Amended in Senate April 15, 2013

Senate Bill No. 820

Introduced by Committee on Governmental Organization (Senators Wright (Chair), Berryhill, Calderon, Cannella, Correa, De León, Galgiani, Hernandez, Lieu, Nielsen, and Padilla)

March 14, 2013

begin delete An act relating to state government. end delete begin insert An act to amend Sections 19821, 19876, 19912, and 19951 of the Business and Professions Code, to amend Sections 1916.12, 1918.5, and 5405 of the Civil Code, to amend Sections 14024, 14025, 14026, 14027, 14028, 14030.2, 14034, 14036, 14037, 14037.5, 14037.7, 14038, 14039, 14040, 14041, 14043, 14061, 14065, 14066, 14070, 14071, 14071.5, 14072, 14074, 14075, 14076, 14085, 14086, 29503, and 31004 of, and to amend the heading of Article 4 (commencing with Section 14025) of Chapter 1 of Part 5 of Division 3 of Title 1 of, the Corporations Code, to amend Sections 300, 301, 320, 326, 350, 353, 4805.055, 5104, 12003, 14003, 14200.1, 14200.2, 17002, 18002, 22005, 30002, 31055, and 50003 of, and to repeal and add Sections 351 and 371 of, the Financial Code, to amend Sections 8684.2, 11532, 11534, 11538, 11539, 11540, 11541, 11542, 11544, 11546, 11549, 11549.1, 11549.3, 12802.8, 13995.60, 13995.64.5, 13995.65.5, 13997.7, 14030, 14998.3, 14998.4, 14998.6, 14998.7, 15251, 15277, 53108.5, 53113, 53114, 53114.1, 53114.2, 53115, 53115.1, 53115.2, 53115.3, 53116, 53119, 53120, 53126.5, 53661, and 65040.12 of, and to amend the heading of Article 5 (commencing with Section 13995.50) of Chapter 1 of Part 4.7 of Division 3 of Title 2 of, and to repeal Section 13995.92 of, the Government Code, to amend Sections 71.4, 71.7, 72.6, 76.5, 76.6, 82, and 82.3 of the Harbors and Navigation Code, to amend Sections 40448.6 and 44272 of the Health and Safety Code, to amend Sections 326.3 and 326.5 of the Penal Code, to amend Section 25464 of the Public Resources Code, to amend Section 41136 of the Revenue and Taxation Code, and to amend Sections 335, 10200, 10202.5, and 15002 of the Unemployment Insurance Code, relating to state government, and declaring the urgency thereof, to take effect immediately. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 820, as amended, Committee on Governmental Organization. begin delete Governor’s Reorganization Plan No. 2 of 2012. end delete begin insert State government. end insert

begin insert

(1) Existing law and the Governor’s Reorganization Plan No. 2 of 2012 (GRP 2), effective on July 3, 2012, and operative on July 1, 2013, assigns and reorganizes the functions of state government among executive officers and agencies by creating the following general agency structure in the executive branch: Business, Consumer Services, and Housing; Government Operations; Corrections and Rehabilitation; Labor and Workforce Development; California Health and Human Services; Environmental Protection; Natural Resources; and Transportation. In creating the new general agency structure, existing law and the GRP 2, abolished certain existing state entities and offices, including, among others, the Business, Transportation and Housing Agency and its secretary.

end insert begin insert

This bill would generally enact the statutory changes to make conforming name changes to properly reflect the assignment and reorganization of the functions of state government among the newly established executive entities and officers and reallocate certain duties of abolished executive entities and officers to the newly established ones.

end insert begin insert

(2) Existing law and the GRP 2 transfer the duties and authorities of the Department of Boating and Waterways to the Division of Boating and Waterways in the Department of Parks and Recreation and reallocate specified duties between the division and the Boating and Waterways Commission.

end insert begin insert

This bill would further modify duties between the division and the commission, including, among others, removing requirements for the consent of the commission for the department to make certain transfers, loans, or grants under various programs and other proposals, as specified.

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(3) Existing law and the GRP 2 transfer a requirement that the Business, Transportation and Housing Agency establish small business financial development corporations to the Governor’s Office of Business and Economic Development.

end insert begin insert

This bill would make conforming changes with respect to the transfer of this duty.

end insert begin insert

(4) Existing law authorizes the State Energy Resources Conservation and Development Commission (Energy Commission) to work with the Business, Transportation and Housing Agency to implement the program funded by federal funds allocated to, and received by, the state for energy-related projects pursuant to the American Recovery and Reinvestment Act of 2009 and other federal acts related to the American Recovery and Reinvestment Act of 2009.

end insert begin insert

This bill would authorize the Energy Commission to work instead with the Governor’s Office of Business and Economic Development.

end insert begin insert

(5) The California Tourism Marketing Act provides for the establishment of the California Travel and Tourism Commission within the Business, Transportation and Housing Agency.

end insert begin insert

This bill would remove references to the abolished agency in the act and delete obsolete provisions.

end insert begin insert

(6) Existing law and the GRP 2 transfer the California Film Commission and the Film California First Program from the Business, Transportation and Housing Agency to the Governor’s Office of Business and Economic Development.

end insert begin insert

This bill would make administrative changes consistent with that transfer.

end insert begin insert

(7) The GRP 2 reallocates certain licensing and regulatory functions between the California Gambling Control Commission and the Department of Justice related to gaming.

end insert begin insert

This bill would reallocate additional functions among the commission to the department, including, among others, requiring the department, rather than the commission, to decide whether the payment of the annual gambling license fee is on an annual or installment basis.

end insert begin insert

(8) Existing law and the GRP 2 reallocates certain duties and functions of the Business, Transportation and Housing Agency related to the small business loan guarantee program, the disaster assistance loan program, the economic adjustment assistance grant, the employment training panel, green collar jobs program, and the film industry.

end insert begin insert

This bill would further reallocate the duties and functions of this abolished agency with regard to these programs and this industry.

end insert begin insert

(9) Existing law requires common interest developments to submit specified information, including personal identifying information regarding the president of the association, to the Secretary of State, who is required to make the information available for governmental purposes under specified conditions to certain entities, including, among others, the Business, Transportation and Housing Agency.

end insert begin insert

This bill would replace the abolished agency with the Business, Consumer Services, and Housing Agency.

end insert begin insert

(10) Existing law authorizes the Secretary of Business, Transportation and Housing to prescribe specified rules and regulations relating to certain mortgage instruments.

end insert begin insert

This bill would transfer the duties of the abolished officer with the Secretary of Business, Consumer Services, and Housing.

end insert begin insert

(11) Existing law authorizes the Governor to, with respect to the Business, Transportation and Housing Agency, appoint a Deputy Secretary of Housing to advise that agency’s secretary on housing matters.

end insert begin insert

The bill would modify the Governor’s authorization to appoint a Deputy Secretary of Housing Coordination to serve as the Secretary of Transportation’s primary advisor on housing matters, as specified.

end insert begin insert

(12) Existing law provides that, among other things, the powers and duties of the Department of Transportation include investigating and reporting to the Secretary of Business, Transportation and Housing upon the consistency between housing plans and programs and federal transportation plans and programs.

end insert begin insert

This bill would instead provide that the Department of Transportation report under these circumstances to the Secretary of Transportation and the Secretary of Business, Consumer Services, and Housing, as specified.

end insert begin insert

(13) Existing law requires the Director of the Office of Planning and Research to consult with the Secretary of Business, Transportation and Housing, as specified.

