Amended in Assembly April 15, 2013

California Legislature—2013–14 Regular Session

Assembly BillNo. 1422


Introduced by Committee on Jobs, Economic Development, and the Economy (Medina (Chair), Daly, Fong, Fox, and V. Manuel Pérez)

March 21, 2013


An act to amend Section 26003 of the Public Resources Code, and to repeal Section 1 of Chapter 677 of the Statutes of 2012, relating to energy.

LEGISLATIVE COUNSEL’S DIGEST

AB 1422, as amended, Committee on Jobs, Economic Development, and the Economy. California Alternative Energy and Advanced Transportation Financing Authority: participating party.

(1) Existing law, the California Alternative Energy and Advanced Transportation Financing Authority Act, establishes the California Alternative Energy and Advanced Transportation Financing Authority and requires the authority to establish programs to provide financial assistance to participating parties for projects related to sustainable and renewable energy sources, energy efficiency, and advanced transportation projects. The act provides financial assistance, in the form of a sales and use tax exclusion, to participating parties for these types of projects.

This bill would clarify that for purposes of the sales and use tax exclusion, an entity located outside of the state, including an entity located overseas, is considered to be a participating party and is eligible to apply for financial assistance if the participating party commits to, and demonstrates that the participating party will be opening a manufacturing facility in thebegin delete stateend deletebegin insert state. This bill would also make technical, nonsubstantive changes to these provisionsend insert.

(2) Existing law requires the Governor’s Office of Business and Economic Development to review and identify efficient and cost-effective methods for the state to create jobs in advanced manufacturing, as specified, and to report its findings to the Legislature on or before January 1, 2017.

This bill would repeal this reporting requirement.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 26003 of the Public Resources Code, as
2amended by Section 5 of Chapter 677 of the Statutes of 2012, is
3amended to read:

4

26003.  

(a) As used in this division, unless the context
5otherwise requires:

6(1) (A) “Advanced manufacturing” means manufacturing
7processes that improve existing, or create entirely new materials,
8products, and processes through the use of science, engineering,
9or information technologies, high-precision tools and methods, a
10high-performance workforce, and innovative business or
11organizational models utilizing any of the following technology
12areas:

13(i) Micro- and nanoelectronics, including semiconductors.

14(ii) Advanced materials.

15(iii) Integrated computational materials engineering.

16(iv) Nanotechnology.

17(v) Additive manufacturing.

18(vi) Industrial biotechnology.

19(B) “Advanced manufacturing” includesbegin delete allend deletebegin insert anyend insert of the following:

20(i) Systems that result from substantive advancement, whether
21incremental or breakthrough, beyond the current industry standard,
22in the production of materials and products. These advancements
23include improvements in manufacturing processes and systems
24that are often referred to as “smart” or “intelligent” manufacturing
25systems, which integrate computational predictability and
26operational efficiency.

P3    1(ii) (I) Sustainable manufacturing systems and manufacturing
2technologies that minimize the use of resources while maintaining
3or improving cost and performance.

4(II) Sustainable manufacturing systems and manufacturing
5technologies do not include those required to be undertaken
6pursuant to state or federal law or regulations, air district rules or
7regulations, memoranda of understanding with a governmental
8entity, or legally binding agreements or documents. The State Air
9Resources Board shall advise the authority to ensure that the
10requirements of this clause are met.

11(2) (A) “Advanced transportation technologies” means
12emerging commercially competitive transportation-related
13technologies identified by the authority as capable of creating
14long-term, high value-added jobs for Californians while enhancing
15the state’s commitment to energy conservation, pollution and
16greenhouse gas emissions reduction, and transportation efficiency.

17(B) “Advanced transportation technologies” does not include
18those projects required to be undertaken pursuant to state or federal
19law or regulations, air district rules or regulations, memoranda of
20understanding with a governmental entity, or legally binding
21agreements or documents. The State Air Resources Board shall
22advise the authority regarding projects that are excluded pursuant
23to this subparagraph.

24(3) (A) “Alternative sources” means devices or technologies
25used for a renewable electrical generation facility, as defined in
26paragraph (1) of subdivision (a) of Section 25741, a combined
27heat and power system, as defined in Section 2840.2 of the Public
28Utilities Code, distributed generation and energy storage
29technologies eligible under the self-generation incentive program
30pursuant to Section 379.6 of the Public Utilities Code, as
31determined by the Public Utilities Commission, or a facility
32designed for the production of renewable fuels, the efficient use
33of which reduce the use of fossil or nuclear fuels, and energy
34efficiency devices or technologies that reduce the need for new
35electric generation and reduce emissions of toxic and criteria
36pollutants and greenhouse gases.

37(B) “Alternative sources” does not include a hydroelectric
38facility that does not meet state laws pertaining to the control,
39appropriation, use, and distribution of water, including, but not
40limited to, the obtaining of applicable licenses and permits.

