BILL NUMBER: AB 232 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Members V. Manuel Pérez and Alejo
(Coauthor: Assembly Member Bradford)
FEBRUARY 2, 2011
An act to amend Sections 7071, 7073.1, 7074, 7076, 7076.1, 7081,
7082, 7085, and 7085.1 of the Government Code, relating to economic
development.
LEGISLATIVE COUNSEL'S DIGEST
AB 232, as introduced, V. Manuel Pérez. Economic development:
Enterprise Zones.
(1) The Enterprise Zone Act provides that its purpose is to
stimulate business and industrial growth in the depressed areas of
the state by relaxing regulatory controls that impede private
investment.
This bill would delete that purpose and instead provide that the
purpose of the act is to help stabilize local communities, alleviate
poverty, and enhance the state's economic prosperity through the
implementation of public and privately funded programs and services
that stimulate business and industrial growth in the depressed areas
of the state.
(2) The act prohibits the designation of an enterprise zone in
which any boundary thereof is drawn so as to include larger stable
businesses or heavily residential areas to the detriment of truly
economically depressed areas.
This bill would delete that prohibition.
(3) The act authorizes any city, county, or city and county with
an eligible area within its jurisdiction to complete a preliminary
application for designation as an enterprise zone. The act requires
the applying entity to establish definitive boundaries for the
proposed enterprise zone and the targeted employment area.
This bill would prohibit, if a census tract or portion of a census
tract included in an enterprise zone proposed on or after January 1,
2011, is within, or previously was within, the boundaries of a
previously designated enterprise zone, the aggregate size of the
proposed enterprise zone from exceeding the size of the previously
designated enterprise zone by more than 10%.
(4) The act requires the Department of Housing and Community
Development, in designating enterprise zones, to select from the
applications submitted proposed enterprise zones that indicate that
they will implement the most appropriate economic development
strategies and implementation plans utilizing state and local
programs and incentives to create jobs, attract private sector
investment, and improve the economic conditions within the zone
proposed. The act enumerates, but does not limit, the possible local
incentives to be used by proposed zones.
This bill would add to that list tax increment moneys and local
financing authorities under the Community Redevelopment Law,
Workforce Investment Act moneys and programs funded by those moneys,
Community Development Block Grant moneys, CalWORKs funding and other
related resources, and local education entities, including K-12,
adult education, community colleges, and public and private
universities.
(5) The act authorizes a city, county, or city and county to
propose that the enterprise zone be expanded by 15% to include
definitive boundaries that are contiguous to the enterprise zone. The
act authorizes the department to approve an enterprise zone
expansion based on specified criteria. The act authorizes a city or
county to propose to use an eligible expansion allotment to expand
into an adjacent jurisdiction if specified conditions exist. The act
authorizes an expansion area to contain noncommercial or
nonindustrial land only if that land is a right-of-way and is needed
to meet the requirement for a contiguous expansion between an
existing enterprise zone and a proposed expansion area.
This bill would modify the immediately above authorization so that
the act would authorize an expansion area to contain noncommercial
land only if that land is a right-of-way.
(6) The act requires the department to provide technical
assistance to an enterprise zone with respect to specified
activities.
This bill would additionally require the department to serve as a
liaison between the state and zone residents, businesses, workers,
nonprofit organizations, and local governments. The bill would
require state agencies and departments to affirmatively support their
regulatory responsibilities under specified provisions of law, and
to respond to requests made by and on the behalf of zones in a manner
consistent with their statutory duties.
(7) The act requires the department to audit each geographically
targeted economic development area (G-TEDA) at least once every 5
years, as specified, and to determine, for each audit, a result of
superior, pass, or fail, as specified. The act sets forth the
criteria for a G-TEDA to be determined superior or passing.
