BILL NUMBER: SB 1128 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 1, 2012
AMENDED IN SENATE APRIL 16, 2012
AMENDED IN SENATE APRIL 9, 2012
INTRODUCED BY Senator Padilla
( Coauthor: Senator Rubio
)
FEBRUARY 21, 2012
An act to amend, repeal, and add Sections 26003, 26011, and
26011.8 of the Public Resources Code, relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
SB 1128, as amended, Padilla. Energy: alternative energy
financing.
Existing law authorizes the California Alternative Energy and
Advanced Transportation Financing Authority, until January 1, 2021,
to provide financial assistance in the form of a sales and use tax
exclusion for a project to promote California-based manufacturing,
California-based jobs, the reduction of greenhouse gases, or the
reduction in air and water pollution or energy consumption.
This bill would additionally authorize the authority, until July
1, 2016, to grant the above financial assistance to projects that
promote the utilization of advanced manufacturing, as defined. The
bill would require the authority, until July 1, 2016, to study the
efficacy and cost benefit of the sales and use tax exemption for
advanced manufacturing projects. The bill would require
the authority, before January 1, 2017, to submit to the
Legislature a report on the study. The bill would require the
authority, until July 1, 2016, to work with the Legislative Analyst's
Office to determine the most efficient and cost effective way for
the state to create jobs in advanced manufacturing. The bill would
require the authority, until January 1, 2021, to work with the
University of California or the California State University to
perform a peer review of the net benefits test used to evaluate
applicants applying for the sales and use tax exemption.
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 26003 of the Public Resources Code is amended
to read:
26003. (a) As used in this division, unless the context otherwise
requires:
(1) (A) "Advanced manufacturing" means manufacturing that improves
existing, or creates entirely new, materials, products, and
processes through the use of science, engineering, or information
technologies, high-precision tools and methods, a high-performance
workforce, and innovative business or organizational models in any of
the following technology areas:
(i) Micro- and nanoelectronics, including semiconductors.
(ii) Advanced materials.
(iii) Integrated computational materials engineering.
(iv) Nanotechnology.
(v) Additive manufacturing.
(vi) Industrial biotechnology.
(B) "Advanced manufacturing" includes all of the following:
(i) A production system capable of furnishing a mix of products in
small or large volumes, with both the efficiency of mass production
and the flexibility of custom manufacturing, to respond rapidly to
customer demand and desired quality.
(ii) Systems that result from substantive advancement, whether
incremental or breakthrough, over the current state of the art, in
the production of materials and products. These advancements include
improvements in manufacturing processes and systems that are often
referred to as "smart" or "intelligent" manufacturing systems, which
integrate computational predictability and operational efficiency.
(iii) Systems that produce goods that minimize the use of
resources while maintaining or improving cost and performance.
(iv) (I) Systems and technologies that are sustainable.
(II) Sustainable systems and technologies do not include those
required to be undertaken pursuant to state or federal law or
regulations, air district rules or regulations, memoranda of
understanding with a governmental entity, or legally binding
agreements or documents. The State Air Resources Board shall advise
the authority to ensure that the requirement of this subclause are
met.
(2) "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:
(A) Intelligent vehicle highway systems.
(B) Advanced telecommunications for transportation.
(C) Command, control, and communications for public transit
vehicles and systems.
(D) Electric vehicles and ultralow-emission vehicles.
(E) High-speed rail and magnetic levitation passenger systems.
(F) Fuel cells.
(3) (A) "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.
(B) "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.
(4) "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.
(5) "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 paragraph (7) of subdivision (a) 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.
(6) "Financial assistance" includes, but is not limited to,
either, or any combination, of the following:
(A) 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.
(B) Any other type of assistance the authority determines is
appropriate.
(7) "Participating party" means either of the following:
(A) 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:
(i) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(ii) Participates in the purchase or sale of energy derived from
an alternative source pursuant to paragraph (7) of subdivision (a) of
Section 26011.
(B) A public agency or nonprofit corporation that does either of
the following:
(i) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(ii) Participates in the purchase or sale of energy derived from
an alternative source pursuant to paragraph (7) of subdivision (a) of
Section 26011.
(8) (A) "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, alternative source
components, or an arrangement for the purchase, including prepayment,
or sale of energy derived from an alternative source pursuant to
paragraph (7) of subdivision (a) of Section 26011.
(B) "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 manufacturing,
advanced transportation technologies , or
alternative source products, components, or systems.
(9) "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.
(10) (A) "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:
(i) Biomass.
(ii) Solar thermal.
