BILL NUMBER: AB 1054	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JANUARY 4, 2012

INTRODUCED BY   Assembly Member Skinner
   (Coauthors: Assembly Members Bradford, Chesbro, John A. Pérez, and
V. Manuel Pérez)

                        FEBRUARY 18, 2011

   An act to amend  Sections 26003, 26102, 26140, and 26141
of, to amend the heading of Division 16.2 (commencing with Section
26100) of, to add Sections 26100.5 and 26103.5 to, and to add Chapter
2.5 (commencing with Section 26130) to Division 16.2 of, the Public
Resources Code, relating to energy, and making an appropriation
therefor   Section 6804.1 of the Public Resources Code,
relating to public lands  .



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1054, as amended, Skinner.  Energy: clean energy
financing.   Public lands: oil and gas leases. 
    Existing law authorizes the State Lands Commission to lease
lands owned by the state that are under the jurisdiction of the
commission for those purposes as the commission deems advisable,
including, but not limited to, grazing leases and leases for
commercial, industrial, and recreational purposes. Existing law
allows lessees of oil and gas and mineral leases to make and file
with the commission a written quitclaim or relinquishment of all
rights under a lease comprising a particular parcel. The quitclaim or
relinquishment becomes effective as of the date of its filing
subject to specified conditions. 
    This bill   instead   would allow a lessee
to file with the commission a written request for the commission to
approve a quitclaim or relinquishment of all rights under an oil and
gas and mineral lease subject to any required abandonment of
facilities and required reclamation of the lease premises. The bill
would require the request to approve a quitclaim or relinquishment of
all rights under a lease to be heard at a commission meeting. 

   Existing law requires the California Alternative Energy and
Advanced Transportation Financing Authority to establish a Property
Assessed Clean Energy (PACE) Reserve program to assist local
jurisdictions in financing the installation of distributed generation
renewable energy sources or energy or water efficiency improvements
meeting specified requirements that are permanently affixed on real
property through the use of a voluntary contractual assessment.
Existing law, until January 1, 2015, appropriates up to $50,000,000
from the Renewable Resource Trust Fund to the authority for the
purposes of the PACE Reserve program and authorizes the authority to
expend up to $300,000 of that appropriation for initial
administrative costs in implementing the PACE Reserve program.
 