This bill would require the department, in undertaking these audit
responsibilities, to seek appropriate opportunities to provide
technical assistance and training to help G-TEDAs address
inadequacies identified in the audit. The bill would also require the
department to review specified progress reports submitted by a
G-TEDA pursuant to a specified provision of law and to determine
whether an audit of the G-TEDA is warranted. The bill would modify
the criteria for a G-TEDA to be determined superior or passing, as
specified.
(8) The act requires, to the extent permitted by federal law, the
Employment Development Department and the State Department of
Education to give high priority to the training of unemployed
individuals who reside in a targeted employment area or a designated
enterprise zone.
This bill would require a state entity, when developing workforce
development and training plans and strategies, to consider how the
G-TEDA programs could be integrated in order to maximize the benefits
to workers and businesses. The bill would also require the
Employment Development Department to provide letters to unemployed
prospective employees that could be used to certify their eligibility
as a person participating in a program developed pursuant to
specified provisions of law.
(9) The act requires the Office of Criminal Justice Planning to
give high priority to designated enterprise zones in the allocation
of its program resources.
This bill would modify that provision to instead require the
Public Safety Branch and the Victim Services Branch of the California
Emergency Management Agency to give high priority to designated
enterprise zones in the allocation of program resources.
(10) The act requires the governing board of a G-TEDA to report to
the Department of Housing and Community Development by October 1,
2008, and by that date every other year thereafter, on the activities
of the G-TEDA in the previous 2 fiscal years and its plans for the
current and following fiscal year. The report is required to include
specified information.
This bill would additionally require the report to include an
identification of the financial value of local incentives provided
during the report period; an identification of the financial value of
federal and other state resources accessed to serve the residents,
workers, and businesses in the G-TEDA; and specified other
information relating to the performance of the G-TEDA.
(11) This bill would make other technical, nonsubstantive changes
updating the act.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 7071 of the Government Code is amended to read:
7071. The Legislature finds and declares as follows:
(a) The health, safety, and welfare of the people of California
depend upon the development, stability, and expansion of private
business, industry, and commerce, and there are certain areas within
the state that are economically depressed due to a lack of investment
in the private sector. Therefore, it is declared to be the purpose
of this chapter to help stabilize local communities, alleviate
poverty, and enhance the state's economic prosperity through the
implementation of public and privately funded programs and services
that stimulate business and industrial growth in the depressed
areas of the state by relaxing regulatory controls that
impede private investment .
(b) The geographically targeted economic development area programs
are based on the economic principle that targeting significant
incentives to lower income communities allows these communities to
more effectively compete for new businesses and retain existing
businesses, which results in increased tax revenues, less reliance on
social services, and lower public safety costs. Residents and
businesses also directly benefit from these more sustainable economic
conditions through improved neighborhoods, business expansion, and
job creation.
(b) It
(c) Therefore, it is in the
economic interest of the state to have one strong, combined,
and business-friendly , and community development
incentive program to help attract business and industry to the
state, to help retain and expand existing state business and
industry, and to create increased job opportunities for all
Californians .
(c) No enterprise zone shall be designated in which any boundary
thereof is drawn in a manner so as to include larger stable
businesses or heavily residential areas to the detriment of areas
that are truly economically depressed.
(d) Nothing in this chapter shall be construed to infringe upon
regulations relating to the civil rights, equal employment rights,
equal opportunity rights, or fair housing rights of any person.
SEC. 2. Section 7073.1 of the Government Code is amended to read:
7073.1. (a) Except as provided in subdivision (e)
(f) , any city, county, or city and county with
an eligible area within its jurisdiction may complete a preliminary
application for designation as an enterprise zone. The applying
entity shall establish definitive boundaries for the proposed
enterprise zone and the targeted employment area. An entity may
propose zones in areas with noncontiguous boundaries, and the
department may designate those areas as zones if the director
determines both of the following:
(1) The noncontiguous area is needed to implement the applicant's
economic development strategy.
(2) The excluded area between the proposed zone boundaries would
not, based on the proposed economic strategy, also benefit from the
zone designation.