end insert begin insert

This bill would instead require the director to consult with the Secretary of Business, Consumer Services, and Housing under these circumstances, as specified.

end insert begin insert

(14) The GRP 2 reorganizes the Department of Corporations and the Department of Financial Institutions into divisions under the Department of Business Oversight, within the Business, Consumer Services, and Housing Agency. Under the GRP 2, the executive officer of the Department of Business Oversight is the Commissioner of Business Oversight, and the department’s administration includes a Deputy Commissioner of Business Oversight for the Division of Corporations, and a Deputy Commissioner of Business Oversight for the Division of Financial Institutions.

end insert begin insert

This bill would enact statutory changes to implement the above-described organizational structure by transferring the responsibilities of the Department of Corporations and the Department of Financial Institutions to the newly established Department of Business Oversight and its Division of Corporations and Division of Financial Institutions, headed by Senior Deputy Commissioners and the Office of Credit Unions, as specified. This bill would make other conforming changes to the duties of the Department of Business Oversight to include additional activities relating to the functions of corporations and financial institutions. The bill would require the Senior Deputy Commissioner of Business Oversight for the Division of Financial Institutions to employ legal counsel to act as the attorney for the commissioner under specified circumstances.

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(15) The GRP 2 recasts the California Technology Agency as the Department of Technology within the Government Operations Agency.

end insert begin insert

This bill would make various technical, nonsubstantive conforming changes to further reflect this reorganization. This bill would also designate that the Office of Technology Services and the Office of Information Security, each within the Department of Technology, is managed or under the direction of a chief. This bill would also rename the Public Safety Communications Division, also within the department, as the Public Safety Communications Office.

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(16) This bill would become operative on July 1, 2013.

end insert begin insert

(17) This bill would declare that it is to take effect immediately as an urgency statute.

end insert begin delete

Existing law and the Governor’s Reorganization Plan No. 2 of 2012 (GRP 2), as of July 1, 2013, among other things, reorganizes state government into the following agencies: Business, Consumer Services and Housing, Government Operations, Corrections and Rehabilitation, Labor and Workforce Development, California Health and Human Services, Environmental Protection, Natural Resources, and Transportation.

end delete begin delete

This bill would state the intent of the Legislature to enact legislation to make conforming programmatic changes to implement the provisions of GRP 2.

end delete

Vote:  begin delete majority end delete begin insert ²⁄₃ end insert . Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

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

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 19821 of the end insert begin insert Business and Professions
Code end insert begin insert is amended to read: end insert

19821.  

(a) The commission shall cause to be made and kept
a record of all proceedings at regular and special meetings of the
commission. These records shall be open to public inspection.

(b) The begin delete commission end delete begin insert department end insert shall maintain a file of all
applications for licenses under this begin delete chapter, together with end delete begin insert chapter.
The commission shall maintain end insert a record of all actions taken with
respect to those applications. The file and record shall be open to
public inspection.

(c) The department and commission may maintain any other
files and records as they deem appropriate. Except as provided in
this chapter, the records of the department and commission are
exempt from disclosure under Chapter 3.5 (commencing with
Section 6250) of Division 7 of Title 1 of the Government Code.

(d) Except as necessary for the administration of this chapter,
no commissioner and no official, employee, or agent of the
commission or the department, having obtained access to
confidential records or information in the performance of duties
pursuant to this chapter, shall knowingly disclose or furnish the
records or information, or any part thereof, to any person who is
not authorized by law to receive it. A violation of this subdivision
is a misdemeanor.

(e) Notwithstanding subdivision (k) of Section 1798.24 of the
Civil Code, a court shall not compel disclosure of personal
information in the possession of the department or the commission
to any person in any civil proceeding wherein the department or
the commission is not a party, except for good cause and upon a
showing that the information cannot otherwise be obtained.
begin delete Nothing herein end delete begin insert This section end insert shall begin delete be construed to end delete begin insert not end insert authorize the
disclosure of personal information that begin delete would end delete begin insert is end insert otherwise begin delete be end delete
exempt from disclosure.

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 19876 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

19876.  

(a) Subject to the power of the commission to deny,
revoke, suspend, condition, or limit any license, as provided in
this chapter, a license shall be renewed biennially.

(b) An application for renewal of a gambling license shall be
filed by the owner licensee or key employee with the begin delete commission end delete
begin insert department end insert no later than 120 calendar days prior to the expiration
of the current license. The commission shall act upon any
application for renewal prior to the date of expiration of the current
license. Upon renewal of any owner license, the commission shall
issue an appropriate renewal certificate or validating device or
sticker.

(c) Notwithstanding the provisions of subdivision (b), if an
owner licensee has submitted an application for renewal prior to
the original expiration date of the current license and the
commission is unable to act on the application prior to the
expiration date, the commission may extend the current license
for up to 180 days.

(d) Unless the commission determines otherwise, renewal of
an owner’s gambling license shall be deemed to effectuate the
renewal of every other gambling license endorsed thereon.

(e) In addition to the penalties provided by law, any owner
licensee who deals, operates, carries on, conducts, maintains, or
exposes for play any gambling game after the expiration date of
the gambling license is liable to the state for all license fees and
penalties that would have been due upon renewal.

(f) If an owner licensee fails to renew the gambling license as
provided in this chapter, the commission may order the immediate
closure of the premises and a cessation of all gambling activity
therein until the license is renewed.

(g) If an owner licensee submits an application for renewal of
the gambling license after the deadline set in subdivision (b) but
before the original expiration date of the license, the commission
may assess reasonable delinquency fees not to exceed three times
the usual application fee.

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 19912 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

19912.  

(a) (1) A person shall not be employed as a gambling
enterprise employee, or serve as an independent agent, except as
provided in paragraph (2), unless he or she is the holder of one of
the following:

(A) A valid work permit issued in accordance with the applicable
ordinance or regulations of the county, city, or city and county in
which his or her duties are performed.

(B) A work permit issued by the commission pursuant to
regulations adopted by the commission for the issuance and
renewal of work permits. A work permit issued by the commission
shall be valid for two years.

(2) An independent agent is not required to hold a work permit
if he or she is not a resident of this state and has registered with
the department in accordance with regulations.

(b) A work permit shall not be issued by any city, county, or
city and county to any person who would be disqualified from
holding a state gambling license for the reasons specified in
subdivisions (a) to (g), inclusive, of Section 19859.

(c) The department may object to the issuance of a work permit
by a city, county, or city and county for any cause deemed
reasonable by the department, and if the department objects to
issuance of a work permit, the work permit shall be denied.

(1) The commission shall adopt regulations specifying particular
grounds for objection to issuance of, or refusal to issue, a work
permit.

(2) The ordinance of any city, county, or city and county relating
to issuance of work permits shall permit the department to object
to the issuance of any permit.

(3) Any person whose application for a work permit has been
denied because of an objection by the department may apply to
the commission for an evidentiary hearing in accordance with
regulations.

(d) Application for a work permit for use in any jurisdiction
where a locally issued work permit is not required by the licensing
authority of a city, county, or city and county shall be made to the
begin delete commission, end delete begin insert department, end insert and may be granted or denied for any
cause deemed reasonable by the commission. If the commission
denies the application, it shall include in its notice of denial a
statement of facts upon which it relied in denying the application.
Upon receipt of an application for a work permit, the commission
may issue a temporary work permit for a period not to exceed 120
days, pending completion of the background investigation by the
department and official action by the commission with respect to
the work permit application.