   This bill would additionally require the authority to administer a
Clean Energy Reserve Program that would be developed by the State
Energy Resources Conservation and Development Commission and the
authority to reduce the costs to property owners of a loan provided
by a financial institution that has a loan program that satisfies
specified requirements. The bill would require the authority to
report annually specified information regarding the reserve program.
The bill would increase the amount of the appropriation that may be
expended for initial administrative costs to $550,000 thereby making
an appropriation. 
   Vote:  2/3   majority  . Appropriation:
 yes   no  . Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 6804.1 of the   Public
Resources Code   is amended to read: 
   6804.1.   (a)  Notwithstanding any  provisions
  provision  of this code to the contrary, a lessee
may at any time  make and  file with the commission
a written  quitclaim or relinquishment of all rights under
any lease or of any portion thereof comprising a 10-acre parcel or
multiple thereof in a compact form, or of any separate or distinct
zone or geological horizon or portion thereof underlying such 10-acre
parcel or multiple thereof. Such quitclaim or relinquishment shall
be effective as of the date of its filing, subject to the continued
obligation of the lessee and his surety to make payment of all
rentals and royalties theretofore accrued and to place all wells on
the lands or in the zones or horizons to be quitclaimed or
relinquished, in condition for suspension or abandonment in
accordance with the applicable lease terms and regulations; thereupon
the lessee shall be released from all obligations thereafter
accruing under said lease with respect to the lands, zones or
horizons quitclaimed or relinquished, but no such quitclaim or
relinquishment shall release such lessee or his surety from any
liability for breach of any obligation of the lease with respect to
which such lessee is in default at the time of the filing of such
quitclaim or relinquishment   request for the commission
to approve a quitclaim or relinquishment of all rights under any
lease. A quitclaim or relinquishment shall be effective upon
completion of any required abandonment of facilities and required
reclamation of the lease premises as approved by the commission.
Until that time, a lessee is subject to the continued obligation of
the lessee and the lessee's surety to pay all rentals and royalties
that have accrued  . 
   (b) A lessee's request for the commission to approve a quitclaim
or relinquishment of all rights under a lease shall be heard at the
next regularly scheduled commission meeting for which the request may
be properly reviewed and noticed. Upon approval of the commission
and contingent upon any other agreement between the lessee and the
commission, the lessee shall be released from all obligations
accruing under the lease with respect to the lands or rights
quitclaimed or relinquished. Approval of the commission does not
release the lessee or the lessee's surety from liability for breach
of any obligation of the lease for which the lessee is in default at
the time of approval.  
  SECTION 1.    Section 26003 of the Public
Resources Code is amended to read:
   26003.  As used in this division, unless the context otherwise
requires:
   (a) "Authority" means the California Alternative Energy and
Advanced Transportation Financing Authority established pursuant to
Section 26004, and any board, commission, department, or officer
succeeding to the functions of the authority, or to which the powers
conferred upon the authority by this division shall be given.
   (b) "Cost" as applied to a project or portion of the project
financed under this division means all or part of the cost of
construction and acquisition of all lands, structures, real or
personal property or an interest in the real or personal property,
rights, rights-of-way, franchises, easements, and interests acquired
or used for a project; the cost of demolishing or removing any
buildings or structures on land so acquired, including the cost of
acquiring any lands to which those buildings or structures may be
moved; the cost of all machinery, equipment, and furnishings,
financing charges, interest prior to, during, and for a period after,
completion of construction as determined by the authority; the cost
of the purchase or sale of energy derived from an alternative source
pursuant to subdivision (g) of Section 26011; provisions for working
capital; reserves for principal and interest and for extensions,
enlargements, additions, replacements, renovations, and improvements;
the cost of architectural, engineering, financial, accounting,
auditing and legal services, plans, specifications, estimates,
administrative expenses, and other expenses necessary or incident to
determining the feasibility of constructing any project or incident
to the construction, acquisition, or financing of a project.
   (c) (1) "Alternative sources" means the application of
cogeneration technology, as defined in Section 25134; the
conservation of energy; or the use of solar, biomass, wind,
geothermal, hydroelectricity under 30 megawatts, or any other source
of energy, the efficient use of which will reduce the use of fossil
and nuclear fuels.
   (2) "Alternative sources" does not include a hydroelectric
facility that does not meet state laws pertaining to the control,
appropriation, use, and distribution of water, including, but not
limited to, the obtaining of applicable licenses and permits.
   (d) "Advanced transportation technologies" means emerging
commercially competitive transportation-related technologies
identified by the authority as capable of creating long-term, high
value-added jobs for Californians while enhancing the state's
commitment to energy conservation, pollution reduction, and
transportation efficiency. Those technologies may include, but are
not limited to, any of the following:
   (1) Intelligent vehicle highway systems.
   (2) Advanced telecommunications for transportation.
   (3) Command, control, and communications for public transit
vehicles and systems.
   (4) Electric vehicles and ultralow-emission vehicles.
   (5) High-speed rail and magnetic levitation passenger systems.
   (6) Fuel cells.
   (e) "Financial assistance" includes, but is not limited to,
either, or any combination, of the following:
   (1) Loans, loan loss reserves, interest rate reductions, proceeds
of bonds issued by the authority, insurance, guarantees or other
credit enhancements or liquidity facilities, contributions of money,
property, labor, or other items of value, or any combination thereof,
as determined by, and approved by the resolution of, the board.
   (2) Any other type of assistance the authority determines is
appropriate.
   (f) "Participating party" means either of the following:
   (1) A person, or an entity or group of entities engaged in
business or operations in the state, whether organized for profit or
not for profit, that does either of the following:
   (A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
   (B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
   (2) A public agency or nonprofit corporation that does either of
the following:
   (A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
   (B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
   (g) (1) "Project" means a land, building, improvement to the land
or building, rehabilitation, work, property, or structure, real or
personal, stationary or mobile, including, but not limited to,
machinery and equipment, whether or not in existence or under
construction, that utilizes, or is designed to utilize, an
alternative source, or that is utilized for the design, technology
transfer, manufacture, production, assembly, distribution, or service
of advanced transportation technologies, or an arrangement for the
purchase, including prepayment, or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
   (2) "Project," for the purposes of Section 26011.8, means any
tangible personal property that is utilized for the design,
manufacture, production, or assembly of advanced transportation
technologies or alternative source products, components, or systems.
   (h) "Public agency" means a federal or state agency, department,
board, authority, state or community college, university, or
commission, or a county, city and county, city, regional agency,
public district, school district, or other political entity.
   (i) (1) "Renewable energy" means a device or technology that
conserves or produces heat, processes heat, space heating, water
heating, steam, space cooling, refrigeration, mechanical energy,
electricity, or energy in any form convertible to these uses, that
does not expend or use conventional energy fuels, and that uses any
of the following electrical generation technologies:
   (A) Biomass.
   (B) Solar thermal.
   (C) Photovoltaic.
   (D) Wind.
   (E) Geothermal.
   (2) For purposes of this subdivision, "conventional energy fuel"
means any fuel derived from petroleum deposits, including, but not
limited to, oil, heating oil, gasoline, fuel oil, or natural gas,
including liquefied natural gas, or nuclear fissionable materials.
   (3) Notwithstanding paragraph (1), for purposes of this section,
"renewable energy" also means ultralow-emission equipment for energy
generation based on thermal energy systems such as natural gas
turbines and fuel cells.
   (j) "Revenue" means all rents, receipts, purchase payments, loan
repayments, and all other income or receipts derived by the authority
from a project, or the sale, lease, or other disposition of
alternative source or advanced transportation technology facilities,
or the making of loans to finance alternative source or advanced
transportation technology facilities, and any income or revenue
derived from the investment of money in any fund or account of the
authority.  
  SEC. 2.    The heading of Division 16.2
(commencing with Section 26100) of the Public Resources Code is
amended to read:

