BILL ANALYSIS                                                                                                                                                                                                    


          |SENATE RULES COMMITTEE            |                   SB 675|
          |Office of Senate Floor Analyses   |                         |
          |1020 N Street, Suite 524          |                         |
          |(916) 651-1520         Fax: (916) |                         |
          |327-4478                          |                         |
                                 THIRD READING

          Bill No:  SB 675
          Author:   Steinberg (D), et al
          Amended:  4/2/09
          Vote:     21

           SENATE EDUCATION COMMITTEE  :  7-0, 4/1/09
          AYES:  Romero, Alquist, Hancock, Liu, Maldonado, Padilla,  
          NO VOTE RECORDED:  Huff, Wyland

           SENATE BUS., PROF. & ECON. DEVEL. COMMITTEE  :  8-1, 4/27/09
          AYES:  Negrete McLeod, Wyland, Corbett, Correa, Florez,  
            Oropeza, Romero, Yee
          NOES:  Aanestad
          NO VOTE RECORDED:  Walters

           SENATE APPROPRIATIONS COMMITTEE  :  6-3, 1/21/10
          AYES:  Kehoe, Corbett, Leno, Liu, Price, Yee
          NOES:  Cox, Denham, Walters

           SUBJECT  :    Energy job training

           SOURCE  :     Author

           DIGEST  :    This bill enacts the 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  


                                                                SB 675

          clean technology, renewable energy, or energy efficiency.   
          Funds will be provided in the form of grants for $3 million  
          for qualifying new education-related modernization  
          projects.  This bill creates a council for the purposes of  
          developing guidelines to implement this act and will  
          empower to issue and renew negotiable bonds, notes,  
          debentures, or other sources of security that will be  
          secured by monies appropriated by the Legislature from the  
          Public Interest Research, Development, and demonstration  

           ANALYSIS  :    Proposition 1D, authorized by AB 127 (Nunez  
          and Perata), Chapter 35, Statutes of 2006, and approved by  
          the voters in November 2006, provided $7.3 billion for K-12  
          school facilities, and established the Career Technical  
          Education Facilities Program, providing $500 million to  
          construct or modernize facilities for this purpose. 

          Existing law creates the Public Interest Research,  
          Development, and Demonstration Fund for the purpose of  
          making awards for projects or programs that are not  
          provided for by competitive and regulated markets.  The  
          revenue for this fund comes from electrical utility  
          corporations and is available upon appropriation by the  

          This bill establishes the Clean Technology and Renewable  
          Energy Job Training, Career Technical Education and Dropout  
          Prevention Act of 2010.  More specifically it:

          1. Establishes the Clean Technology and Renewable Energy  
             Job Training, Career Technical Education and Dropout  
             Prevention 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  

          2. Defines various terms in the bill including:

               (1)       Council  :  The Clean Technology and Renewable  


                                                                SB 675

                 Energy Job Training, Career Technical Education and  
                 Dropout Prevention Council comprised of the  
                 Secretaries of the Natural Resources Agency  
                 (chair), 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 and two  
                 members appointed by the Speaker of the Assembly,  
                 as specified.

               (2)    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, as specified, the California  
                 Conservation Corp or a certified local conservation  
                 corp., a public postsecondary educational  
                 institution or any other entity approved by the  

               (3)    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, as specified, or 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  

          3. Outlines various elements of the competitive grants  
             program proposed by the bill.  Specifically it:

               (1)   Requires the State Allocation Board (SAB) to  
                 administer grant applications and to implement the  
                 program pursuant to regulations and guidelines  
                 established by the Council.


                                                                SB 675

               (2)   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  

               (3)   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. 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. 

               (4)   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.

               (5)   Authorizes the repayment of the local  
                 contribution over time but prohibits the SAB from  
                 waiving the local contribution on any basis.

               (6)   Requires that applicants meet any criteria  
                 established by the 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.

               (7)   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  


                                                                SB 675

                 three deciles of the Academic Performance Index  
                 (API), as specified, 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.

               (8)   Authorizes the Council to use state agency  
                 personnel in administering outreach, education,  
                 technical assistance, guideline development and  
                 grant application review.

               (9)   Requires that every proposed activity or  
                 project financed be in compliance with the  
                 California Environmental Quality Act, and that real  
                 property acquisitions are from willing sellers.

              (10)   Authorizes up to five percent of funds be  
                 allocated for administrative costs of the program.