(e) An order of the commission denying an application for, or
placing restrictions or conditions on, a work permit, including an
order declining to issue a work permit following review pursuant
to paragraph (3) of subdivision (c), may be reviewed in accordance
with subdivision (e) of Section 19870.

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 19951 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

19951.  

(a) Every application for a license or approval shall be
accompanied by a nonrefundable fee, the amount of which shall
be adopted by regulation on or before January 1, 2009. The adopted
fee shall not exceed one thousand two hundred dollars ($1,200).
Prior to adoption of the regulation, the nonrefundable application
fee shall be five hundred dollars ($500).

(b) (1) Any fee paid pursuant to this section, including all
licenses issued to key employees and other persons whose names
are endorsed upon the license, shall be assessed against the
gambling license issued to the owner of the gambling
establishment. This paragraph shall not apply to key employee
licenses issued on and after January 1, 2009, or the implementation
of regulations establishing a personal key employee license adopted
pursuant to Section 19854, whichever is sooner.

(2) (A) The fee for initial issuance of a state gambling license
shall be an amount determined by the commission in accordance
with regulations adopted pursuant to this chapter.

(B) The fee for the renewal of a state gambling license shall be
determined pursuant to the schedule in subdivision (c) or the
schedule in subdivision (d), whichever amount is greater.

(C) The holder of a provisional license shall pay an annual fee
pursuant to the schedule in subdivision (c).

(c) The schedule based on the number of tables is as follows:

(1) For a license authorizing one to five tables, inclusive, at
which games are played, three hundred dollars ($300) for each
table.

(2) For a license authorizing six to eight tables, inclusive, at
which games are played, five hundred fifty dollars ($550) for each
table.

(3) For a license authorizing 9 to 14 tables, inclusive, at which
games are played, one thousand three hundred dollars ($1,300) for
each table.

(4) For a license authorizing 15 to 25 tables, inclusive, at which
games are played, two thousand seven hundred dollars ($2,700)
for each table.

(5) For a license authorizing 26 to 70 tables, inclusive, at which
games are played, four thousand dollars ($4,000) for each table.

(6) For a license authorizing 71 or more tables at which games
are played, four thousand seven hundred dollars ($4,700) for each
table.

(d) Without regard to the number of tables at which games may
be played pursuant to a gambling license, if, at any time of any
license renewal, or when a licensee is required to pay the fee
described in subparagraph (C) of paragraph (2) of subdivision (b)
it is determined that the gross revenues of an owner licensee during
the licensee’s previous fiscal year fell within the following ranges,
the annual fee shall be as follows:

(1) For a gross revenue of two hundred thousand dollars
($200,000) to four hundred ninety-nine thousand nine hundred
ninety-nine dollars ($499,999), inclusive, the amount specified by
the department pursuant to paragraph (2) of subdivision (c).

(2) For a gross revenue of five hundred thousand dollars
($500,000) to one million nine hundred ninety-nine thousand nine
hundred ninety-nine dollars ($1,999,999), inclusive, the amount
specified by the department pursuant to paragraph (3) of
subdivision (c).

(3) For a gross revenue of two million dollars ($2,000,000) to
nine million nine hundred ninety-nine thousand nine hundred
ninety-nine dollars ($9,999,999), inclusive, the amount specified
by the department pursuant to paragraph (4) of subdivision (c).

(4) For a gross revenue of ten million dollars ($10,000,000) to
twenty-nine million nine hundred ninety-nine thousand nine
hundred ninety-nine dollars ($29,999,999), the amount specified
by the department pursuant to paragraph (5) of subdivision (c).

(5) For a gross revenue of thirty million dollars ($30,000,000)
or more, the amount specified by the department pursuant to
paragraph (6) of subdivision (c).

(e) The begin delete commission end delete begin insert department end insert may provide for payment of
the annual gambling license fee on an annual or installment basis.

(f) For the purposes of this section, each table at which a game
is played constitutes a single game table.

(g) It is the intent of the Legislature that the fees paid pursuant
to this section are sufficient to enable the department and the
commission to fully carry out their duties and responsibilities under
this chapter.

begin insert

begin insert SEC. 5. end insert   

end insert

begin insert Section 1916.12 of the end insert begin insert Civil Code end insert begin insert is amended to read: end insert

1916.12.  

(a) The Legislature finds that the economic
environment of financial institutions has become increasingly
volatile as a result of regulatory revisions enacted by the United
States Congress and federal agencies begin delete such as, end delete begin insert including, end insert but not
necessarily limited to, the Comptroller of the Currency, the Federal
Home Loan Bank Board, Federal Reserve Board, and the
Depository Institutions Deregulation Committee. The Legislature
further finds that deposit rate ceilings are being phased out while
the cost of and competition for funds have escalated. It is the
purpose of this section to maintain the quality of competition
between state-licensed and federally regulated financial institutions
in the field of mortgage lending, as well as promote the
convenience, advantage and best interests of California residents
in their pursuit of adequate and available housing. In order to
remain competitive and provide the optimum housing environment
for the citizens of California, state institutions require the ability
to respond in a timely manner to changes in mortgage lending
parameters initiated at the federal level. Local regulatory guidelines
must promote continued parity between the state and federal levels
in order to avoid creation of discriminatory burdens upon state
institutions and to protect interests held by California citizens. It
is the intent of the Legislature to eliminate past and prevent future
inequities between state and federal financial institutions doing
business in the State of California by creating a sensitive and
responsive mortgage parity procedure.

(b) The Secretary of the Business, begin delete Transportation end delete begin insert Consumer
Services, end insert and Housing Agency, or the secretary’s designee as
defined by subdivision (c) of Section 1918.5 of the Civil Code,
shall have the authority to prescribe rules and regulations extending
to lenders who make loans upon the security of residential real
property any right, power, privilege or duty relating to mortgage
instruments that is equivalent to authority extended to
federally-regulated financial institutions by federal statute or
regulation.

(c) In order to grant equivalent mortgage lending authority to
state financial institutions to that which has been extended to
federal financial institutions, the secretary or the secretary’s
designee shall adopt such regulations within 60 days of the
effective date of the statute or regulation extending the comparable
right, power, privilege or duty to federally regulated financial
institutions.

(d) The provisions of Sections 1916.5, 1916.6, 1916.7, 1916.8,
begin insert and end insert 1916.9, and begin delete Chapter 5 (commencing with Section 1918) of
the Civil Code, and end delete any other provisions of law relating to the
requirements for changes in the rate of interest on loans, shall not
be applicable to loans made pursuant to the provisions of this
section and regulations promulgated thereunder.

(e) Any regulations adopted pursuant to this section shall expire
on January 1 of the second succeeding year following the end of
the calendar year in which the regulation was promulgated.
Subsequent amendments to these regulations cannot extend this
expiration date.

(f) This section shall become operative on December 31, 1983.

begin insert

begin insert SEC. 6. end insert   

end insert

begin insert Section 1918.5 of the end insert begin insert Civil Code end insert begin insert is amended to read: end insert

1918.5.  

As used in this chapter:

(a) “Evidence of debt” means a note or negotiable instrument.

(b) “Secretary” means the Secretary of the Business,
begin delete Transportation end delete begin insert Consumer Services, end insert and begin delete Housing Agency. end delete begin insert Housing. end insert

(c) “Secretary’s designee” means the director of a department
within the agency that licenses or regulates the institutions,
organizations or persons engaged in a business related to or
affecting compliance with this chapter.

