Amended in Senate August 12, 2013

Amended in Senate July 11, 2013

Amended in Assembly May 8, 2013

Amended in Assembly April 22, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 1021

Introduced by Assembly Member Eggman

(Coauthors: Assembly Members Chesbro and Williams)

February 22, 2013

An act to amend Section 26003 of the Public Resources Code, relating to alternative energy.

LEGISLATIVE COUNSEL’S DIGEST

AB 1021, as amended, Eggman. Alternative energy: recycled feedstock.

Existing law establishes the California Alternative Energy and Advanced Transportation Financing Authority to provide financial assistance for projects that promote the use of alternative energies. Existing law authorizes the authority to approve a project for financial assistance in the form of the sales and use tax exclusion.

This bill would expand projects eligible for the sales and use tax exclusion to include projects that process or utilize recycled feedstock, as defined, that is intended to be reused in the production of another product or soil amendment, but would not include a project that processes or utilizes recycled feedstock in a manner that constitutes disposal, as defined.

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, as
amended by Section 5 of Chapter 677 of the Statutes of 2012, is
amended to read:

26003.  

(a) As used in this division, unless the context
otherwise requires:

(1) (A) “Advanced manufacturing” means manufacturing
processes that improve existing begin delete , end delete or create entirely begin delete new, end delete begin insert new end insert
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 utilizing any of the following technology
areas:

(i) Microelectronics 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) Systems that result from substantive advancement, whether
incremental or breakthrough, beyond the current industry standard,
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.

(ii) (I) Sustainable manufacturing systems and manufacturing
technologies that minimize the use of resources while maintaining
or improving cost and performance.

(II) Sustainable manufacturing systems and manufacturing
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
requirements of this clause are met.

(2) (A) “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 and
greenhouse gas emissions reduction, and transportation efficiency.

(B) “Advanced transportation technologies” does not include
those projects 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 regarding projects that are excluded pursuant
to this subparagraph.

(3) (A) “Alternative sources” means devices or technologies
used for a renewable electrical generation facility, as defined in
paragraph (1) of subdivision (a) of Section 25741, a combined
heat and power system, as defined in Section 2840.2 of the Public
Utilities Code, distributed generation and energy storage
technologies eligible under the self-generation incentive program
pursuant to Section 379.6 of the Public Utilities Code, as
determined by the Public Utilities Commission, or a facility
designed for the production of renewable fuels, the efficient use
of which reduce the use of fossil or nuclear fuels, and energy
efficiency devices or technologies that reduce the need for new
electric generation and reduce emissions of toxic and criteria
pollutants and greenhouse gases.

(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;
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, loans,
loan loss reserves, interest rate reductions, proceeds of bonds issued
by the authority, bond insurance, loan guarantees or other credit
enhancements or liquidity facilities, contributions of money, or a
combination thereof, as determined by, and approved by the
resolution of, the board.

(7) (A) “Participating party” means a person, federal or state
agency, department, board, authority, or commission, state or
community college, or university, or a city or county, regional
agency, public district, school district, or other political entity
engaged in the business or operations in the state, whether
organized for profit or not for profit, that applies for financial
assistance from the authority for the purpose of implementing a
project.

(B) For the purposes of Section 6010.8 of the Revenue and
Taxation Code, “participating party” means an entity specified in
subparagraph (A) that seeks financial assistance pursuant to Section
26011.8.

(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 or alternative source
components.

(B) “Project,” for the purposes of Section 26011.8 and Section
6010.8 of the Revenue and Taxation Code, means tangible personal
property that primarily processes begin delete or utilizes end delete recycled feedstock
that is intended to be reused in the production of another product
or begin insert utilizes recycled feedstock in the production of another product
or end insert soil amendment, or that is utilized for the design, manufacture,
production, or assembly of advanced manufacturing, advanced
transportation technologies, or alternative source products,
components, or systems. begin delete Project end delete begin insert “Project end insert begin insert ” end insert does not include
tangible personal property that processes or utilizes recycled
feedstock in a manner that would constitute disposal as defined in
subdivision (b) of Section 40192.

(9) “Recycled feedstock” means material that would otherwise
be destined for disposal, having completed its intended end use
and product begin delete lifecycle, that is intended to be reused in the production
of another product or soil amendment. end delete begin insert lifecycle. end insert

(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 moneys 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 of the Public Resources Code, as added
by Section 6 of Chapter 677 of the Statutes of 2012, is amended
to read:

26003.  

(a) As used in this division, unless the context
otherwise requires:

(1) (A) “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 and
greenhouse gas emissions reduction, and transportation efficiency.

(B) “Advanced transportation technologies” does not include
those projects 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 regarding projects that are excluded pursuant
to this subparagraph.

(2) (A) “Alternative sources” means devices or technologies
used for a renewable electrical generation facility, as defined in
paragraph (1) of subdivision (a) of Section 25741, a combined
heat and power system, as defined in Section 2840.2 of the Public
Utilities Code, distributed generation and energy storage
technologies eligible under the self-generation incentive program
pursuant to Section 379.6 of the Public Utilities Code, as
determined by the Public Utilities Commission, or a facility
designed for the production of renewable fuels, the efficient use
of which reduce the use of fossil or nuclear fuels, and energy
efficiency devices or technologies that reduce the need for new
electric generation and reduce emissions of toxic and criteria
pollutants and greenhouse gases.

(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;
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, loans,
loan loss reserves, interest rate reductions, proceeds of bonds issued
by the authority, bond insurance, loan guarantees or other credit
enhancements or liquidity facilities, contributions of money, or a
combination thereof, as determined by, and approved by the
resolution of, the board.

(6) (A) “Participating party” means a person, federal or state
agency, department, board, authority, or commission, state or
community college, or university, or a city or county, regional
agency, public district, school district, or other political entity
engaged in the business or operations in the state, whether
organized for profit or not for profit, that applies for financial
assistance from the authority for the purpose of implementing a
project.

(B) For the purposes of Section 6010.8 of the Revenue and
Taxation Code, “participating party” means an entity specified in
subparagraph (A) that seeks financial assistance pursuant to Section
26011.8.

(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 or alternative source
components.

(B) “Project,” for the purposes of Section 26011.8 and Section
6010.8 of the Revenue and Taxation Code, means tangible personal
property that primarily processes begin delete or utilizes end delete recycled feedstock
that is intended to be reused in the production of another product
or begin insert utilizes recycled feedstock in the production of another product
or end insert soil amendment, or that is utilized for the design, manufacture,
production, or assembly of advanced transportation technologies
or alternative source products, components, or systems. begin delete Project end delete
begin insert “Project end insert begin insert ” end insert does not include tangible personal property that
processes or utilizes recycled feedstock in a manner that would
constitute disposal as defined in subdivision (b) of Section 40192.

(8) “Recycled feedstock” means material that would otherwise
be destined for disposal, having completed its intended end use
and product begin delete lifecycle, that is intended to be reused in the production
of another product or soil amendment. end delete begin insert lifecycle. end insert

(9) “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.