(iii) Photovoltaic.
(iv) Wind.
(v) Geothermal.
(B) 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.
(C) Notwithstanding subparagraph (A), for the purposes of this
section, "renewable energy" also means ultralow-emission equipment
for energy generation based on thermal energy systems such as natural
gas turbines; landfill gas turbines, engines, and microturbines;
digester gas turbines, engines, and microturbines; and fuel cells.
(11) "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.
(b) This section shall become inoperative on July 1, 2016, and, as
of January 1, 2017, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2017, deletes or
extends the dates on which it becomes inoperative and is repealed.
SEC. 2. Section 26003 is added to the Public Resources Code, to
read:
26003. (a) As used in this division, unless the context otherwise
requires:
(1) "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:
(A) Intelligent vehicle highway systems.
(B) Advanced telecommunications for transportation.
(C) Command, control, and communications for public transit
vehicles and systems.
(D) Electric vehicles and ultralow-emission vehicles.
(E) High-speed rail and magnetic levitation passenger systems.
(F) Fuel cells.
(2) (A) "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.
(B) "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.
(3) "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.
(4) "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 paragraph (7) subdivision (a) 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.
(5) "Financial assistance" includes, but is not limited to,
either, or any combination, of the following:
(A) 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.
(B) Any other type of assistance the authority determines is
appropriate.
(6) "Participating party" means either of the following:
(A) 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:
(i) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(ii) Participates in the purchase or sale of energy derived from
an alternative source pursuant to paragraph (7) of subdivision (a) of
Section 26011.
(B) A public agency or nonprofit corporation that does either of
the following:
(i) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(ii) Participates in the purchase or sale of energy derived from
an alternative source pursuant to paragraph (7) of subdivision (a) of
Section 26011.
(7) (A) "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, alternative source
components, or an arrangement for the purchase, including prepayment,
or sale of energy derived from an alternative source pursuant to
paragraph (7) of subdivision (a) of Section 26011.
(B) "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.
(8) "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.
(9) (A) "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:
(i) Biomass.
(ii) Solar thermal.
(iii) Photovoltaic.
(iv) Wind.
(v) Geothermal.
(B) 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.
(C) Notwithstanding subparagraph (A), for the purposes of this
section, "renewable energy" also means ultralow-emission equipment
for energy generation based on thermal energy systems such as natural
gas turbines; landfill gas turbines, engines, and microturbines;
digester gas turbines, engines, and microturbines; and fuel cells.
(10) "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.
(b) This section shall become operative on July 1, 2016.
SEC. 3. Section 26011 of the Public Resources Code is amended to
read:
26011. (a) The authority is authorized and empowered:
(1) To adopt an official seal.
(2) To sue and be sued in its own name.
(3) To issue bonds, notes, bond anticipation notes, and other
obligations of the authority, including, at the option of the
authority, obligations bearing interest that is taxable for purposes
of federal income taxation, for any of its purposes and to fund or
refund the same, all as provided in this division.
(4) To determine the location and character of a project to be
financed under the provisions of this division, to lend financial
assistance to a participating party, to enter into loan agreements
with a participating party for the financing of a project including
creating a lien or security interest in the property, to construct,
reconstruct, renovate, replace, lease, as lessor or lessee, and
regulate the same, and to enter into contracts for the sale of a
project, including installment sales or sales under conditional sales
contracts.
(5) To fix fees and charges for projects, and interest rates with
respect to loans for projects, and to revise from time to time the
fees and charges and interest rates, and to collect rates, rents,
fees, and charges for the use of, and for a facility or service
furnished, or to be furnished, by a project or part of the project
and to contract with a person, partnership, association, corporation,
or public agency with respect to the project, and to fix the terms
and conditions upon which a project may be sold or disposed of,
whether upon installment sales contracts or otherwise.
(6) To employ and fix the compensation of bond counsel, financial
consultants, and advisers as may be necessary in its judgment in
connection with the issuance and sale of any bonds, notes, bond
anticipation notes, or other obligations of the authority; to
contract for engineering, architectural, accounting, or other
services of appropriate state agencies as may be necessary in the
judgment of the authority for the successful development of a
project; and to pay the reasonable costs of consulting engineers,
architects, accountants, and construction experts employed by a
participating party if, in the judgment of the authority, the
services are necessary to the successful development of a project,
and the services are not obtainable from a state agency.