(b) If a census tract or portion of a census tract included in an
enterprise zone proposed in an application submitted to the
department on or after January 1, 2011, is within, or previously was
within, the boundaries of a previously designated enterprise zone,
then the aggregate size of the proposed enterprise zone shall not
exceed the size of the previously designated enterprise zone by more
than 10 percent.
(b)
(c) (1) In designating enterprise zones, the department
shall select from the applications submitted those proposed
enterprise zones that, upon a comparison of all of the applications
submitted, indicate that they propose the most appropriate economic
development strategy and implementation plan utilizing state and
local programs and incentives to create jobs, attract private sector
investment, and improve the economic conditions within the zone
proposed. The department shall prescribe a format that promotes
succinct and focused strategies and plans, and set minimum standards
for the strategies and plans. For the purposes of this subdivision,
important elements of a strategy or plan may include, but are not
limited to, all of the following:
(A) An assessment of current financial and community development
strengths, needs, and opportunities.
(B) A framework for investment of time, action, and money.
(C) Clear articulation of goals.
(D) Measurable objectives, including targets.
(E) Proposed implementation activities and tasks, including
timeframes, and a framework for evaluating performance, including
qualitative and quantitative benchmarks.
(F) An identification of local resources, including incentives,
the jurisdiction will utilize to implement the strategy or plan and
how those resources will help to leverage or maximize the benefit of
state resources that become available for enterprise zone
communities.
(2) For purposes of this subdivision, local resources
incentives may include, but are not limited to, all of the following:
(A) The suspension or relaxation of locally originated or modified
building codes, zoning laws, general development plans, or rent
controls.
(B) The elimination or reduction of fees for applications,
permits, and local government services.
(C) The establishment of a streamlined permit process.
(D) Elimination or reduction of construction taxes or business
license taxes.
(E) The provision or expansion of infrastructure.
(F) The targeting of federal block grant moneys, including small
cities, education, and health and welfare block grants.
(G) The targeting of economic development grants and loan moneys,
including grant and loan moneys provided by the United States
Department of Housing and Urban Development.
(H) The targeting of state and federal job disadvantaged and
vocational education grant moneys, including moneys provided by the
federal Workforce Investment Act of 1998 (Public Law 105-220), or its
successor.
(I) The targeting of federal or state transportation grant moneys.
(J) The targeting of federal or state low-income housing and
rental assistance moneys.
(K) The use of tax allocation bonds, special assessment bonds,
bonds under the Mello-Roos Community Facilities Act of 1982 (Chapter
2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title
5), industrial development bonds, revenue bonds, private activity
bonds, housing bonds, bonds issued pursuant to the Marks-Roos Local
Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of
Chapter 5), certificates of participation, hospital bonds,
redevelopment bonds, school bonds, and all special provisions
provided for under federal tax law for enterprise community or
empowerment zone bonds.
(L) Redevelopment tax increment moneys and local financing
authorities.
(M) Workforce Investment Act moneys and programs funded with those
moneys.
(N) Community Development Block Grant moneys.
(O) CalWORKs funding and other related resources.
(P) Local education entities, including K-12, adult education,
community colleges, and public and private universities.
(3) When designating new enterprise zones, the department shall
take into consideration the location of existing zones and make every
effort to locate new zones in a manner that will not adversely
affect any existing zones.
(4) When reviewing and ranking new enterprise zone applications,
the department shall give bonus points to applications from
jurisdictions that meet minimum threshold points and at least two of
the following criteria:
(A) The percentage of households within the census tracts of the
proposed enterprise zone area, the income of which is below the
poverty level, is at least 17.5 percent.
(B) The average unemployment rate for the census tracts of the
proposed enterprise zone area was not less than five percentage
points above the statewide average for the most recent calendar year
as determined by the Employment Development Department.
(C) The applicant jurisdiction has, and can document that it has,
a unique distress factor affecting long-term economic development,
including, but not limited to, resource depletion, plant closure,
industry recession, natural disaster, or military base closure.