(d) “Security document” means a mortgage contract, deed of
trust, real estate sales contract, or any note or negotiable instrument
issued in connection therewith, when its purpose is to finance the
purchase or construction of real property occupied or intended to
be occupied by the borrower, containing four or fewer residential
units or on which four or fewer residential units are to be
constructed.

begin insert

begin insert SEC. 7. end insert   

end insert

begin insert Section 5405 of the end insert begin insert Civil Code end insert begin insert is amended to read: end insert

5405.  

(a) To assist with the identification of common interest
developments, each association, whether incorporated or
unincorporated, shall submit to the Secretary of State, on a form
and for a fee not to exceed thirty dollars ($30) that the Secretary
of State shall prescribe, the following information concerning the
association and the development that it manages:

(1) A statement that the association is formed to manage a
common interest development under the Davis-Stirling Common
Interest Development Act.

(2) The name of the association.

(3) The street address of the business or corporate office of the
association, if any.

(4) The street address of the association’s onsite office, if
different from the street address of the business or corporate office,
or if there is no onsite office, the street address of the responsible
officer or managing agent of the association.

(5) The name, address, and either the daytime telephone number
or e-mail address of the president of the association, other than the
address, telephone number, or e-mail address of the association’s
onsite office or managing agent.

(6) The name, street address, and daytime telephone number of
the association’s managing agent, if any.

(7) The county, and, if in an incorporated area, the city in which
the development is physically located. If the boundaries of the
development are physically located in more than one county, each
of the counties in which it is located.

(8) If the development is in an unincorporated area, the city
closest in proximity to the development.

(9) The front street and nearest cross street of the physical
location of the development.

(10) The type of common interest development managed by the
association.

(11) The number of separate interests in the development.

(b) The association shall submit the information required by
this section as follows:

(1) By incorporated associations, within 90 days after the filing
of its original articles of incorporation, and thereafter at the time
the association files its statement of principal business activity
with the Secretary of State pursuant to Section 8210 of the
Corporations Code.

(2) By unincorporated associations, in July 2003, and in that
same month biennially thereafter. Upon changing its status to that
of a corporation, the association shall comply with the filing
deadlines in paragraph (1).

(c) The association shall notify the Secretary of State of any
change in the street address of the association’s onsite office or of
the responsible officer or managing agent of the association in the
form and for a fee prescribed by the Secretary of State, within 60
days of the change.

(d) The penalty for an incorporated association’s noncompliance
with the initial or biennial filing requirements of this section shall
be suspension of the association’s rights, privileges, and powers
as a corporation and monetary penalties, to the same extent and in
the same manner as suspension and monetary penalties imposed
pursuant to Section 8810 of the Corporations Code.

(e) The statement required by this section may be filed,
notwithstanding suspension of the corporate powers, rights, and
privileges under this section or under provisions of the Revenue
and Taxation Code. Upon the filing of a statement under this
section by a corporation that has suffered suspension under this
section, the Secretary of State shall certify that fact to the Franchise
Tax Board and the corporation may thereupon be relieved from
suspension, unless the corporation is held in suspension by the
Franchise Tax Board by reason of Section 23301, 23301.5, or
23775 of the Revenue and Taxation Code.

(f) The Secretary of State shall make the information submitted
pursuant to paragraph (5) of subdivision (a) available only for
governmental purposes and only to Members of the Legislature
and the Business, begin delete Transportation end delete begin insert Consumer Services, end insert and Housing
Agency, upon written request. All other information submitted
pursuant to this section shall be subject to public inspection
pursuant to the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code). The information submitted pursuant to this
section shall be made available for governmental or public
inspection.

(g) Whenever any form is filed pursuant to this section, it
supersedes any previously filed form.

(h) The Secretary of State may destroy or otherwise dispose of
any form filed pursuant to this section after it has been superseded
by the filing of a new form.

begin insert

begin insert SEC. 8. end insert   

end insert

begin insert Section 14024 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14024.  

The begin delete agency end delete begin insert manager end insert shall adopt regulations concerning
the implementation of this chapter and direct lending as emergency
regulations in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code. The adoption of these regulations is an emergency and
necessary for the immediate preservation of the public peace, health
and safety, or general welfare within the meaning of subdivision
(b) of Section 11346.1 of the Government Code. Notwithstanding
subdivision (e) of Section 11346.1 of the Government Code, the
regulations shall not remain in effect for more than 180 days unless
the begin delete agency end delete begin insert Governor’s Office of Business and Economic
Development end insert complies with all provisions of Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code, as required by subdivision (e) of
Section 11346.1 of the Government Code. This section also applies
to any direct loan program administered by the begin delete agency. end delete begin insert Governor’s
Office of Business and Economic Development. end insert

begin insert

begin insert SEC. 9. end insert   

end insert

begin insert Section 14025 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14025.  

The begin delete director end delete begin insert manager end insert shall do all of the following:

(a) Administer this part.

(b) In accordance with program resources, stimulate the
formation of corporations and the use of branch offices for the
purposes of making this program accessible to all areas of the state.

(c) Expeditiously approve or disapprove the articles of
incorporation and any subsequent amendments to the articles of
incorporation of a corporation.

(d) Require each corporation to submit an annual written plan
of operation.

(e) Review reports from the Department of Financial Institutions
and inform corporations as to what corrective action is required.

(f) Examine, or cause to be examined, at any reasonable time,
all books, records, and documents of every kind, and the physical
properties of a corporation. The inspection shall include the right
to make copies, extracts, and search records.

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert The heading of Article 4 (commencing with Section
14025) of Chapter 1 of Part 5 of Division 3 of Title 1 of the end insert begin insert Corporations Code end insert begin insert is amended to read: end insert

 

Article 4.  begin delete Executive Director end delete begin insert Manager end insert

 

begin insert

begin insert SEC. 11. end insert   

end insert

begin insert Section 14026 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14026.  

The begin delete director, following notification to the secretary, end delete
begin insert manager end insert may do all of the following:

(a) Contract for services entered into pursuant to this chapter.

(b) Hold public hearings.

(c) Act as liaison between corporations formed under this part,
other state and federal agencies, lenders, and the Legislature.

(d) Process and tabulate on a monthly basis all corporate reports.

(e) Attend board meetings.

(f) Attend and participate at corporation meetings. The begin delete director, end delete
begin insert manager, end insert or his or her designee, shall be an ex officio, nonvoting
representative on the board of directors and loan committees of
each corporation. The begin delete director end delete begin insert manager end insert shall meet with the board
of directors of each corporation at least once each fiscal begin delete year,
commencing July 1, 1999. end delete begin insert year. end insert

(g) Assist corporations in applying for federal grant applications,
and in obtaining program support from the business community.

begin insert

begin insert SEC. 12. end insert   

end insert

begin insert Section 14027 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14027.  

The begin delete director end delete begin insert manager end insert shall have the accounts of each
corporation formed under this part audited as of the close of
business on June 30, of each year. The begin delete director end delete begin insert manager end insert shall also
have the portfolio of each corporation audited a minimum of once
a year. Material audit exceptions that are not corrected by the
corporation within a reasonable period of time may result in the
suspension of the corporation pursuant to Section 14028.

begin insert

begin insert SEC. 13. end insert   

end insert

begin insert Section 14028 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14028.  

