BILL ANALYSIS Ó
AB 337
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ASSEMBLY THIRD READING
AB 337 (Allen)
As Amended January 14, 2014
Majority vote
ECONOMIC DEVELOPMENT 8-0 APPROPRIATIONS 16-0
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|Ayes:|Medina, Mansoor, Campos, |Ayes:|Gatto, Bigelow, Allen, |
| |Daly, Fong, Fox, Linder, | |Bocanegra, Bradford, Ian |
| |Melendez | |Calderon, Campos, Eggman, |
| | | |Gomez, Holden, Linder, |
| | | |Pan, Quirk, |
| | | |Ridley-Thomas, Wagner, |
| | | |Weber |
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SUMMARY : Requires the Governor's Office of Business and
Economic Development (GO-Biz) to evaluate key issues affecting
trade and foreign investment as part of the development of the
previously mandated international trade and investment strategy
(ITI Strategy). In undertaking this evaluation, GO-Biz is
directed, to the greatest extent possible, to use existing
reports and other resources. The evaluation required by this
measure applies to the second update of the strategy, which
should occur no later than February 1, 2019.
EXISTING LAW :
1)Requires GO-Biz to provide the Legislature with an ITI
Strategy by February 2014 and an updated ITI Strategy at least
once every five years.
2)Requires the ITI Strategy to, at a minimum, include the
following:
a) Policy, goals, objectives and recommendations;
b) Measurable outcomes and timelines for meeting the ITI
Strategy goals, objectives, and actions;
c) Identification of key stakeholder partnerships that will
be used to implement the goals and objectives;
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d) Identification of impediments for achieving the goals
and objectives;
e) Identification of options for funding recommended
actions; and
f) Identification of an international trade and investment
organizational structure.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, this measure will cost GO-Biz $50,000 to implement.
COMMENTS : Between 2003 and 2006, California had no trade and
international marketing authority. After years of debate, the
Legislature and the Governor began an unprecedented
collaboration on the development of a new international trade
and investment program. Agreements on the new program were
codified in SB 1513 (Romero and Figueroa), Chapter 663, Statutes
of 2006, and further refined in AB 2012 (John A. Pérez), Chapter
294, Statutes of 2012. The current ITI Strategy was finalized
in August 2008 and the next strategy is due in February 2014.
California's Trade Economy
California's $2 trillion economy naturally functions as an
independent nation and is highly dependent on industry sectors
that participate within the larger global economy. In fact,
compared to other nations, California has one of the 10 largest
economies in the world, due to it being a top-tier trade
partner, a best-in-class investment location, a high quality
producer of goods and services, and the home and key access
point for a massive consumer-base. In 2012, California exported
$162 billion in products to over 220 foreign countries. While
California has been significantly impacted by the recession,
exports continued to increase in almost every quarter from 2010
through 2012.
It is estimated that one in five manufacturing jobs in
California is related to trade. Goods movement supports
employment, business profit, and state and local tax revenue.
The logistics industry is responsible for hiring 73,000 workers.
California businesses rely heavily on the state's ports and
their related transportation systems to move manufactured goods.
Firms rely on fast, flexible, and reliable shipping to link
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national and global supply chains and bring products to the
retail market. Transportation breakdowns and congestion can
idle entire global production networks.
Changes in U.S. and global trade patterns and the continuing
development of foreign markets place challenges on California's
goods movement and IT systems. These challenges are only
expected to become greater as the rate of innovation within
manufacturing, transportation, and communication technologies
gets faster and the ability of multiple geographic locations to
successfully use these technologies expands.
Doubling Exports in Five Years
In January 2010, the President announced a national goal of
doubling U.S. exports within five years, setting a 2015 target
for U.S. exports of $3.14 trillion. In accomplishing this goal,
the federal government has and will continue to implement new
programs, targeting existing trade related activities, and
increasing funding and technical assistance within its current
programs.
For California, the second largest exporter of products in the
U.S. and the largest receiver of foreign direct investment in
the nation, this federal goal could result in significant new
trade and investment opportunities. California has already
received nearly $4 million in federal funds to administer a
state export assistance program for small businesses. Since the
announcement of the new national goal, exports from California
were up $41 billion. Further, with the upgrading of the Panama
Canal and two new broad-based trade agreements being negotiated
and implemented (the Trans-Pacific Partnership and the
Transatlantic Trade and Investment Agreement), California goods
movement infrastructure will face even greater pressure to
perform.
Analysis Prepared by : Toni Symonds / J., E.D. & E. / (916)
319-2090
FN: 0003002
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