies. The
report was done at the request of a bipartisan group of 11 members of
the California Legislature and funding support from the James Irvine
Foundation. The study consisted of three distinct phases - a
statewide survey of middle and high school counselors and principals,
an economic analysis and survey of representatives of business and
industry in California and school focus groups.
The following are the findings relevant to this legislation:
There are limited resources available to all students in grades seven
through 12 for career development.
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Half of all respondents reported that their schools offered a
curriculum for career development, less than half had developed
such a curriculum, and about half had provided career development
to all students. This indicates that the provision of career
development information for all students regarding the various
careers and industries in the state is not a high priority for
school districts and schools.
Of the schools providing career development services, only ten
percent had evaluated the effectiveness of their career
development activities, programs or tools. Moreover, of the
schools that had engaged with local businesses, about a fifth had
evaluated the effectiveness of these partnerships.
Schools not providing career development to all students or not
engaging with entities in their local community (such as community
colleges, local businesses or other community organizations) might
if they had more staff.
Principals and counselors concurred that students are
interested in receiving more career development information, since
this was the least cited reason for not providing career
development to all students.
1.BP&ED Informational Hearing on Workforce Development. On March 23rd,
the Committee on Business, Professions and Economic Development held
an informational hearing entitled "The Role of Private Education
Institutions in Preparing California's Diverse Workforce: Meeting the
Challenges of our Workforce and Job Training Needs." The hearing
examined the ability of private postsecondary institutions to fill
the career preparation needs of California's workforce and evaluate
policy options that allow them to expand their workforce development
programs with the requisite amount of oversight required to protect
students.
Automotive, biotech, construction, health and manufacturing industry
representatives were invited to participate in the hearing and they
offered testimony on their industries' difficulty in difficulty in
hiring qualified employees. They also provided the Committee with
information on workforce development programs in which they have
engaged to help address those workforce shortages. This information
provided the basis for one of the hearing's main findings;
specifically, that industries are facing shortages in hiring workers
with the minimum skills needed for entry into the field.
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2.California Energy Commission's PIER Program. Created in 1974, the
California Energy Commission is the state's primary energy policy and
planning agency and among other things, is responsible for supporting
public interest energy research that advances energy science and
technology through research, development, and demonstration programs.
The Commission also supports renewable energy by providing market
support to existing, new, and emerging renewable technologies;
providing incentives for small wind and fuel cell electricity systems
and providing incentives for solar electricity systems in new home
construction.
The Commission's Research Development and Demonstration Division
administers the PIER program and the PIER fund to provide grants for
energy-related research, development and demonstration efforts not
adequately provided by competitive and regulated markets. The PIER
fund, which receives funds from electric and natural gas utilities,
allocates 83.5 million in public interest energy research funds
annually; $62.5 million for electricity and $21 million for natural
gas.
The general goal of the program is to develop, and help bring to
market, energy technologies that provide increased environmental
benefits, greater system reliability, lower system costs and provide
tangible benefits to electric utility customers through the following
investments:
Advanced transportation technologies that reduce air pollution
and greenhouse gas emissions beyond applicable standards, and that
benefit electricity and natural gas ratepayers.
Increased energy efficiency in buildings, appliances, lighting,
and other applications beyond applicable standards, and that
benefit electric utility customers.
Advanced electricity generation technologies that exceed
applicable standards to increase reductions in greenhouse gas
emissions from electricity generation, and that benefit electric
utility customers.
Advanced electricity technologies that reduce or eliminate
consumption of water or other finite resources, increase use of
renewable energy resources, or improve transmission or
distribution of electricity generated from renewable energy
resources.
1.PIER funds. According to the California Energy Commission, its
proposed
FY 2009-10 budget includes $74.2 million in PIER funds to support
approximately 70 positions, operating and baseline technical support
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contracts and $62.5 million for pass through research, development
and demonstration projects.
Rather than a statewide general obligation bond, this bill proposes
the creation of a revenue backed bond issuance, i.e. bonds backed by
the revenue that accrues to the PIER fund as well as appropriations
made by the Legislature.
PIER funds are currently used to fund research projects to develop
new energy technologies. If enacted these funds would be redirected
for the purposes outlined in this bill. Current law restricts the
expenditure of these funds for specified purposes from 2007 until
2012.
2.General Obligation Bonds for School Facilities. Proposition 1D,
authorized by AB 127 (Nunez and Perata. Chapter 35, Statutes of 2008)
and approved by the voters in November 2006 authorized the issuance
of $7.3 billion on general obligation bonds for K-12 school
facilities, and established the Career Technical Education Facilities
Program, which allocated $500 million for the construction and
modernization of career technical education facilities.