(a) Upon a finding by the begin delete director end delete begin insert manager end insert that
irreparable harm may occur if guarantee authority is not temporarily
withdrawn from a corporation, the begin delete director end delete begin insert manager end insert may
temporarily withdraw guarantee authority from a corporation. The
notice of temporary withdrawal sent to the corporation shall specify
the reasons for the action. As used in this section, “guarantee
authority” means the authority to make or guarantee any loan that
encumbers funds in a trust fund account or the expansion fund.
The begin delete director end delete begin insert manager end insert shall make one of the determinations
specified in subdivision (c) within 30 days of the effective date of
the temporary withdrawal unless the corporation and the begin delete director end delete
begin insert manager end insert mutually agree to an extension. The corporation shall
have the opportunity to submit written material to the begin delete director end delete
begin insert manager end insert addressing the items stated in the temporary withdrawal
notice. If the begin delete director end delete begin insert manager end insert does not make any determinations
within 30 days, the temporary withdrawal shall be negated. The
corporation’s yearly contract shall remain in effect during the
period of temporary withdrawal, and the corporation shall continue
to receive reimbursement of necessary operating expenses.

(b) Failure of a corporation to substantially comply with the
following may result in the suspension of a corporation:

(1) Regulations implementing the Small Business Development
Corporation Law.

(2) The plan of operation specified in subdivision (d) of Section
14025.

(3) Fiscal and portfolio requirements, as contained in the fiscal
and portfolio audits specified in Section 14027.

(4) Milestones and scope of work as contained in the annual
contract between the corporation and the begin delete agency. end delete begin insert office. end insert

(c) Pursuant to subdivision (a) or (b), the begin delete director end delete begin insert manager end insert may
do the following:

(1) Terminate the temporary withdrawal.

(2) Terminate the temporary withdrawal subject to the
corporation’s adoption of a specified remedial action plan.

(3) Temporarily withdraw, or continue to withdraw, guarantee
authority until a specified time. This determination by the begin delete director end delete
begin insert manager end insert requires a finding that the corporation has failed to
comply with the Small Business Development Corporation Law.

(4) Suspend the corporation.

(5) Suspend the corporation, with suspension stayed until the
corporation provides a remedial action plan to the begin delete director, end delete
begin insert manager, end insert and the begin delete director end delete begin insert manager end insert decides whether to repeal or
implement the stayed suspension.

The determinations contained in paragraphs (4) and (5) require
a finding that irreparable harm will occur unless the corporation
is suspended.

(d) In considering a determination regarding the recommended
suspension and possible remedial action plans, the begin delete director end delete
begin insert manager end insert shall consider, along with other criteria as specified in
subdivision (b), the corporation’s history and past performance.

(e) Upon suspension of a corporation, the begin delete director end delete begin insert manager end insert
shall transfer all funds, whether encumbered or not, in the trust
fund account of the suspended corporation into either the expansion
fund or temporarily transfer the funds to another corporation.

(f) If the begin delete director end delete begin insert manager end insert decides to take any action against
the corporation pursuant to paragraphs (2) to (5), inclusive, of
subdivision (c), the corporation shall be notified of the action 10
days before the effective date of the action. The corporation shall
have the right to appeal the begin delete director’s end delete begin insert manager’s end insert decision to the
board within that 10-day period by sending notice to the begin delete director end delete
begin insert manager end insert and to the chair of the board. Once the begin delete director end delete begin insert manager end insert
receives notice that the action is being appealed, the begin delete director’s end delete
begin insert manager’s end insert action shall be stayed except for temporary withdrawal
of guarantee authority. Upon receipt of the notice, the begin delete director end delete
begin insert manager end insert shall schedule a properly noticed board meeting within
30 days. The board may elect to take any of the actions listed in
subdivision (g). The temporary withdrawal of corporation guarantee
authority shall remain in effect until the board issues its decision.

(g) Pursuant to subdivision (f), the board may do any of the
following:

(1) Terminate the action taken by the director.

(2) Modify the action taken by the begin delete director end delete begin insert manager end insert subject to
the adoption by the corporation of a specified remedial action plan.

(3) Affirm the action taken by the begin delete director. end delete begin insert manager. end insert

(h) Following suspension, the corporation may continue its
existence as a nonprofit corporation pursuant to the Nonprofit
Public Benefit Corporation Law (Part 2 (commencing with Section
5110) of Division 2) but shall no longer be registered with the
Secretary of State as a small business development corporation.
A corporation shall not enjoy any of the benefits of a small business
development corporation following suspension.

(i) The funds in the trust fund account of a corporation under
temporary withdrawal shall be transferred to the expansion fund.
Upon termination of the temporary withdrawal, unless the
termination is caused by suspension, the funds of the corporation
that were transferred to the expansion fund from the trust fund
account shall be returned to the corporation’s trust fund account,
notwithstanding Section 14037. While the funds of a corporation’s
trust fund account reside in the expansion fund, use of the principal
on the funds shall be governed by the implementing regulations
specifying use of funds in the expansion fund. Interest on the funds
moved from a corporation’s trust fund account upon temporary
withdrawal shall be limited to payment of the corporation’s
administrative expenses, as contained in the contract between the
corporation and the begin delete agency. end delete begin insert office. end insert

begin insert

begin insert SEC. 14. end insert   

end insert

begin insert Section 14030.2 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14030.2.  

(a) The begin delete director end delete begin insert manager end insert may establish accounts
within the expansion fund for loan guarantees and surety bond
guarantees, including loan loss reserves. Each account is a legally
separate account, and shall not be used to satisfy loan or surety
bond guarantees or other obligations of another corporation. The
begin delete director end delete begin insert manager end insert shall recommend whether the expansion fund
and trust fund accounts are to be leveraged, and if so, by how
much. Upon the request of the corporation, the begin delete director’s end delete
begin insert manager’s end insert decision may be repealed or modified by a board
resolution.

(b) Annually, not later than January 1 of each year commencing
January 1, 1996, the begin delete director end delete begin insert manager end insert shall prepare a report
regarding the loss experience for the expansion fund for loan
guarantees and surety bond guarantees for the preceding fiscal
year. At a minimum, the report shall also include data regarding
numbers of surety bond and loan guarantees awarded through the
expansion fund, including ethnicity and gender data of participating
contractors and other entities, and experience of surety insurer
participants in the bond guarantee program. The report shall include
the information described in Section 14076 of the Corporations
Code. The begin delete director end delete begin insert manager end insert shall submit that report to the
begin delete Secretary of Business, Transportation and Housing for transmission
to the end delete Governor and the Legislature.

begin insert

begin insert SEC. 15. end insert   

end insert

begin insert Section 14034 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14034.  

(a) The begin delete director end delete begin insert manager end insert at his or her discretion, with
the approval of the Director of Finance, may request the trustee to
invest those funds in the trust fund in any of the securities described
in Section 16430 of the Government Code. Returns from these
investments shall be deposited in the expansion fund and shall be
used to support the programs of this part.

(b) Any investments made in securities described in Section
16430 of the Government Code shall be governed by the statement
of investment policy prepared by the Treasurer pursuant to
subdivision (a) of Section 16481.2 of the Government Code.

begin insert

begin insert SEC. 16. end insert   

end insert

begin insert Section 14036 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14036.  

The expansion fund and trust fund are created solely
for the purpose of receiving state, federal, or local government
money, and other public or private money to make loans,
guarantees, and restricted investments pursuant to this article.
Funds in the expansion fund may be allocated by the begin delete director, end delete
begin insert manager, end insert with the approval of the Department of Finance, to the
trust fund accounts.

begin insert

begin insert SEC. 17. end insert   

end insert

begin insert Section 14037 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14037.  