(7) To purchase alternative source energy or projects from a
person or entity for sale to a participating party, or to make a loan
to a participating party to purchase alternative source energy or
projects, or to purchase from a person or entity that has contracted
to sell alternative source energy to a participating party the right
to receive purchase payments and related rights under that contract
or any related contracts. Notwithstanding any other applicable law,
the authority and a public agency, for purposes of a program or
financing, shall have the power to enter into contractual
arrangements and related agreements or instruments, including,
without limitation, a prepayment purchase contract, lease, loan,
construction, security, operation and maintenance, or other agreement
or instrument, with the authority or with a participating party,
upon the terms and subject to the conditions that may be necessary or
convenient to accomplish the purposes of this subdivision. The
authority shall only enter into a prepayment contract with a
participating party for energy derived from an alternative source to
the extent the prepayment is for energy intended to primarily offset
part or all of the authority's or a participating party's own
electrical requirements.
(8) To purchase, with proceeds of its bonds or its revenue, bonds
issued by a public agency described in clause (ii) of subparagraph
(B) of paragraph (7) of subdivision (a) of Section 26003 at a public
or negotiated sale. Bonds purchased pursuant to this subdivision may
be held by the authority or sold to public or private purchasers at
public or negotiated sales, in whole or in part, separately or
together with other bonds issued by the authority.
(9) To do all things generally necessary or convenient to carry
out the purposes of this division.
(b) This section shall become inoperative on July 1, 2016, and, as
of January 1, 2017, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2017, deletes or
extends the dates on which it becomes inoperative and is repealed.
SEC. 4. Section 26011 is added to the Public Resources Code, to
read:
26011. (a) The authority is authorized and empowered:
(1) To adopt an official seal.
(2) To sue and be sued in its own name.
(3) To issue bonds, notes, bond anticipation notes, and other
obligations of the authority, including, at the option of the
authority, obligations bearing interest that is taxable for purposes
of federal income taxation, for any of its purposes and to fund or
refund the same, all as provided in this division.
(4) To determine the location and character of a project to be
financed under the provisions of this division, to lend financial
assistance to a participating party, to enter into loan agreements
with a participating party for the financing of a project including
creating a lien or security interest in the property, to construct,
reconstruct, renovate, replace, lease, as lessor or lessee, and
regulate the same, and to enter into contracts for the sale of a
project, including installment sales or sales under conditional sales
contracts.
(5) To fix fees and charges for projects, and interest rates with
respect to loans for projects, and to revise from time to time the
fees and charges and interest rates, and to collect rates, rents,
fees, and charges for the use of, and for a facility or service
furnished, or to be furnished, by a project or part of the project
and to contract with a person, partnership, association, corporation,
or public agency with respect to the project, and to fix the terms
and conditions upon which a project may be sold or disposed of,
whether upon installment sales contracts or otherwise.
(6) To employ and fix the compensation of bond counsel, financial
consultants, and advisers as may be necessary in its judgment in
connection with the issuance and sale of any bonds, notes, bond
anticipation notes, or other obligations of the authority; to
contract for engineering, architectural, accounting, or other
services of appropriate state agencies as may be necessary in the
judgment of the authority for the successful development of a
project; and to pay the reasonable costs of consulting engineers,
architects, accountants, and construction experts employed by a
participating party if, in the judgment of the authority, the
services are necessary to the successful development of a project,
and the services are not obtainable from a state agency.
(7) To purchase alternative source energy or projects from a
person or entity for sale to a participating party, or to make a loan
to a participating party to purchase alternative source energy or
projects, or to purchase from a person or entity that has contracted
to sell alternative source energy to a participating party the right
to receive purchase payments and related rights under that contract
or any related contracts. Notwithstanding any other applicable law,
the authority and a public agency, for purposes of a program or
financing, shall have the power to enter into contractual
arrangements and related agreements or instruments, including,
without limitation, a prepayment purchase contract, lease, loan,
construction, security, operation and maintenance, or other agreement
or instrument, with the authority or with a participating party,
upon the terms and subject to the conditions that may be necessary or
convenient to accomplish the purposes of this subdivision. The
authority shall only enter into a prepayment contract with a
participating party for energy derived from an alternative source to
the extent the prepayment is for energy intended to primarily offset
part or all of the authority's or a participating party's own
electrical requirements.
(8) To purchase, with proceeds of its bonds or its revenue, bonds
issued by a public agency described in clause (ii) of subparagraph
(B) of paragraph (6) of subdivision (a) of Section 26003 at a public
or negotiated sale. Bonds purchased pursuant to this subdivision may
be held by the authority or sold to public or private purchasers at
public or negotiated sales, in whole or in part, separately or
together with other bonds issued by the authority.
