BILL ANALYSIS Ó
SENATE GOVERNANCE & FINANCE COMMITTEE
Senator Lois Wolk, Chair
BILL NO: AB 1070 HEARING: 7/3/13
AUTHOR: Frazier FISCAL: Yes
VERSION: 4/3/13 TAX LEVY: No
CONSULTANT: Grinnell
CALIFORNIA TRANSPORTATION FINANCE AUTHORITY
Clarifies appropriate roles when CTFA allows project
sponsors to issue bonds.
Background and Existing Law
The Legislature created the California Transportation
Financing Authority (CTFA) to assist transportation
agencies in obtaining financing for transportation projects
(AB 798, Nava, 2009). CTFA is housed within the State
Treasurer's Office, and governed by a board composed of the
State Treasurer, the State Controller, the Director of the
Department of Finance, the Director of the California
Department of Transportation, the Executive Director of the
California Transportation Commission, and local agency
representatives selected by the Senate Rules Committee and
the Speaker of the Assembly.
State law allows CTFA to provide various forms of financial
assistance, including issuing revenue bonds repaid by local
transportation funds or tolls, to increase new capacity in
the state transportation system in a manner consistent with
the state's greenhouse gas reduction, air quality
improvement, and natural resource conservation goals. CTFA
must determine that revenues will be sufficient to repay
the bonds prior to providing assistance. At that point,
CTFA can issue conduit bonds on behalf of project sponsors,
or grant authority for the sponsor to issue bonds directly.
CTFA sells a conduit bond in its name with its credit
rating, and sends the bond proceeds to the project sponsor,
which levies tolls to repay the bond.
State law limits project sponsors to the California
Department of Transportation, a regional transportation
planning agency, a county transportation commission, any
other local or regional transportation entity designated in
AB 1070 - 04/13/13-- Page 2
statute as a regional transportation agency, or a joint
powers authority
Proposed Law
Assembly Bill 1070 adds to CTFA statute a definition for
issuer to clarify CTFA and the project sponsor's role when
it authorizes the project sponsor to issue bonds. The bill
also makes nonsubstantive conforming changes to CTFA's
statute.
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill . According to the author, "AB 1070
would make technical changes to remove the confusion
surrounding the responsibilities of the bond issuer,
whether that is California Transportation Financing
Authority(CTFA) or the project sponsor. CTFA has the
ability to issue or approve the issuance of revenue bonds,
which includes tolls, to finance transportation projects.
The changes in this bill would clarify that when CTFA
grants a project sponsor the ability to issue bonds, the
powers conveyed to a project sponsor are for bond issuance
only and not the other powers and responsibilities of
CTFA."
Assembly Actions
Assembly Transportation 16-0
Assembly Appropriations 17-0
Assembly Floor 75-0
Senate Transportation and Housing10-0
AB 1070 - 04/13/13-- Page 3
Support and Opposition (06/27/13)
Support : State Treasurer Bill Lockyer.
Opposition : Unknown.