(a) The state shall not be liable or obligated in any way
beyond the state money that is allocated and deposited in the trust
fund account from state money and that is appropriated for these
purposes.

(b) The begin delete director end delete begin insert manager end insert may reallocate funds held within a
corporation’s trust fund account.

(1) The begin delete director end delete begin insert manager end insert shall reallocate funds based on which
corporation is most effectively using its guarantee funds. If funds
are withdrawn from a less effective corporation as part of a
reallocation, the office shall make that withdrawal only after giving
consideration to that corporation’s fiscal solvency, its ability to
honor loan guarantee defaults, and its ability to maintain a viable
presence within the region it serves. Reallocation of funds shall
occur no more frequently than once per fiscal year. Any decision
made by the begin delete director end delete begin insert manager end insert pursuant to this subdivision may
be appealed to the board. The board has authority to repeal or
modify any decision to reallocate funds.

(2) The begin delete director end delete begin insert manager end insert may authorize a corporation to exceed
the leverage ratio specified in Section 14030, subdivision (b) of
Section 14070, and subdivision (a) of Section 14076 pending the
annual reallocation of funds pursuant to this section. However, no
corporation shall be permitted to exceed an outstanding guarantee
liability of more than five times its portion of funds on deposit in
the expansion fund.

begin delete end delete begin delete

(c) This section shall become operative on January 1, 2013.

end delete begin delete end delete

begin insert

begin insert SEC. 18. end insert   

end insert

begin insert Section 14037.5 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14037.5.  

The Director of Finance, with the approval of the
Governor, may transfer moneys in the Special Fund for Economic
Uncertainties to the Small Business Expansion Fund for use as
authorized by the begin delete director, end delete begin insert manager, end insert in an amount necessary to
make loan guarantees pursuant to Chapter 1 (commencing with
Section 14000) of Part 5 of Division 3 of Title 1 of the
Corporations Code.

begin insert

begin insert SEC. 19. end insert   

end insert

begin insert Section 14037.7 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14037.7.  

Pursuant to subdivision (f) of Section 8684.2 of the
Government Code, within 60 days of the conclusion of the period
for guaranteeing loans under any small business disaster loan
guarantee program conducted for a disaster as authorized by
Section 8684.2 of the Government Code or Section 14075, the
begin delete agency end delete begin insert manager, through the office, end insert shall provide a report to the
Legislature on loan guarantees approved and rejected by gender,
ethnic group, type of business and location, and each participating
loan institution. The begin delete agency end delete begin insert office end insert need only submit one report to
comply with this section and subdivision (f) of Section 8684.2 of
the Government Code.

begin insert

begin insert SEC. 20. end insert   

end insert

begin insert Section 14038 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14038.  

begin delete

(a) 

end delete

begin insert (a) end insert begin insert   end insert The funds in the expansion fund shall be paid out to trust
fund accounts by the Treasurer on warrants drawn by the Controller
and requisitioned by the begin delete director, end delete begin insert manager, end insert pursuant to the
purposes of this chapter. The begin delete director end delete begin insert manager end insert may transfer funds
allocated from the expansion fund to accounts, established solely
to receive the funds, in lending institutions designated by the office
to act as trustee. The lending institutions so designated shall be
approved by the state for the receipt of state deposits. Interest
earned on the trust fund accounts in lending institutions may be
utilized by the corporations pursuant to the purposes of this chapter.

(b) Except as specified in subdivision (c), the begin delete director end delete begin insert manager end insert
shall allocate and transfer money to trust fund accounts based on
performance-based criteria. The criteria shall include, but not be
limited to, the following:

(1) The default record of the corporation.

(2) The number and amount of loans guaranteed by a
corporation.

(3) The number and amount of loans made by a corporation if
state funds were used to make those loans.

(4) The number and amount of surety bonds guaranteed by a
corporation.

Any decision made by the begin delete director end delete begin insert manager end insert pursuant to this
subdivision may be appealed to the board within 15 days of notice
of the proposed action. The board may repeal or modify any
reallocation and transfer decisions made by the begin delete director. end delete begin insert manager. end insert

(c) The criteria specified in subdivision (b) shall not apply to a
corporation that has been in existence for five years or less. The
begin delete director end delete begin insert manager end insert shall develop regulations specifying the basis
for transferring account funds to those corporations that have been
in existence for five years or less.

begin insert

begin insert SEC. 21. end insert   

end insert

begin insert Section 14039 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14039.  

Pursuant to this section and the regulations, the state
has residual interest in the funds deposited by the state to a trust
fund account and to the return on these funds from investments.
On dissolution or suspension of the corporation, these funds shall
be withdrawn by the begin delete director end delete begin insert manager end insert from the trust fund account
and returned to the expansion fund or temporarily transferred to
another trust fund account. This provision shall be contained in
the trust instructions to the trustee.

begin insert

begin insert SEC. 22. end insert   

end insert

begin insert Section 14040 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14040.  

Each trust fund account shall consist of a loan guarantee
account, and, upon recommendation by the begin delete director, end delete begin insert manager, end insert a
bond guarantee account, each of which is a legally separate
account, and the assets of one account shall not be used to satisfy
loan guarantees or other obligations of another corporation. Not
more than one-third of a trust fund account shall be allocated to a
bond guarantee account. begin delete No end delete begin insert A end insert corporation shall begin insert not end insert use trust fund
accounts to secure a corporate indebtedness. State funds deposited
in the trust fund accounts, with the exception of guarantees
established pursuant to this chapter, shall not be subject to liens
or encumbrances of the corporation or its creditors.

begin insert

begin insert SEC. 23. end insert   

end insert

begin insert Section 14041 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14041.  

(a) Except as provided in subdivisions (c) and (d) of
Section 14070, the trust fund account, shall be used solely to make
loans, guarantee bonds, and guarantee loans, approved by the
corporation, that meet the California Small Business Development
Corporation Law loan criteria. The state shall not be liable or
obligated in any way as a result of the allocation of state money
to a trust fund account beyond the state money that is allocated
and deposited in the fund pursuant to this chapter, and that is not
otherwise withdrawn by the state pursuant to this chapter.

(b) A summary of all loans and bonds to which a state guarantee
is attached shall be submitted to the begin delete director end delete begin insert manager end insert upon
execution of the loan agreement and periodically thereafter.

(c) A summary of all loans made by a corporation shall be
submitted to the begin delete director end delete begin insert manager end insert upon execution of the loan
agreement and periodically thereafter.

begin insert

begin insert SEC. 24. end insert   

end insert

begin insert Section 14043 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14043.  

The financial institution that is to act as trustee of the
trust fund shall be designated after review by the begin delete director. end delete begin insert manager. end insert
The corporation shall not receive money on deposit to support
guarantees issued under begin delete the provisions of end delete this chapter without the
approval of the begin delete director. end delete begin insert manager. end insert

begin insert

begin insert SEC. 25. end insert   

end insert

begin insert Section 14061 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14061.  

Every corporation shall provide for and maintain a
central staff to perform all administrative requirements of the
corporation including all those functions required of a corporation
by the begin delete director. end delete begin insert manager. end insert

begin insert

begin insert SEC. 26. end insert   

end insert

begin insert Section 14065 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14065.  

The corporations shall report to the begin delete director, end delete begin insert manager, end insert
or his or her designated representative, all statistical and other
reports required by this part, responses to audit reports, budget
requirements, invoices submitted for payment by the state, and
information concerning loans made or guaranteed.

begin insert

begin insert SEC. 27. end insert   

end insert

begin insert Section 14066 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14066.  