(9) To do all things generally necessary or convenient to carry
out the purposes of this division.
(b) This section shall become operative on July 1, 2016.
SEC. 5. Section 26011.8 of the Public Resources Code is amended to
read:
26011.8. (a) The purpose of this section is to promote the
creation of California-based manufacturing, California-based jobs,
advanced manufacturing, the reduction of greenhouse gases, or
reductions in air and water pollution or energy consumption. In
furtherance of this purpose, the authority may approve a project for
financial assistance in the form of the sales and use tax exclusion
established in Section 6010.8 of the Revenue and Taxation Code.
(b) For purposes of this section, the following terms have the
following meanings:
(1) "Alternative source," in addition to as provided pursuant to
subdivision (c) of Section 26003, includes advanced electric
distributive generation technology as defined in Section 379.8 of the
Public Utilities Code or energy storage technologies and their
component materials.
(2) "Project" means a project as defined in subparagraph (B) of
paragraph (8) of subdivision (a) of Section 26003.
(c) The authority shall publish
notice of the availability of project applications and deadlines for
submission of project applications to the authority.
(d) The authority shall evaluate project applications based upon
all of the following criteria:
(1) The extent to which the project develops manufacturing
facilities, or purchases equipment for manufacturing facilities,
located in California.
(2) The extent to which the anticipated benefit to the state from
the project equals or exceeds the projected benefit to the
participating party from the sales and use tax exclusion.
(3) The extent to which the project will create new, permanent
jobs in California.
(4) The extent to which the project utilizes advanced
manufacturing, as defined in paragraph (1) of subdivision (a) of
Section 26003.
(5)
(4) To the extent feasible, the extent to which the
project, or the product produced by the project, results in a
reduction of greenhouse gases, a reduction in air or water pollution,
an increase in energy efficiency, or a reduction in energy
consumption, beyond what is required by any federal or state law or
regulation.
(6)
(5) The extent of unemployment in the area in which the
project is proposed to be located.
(7)
(6) Any other factors the authority deems appropriate
in accordance with this section.
(e) At a duly noticed public hearing, the authority shall approve,
by resolution, project applications for financial assistance.
(f) Notwithstanding subdivision (j), and without regard to the
actual date of any transaction between a participating party and the
authority, any project approved by the authority by resolution for
the sales and use tax exclusion pursuant to Section 6010.8 of the
Revenue and Taxation Code prior to March 24, 2010, shall not be
subject to this section.
(g) The Legislative Analyst's Office shall report to the Joint
Legislative Budget Committee on the effectiveness of this program, on
or before January 1, 2019, by evaluating factors, including, but not
limited to, the following:
(1) The number of jobs created by the program in California.
(2) The number of businesses that have remained in California or
relocated to California as a result of this program.
(3) The amount of state and local revenue and economic activity
generated by the program.
(4) The types of advanced manufacturing, as defined in paragraph
(1) of subdivision (a) of Section 26003, utilized.
(5) The amount of reduction in greenhouse gases, air pollution,
water pollution, or energy consumption.
(h) Once the exclusions granted pursuant to Section 6010.8 of the
Revenue and Taxation Code for projects approved by the authority
pursuant to this section exceed one hundred million dollars
($100,000,000) annually, the authority shall provide a 20-day notice
to the Legislature prior to making additional approvals pursuant to
this section.
(i) The authority shall make every effort to expedite the
operation of this section, and shall adopt regulations for purposes
of implementing the section as emergency regulations in accordance
with Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code. For purposes of that
Chapter 3.5, including Section 11349.6 of the Government Code, the
adoption of the regulations shall be considered by the Office of
Administrative Law to be necessary for the immediate preservation of
the public peace, health and safety, and general welfare.
(j) (1) The authority shall study the efficacy and cost benefit of
the sales and use tax exemption as it relates to advanced
manufacturing projects. The study shall include the number of jobs
created, the costs of each job, the annual salary of each job. The
study shall also consider a dynamic analysis of the economic output
to the state that would occur without the sales and use tax
exemption. The authority shall work with the Legislative Analyst's
Office to determine the most efficient and cost effective way for the
state to create jobs in advanced manufacturing.
(2) The authority shall work with the University of California or
the California State University to perform a peer review of the net
benefits test currently used to evaluate applicants applying pursuant
to this section.
(3) Before January 1, 2017, the authority shall, in compliance
with Section 9795 of the Government Code, submit to the Legislature a
report on the study performed pursuant to paragraph (1).