(5) Except as modified pursuant to paragraph (4), applications
shall be ranked by the appropriateness of the economic development
strategy and implementation plan, including all of the following:
(A) The extent the strategy clearly identifies the local
resources, incentives, and programs that will be made available to
the zone for meeting its goals and objectives.
(B) The extent the strategy provides for attracting private sector
investment.
(C) The extent the strategy includes related regional and
community-based partnerships for achieving the goals and objectives
in the strategy.
(D) The extent the strategy fits within the jurisdiction's overall
economic development strategy, including the extent the strategy and
implementation plan is appropriate for the local community.
(E) The extent the strategy addresses the hiring and retention of
unemployed or underemployed residents or low-income individuals in
the proposed zone and surrounding areas.
(F) The extent the strategy sets reasonable and measurable
benchmarks, goals, and objectives.
(G) The extent the strategy sets forth an appropriate funding
schedule for management, oversight, and program delivery within the
zone relative to the benchmarks, goals, and objectives in the
strategy.
(H) The extent that the economic development strategy has a
comprehensive incentive package for attracting private investment to
the enterprise zone.
(c)
(d) In evaluating applications for designation, the
department shall ensure that applications are not disqualified solely
because of technical deficiencies, and shall provide applicants with
an opportunity to correct the deficiencies. Applications shall be
disqualified if the deficiencies are not corrected within two weeks.
(d)
(e) Except upon dedesignation pursuant to subdivision
(c) of Section 7076.1, Section 7076.2, or Section 7085.1, a
designation made by the department shall be binding for a period of
15 years from the date of the original designation.
(e)
(f) This section shall only apply to enterprise zone
applications for which the department has issued a solicitation for
new enterprise zone designations on or after January 1, 2007.
SEC. 3. Section 7074 of the Government Code is amended to read:
7074. (a) In the case of any enterprise zone, including an
enterprise zone formerly designated as an enterprise zone pursuant to
Chapter 12.8 (commencing with Section 7070) as it read prior to
January 1, 1997, or as a program area pursuant to Chapter 12.9
(commencing with Section 7080) as it read prior to January 1, 1997, a
city, county, or city and county may propose that the enterprise
zone be expanded by 15 percent to include definitive boundaries that
are contiguous to the enterprise zone.
(b) The department may approve an enterprise zone expansion
proposed pursuant to this section based on the following criteria:
(1) Each of the adjacent jurisdictions' governing bodies approves
the expansion by adoption of an ordinance or resolution.
(2) Land included within the proposed expansion is zoned for
industrial or commercial use.
(3) Basic infrastructure, including, but not limited to, gas,
water, electrical service, and sewer systems, is available to the
area that would be included in the expansion.
(c) A city, county, or city and county may propose to use an
eligible expansion allotment to expand into an adjacent jurisdiction
pursuant to this section if the department finds that all of the
following conditions exist:
(1) The governing body of the local agency with jurisdiction over
the existing enterprise zone and the governing body of the local
agency with jurisdiction over the proposed expansion area each
approve the expansion by adoption of an ordinance or resolution. The
ordinance or resolution by the jurisdiction containing the proposed
expansion area shall indicate that the jurisdiction will provide the
same or equivalent local incentives as provided by the jurisdiction
of the existing enterprise zone.
(2) (A) Land included within the proposed expansion is zoned for
industrial or commercial use.
(B) An expansion area may contain noncommercial or nonindustrial
land only if that land is a right-of-way and is needed to
meet the requirement for a contiguous expansion between an existing
enterprise zone and a proposed expansion area .
(3) Basic infrastructure, including, but not limited to, gas,
water, electrical service, and sewer systems, is available to the
area that would be included in the expansion.
(4) The expansion area is contiguous to the existing enterprise
zone.
(d) (1) Except as otherwise provided in paragraph (2), in no event
shall an enterprise zone be permitted to expand more than 15 percent
in size from its size on the date of original designation, including
any expansion authorized pursuant to Chapter 12.8 (commencing with
Section 7070), or Chapter 12.9 (commencing with Section 7080), as
those chapters read prior to January 1, 1997.
