BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 29
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          CONCURRENCE IN SENATE AMENDMENTS
          AB 29 (John A. Pérez)
          As Amended  September 2, 2011
          Majority vote
           
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          |ASSEMBLY:  |76-2 |(May 31, 2011)  |SENATE: |31-3 |(September 7,  |
          |           |     |                |        |     |2011)          |
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           Original Committee Reference:    J., E.D. & E.  

           SUMMARY  :  Establishes the Governor's Office of Business 
          Development (GO-Biz) for the purpose of serving as the lead 
          state entity for economic strategy and marketing of California 
          on issues relating to business development, private sector 
          investment and economic growth.   Among other things, this bill 
          reorganizes the Office of the Small Business Advocate (OSBA) and 
          codifies the Office of Business Assistance within the new 
          GO-Biz. 

           The Senate amendments  :

          1)Change the name of the Office of Economic Development to 
            GO-Biz.

          2)Authorize rather than mandate the duties of GO-Biz.

          3)Delete the requirement that the Director of Go-Biz be 
            confirmed by the Senate.

          4)Remove 2011-12 funding provisions.

          5)Remove language related the California Economic Strategy 
            Panel, which was eliminated through 2011-12 Budget actions.  
           
          AS PASSED BY THE ASSEMBLY , this bill established the Office of 
          Economic Development (OED) within the Office of the Governor.  
          The Director of OED was required to be confirmed by the Senate.  
          Funding for the OED in the 2011-12 fiscal year was directed to 
          come from existing resources and staffed by personnel loaned 
          from other state agencies and departments.  The bill required 
          each member of the Cabinet to identify a senior manager within 
          his or her agency who would be responsible for coordinating 
          business support activities with OED.  Funding in subsequent 








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          years would be provided through the regular budgeting process, 
          including the permanent transfer of associated positions.

           FISCAL EFFECT :  According to the Senate Appropriations 
          Committee, implementation of this bill creates ongoing costs of 
          $2.3 million with a mix of General and Special Funds.  

           COMMENTS  :  In February 2010, the Little Hoover Commission (LHC) 
          undertook a review of the state's economic and workforce 
          development programs.  In its final report, Making up for Lost 
          Ground: Creating a Governor's Office of Economic Development, it 
          analyzed the status and effectiveness of current programs since 
          the 2003 demise the Technology, Trade and Commerce Agency and 
          recommended the creation of a new governmental entity to fill 
          the void left by the dismantled agency.

          The report called for a single agency that would promote greater 
          economic development, foster job creation, and deliver specific 
          services (i.e., permitting, tax, regulatory, and other 
          information) directly to the California business community.  In 
          April 2010, Governor Schwarzenegger issued Executive Order 
          S-05-10 (EO) as a means to operationalize the report 
          recommendations including the creation of the Governor's Office 
          of Economic Development (GOED).  This bill substantially 
          codifies and provides enhanced guidance to the framework 
          detailed in EO S-05-10 by statutorily forming GO-Biz and 
          assigning specific tasks and duties.   

          Previous legislation:  This bill is a re-introduction of AB 2734 
          (John A. Pérez) of 2010, which was vetoed by the Governor, 
          based, according to his veto message, on the provision that the 
          Director was subject to Senate confirmation, which he stated 
          would "inappropriately infringe" upon the rights and powers of 
          the Governor.  Senate amendments remove this requirement from 
          this bill.
             
          Governor's Office of Economic Development:  GOED was created in 
          April 2010 through Executive Order (S-05-10).  Since its 
          inception, GOED has served over 3,000 businesses, 95% of which 
          are small.  The most frequent types of assistance include help 
          with permit streamlining, starting a businesses, relocation and 
          expansion of businesses, and regulatory challenges.

          Under the auspices of GOED, a number of state programs and 
          services are administered, including programs related to 








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          international trade, permit assistance, the California Business 
          Investment Services Program (CalBIS), the OSBA, and innovation.  
          There are 23 positions assigned to GOED, which is funded through 
          existing state resources and staffed by personnel loaned from 
          state agencies and departments.  This bill states that this 
          shall remain the funding and staffing structure for GOED during 
          fiscal year 2011-12 and thereafter be subject to the regular 
          state budget process.

          Among other programs, GOED administers the Innovation Hub (iHUB) 
          program in partnership with the statewide network of Small 
          Business Development Centers.  There are currently 12 regional 
          iHUBs located throughout the state.  The iHUB program is 
          designed to improve the state's national and global 
          competitiveness by stimulating partnerships, economic 
          development, and job creation around specific research clusters. 
           Key assets and partners of the initiative include technology 
          incubators, research parks, universities, federal laboratories, 
          economic development organizations, business groups, and venture 
          capitalists.

          Another key initiative of GOED are the "strike teams" which can 
          be mobilized to help attract and/or retain specific businesses.  
          Strike teams are especially well suited to engage with major 
          employers and have been successfully activated to assist Bayer 
          Healthcare, Jazz Semiconductor, and Baxter Pharmaceutical locate 
          and/or expand in California.

          GOED is also sponsoring a permit streamlining pilot project, 
          which will offer a One-Stop-Shop for state and local permits.  
          The pilot, launched in partnership with the City and County of 
          San Francisco, will allow a business owner to login to a single 
          Web site (24x7) and apply for and pay all necessary city, county 
          and state permits.  

          AB 29 (John A. Pérez) substantially implements the current 
          activities of GOED as outlined in the 2010 EO.


           Analysis Prepared by  :    Toni Symonds / J., E.D. & E. / (916) 
          319-2090 
                                                                 FN: 
          0002781 










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