P4    1(4) “Authority” means the California Alternative Energy and
2Advanced Transportation Financing Authority established pursuant
3to Section 26004, and any board, commission, department, or
4officer succeeding to the functions of the authority, or to which
5the powers conferred upon the authority by this division shall be
6given.

7(5) “Cost” as applied to a project or portion of the project
8financed under this division means all or part of the cost of
9construction and acquisition of all lands, structures, real or personal
10property or an interest in the real or personal property, rights,
11rights-of-way, franchises, easements, and interests acquired or
12used for a project; the cost of demolishing or removing any
13buildings or structures on land so acquired, including the cost of
14acquiring any lands to which those buildings or structures may be
15moved; the cost of all machinery, equipment, and furnishings,
16financing charges, interest prior to, during, and for a period after,
17completion of construction as determined by the authority;
18provisions for working capital; reserves for principal and interest
19and for extensions, enlargements, additions, replacements,
20renovations, and improvements; the cost of architectural,
21engineering, financial, accounting, auditing and legal services,
22plans, specifications, estimates, administrative expenses, and other
23expenses necessary or incident to determining the feasibility of
24constructing any project or incident to the construction, acquisition,
25or financing of a project.

26(6) “Financial assistance” includes, but is not limited to, loans,
27loan loss reserves, interest rate reductions, proceeds of bonds issued
28by the authority, bond insurance, loan guarantees or other credit
29enhancements or liquidity facilities, contributions of money, or a
30combination thereof, as determined by, and approved by the
31resolution of, the board.

32(7) (A) “Participating party” means a person, federal or state
33agency, department, board, authority, or commission, state or
34community college, or university, or a city or county, regional
35agency, public district, school district, or other political entity
36engaged in the business or operations in the state, whether
37organized for profit or not for profit, that applies for financial
38assistance from the authority for the purpose of implementing a
39project.

P5    1(B) (i) For the purposes of Section 6010.8 of the Revenue and
2Taxation Code, “participating party” means an entity specified in
3subparagraph (A) that seeks financial assistance pursuant to Section
426011.8.

5(ii) For purposes of Section 6010.8 of the Revenue and Taxation
6Code, an entity located outside of the state, including an entity
7located overseas, is considered to be a participating party and is
8eligible to apply for financial assistance pursuant to Section
926011.8 if the participating party commits to, and demonstrates
10that, the party will be opening a manufacturing facility in the state.

11(iii) It is the intent of the Legislature by adding clause (ii) to
12clarify existing law and ensure that an out-of-state entity or
13overseas entity is eligible to apply for financial assistance pursuant
14to Section 26011.8.

15(8) (A) “Project” means a land, building, improvement to the
16land or building, rehabilitation, work, property, or structure, real
17or personal, stationary or mobile, including, but not limited to,
18machinery and equipment, whether or not in existence or under
19construction, that utilizes, or is designed to utilize, an alternative
20source, or that is utilized for the design, technology transfer,
21manufacture, production, assembly, distribution, or service of
22advanced transportation technologies or alternative source
23components.

24(B) “Project,” forbegin delete theend delete purposes of Section 26011.8 and Section
256010.8 of the Revenue and Taxation Code, meansbegin delete anyend delete tangible
26personal property that is utilized for the design, manufacture,
27production, or assembly of advanced manufacturing, advanced
28transportation technologies, or alternative source products,
29components, or systems.

30(9) “Revenue” means all rents, receipts, purchase payments,
31loan repayments, and all other income or receipts derived by the
32authority from a project, or the sale, lease, or other disposition of
33alternative source or advanced transportation technology facilities,
34or the making of loans to finance alternative source or advanced
35transportation technology facilities, and any income or revenue
36 derived from the investment of money in any fund or account of
37the authority.

38(b) This section shall become inoperative on July 1, 2016, and,
39as of January 1, 2017, is repealed, unless a later enacted statute,
P6    1that becomes operative on or before January 1, 2017, deletes or
2extends the dates on which it becomes inoperative and is repealed.

3

SEC. 2.  

Section 26003 of the Public Resources Code, as added
4by Section 6 of Chapter 677 of the Statutes of 2012, is amended
5to read:

6

26003.  

(a) As used in this division, unless the context
7otherwise requires:

8(1) (A)  “Advanced transportation technologies” means
9emerging commercially competitive transportation-related
10technologies identified by the authority as capable of creating
11long-term, high value-added jobs for Californians while enhancing
12the state’s commitment to energy conservation, pollution and
13greenhouse gas emissions reduction, and transportation efficiency.

14(B) “Advanced transportation technologies” does not include
15those projects required to be undertaken pursuant to state or federal
16law or regulations, air district rules or regulations, memoranda of
17understanding with a governmental entity, or legally binding
18agreements or documents. The State Air Resources Board shall
19advise the authority regarding projects that are excluded pursuant
20to this subparagraph.