(2) If an enterprise zone, on the date of original designation, is
no greater than 13 square miles, it may be permitted to expand up to
20 percent in size from its size on the date of original
designation.
(e) A city, county, or city and county may propose expansion into
a noncontiguous area if the department finds both of the following:
(1) The noncontiguous area is needed to implement the enterprise
zone's economic development strategy.
(2) The excluded areas between the proposed new boundaries would
not, based on the enterprise zone's economic development strategy,
also benefit from enterprise zone expansion.
SEC. 4. Section 7076 of the Government Code is amended to read:
7076. (a) (1)
7076. (a) The department shall serve as a liaison
between the state and zone residents, businesses, workers, nonprofit
organizations, and local governments. State agencies and departments
shall affirmatively support their statutory responsibilities under
this part, and respond to requests made by and on behalf of
enterprise zones in a manner consistent with their statutory duties.
(b) (1) The department
shall provide technical assistance to the enterprise zones
designated pursuant to this chapter with respect to all of the
following activities:
(A) Furnish limited onsite assistance to the enterprise zones when
appropriate.
(B) Ensure that the locality has developed a method to make
residents, businesses, and neighborhood organizations aware of the
opportunities to participate in the program.
(C) Help the locality develop a marketing program for the
enterprise zone.
(D) Coordinate activities of other state agencies regarding the
enterprise zones.
(E) Monitor the progress of the program.
(F) Help businesses to participate in the program.
(2) Notwithstanding existing law, the provision of services in
subparagraphs (A) to (F), inclusive, shall be a high priority of the
department.
(3) The department may, at its discretion, undertake other
activities in providing management and technical assistance for
successful implementation of this chapter.
(b)
(c) The applicant shall be required to begin
implementation of the enterprise zone plan contained in the final
application within six months after notification of final designation
or the enterprise zone shall lose its designation.
(c)
(d) The department shall assess a fee of fifteen
dollars ($15) on each enterprise zone and manufacturing enhancement
area for each application for issuance of a certificate pursuant to
subdivision (j) of Section 17053.47 of, subdivision (c) of Section
17053.74 of, subdivision (c) of Section 23622.7 of, or subdivision
(i) of Section 23622.8 of, the Revenue and Taxation Code. The
department shall collect the fee for deposit into the Enterprise Zone
Fund, pursuant to Section 7072.3, for the costs of administering
this chapter. The enterprise zone or manufacturing enhancement area
administrator shall collect this fee at the time an application is
submitted for issuance of a certificate.
SEC. 5. Section 7076.1 of the Government Code is amended to read:
7076.1. (a) The department may audit the program of any
jurisdiction in any designated G-TEDA at any time during the duration
of the designation, as appropriate. However, the department shall
audit each G-TEDA at least once every five years from the date of
designation or the operative date of this section, whichever is the
latest. The matters to be examined in the course of an audit shall
include an examination of the progress made by the G-TEDA toward
meeting the goals, objectives, and commitments set forth in its
original application and the department's memorandum of understanding
with the G-TEDA.
(b) The department shall, for each audit, determine a result of
superior, pass, or fail in accordance with subdivision (c). The
results of each audit shall be based upon the success of the G-TEDA
in making substantial and sustained efforts since the later of its
designation or last audit to meet the standards, criteria, and
conditions contained in the application and the memorandum of
understanding (MOU) between the department and the G-TEDA, as may be
amended pursuant to the agreement of the G-TEDA and the department.
In each audit, the department shall focus upon the G-TEDA's use of
the marketing plan, local incentives, financing programs, job
development, and program management as described in the application
and the MOU. The department shall also evaluate the vouchering plan,
staffing levels, budget, and elements unique to each application.
