BILL ANALYSIS �
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THIRD READING
Bill No: AB 1399
Author: Assembly Jobs, Economic Development, and the Economy
Committee
Amended: 8/22/13 in Senate
Vote: 21
SENATE BUSINESS, PROF. & ECON. DEV. COMMITTEE : 9-0, 6/24/13
AYES: Lieu, Block, Corbett, Galgiani, Hernandez, Hill, Padilla,
Wyland, Yee
NO VOTE RECORDED: Emmerson
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 70-0, 5/16/13 (Consent) - See last page for
vote
SUBJECT : Economic development
SOURCE : Author
DIGEST : This bill makes technical changes to the Government
Code relating to the transfer of economic related programs from
the Business, Transportation and Housing Agency (BTH) to the
Governor's Office of Business and Economic Development (GO-Biz).
Senate Floor Amendments of 8/22/13 contain chaptering-out
language with
AB 1247 (Medina); and make technical and clarifying changes.
ANALYSIS :
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Existing law:
1. Establishes GO-Biz for the purpose of serving as the lead
state entity for economic strategy and marketing of
California on issues relating to business development,
private sector investment and economic growth. GO-Biz also
serves as the administrative oversight for the California
Business Investment Service and the Office of the Small
Business Advocate.
2. Requires BTH to administer the Economic Adjustment Assistance
Grant (EAA Grant), funded through the United States Economic
Development Administration under Title IX of the Public Works
and Economic Development Act of 1965. Provides that all
federal moneys held in the Sudden and Severe Economic
Dislocation Grant Account within the Special Deposit Fund are
transferred to the Small Business Expansion Fund for
expenditure by BTH.
This bill:
1. Transfers administration of the EAA Grant and the Sudden and
Severe Economic Dislocation Grant program from BTH to GO-Biz.
2. Renumbers within statute the following definitions (no
changes have been made to the definitions):
Local economic development organization
Financial intermediary
California Council on Science and Technology
Regional economic development organization
Regional economic development corporation
Small businesses
Economic development corporation
Community development
Triple bottom line
Financial institution capital
Economic development
Community development intermediary
Local economic development
Microbusiness lender
Emerging domestic market
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Background
GO-Biz . In February 2010, the Little Hoover Commission
undertook a review of the state's economic and workforce
development programs. In its final report, "Making up for Lost
Ground: Creating a Governor's Office of Economic Development,"
it analyzed the status and effectiveness of current programs
since the 2003 demise of the Technology, Trade and Commerce
Agency (TTCA) and recommended the creation of a new governmental
entity to fill the void left by the dismantled agency.
The report called for a single entity that would promote greater
economic development, foster job creation, serve as a policy
advisor and deliver specific services (i.e., permitting, tax,
regulatory, and other information) directly to the California
business community. In April 2010, Governor Schwarzenegger
issued Executive Order S-05-10 as a means to operationalize the
report recommendations including the creation of the Governor's
Office of Economic Development (GOED).
In October 2011, AB 29 (John A. Perez, Chapter 475) effectively
codified GOED and changed its name to GO-Biz, effective January
1, 2012. Since its inception, the office has served over 3,000
businesses, 95% of which are small. The most frequent types of
assistance include help with permit streamlining, starting a
businesses, relocation and expansion of businesses, and
regulatory challenges.
One key initiative of GO-Biz is the "strike teams" which can be
mobilized to help attract and/or retain specific businesses.
Strike teams are especially well suited to engage with major
employers and have been successfully activated to assist Bayer
Healthcare, Jazz Semiconductor, and Baxter Pharmaceutical to
locate and/or expand in California.
In March 2012, Governor Brown initiated a reorganization process
to realign the state's administrative structure in Governor's
Reorganization Plan 2 (GRP 2). Among other changes, the GRP 2
reduced the number of state agencies by eliminating give
agencies and merging their responsibilities into three new
agencies: Government Operations; Buisness, Consumer Services
and Housing; and Transportation. Key changes include
dismantling of BTH and the shifting of a number of key programs
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and services to GO-Biz including the Small Business Loan
Guarantee Program, the California Travel and Tourism Commission,
the California Film Commission, the Film California First
Program and the Infrastructure and Economic Development Bank.
EAA Grant . The federal EAA Grant program was initially
designated to be administered through the TTCA, which was
eliminated in 2003. Although the State Controller retained the
money for uses consistent with the federal program, no state
entity had authority to actually use the money. In 2008, BTH
was designed to administer the program and the moneys were
transferred to the California Expansion Fund to be used under
contract through the small business financial development
corporations (FDCs). BTH is now going to be eliminated and a
new administering entity needs to be provided for these
programs. GRP 2 consolidates several economic development
programs at GO-Biz including contracting authority for FDCs.
Comments
According to the author's office, existing law places the
definitions for specified economic development terms within the
code sections related to the activities of BTH. On July 1,
2013, BTH will cease to exist and its programs and authorities
will either be eliminated or transferred to other existing and
new state government entities. According to the author's
office, this bill transfers, without substantive changes, key
economic development definitions, as well as the authority to
administer the EAA Grant and the Severe Economic Dislocation
Grant from BTH to GO-Biz.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
ASSEMBLY FLOOR : 70-0, 5/16/13
AYES: Achadjian, Alejo, Ammiano, Atkins, Bigelow, Bloom,
Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown, Ian
Calderon, Campos, Chau, Ch�vez, Chesbro, Conway, Cooley,
Dahle, Daly, Dickinson, Donnelly, Fong, Fox, Frazier, Garcia,
Gatto, Gomez, Gordon, Gorell, Gray, Hagman, Hall, Harkey,
Roger Hern�ndez, Jones, Jones-Sawyer, Levine, Linder, Logue,
Lowenthal, Maienschein, Mansoor, Medina, Mitchell, Mullin,
Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson, Perea,
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V. Manuel P�rez, Quirk, Quirk-Silva, Rendon, Salas, Skinner,
Ting, Torres, Wagner, Waldron, Weber, Wieckowski, Wilk,
Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Allen, Buchanan, Eggman, Beth Gaines, Grove,
Holden, Melendez, Morrell, Stone, Vacancy
MW:k 8/26/13 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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