The corporation shall make a report to the begin delete director, end delete
begin insert manager, end insert as of the close of business on June 30, of each year
describing the corporation’s activities and any additional
information requested by the begin delete director, end delete begin insert manager, end insert on or before
August 1 of each year.

begin insert

begin insert SEC. 28. end insert   

end insert

begin insert Section 14070 of the end insert begin insert Corporations Code end insert begin insert , as amended
by Section 4 of Chapter 648 of the Statutes of 2012, is amended
to read: end insert

14070.  

(a) The corporate guarantee shall be backed by funds
on deposit in the corporation’s trust fund account, or by receivables
due from funds loaned from the corporation’s trust fund account
to another fund in state government as directed by the Department
of Finance pursuant to a statute enacted by the Legislature.

(b) Loan guarantees shall be secured by a reserve of at least 20
percent to be determined by the begin delete director. end delete begin insert manager. end insert

(c) The expansion fund and trust fund accounts shall be used
exclusively to guarantee obligations and pay the administrative
costs of the corporations. A corporation located in a rural area may
utilize the funds for direct lending to farmers as long as at least 90
percent of the corporate fund farm loans, calculated by dollar
amount, and all expansion fund farm loans are guaranteed by the
United States Department of Agriculture. The amount of funds
available for direct farm lending shall be determined by the
begin delete director. end delete begin insert manager. end insert In its capacity as a direct lender, the corporation
may sell in the secondary market the guaranteed portion of each
loan so as to raise additional funds for direct lending. The begin delete agency end delete
begin insert office end insert shall issue regulations governing these direct loans, including
the maximum amount of these loans.

(d) In furtherance of the purposes of this part, up to one-half of
the trust funds may be used to guarantee loans utilized to establish
a Business and Industrial Development Corporation (BIDCO)
under Division 15 (commencing with Section 33000) of the
Financial Code.

(e) To execute the direct loan programs established in this
chapter, the begin delete director end delete begin insert manager end insert may loan trust funds to a corporation
located in a rural area for the express purpose of lending those
funds to an identified borrower. The loan authorized by the begin delete director end delete
begin insert manager end insert to the corporation shall be on terms similar to the loan
between the corporation and the borrower. The amount of the loan
may be in excess of the amount of a loan to any individual farm
borrower, but actual disbursements pursuant to the begin delete agency end delete begin insert office end insert
loan agreement shall be required to be supported by a loan
agreement between the farm borrower and the corporation in an
amount at least equal to the requested disbursement. The loan
between the begin delete agency end delete begin insert office end insert and the corporation shall be evidenced
by a credit agreement. In the event that any loan between the
corporation and borrower is not guaranteed by a governmental
agency, the portion of the credit agreement attributable to that loan
shall be secured by assignment of any note, executed in favor of
the corporation by the borrower to the begin delete agency. end delete begin insert office. end insert The terms
and conditions of the credit agreement shall be similar to the loan
agreement between the corporation and the borrower, which shall
be collateralized by the note between the corporation and the
borrower. In the absence of fraud on the part of the corporation,
the liability of the corporation to repay the loan to the begin delete agency end delete begin insert office end insert
is limited to the repayment received by the corporation from the
borrower except in a case where the United States Department of
Agriculture requires exposure by the corporation in rule or
regulation. The corporation may use trust funds for loan repayment
to the begin delete agency end delete begin insert office end insert if the corporation has exhausted a loan loss
reserve created for this purpose. Interest and principal received by
the begin delete agency end delete begin insert office end insert from the corporation shall be deposited into the
same account from which the funds were originally borrowed.

(f) Upon the approval of the begin delete director, end delete begin insert manager, end insert a corporation
shall be authorized to borrow trust funds from the begin delete agency end delete begin insert office end insert
for the purpose of relending those funds to small businesses. A
corporation shall demonstrate to the begin delete director end delete begin insert manager end insert that it has
the capacity to administer a direct loan program, and has procedures
in place to limit the default rate for loans to startup businesses.
Not more than 25 percent of any trust fund account shall be used
for the direct lending established pursuant to this subdivision. A
loan to a corporation shall not exceed the amount of funds likely
to be lent to small businesses within three months following the
loan to the corporation. The maximum loan amount to a small
business is fifty thousand dollars ($50,000). In the absence of fraud
on the part of the corporation, the repayment obligation pursuant
to the loan to the corporation shall be limited to the amount of
funds received by the corporation for the loan to the small business
and any other funds received from the begin delete agency end delete begin insert office end insert that are not
disbursed. The corporation shall be authorized to charge a fee to
the small business borrower, in an amount determined by the
begin delete director end delete begin insert manager end insert pursuant to regulation. The program provided
for in this subdivision shall be available in all geographic areas of
the state.

(g) This section shall remain in effect only until January 1, 2018,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2018, deletes or extends that date.

begin insert

begin insert SEC. 29. end insert   

end insert

begin insert Section 14070 of the end insert begin insert Corporations Code end insert begin insert , as amended
by Section 5 of Chapter 648 of the Statutes of 2012, is amended
to read: end insert

14070.  

(a) The corporate guarantee shall be backed by funds
on deposit in the corporation’s trust fund account, or by receivables
due from funds loaned from the corporation’s trust fund account
to another fund in state government as directed by the Department
of Finance pursuant to a statute enacted by the Legislature.

(b) Loan guarantees shall be secured by a reserve of at least 25
percent to be determined by the begin delete director, end delete begin insert manager, end insert unless the
begin delete director end delete begin insert manager end insert authorizes a higher leverage ratio for an
individual corporation pursuant to subdivision (b) of Section 14037.

(c) The expansion fund and trust fund accounts shall be used
exclusively to guarantee obligations and pay the administrative
costs of the corporations. A corporation located in a rural area may
utilize the funds for direct lending to farmers as long as at least 90
percent of the corporate fund farm loans, calculated by dollar
amount, and all expansion fund farm loans are guaranteed by the
United States Department of Agriculture. The amount of funds
available for direct farm lending shall be determined by the
begin delete director. end delete begin insert manager. end insert In its capacity as a direct lender, the corporation
may sell in the secondary market the guaranteed portion of each
loan so as to raise additional funds for direct lending. The begin delete agency end delete
begin insert office end insert shall issue regulations governing these direct loans, including
the maximum amount of these loans.

(d) In furtherance of the purposes of this part, up to one-half of
the trust funds may be used to guarantee loans utilized to establish
a Business and Industrial Development Corporation (BIDCO)
under Division 15 (commencing with Section 33000) of the
Financial Code.

(e) To execute the direct loan programs established in this
chapter, the begin delete director end delete begin insert manager end insert may loan trust funds to a corporation
located in a rural area for the express purpose of lending those
funds to an identified borrower. The loan authorized by the begin delete director end delete
begin insert manager end insert to the corporation shall be on terms similar to the loan
between the corporation and the borrower. The amount of the loan
may be in excess of the amount of a loan to any individual farm
borrower, but actual disbursements pursuant to the begin delete agency end delete begin insert office end insert
loan agreement shall be required to be supported by a loan
agreement between the farm borrower and the corporation in an
amount at least equal to the requested disbursement. The loan
between the begin delete agency end delete begin insert office end insert and the corporation shall be evidenced
by a credit agreement. In the event that any loan between the
corporation and borrower is not guaranteed by a governmental
agency, the portion of the credit agreement attributable to that loan
shall be secured by assignment of any note, executed in favor of
the corporation by the borrower to the begin delete agency. end delete begin insert office. end insert The terms
and conditions of the credit agreement shall be similar to the loan
agreement between the corporation and the borrower, which shall
be collateralized by the note between the corporation and the
borrower. In the absence of fraud on the part of the corporation,
the liability of the corporation to repay the loan to the begin delete agency end delete begin insert office end insert
is limited to the repayment received by the corporation from the
borrower except in a case where the United States Department of
Agriculture requires exposure by the corporation in rule or
regulation. The corporation may use trust funds for loan repayment
to the begin delete agency end delete begin insert office end insert if the corporation has exhausted a loan loss
reserve created for this purpose. Interest and principal received by
the begin delete agency end delete begin insert office end insert from the corporation shall be deposited into the
same account from which the funds were originally borrowed.