      DIVISION 16.2.  Property Assessed Clean Energy (PACE) AND CLEAN
ENERGY Financing Assistance

 
  SEC. 3.   Section 26100.5 is added to the Public
Resources Code, to read:
   26100.5.  The Legislature further finds and declares both of the
following:
   (a) Actions by federally chartered home loan entities have
frustrated efforts to accelerate the implementation of the PACE
financing program, creating a need to establish effective alternative
approaches that can be rapidly deployed to advance the purposes of
this division.
   (b) Among the most promising alternatives that can be implemented
rapidly are those intended to increase access to capital for projects
that advance the purposes of this division.  
  SEC. 4.    Section 26102 of the Public Resources
Code is amended to read:
   26102.  "Applicant" means, for the purposes of Chapter 2
(commencing with Section 26120), a public agency as defined in
paragraph (3) of subdivision (c) of Section 5898.20 of the Streets
and Highways Code and, for the purposes of Chapter 2.5 (commencing
with Section 26130), a financial institution providing a loan
pursuant to that chapter to finance the installation of distributed
generation renewable energy sources, electric vehicle charging
infrastructure, or energy or water efficiency improvements. 

  SEC. 5.    Section 26103.5 is added to the Public
Resources Code, to read:
   26103.5.  "Clean Energy Reserve Program" means a statewide energy
and water efficiency and renewable energy generation retrofit program
developed by the authority pursuant to Section 26130. 