3.Suggested Amendments. This bill establishes the Clean Technology and
Renewable Energy Job Training, Career Technical Education and Dropout
Prevention Council (Council) comprised of the Secretaries of
specified state agencies and the Superintendent of Public Instruction
(SPI). Given the many responsibilities these individuals have and
the scheduling conflicts that may arise when trying to arrange
Council meetings, the Author may wish to consider amending the bill
to allow the designees of the various Secretaries and the SPI to sit
on the Council and act on their behalf.
4.Related legislation. SB 1672 (Steinberg, 2008) would have
authorized, upon voter approval at 2010 statewide election, $2.25
billion worth of state general obligation (G.O.) bonds to fund
capital outlay projects at institutions offering career development
related to clean technology, renewable energy or energy efficiency
and to fund a revolving loan for capital outlay projects undertaken
by public and private entities involved in such career development.
The measure was held in the Assembly Appropriations Committee.
AB 118 (N??ez, Chapter 750, Statutes of 2007) established the
Enhanced Fleet Modernization Program and the Air Quality Improvement
Program.
AB 32 (N??ez, Statutes of 2006, Chapter 488) enacted the Global
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Warming Act of 2006 (Act), which creates a statewide greenhouse gas
(GHG) emission limit to reduce emissions by 25 percent by 2020.
SB 1250 (Perata, Chapter 512, Statutes of 2006) authorized the
continued expenditure of funds collected pursuant to current law for
the Public Interest Energy Research program and the Renewable
Research Development and Demonstration program and provides policy
directions for these programs
AB 1002 (Chapter 932, Statutes of 2000) imposed a surcharge on all
natural gas consumed in California to fund specified low-income,
energy efficiency, conservation and public interest research
programs.
AB 1890 (Chapter 854, Statutes of 1996) restructured the electrical
services industry in California in order to transition to competitive
markets by December 31, 2001, to lower the cost of electricity,
retain and attract jobs and to reduce power outages.
5.Arguments in Support. Several organizations (see below) have written
in support of this measure and contend that it would establish
partnerships between schools, ROC/Ps and various other entities to
work together to make California an international leader in clean
technology and renewable energy. They state that this investment in
reducing the dropout rate, expanding workforce opportunities and
targeting climate change will create major economic stimulus for
clean energy and technology jobs that will improve the quality of
life for all Californians.
6.Support if Amended. The California Manufacturers and Technology
Association (CMTA) supports efforts to rebuild career and technical
education in California's schools and the need to address the state's
alarmingly high drop-out rate. However, CMTA opposes the use of PIER
funds for this purpose and instead proposes that the programs in this
bill be funded through existing and future public education
resources. CMTA states it looks forward to working with the Author
to identify viable and stable funding sources to support workforce
development goals and the economy.
The School for Integrated Academies and Technologies (SIATech) also
has a support if amended position on SB 675. SIATech is a
comprehensive high school program that partners with the Federal Job
Corps to provide a second chance for dropouts who wish to re-engage
in a rigorous academic program and receive an accredited California
education standards aligned diploma. SIATech is asking that SB 675
be amended to include charter schools (such as theirs) that have
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specific workforce preparation roles in the eligible entity
definitions and refers to the current statutory reference to those
schools in Education Code 47605.1(g)(3), which reads as follows.
Education Code 47605.1(g). Notwithstanding any other provision of
law, the jurisdictional limitations set forth in this section do not
apply to a charter school that provides instruction exclusively in
partnership with any of the following:
(1) The federal Workforce Investment Act of 1998 (29 U.S.C. Sec.
2801 et seq.)
(2) Federally affiliated Youth Build programs.
(3) Federal job corps training or instruction provided pursuant to
a memorandum of
understanding with the federal provider.
(4) The California Conservation Corps or local conservation corps
certified by the
California Conservation Corps pursuant to Sections 14507.5
or 14406 of the
Public Resources Code.
(5) Instruction provided to juvenile court school pupils pursuant
to subdivision (c) of
Section 42238.18 or pursuant to Section 1981 for individuals
who are placed in
a residential facility
Specifically, SIATech is requesting amendments to 102002 and
102004 that read: "A charter school that provides instruction
exclusively in partnership with the programs identified in Education
Code 47605.1(g)(3)."
SUPPORT AND OPPOSITION:
Support:
American Federation of State, County, and Municipal Employees
California Apollo Alliance
California Association of Local Conservation Corps
California Community Colleges
California Labor Federation (Co-Sponsor)
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California School Boards Association
CALPINE
Construction Employers' Association
Long Beach City College District
Los Angeles Unified School District
Natural Resources Defense Council
San Francisco Unified School District
State Building and Construction Trades Council of California
(Co-Sponsor)
Support if Amended :
California Manufacturers and Technology Association
School for Integrated Academies and Technologies (SIATech)
Opposition:
None received as of April 22nd.
Consultant: Sieglinde Johnson