(c) For purposes of subdivision (b), an audit determination of
superior, pass, or fail shall be made in accordance with the
following:
(1) A G-TEDA will be determined to be superior if each
jurisdiction comprising the G-TEDA does all of the following:
(A) Meets 100 percent of its goals, objectives, and commitments as
defined in its application, most recent audit, biennial report, and
memorandum of understanding with the department, and as determined by
the department in consultation with the G-TEDA. An equivalent or
similar commitment may be substituted for an existing commitment of a
G-TEDA if it is determined by the department that an original
commitment was not realistically practical or is no longer relevant.
(B) Demonstrates that it has reviewed and updated its goals,
objectives, and commitments as defined in its original application,
most recent audit, biennial report, and memorandum of understanding
with the department.
(C) Identifies to the department's satisfaction that it has
incorporated economic development commitments in addition to those
commitments previously made in its application.
(2) (A) A G-TEDA will be determined to be passing if each
jurisdiction comprising the area meets or exceeds
75 to 90 percent of its goals, objectives, or commitments
as defined in its original application, most recent audit, biennial
report, and memorandum of understanding with the department, and as
determined by the department in consultation with the G-TEDA. An
equivalent or similar commitment may be substituted for an existing
commitment of a G-TEDA if it is determined by the department that an
original commitment was not realistically practical or is no longer
relevant.
(B) Any G-TEDA that is determined to be passing may appeal in
writing to the department for a determination of superior. Only one
appeal may be filed pursuant to this subparagraph with respect to a
determination by the department, and may be filed no later than 30
days after the G-TEDA's receipt of the determination to which the
appeal pertains. The department shall respond in writing to any
appeal that is properly filed pursuant to this subparagraph within 60
days of the date of that filing.
(3) (A) A G-TEDA will be determined to be failing if any
jurisdiction comprising the G-TEDA fails to meet or exceed 75 percent
of its goals, objectives, or commitments as defined in its original
application, most recent audit, biennial report, and memorandum of
understanding with the department, and as determined by the
department in consultation with the G-TEDA. An equivalent or similar
commitment may be substituted for an existing commitment of a G-TEDA
if it is determined by the department that an original commitment was
not realistically practical or is no longer relevant.
(B) Any G-TEDA that is determined to be failing shall enter into a
written agreement with the department that specifies those items
that the G-TEDA is required to remedy or improve. Failure of the
G-TEDA and the department to negotiate and enter into a written
agreement as so described within 60 days of the last day upon which
the department is required to deliver a response letter pursuant to
subparagraph (C) of paragraph (4) shall result in the
dedesignation of the G-TEDA on January 1 immediately following the
department's written notice of dedesignation to the G-TEDA.
A
(C) A written agreement entered
into pursuant to this subparagraph paragraph
shall be for a six-month period. If, upon the expiration of the
agreement, the department determines that the G-TEDA has not met or
implemented at least 75 percent of the conditions set forth in the
agreement, the department shall, after immediately providing written
notification to each jurisdiction comprising the G-TEDA that the
G-TEDA is to be dedesignated , dedesignate .
Dedesignation of the G-TEDA is effective on the
first day of the month next following the date upon which the
agreement expired. If, upon expiration of the agreement, the
department determines that the G-TEDA has met or implemented at least
75 percent of the conditions set forth in the agreement, the
department shall do either of the following:
(i) Allow the G-TEDA an additional year, or a longer period in the
department's discretion, to meet or implement those conditions in
their entirety.
(ii) Pursuant to written notice provided immediately to each
jurisdiction that comprises the G-TEDA that the G-TEDA is to be
dedesignated, dedesignate the G-TEDA effective on January 1
immediately following the date of the department's written
notification of dedesignation to those jurisdictions.