              (11)   Requires the body awarding a contract for a  
                 public works project financed from these funds to  
                 adopt and enforce a labor compliance program, as  

              (12)   Requires the chair of the Council to provide  
                 for an annual independent audit of expenditures  
                 from the fund.

          4. Makes fiscal provision for the funding of the grant  
             program.  Specifically it:

               (1)   Authorizes the Council to incur indebtedness  
                 and issue and renew negotiable bonds, notes,  
                 debentures or other securities of any kind or  

               (2)   Requires all indebted incurred to be paid  
                 solely from moneys from the Public Interest  
                 Research Development and Demonstration Fund and  
                 from funds appropriated by the Legislature in the  
                 annual Budget Act for this purpose and requires  
                 that proceeds from the sale of these instrument be  
                 deposited into the Clean Technology and Renewable  


                                                                SB 675

                 Energy Job Training, Career Technical Education and  
                 Dropout Prevention fund in the State Treasury. 

               (3)   Specifies that the funds appropriated by the  
                 Legislature in the annual Budget Act for this  
                 purpose shall not exceed an unspecified amount.

               (4)   Authorizes the Legislature by statute, to  
                 authorize the Council to issue bonds in excess of  
                 the unspecified amount provided for in the bill.

               (5)   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 of any  
                 form of taxation or to make any appropriation for  
                 their payment. 


          According to information provided by the author's office,  
          this bill is intended to address two key state priorities:   
          (1) reducing the high school dropout rate by encouraging  
          the construction or reconfiguration of facilities that will  
          provide engaging career technical education to students,  
          and (2) developing a skilled workforce that is prepared to  
          take advantage of opportunities created by emerging green  

          According to 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.  They also believe that all students benefit  


                                                                SB 675

          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.

           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  
          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 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.

           Prior legislation
          A similar bill was SB 1672 (Steinberg) of 2008 which died  
          in the Assembly Appropriation Committee.


                                                                SB 675

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

          According to the California Energy Commission, its proposed  
          FY 2009-10 budget includes $74.2 million in the Public  
          Interest Research Development and Demonstration Fund (PIER)  
          funds to support approximately 70 positions, operating and  
          baseline technical support contracts and $62.5 million for  
          pass through research, development and demonstration  
          projects.  PIER funds are currently used to fund research  
          projects to develop new energy technologies.  These funds  
          will be redirected for the purposes outlined in this bill.   
          Currently law restricts the expenditure of these funds for  
          specified purposes from 2007 until 2012.  To make the  
          funding mechanism of this bill viable, it will likely be  
          necessary to extend the statutory life of the PIER fund.   
          As the bill does not currently specify an amount of debt  
          that will be issued by the Council, the exact cost of this  
          bill is unknown.  Assuming, for one example, that the  
          intent was to use approximately half of the available  
          amount of the PIER fund to pay-off the debt issued by the  
          Council at an interest rate of five percent, the Council  
          could issue $450 million in bonds.  The total repayment  
          over 20 years will be $722 million.  Of course, the actual  
          amount will be dependent on future legislative action  
          concerning the fund and the authority ultimately granted to  
          the Council.  In addition to the costs of debt repayment,  
          the Office of Public School Construction indicates costs of  
          $900,000 for administering grant applications and operating  
          the program.

           SUPPORT  :   (Verified  1/25/10)

          American Federation of State, County and Municipal  
          Employees, AFL-CIO
          Apollo Alliance
          Association of California School Administrators
          Bloom Energy
          California Association of Local Conservation Corps.
          California Association of Regional Occupation Centers and  
          California Catholic Conference
          California Community Colleges


                                                                SB 675

          California Correctional Peace Officers Association
          California Labor Federation
          California League of Conservation Voters
          California School Boards Association
          Calpine Corp.
          City of Sacramento
          Construction Employers' Association
          Elk Grove Unified School District
          Ella Baker Center for Human Rights - Green Collar Jobs  
          Green Technical Education and Employment
          Long Beach Community College
          Los Angeles Community College District
          Los Angeles Unified School District
          Los Rios Community College District
          Metropolitan Education District
          Natural Resources Defense Council
          Sacramento Conservation Corps
          San Francisco Board of Supervisors
          San Francisco Unified School District
          School for Integrated Academics and Technologies
          Sierra Club
          State Construction and Building Trades of California

           ARGUMENTS IN SUPPORT  :    Several organizations have written  
          in support of this bill and contend that it establishes  
          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.

          DLW:do  1/25/10   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

                                ****  END  ****