BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1477
                                                                  Page  1

          Date of Hearing:   August 4, 2010

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

            SB 1477 (Committee on Environmental Quality) - As Introduced:   
                                   March 1, 2010 

          Policy Committee:                              Environmental  
          Safety and Toxic Materials                    Vote: 9-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              No

          SUMMARY  

          This bill makes several technical changes to the California  
          Pollution Control Financing Authority (CPCFA) Act.  Most  
          significantly, this bill clarifies that projects eligible to  
          receive CPCFA financing may include environmental projects  
          authorized by federal law for tax-exempt or tax-credit  
          financing, as specified, in addition to those meeting certain  
          requirements of state law.

           FISCAL EFFECT  

          1)Negligible costs, if any.

          2)Possible expedited funding of eligible projects through CPCFA.

           COMMENTS  

           1)Rationale  .  The Treasurer (sponsor) reports that the Attorney  
            General (AG) recommends technical changes to existing law to  
            clarify the types of projects that may receive funding from  
            the CPCFA.  As the sponsor describes it, SB 832 (Senate  
            Committee on Environmental Safety, Chapter 643, Statutes of  
            2009) was intended to clarify CPCFA's authority.  The sponsor  
            contends certain last-minute amendments to the bill have been  
            interpreted by the AG as possibly limiting CPCFA financing to  
            only those projects that qualify for tax-exempt financing  
            under state law.  The sponsor and author intend this bill to  
            clarify this ambiguity so that CPCFA may finance projects that  
            qualify for tax-exempt financing under federal tax law which,  
            the sponsor argues, is in keeping with legislative intent.








                                                                  SB 1477
                                                                  Page  2


           2)Background  .  CPCFA provides low-cost innovative financing to  
            California businesses. As an issuer of tax-exempt private  
            activity bonds, CPCFA facilitates low-cost financing to  
            qualified waste and recycling projects. Other projects to  
            control pollution can qualify for tax-exempt financing as  
            allowed by federal tax law.  CPCFA works with participating  
            financial institutions to assist small business with loans up  
            to $1.5 million. CPCFA also assists with the clean-up of  
            contaminated sites through a $60 million grant and loan  
            program and a site-assessment loan program.

           3)SB 832  , which was signed into law in 2009, made several  
            technical, noncontroversial changes, including an update of  
            governing code, which had not been updated since 1975, to  
            reflect changes in business practices, program updates, and  
            federal tax law.  
           
           Analysis Prepared by  :    Jay Dickenson / APPR. / (916) 319-2081