Any
(D) Any business, located within
any jurisdiction that comprises a G-TEDA that has been dedesignated,
that has elected to avail itself of any state tax incentive
specifically applicable to a G-TEDA for any taxable or income year
beginning prior to the dedesignation of the G-TEDA may, to the extent
the business is otherwise still eligible for those incentives,
continue to avail itself of those incentives for a period equal to
the remaining life of the G-TEDA. However, any business, located
within any jurisdiction that comprises a G-TEDA that has been
dedesignated, that has not availed itself of any state tax incentive
in the manner described in the preceding sentence may not, after
dedesignation of the G-TEDA, avail itself of any state incentive
specifically applicable to a G-TEDA.
(4) (A) Notwithstanding paragraphs (1) to (3), inclusive, a G-TEDA
shall be determined to be failing if any jurisdiction comprising the
G-TEDA, in the determination of the director, provides funding
support in at least three of the previous five years at a level that
is less than 75 percent of the amount committed to in the G-TEDA's
memorandum of understanding with the department.
(B) In the event that a G-TEDA is determined to be failing
pursuant to this paragraph, subparagraph (B) of paragraph (3) shall
apply.
(C) Any G-TEDA that is determined to be failing pursuant to this
paragraph may appeal in writing to the department. The appeal shall
be filed within 30 days of the G-TEDA's receipt of the determination
to which the appeal pertains. The department shall respond in writing
to any appeal that is properly filed within 60 days of the date of
filing.
(d) In undertaking its audit responsibilities pursuant to this
section, the department shall seek appropriate opportunities to
provide technical assistance and training to help G-TEDAs address
inadequacies identified through the audit progress in the program.
Assistance may include, but is not limited to, workshops, mentoring
programs, and referrals to other federal, state, and local public and
private entities.
(d)
(e) (1) For purposes of this section, "dedesignation"
means that a G-TEDA is no longer a G-TEDA for purposes of either
Section 7073 or 7085.
(2) Upon notification by the department of the dedesignation of a
G-TEDA and the end of the appeal period with respect to that
dedesignation, the department shall initiate an application process
for a new designation as provided in Section 7073, 7073.8, 7085,
7097, or 7114.
(f) In addition to any other oversight activities that the
department determines are appropriate and necessary, the department
shall review the progress reports submitted by a G-TEDA pursuant to
Section 7085.1 and determine whether an audit is warranted.
SEC. 6. Section 7081 of the Government Code is amended to read:
7081. (a) Notwithstanding any other
provision of state law, and to the extent permitted by federal law,
the Employment Development Department and the State Department of
Education shall give high priority to the training of unemployed
individuals who reside in a targeted employment area or a designated
enterprise zone. The
(b) When developing workforce development and training plans and
strategies, including, but not limited to, federal Workforce
Development Act funds, a state entity shall consider how the G-TEDA
programs could be integrated so as to maximize the benefits to
workers and businesses.
(c) The Employment Development Department shall, consistent with
its duties to assist unemployed workers who are registered in the
one-stop career centers, provide letters to unemployed prospective
employees that could be
used to certify their eligibility as a person participating in a
program developed pursuant to the federal Workforce Investment Act of
1998 (Public Law 105-220).
(d) The department may assist
localities in designating local business, labor, and education
consortia to broker activities between the employment community and
educational and training institutions. Any available discretionary
funds may be used to assist the creation of those consortia.
SEC. 7. Section 7082 of the Government Code is amended to read:
7082. Notwithstanding any other provision of law, the
Office of Criminal Justice Planning Public Safety
Branch and the Victim Services Branch of the California Emergency
Management Agency shall give high priority to designated
enterprise zones in the allocation of its program
resources.
SEC. 8. Section 7085 of the Government Code is amended to read:
7085. (a) Notwithstanding Section 7550.5, the department shall
submit a report to the Legislature every five years beginning January
1, 1998, that evaluates the effect of the program on employment,
investment, and incomes, and on state and local tax revenues in
designated enterprise zones. The report shall include a department
review of the progress and effectiveness of each enterprise zone,
including, but not limited to, any efforts made regarding training of
unemployed individuals pursuant to Section 7081. The Employment
Development Department shall, for the purposes of the report, provide
the department with existing data on unemployed individuals
receiving training. The Franchise Tax Board shall make available to
the department and the Legislature aggregate information on the
dollar value of enterprise zone tax credits that are claimed each
year by businesses pursuant to Section 7085.5 .