(k) This (1) Except
as provided in paragraph (2), this section shall become
inoperative on July 1, 2016, and, as of January 1, 2017, is repealed,
unless a later enacted statute, that becomes operative on or before
January 1, 2017, deletes or extends the dates on which it becomes
inoperative and is repealed. The sale or purchase of tangible
personal property of a project approved prior to June 30, 2016, shall
continue to be excluded from sales and use taxes pursuant to Section
6010.8 of the Revenue and Taxation Code for the period of time set
forth in the authority's resolution approving the project pursuant to
this section.
(2) Notwithstanding paragraph (1), the authority's obligation to
submit to the Legislature a report pursuant to paragraph (3) of
subdivision (j) shall remain operative until the submission of the
report.
SEC. 6. Section 26011.8 is added to the Public Resources Code, to
read:
26011.8. (a) The purpose of this section is to promote the
creation of California-based manufacturing, California-based jobs,
the reduction of greenhouse gases, or reductions in air and water
pollution or energy consumption. In furtherance of this purpose, the
authority may approve a project for financial assistance in the form
of the sales and use tax exclusion established in Section 6010.8 of
the Revenue and Taxation Code.
(b) (1) For purposes of this section, "project" means a project
as defined in subparagraph (B) of paragraph (7) of subdivision (a) of
Section 26003.
(2) For purposes of this section, "alternative sources" also
includes advanced electric distributive generation technology as
defined in Section 379.8 of the Public Utilities Code or energy
storage technologies and their component materials.
(c) The authority shall publish notice of the availability of
project applications and deadlines for submission of project
applications to the authority.
(d) The authority shall evaluate project applications based upon
all of the following criteria:
(1) The extent to which the project develops manufacturing
facilities, or purchases equipment for manufacturing facilities,
located in California.
(2) The extent to which the anticipated benefit to the state from
the project equals or exceeds the projected benefit to the
participating party from the sales and use tax exclusion.
(3) The extent to which the project will create new, permanent
jobs in California.
(4) To the extent feasible, the extent to which the project, or
the product produced by the project, results in a reduction of
greenhouse gases, a reduction in air or water pollution, an increase
in energy efficiency, or a reduction in energy consumption, beyond
what is required by any federal or state law or regulation.
(5) The extent of unemployment in the area in which the project is
proposed to be located.
(6) Any other factors the authority deems appropriate in
accordance with this section.
(e) At a duly noticed public hearing, the authority shall approve,
by resolution, project applications for financial assistance.
(f) Notwithstanding subdivision (j), and without regard to the
actual date of any transaction between a participating party and the
authority, any project as defined in paragraph (7) of subdivision (a)
of Section 26003 approved by the authority by resolution for the
sales and use tax exclusion pursuant to Section 6010.8 of the Revenue
and Taxation Code prior to March 24, 2010, shall not be subject to
this section.
(g) The Legislative Analyst's Office shall report to the Joint
Legislative Budget Committee on the effectiveness of this program, on
or before January 1, 2019, by evaluating factors, including, but not
limited to, the following:
(1) The number of jobs created by the program in California.
(2) The number of businesses that have remained in California or
relocated to California as a result of this program.
(3) The amount of state and local revenue and economic activity
generated by the program.
(4) The amount of reduction in greenhouse gases, air pollution,
water pollution, or energy consumption.
(h) Once the exclusions granted pursuant to Section 6010.8 of the
Revenue and Taxation Code for projects approved by the authority
pursuant to this section exceed one hundred million dollars
($100,000,000) annually, the authority shall provide a 20-day notice
to the Legislature prior to making additional approvals pursuant to
this section.
(i) The authority shall make every effort to expedite the
operation of this section, and shall adopt regulations for purposes
of implementing the section as emergency regulations in accordance
with Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code. For purposes of that
Chapter 3.5, including Section 11349.6 of the Government Code, the
adoption of the regulations shall be considered by the Office of
Administrative Law to be necessary for the immediate preservation of
the public peace, health and safety, and general welfare.
(j) The authority shall work with the University of California or
the California State University to perform a peer review of the net
benefits test currently used to evaluate applicants applying pursuant
to this section.
(k) This section shall become operative on July 1, 2016, and shall
remain in effect only until January 1, 2021, and as of that date is
repealed. The sale or purchase of tangible personal property of a
project approved prior to January 1, 2021, shall continue to be
excluded from sales and use taxes pursuant to Section 6010.8 of the
Revenue and Taxation Code for the period of time set forth in the
authority's resolution approving the project pursuant to this
section.