  SEC. 6.    Chapter 2.5 (commencing with Section
26130) is added to Division 16.2 of the Public Resources Code, to
read:
      CHAPTER 2.5.  CLEAN ENERGY RESERVE PROGRAM


   26130.  The authority shall administer a Clean Energy Reserve
Program to reduce overall costs to the property owners of a loan
provided by an applicant to finance the installation of distributed
generation renewable energy sources, electric vehicle charging
infrastructure, or energy or water efficiency improvements on real
property by providing a reserve or other financial assistance at a
level to be determined by the State Energy Resources Conservation and
Development Commission and the authority.
   26131.  The authority may adopt guidelines governing the
implementation of this chapter at a publicly noticed meeting.
Notwithstanding any other law, guidelines adopted pursuant to this
section shall be exempt from the requirements of Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code.
   26132.  An applicant shall submit to the authority an application
providing a detailed description of the loan program to finance the
installation of distributed generation renewable energy sources,
electric vehicle charging infrastructure, or energy or water
efficiency improvements on real property, a detailed description of
the transactional activities associated with the loan issuance,
including all transactional costs, and other information deemed
necessary by the authority.
   26133.  (a) In evaluating eligibility, the authority shall
consider whether the applicant's loan program includes the following
conditions:
   (1) Loan recipients are legal owners of underlying property.
   (2) Loan recipients are current on mortgage and property tax
payments.
   (3) Loan recipients are not in default or in bankruptcy
proceedings.
   (4) Loans are for less than 10 percent of the value of the
property.
   (5) The program offers financing for energy efficiency
improvements or electric vehicle charging infrastructure.
   (6) Improvements financed by the program follow applicable
standards of energy efficiency retrofit work, including any
guidelines adopted by the State Resources Conservation and
Development Commission.
   (b) In evaluating an application, the authority shall consider all
the following factors:
   (1) The use by the loan program of best practices, adopted by the
authority, to qualify eligible properties for participation in
underwriting the loan program.
   (2) The cost efficiency of the applicant's loan program.
   (3) The projected number of jobs created by the loan program.
   (4) The applicant's loan program requirements for quality
assurance and consumer protection as related to achieving efficiency
and clean energy production.
   (5) The mechanisms by which savings produced by this program are
passed on to the property owners.
   (6) Any other factors deemed appropriate by the authority.
   26134.  (a) The authority shall require certification from the
loan applicant that each loan offered pursuant to the applicant's
loan program is consistent with the requirements of the Clean Energy
Reserve Program administered pursuant to this chapter.
   (b) If the conditions of subdivision (a) are satisfied, the
authority shall allocate to the applicant, at the closing of the
loan, the amount made available from the Renewable Resources Trust
Fund in the form of financial assistance as approved by the State
Energy Resources Conservation and Development Commission and the
authority. Prior to providing financial assistance pursuant to this
section, the authority shall enter into an agreement with the
applicant regarding the financial assistance, including the process
for the possible return of money disbursed to or on behalf of the
applicant.  
  SEC. 7.    Section 26140 of the Public Resources
Code is amended to read:
   26140.  (a) Until January 1, 2015, an amount of up to fifty
million dollars ($50,000,000) from the Renewable Resource Trust Fund,
established pursuant to Section 25751, is hereby appropriated to the
authority for the purposes of this division. The moneys appropriated
shall remain in the Renewable Resource Trust Fund until the funds
are needed by the authority pursuant to this division.
   (b) Of the moneys appropriated in subdivision (a), up to five
hundred fifty thousand dollars ($550,000) may be expended by the
authority for the initial administrative costs in implementing this
division.
   (c) All repayments of moneys disbursed pursuant to this division
shall be deposited into the Renewable Resource Trust Fund. 

  SEC. 8.    Section 26141 of the Public Resources
Code is amended to read:
   26141.  (a) On March 31, 2011, and annually thereafter, the
authority shall submit to the Legislature a report pursuant to
Section 9795 of the Government Code on all of the following:
   (1) The status of the account.
   (2) A summary of the PACE bonds that received assistance pursuant
to Chapter 2 (commencing with Section 26120) and a summary of the
loans that received assistance pursuant to Chapter 2.5 (commencing
with Section 26130).
   (3) A summary of the benefits provided by this division, including
reduced interest rates on the PACE bonds or on loans receiving
assistance pursuant to this division.
   (4) The number of jobs created by the PACE programs or loans that
received assistance pursuant to this division.
   (5) Information on energy and water savings resulting from the
PACE programs or loans that received assistance pursuant to this
division.
   (6) Other information deemed appropriate by the authority.
   (b) This section shall remain in effect only until January 1,
2015, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2015, deletes or extends
that date.