(b) An enterprise zone governing body shall provide information at
the request of the department as necessary for the department to
prepare the report required pursuant to subdivision (a).
SEC. 9. Section 7085.1 of the Government Code is amended to read:
7085.1. (a) The governing board of the G-TEDA shall report to the
department by October 1, 2008, and by that date every other year
thereafter, on the activities of the G-TEDA in the previous two
fiscal years and its plans for the current and following fiscal year.
The biennial report shall include at least both
all of the following:
(1) The progress the G-TEDA has made during the period covered by
the report relative to its goals, objectives, and commitments set
forth in its original application and the department's memorandum of
understanding with the G-TEDA.
(2) Identification of the previous two years' funding, including
in-kind funding. The previous two years' funding levels shall be
compared to the funding levels identified in its original application
and the department's memorandum of understanding with the G-TEDA,
and the amount identified in the previous year's biennial report. An
explanation of any meaningful discrepancies in these amounts shall be
provided.
(3) Identification of the financial value of local incentives
provided during the report period, and identification of the
financial value of federal and other state resources accessed to
serve the residents, workers, and businesses in the G-TEDA.
(4) The following information based on the certification
applications approved in the zones relating to the hiring credit:
(A) The number of jobs for which the hiring credits are certified.
(B) The number of new employees for which hiring credits were
certified.
(C) The number of employees replacing previous employees for which
hiring credits were certified.
(D) The range of employee wage rates that were certified.
(E) The number of businesses obtaining certified hiring tax
credits.
(F) An aggregate summary of the North American Industry
Classification System (NAICS) codes to the third digit of the
businesses applying for hiring tax credit employee certification.
(G) An aggregate summary of the size of businesses based on annual
gross revenues receiving certification of employee hiring credits.
(b) A copy of the biennial report developed pursuant to
subdivision (a) shall also be submitted to the legislative bodies of
the local jurisdictions comprising the G-TEDA. The progress of the
G-TEDA in meeting the goals, objectives, and commitments set forth in
the original application and the memorandum of understanding with
the department shall be reviewed at least biennially by these
legislative bodies , either as part of the approval of the
G-TEDA's annual work plan or separately, at the discretion of the
legislative body .
(c) (1) G-TEDAs designated prior to January 1, 2007, shall have
until April 15, 2008, to update their benchmarks, goals, objectives,
and funding levels for administering the G-TEDA program, in order to
make them measurable and conducive to the successful completion of
the economic development strategy. The local legislative body and the
department shall approve the updated goals and objectives. The
updated goals and objectives shall be included as an update to the
existing memorandum of understanding between the G-TEDA and the
department.
(2) G-TEDAs that fail to obtain approved updated goals and
objectives by April 15, 2008, shall be dedesignated effective July 1,
2008. The Director of Housing and Community Development shall
provide notice of prospective dedesignation to the local government
no later than May 1, 2008. The director may authorize up to two
60-calendar-day extensions, if the local government and G-TEDA are
acting in good faith and the additional time would allow them to meet
the requirements of this subdivision. Businesses located within a
G-TEDA that have been dedesignated shall continue to have access to
tax incentives previously authorized within the G-TEDA pursuant to
Section 7082.2.
(3) G-TEDAs designated prior to January 1, 2007, are not required
to implement the biennial reporting requirements of subdivisions (a)
and (b) until October 1, 2009.
(4) G-TEDAs that expire prior to January 1, 2010, are not required
to meet the conditions of this subdivision.
(d) The department shall biennially make available to the
Legislature information related to the progress that each G-TEDA is
making toward implementing its goals, objectives, and commitments set
forth in the original application, the department's memorandum of
understanding with the G-TEDA, and the biennial report.