BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 701| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 701 Author: John A. Pérez (D) Amended: 6/3/13 in Senate Vote: 21 SENATE GOVERNANCE & FINANCE COMMITTEE : 4-1, 6/12/13 AYES: Wolk, Beall, DeSaulnier, Liu NOES: Knight NO VOTE RECORDED: Emmerson, Hernandez SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8 ASSEMBLY FLOOR : 54-24, 4/22/13 - See last page for vote SUBJECT : California Infrastructure and Economic Development Bank SOURCE : Author DIGEST : This bill allows the Assembly Speaker and the Senate Rules Committee to each appoint a non-voting legislative member to the California Infrastructure and Economic Development Banks (I-Bank) board of directors. This bill also designates the I-Bank as the primary state agency for developing an application to any federal infrastructure bank or financing authority. ANALYSIS : Existing law establishes the I-Bank which supports economic development and public and private infrastructure investments through its authority to issue bonds, make loans and, provide credit enhancements. CONTINUED AB 701 Page 2 This bill allows the Assembly Speaker and the Senate Rules Committee to each appoint a non-voting legislative member to the I-Bank board of directors. This bill specifies that legislative members can advise the board to the extent that their advisory participation is not incompatible with their duties as Members of the Legislature. The appointed Member of the Legislature may select a designee to serve in his/her place. This bill also designates the I-Bank as the primary state agency for developing an application to any federal infrastructure bank or financing authority. Background The I-Bank manages several programs, including: The Infrastructure State Revolving Fund Program provides low-cost financing to local agencies for public infrastructure projects. The Industrial Development Bond Program provides tax-exempt revenue bond financing for eligible manufacturing and processing companies. The 501(c)(3) Revenue Bond Program offers tax-exempt revenue bond financing for certain nonprofit, public benefit corporations. The Exempt Facility Bond Program provides tax-exempt financing for projects that are government-owned or consist of private improvements within publicly-owned facilities, such as private airline improvements at publicly owned airports. Public Agency Revenue Bond Program provides tax-exempt and taxable bond financing to specified programs for state and local governmental agencies. Formerly housed within the Business, Transportation and Housing Agency, Governor's Reorganization Plan 2 of 2012 moved the CONTINUED AB 701 Page 3 I-Bank into the Governor's Office of Business and Economic Development. The I-Bank has a five-member board of directors, including the Director of the Governor's Office of Business and Economic Development, who serves as chair, the Treasurer, or his designee, the Department of Finance, or her designee, the Secretary of Transportation, or his designee, and an appointee of the Governor. The I-Bank's Executive Director is appointed by the Governor and confirmed by the Senate. The I-Bank generally does not receive direct state funding. Funding comes from fees, interest income, and revenues tied to financing activities. Related legislation AB 311 (V. Manuel Perez) expands the role of the I-Bank to include facilitating infrastructure and economic development financing activities within the California and Mexico border region. AB 1272 (Medina) expands the authority of the I-Bank to participate in regional, national and international organizations related to infrastructure financing and support projects involving goods movement. AB 1095 (John A. Pérez, 2011) adds two non-voting legislative members of the I-Bank's board of directors. Passed Senate Governance and Finance 5-3, amended to address school recycling. AB 696 (Hueso) directs the I-Bank to establish a methodology for determining the economic benefits of projects under consideration and, as of January 1, 2013, restricts the I-Bank to approve only those projects that provide economic benefits and meet land use criteria. AB 696 was vetoed by Governor Brown. AB 700 (Blumenfield) requires the I-Bank to adopt two-year goals and measurable objectives, consistent with state infrastructure, economic development and environmental plans and authorizes the I-Bank to pursue streamlined administrative functions. AB 700 was vetoed by Governor Brown. CONTINUED AB 701 Page 4 AB 893 (V. Manuel Pérez) directs the I-Bank to enhance outreach and technical assistance to small and rural communities to obtain financing for infrastructure projects. AB 893 died in Senate Appropriations. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No SUPPORT : (Verified 6/24/13) AFSCME, AFL-CIO ASSEMBLY FLOOR : 54-24, 4/22/13 AYES: Achadjian, Alejo, Ammiano, Atkins, Bloom, Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chesbro, Cooley, Daly, Dickinson, Eggman, Fong, Fox, Frazier, Garcia, Gatto, Gomez, Gordon, Gray, Hall, Roger Hernández, Holden, Jones-Sawyer, Levine, Medina, Mitchell, Mullin, Muratsuchi, Nazarian, Pan, Perea, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Salas, Skinner, Stone, Ting, Torres, Weber, Wieckowski, Williams, Yamada, John A. Pérez NOES: Allen, Bigelow, Chávez, Conway, Dahle, Donnelly, Beth Gaines, Gorell, Grove, Hagman, Harkey, Jones, Linder, Logue, Maienschein, Mansoor, Melendez, Morrell, Nestande, Olsen, Patterson, Wagner, Waldron, Wilk NO VOTE RECORDED: Lowenthal, Vacancy AB:d 6/24/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED