BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1422|
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THIRD READING
Bill No: AB 1422
Author: Committee on Jobs, Economic Development and the
Economy
Amended: 8/26/13 in Senate
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 7-0, 7/3/13
AYES: Wolk, Knight, Beall, DeSaulnier, Emmerson, Hernandez, Liu
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 70-0, 5/16/13 (Consent) - See last page for
vote
SUBJECT : California Alternative Energy and Advanced
Transportation
Finance Authority: participating authority
SOURCE : Author
DIGEST : This bill provides code maintenance and technical
clean-up to the sales and use tax exemption (SUTE) program
administered through the California Alternative Energy and
Advanced transportation Financing Authority (CAEATFA).
Senate Floor Amendments of 8/26/13 delete the provisions that
require equipment be "purchased in" this state for purposes of
the SUTE.
ANALYSIS : The CAEATFA provides financing through conduit or
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revenue bonds, loan guarantees, loan loss reserves and a SUTE
for facilities that use alternative energy sources and
technologies. CAEATFA also provides these financing mechanisms
for facilities needed to develop and commercialize advanced
transportation technologies that conserve energy, reduce air
pollution, and promote economic development and jobs. CAEATFA's
board, composed of the Treasurer, the Controller, the Director
of Finance, the Chairperson of the Energy Commission, and the
President of the Public Utilities Commission, decides which
projects to assist. On March 24, 2010, Governor Arnold
Schwarzenegger signed SB 71 (Padilla, Chapter 10, Statutes of
2010) which authorizes the CAEATFA to provide eligible projects
financial assistance in the form of a SUTE on property used for
the "design, manufacture, production, or assembly" of either
advanced transportation technologies or alternative energy
source products, components or system.
The SB 71 program promotes the creation of California-based
manufacturing, California-based jobs, and the reduction of
greenhouse gases, air and water pollution, or energy
consumption. To date, CAEATFA has approved financial assistance
for private entities in the following fields: electric vehicle
manufacturing, solar photovoltaic manufacturing, landfill gas
capture and production, biogas capture and production (dairies
and waste water treatment plants), demonstration hydrogen fuel
production, electric vehicle battery manufacturing, biomass
processing and fuel production, and others. In 2012, the
Legislature added "advanced manufacturing" to the list of
projects eligible for the exemption, and capped the amount of
exemptions awarded annually to $100 million. The Legislature
also approved a study by the Governor's Office of Business and
Economic Development (GO-Biz) in conjunction with the study (SB
1128, Padilla, Chapter 677, Statutes of 2012).
This bill:
1.Makes several changes to the CAEATFA statute to clarify
existing law, broadens aspects of the program within the cap,
and changes aspects of the cap.
2.Clarifies that an entity that is located outside the state,
including those located overseas, is considered a
"participating party" for the purpose of the Finance
Authority's SUTE program if the equipment is purchased and
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utilized within the state.
3.Deletes a requirement that GO-Biz review and identify
efficient and cost-effective methods for the state to create
jobs in advanced manufacturing and report their findings to
the Legislature by January 1, 2017.
4.Modifies the definition of advanced manufacturing to include
either of the following rather than both of the following:
A. Systems that result from substantive advancement, beyond
the current industry standard, in the production of
materials and products.
B. Sustainable manufacturing systems and manufacturing
technologies that minimize the use of resources while
maintaining or improving cost and performance. These
systems and manufacturing technologies may not include
those required to be undertaken pursuant to state or
federal law or regulations.
1.Redefines "project" to mean 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 utilized in the
state, 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.
A. "Project," for purposes of Section 26011.8 and Section
6010.8 of the Revenue and Taxation Code, means tangible
personal property that is purchased and utilized in the
state for the design, manufacture, production, or assembly
of advanced manufacturing, advanced transportation
technologies, or alternative source products, components,
or systems.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
ASSEMBLY FLOOR : 70-0, 5/16/13
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AYES: Achadjian, Alejo, Ammiano, Atkins, Bigelow, Bloom,
Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown, Ian
Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley,
Dahle, Daly, Dickinson, Donnelly, Fong, Fox, Frazier, Garcia,
Gatto, Gomez, Gordon, Gorell, Gray, Hagman, Hall, Harkey,
Roger Hernández, Jones, Jones-Sawyer, Levine, Linder, Logue,
Lowenthal, Maienschein, Mansoor, Medina, Mitchell, Mullin,
Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson, Perea,
V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Salas, Skinner,
Ting, Torres, Wagner, Waldron, Weber, Wieckowski, Wilk,
Williams, Yamada, John A. Pérez
NO VOTE RECORDED: Allen, Buchanan, Eggman, Beth Gaines, Grove,
Holden, Melendez, Morrell, Stone, Vacancy
AB:ej 8/27/13 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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