21(2) (A) “Alternative sources” means devices or technologies
22used for a renewable electrical generation facility, as defined in
23paragraph (1) of subdivision (a) of Section 25741, a combined
24heat and power system, as defined in Section 2840.2 of the Public
25Utilities Code, distributed generation and energy storage
26technologies eligible under the self-generation incentive program
27pursuant to Section 379.6 of the Public Utilities Code, as
28determined by the Public Utilities Commission, or a facility
29designed for the production of renewable fuels, the efficient use
30of which reduce the use of fossil or nuclear fuels, and energy
31efficiency devices or technologies that reduce the need for new
32electric generation and reduce emissions of toxic and criteria
33pollutants and greenhouse gases.

34(B) “Alternative sources” does not include a hydroelectric
35facility that does not meet state laws pertaining to the control,
36appropriation, use, and distribution of water, including, but not
37limited to, the obtaining of applicable licenses and permits.

38(3) “Authority” means the California Alternative Energy and
39Advanced Transportation Financing Authority established pursuant
40to Section 26004, and any board, commission, department, or
P7    1officer succeeding to the functions of the authority, or to which
2the powers conferred upon the authority by this division shall be
3given.

4(4) “Cost” as applied to a project or portion of the project
5financed under this division means all or part of the cost of
6construction and acquisition of all lands, structures, real or personal
7property or an interest in the real or personal property, rights,
8rights-of-way, franchises, easements, and interests acquired or
9used for a project; the cost of demolishing or removing any
10buildings or structures on land so acquired, including the cost of
11acquiring any lands to which those buildings or structures may be
12moved; the cost of all machinery, equipment, and furnishings,
13financing charges, interest prior to, during, and for a period after,
14completion of construction as determined by the authority;
15provisions for working capital; reserves for principal and interest
16and for extensions, enlargements, additions, replacements,
17renovations, and improvements; the cost of architectural,
18engineering, financial, accounting, auditing and legal services,
19plans, specifications, estimates, administrative expenses, and other
20expenses necessary or incident to determining the feasibility of
21constructing any project or incident to the construction, acquisition,
22or financing of a project.

23(5) “Financial assistance” includes, but is not limited to, loans,
24loan loss reserves, interest rate reductions, proceeds of bonds issued
25by the authority, bond insurance, loan guarantees or other credit
26enhancements or liquidity facilities, contributions of money, or a
27combination thereof, as determined by, and approved by the
28resolution of, the board.

29(6) (A) “Participating party” means a person, federal or state
30agency, department, board, authority, or commission, state or
31community college, or university, or a city or county, regional
32agency, public district, school district, or other political entity
33engaged in the business or operations in the state, whether
34organized for profit or not for profit, that applies for financial
35assistance from the authority for the purpose of implementing a
36project.

37(B) (i) For the purposes of Section 6010.8 of the Revenue and
38Taxation Code, “participating party” means an entity specified in
39subparagraph (A) that seeks financial assistance pursuant to Section
4026011.8.

P8    1(ii) For purposes of Section 6010.8 of the Revenue and Taxation
2Code, an entity located outside of the state, including an entity
3located overseas, is considered to be a participating party and is
4eligible to apply for financial assistance pursuant to Section
526011.8 if the participating party commits to, and demonstrates
6that, the party will be opening a manufacturing facility in the state.

7(iii) It is the intent of the Legislature by adding clause (ii) to
8clarify existing law and ensure that an out-of-state entity or
9overseas entity is eligible to apply for financial assistance pursuant
10to Section 26011.8.

11(7) (A) “Project” means a land, building, improvement to the
12land or building, rehabilitation, work, property, or structure, real
13or personal, stationary or mobile, including, but not limited to,
14machinery and equipment, whether or not in existence or under
15construction, that utilizes, or is designed to utilize, an alternative
16source, or that is utilized for the design, technology transfer,
17manufacture, production, assembly, distribution, or service of
18advanced transportation technologies or alternative source
19components.

20(B) “Project,” forbegin delete theend delete purposes of Section 26011.8 and Section
216010.8 of the Revenue and Taxation Code, meansbegin delete anyend delete tangible
22personal property that is utilized for the design, manufacture,
23production, or assembly of advanced transportation technologies
24or alternative source products, components, or systems.

25(8) “Revenue” means all rents, receipts, purchase payments,
26loan repayments, and all other income or receipts derived by the
27authority from a project, or the sale, lease, or other disposition of
28alternative source or advanced transportation technology facilities,
29or the making of loans to finance alternative source or advanced
30transportation technology facilities, and any income or revenue
31derived from the investment of money in any fund or account of
32the authority.

33(b) This section shall become operative on July 1, 2016.

34

SEC. 3.  

Section 1 of Chapter 677 of the Statutes of 2012 is
35repealed.



O

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