(f) Upon the approval of the begin delete director, end delete begin insert manager, end insert a corporation
shall be authorized to borrow trust funds from the begin delete agency end delete begin insert office end insert
for the purpose of relending those funds to small businesses. A
corporation shall demonstrate to the begin delete director end delete begin insert manager end insert that it has
the capacity to administer a direct loan program, and has procedures
in place to limit the default rate for loans to startup businesses.
Not more than 25 percent of any trust fund account shall be used
for the direct lending established pursuant to this subdivision. A
loan to a corporation shall not exceed the amount of funds likely
to be lent to small businesses within three months following the
loan to the corporation. The maximum loan amount to a small
business is fifty thousand dollars ($50,000). In the absence of fraud
on the part of the corporation, the repayment obligation pursuant
to the loan to the corporation shall be limited to the amount of
funds received by the corporation for the loan to the small business
and any other funds received from the agency that are not
disbursed. The corporation shall be authorized to charge a fee to
the small business borrower, in an amount determined by the
begin delete director end delete begin insert manager end insert pursuant to regulation. The program provided
for in this subdivision shall be available in all geographic areas of
the state.

(g) This section shall become operative on January 1, 2018.

begin insert

begin insert SEC. 30. end insert   

end insert

begin insert Section 14071 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14071.  

In furtherance of the purposes set forth in Section
14002, a corporation may do any one or more of the following
activities, but only to the extent that the activities are authorized
pursuant to the contract between the begin delete agency end delete begin insert office end insert and begin insert the end insert
corporation: guarantee, endorse, or act as surety on the bonds,
notes, contracts, or other obligations of, or assist financially, any
person, firm, corporation, or association, and may establish and
regulate the terms and conditions with respect to any such loans
or financial assistance and the charges for interest and service
connected therewith, except that the corporation shall not make
or guarantee any loan unless and until it determines:

(a) There is no probability that the loan or other financial
assistance would be granted by a financial company under
reasonable terms or conditions, and the borrower has demonstrated
a reasonable prospect of repayment of the loan.

(b) The loan proceeds shall be used exclusively in this state.

(c) The loan qualifies as a small business loan or an employment
incentive loan.

(d) That the borrower has a minimum equity interest in the
business as determined by the begin delete director. end delete begin insert manager. end insert

(e) As a result of the loan, the jobs generated or retained
demonstrate reasonable conformance to the regulations specifying
employment criteria.

begin insert

begin insert SEC. 31. end insert   

end insert

begin insert Section 14071.5 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14071.5.  

In addition to the authority granted by Section 14071,
upon approval of the begin delete director, end delete begin insert manager, end insert a corporation may act as
guarantor on a surety bond for any small business contractor,
including, but not limited to, women, minority, and disabled
veteran contractors.

The provisions of this section allowing a corporation to act as a
guarantor on surety bonds may be funded through appropriate
federal funding sources. Federal funds shall be deposited in the
Federal Trust Fund in the State Treasury in accordance with Section
16360 of the Government Code, for transfer to the Small Business
Expansion Fund, as created by Section 14030 of the Corporations
Code.

begin insert

begin insert SEC. 32. end insert   

end insert

begin insert Section 14072 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14072.  

A corporation may charge the borrower or financial
institution a loan fee on all loans made or guaranteed by the
corporation to defray the operating expenses of the corporation.
The amount of the fee shall be determined by the begin delete director. end delete
begin insert manager. end insert

begin insert

begin insert SEC. 33. end insert   

end insert

begin insert Section 14074 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14074.  

The begin delete agency end delete begin insert office end insert shall enter into an agreement with
the California Energy Extension Service of the Office of Planning
and Research to assist small business owners in reducing their
energy costs through low interest loans and by providing assistance
and information.

begin insert

begin insert SEC. 34. end insert   

end insert

begin insert Section 14075 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14075.  

(a) A corporation may, in an area affected by a state
of emergency within the state and declared a disaster by the
President of the United States, or by the Administrator of the
United States Small Business Administration, or by the United
States Secretary of Agriculture or declared to be in a state of
emergency by the begin delete Governor of California, end delete begin insert Governor, end insert provide loan
guarantees from funds allocated in Section 14037.5 to small
businesses, small farms, nurseries, and agriculture-related
enterprises that have suffered actual physical damage or significant
economic injury as a result of the disaster.

(b) The begin delete agency end delete begin insert office end insert may adopt regulations to implement the
loan guarantee program authorized by this section. The begin delete agency end delete
begin insert office end insert may adopt these regulations as emergency regulations in
accordance with Chapter 3.5 (commencing with Section 11340)
of Part 1 of Division 3 of the Government Code, and for purposes
of that chapter, including Section 11349.6 of the Government
Code, the adoption of the regulations shall be considered by the
Office of Administrative Law to be necessary for the immediate
preservation of the public peace, health and safety, and general
welfare. Notwithstanding subdivision (e) of Section 11346.1 of
the Government Code, the regulations shall be repealed within
180 days after their effective date unless the agency complies with
Chapter 3.5 (commencing with Section 11340) of Part 1 of Division
3 of the Government Code, as provided in subdivision (e) of
Section 11346.1 of the Government Code.

(c) Allocations pursuant to subdivision (a) shall be deemed to
be for extraordinary emergency or disaster response operations
costs incurred by the begin delete agency. end delete begin insert office. end insert

begin insert

begin insert SEC. 35. end insert   

end insert

begin insert Section 14076 of the end insert begin insert Corporations Code end insert begin insert , as amended
by Section 6 of Chapter 648 of the Statutes of 2012, is amended
to read: end insert

14076.  

(a) It is the intent of the Legislature that the
corporations make maximal use of their statutory authority to
guarantee loans and surety bonds, including the authority to secure
loans with a minimum loan loss reserve of only 20 percent, so that
the financing needs of small business may be met as fully as
possible within the limits of corporations’ loan loss reserves. The
begin delete agency end delete begin insert office end insert shall report annually to the Legislature on the
financial status of the corporations and their portfolio of loans and
surety bonds guaranteed.

(b) Any corporation that serves an area declared to be in a state
of emergency by the Governor or a disaster area by the President
of the United States, the Administrator of the United States Small
Business Administration, or the United States Secretary of
Agriculture shall increase the portfolio of loan guarantees where
the dollar amount of the loan is less than one hundred thousand
dollars ($100,000), so that at least 15 percent of the dollar value
of loans guaranteed by the corporation is for those loans. The
corporation shall comply with this requirement within one year of
the date the emergency or disaster is declared. Upon application
of a corporation, the begin delete director end delete begin insert manager end insert may waive or modify the
rule for the corporation if the corporation demonstrates that it made
a good faith effort to comply and failed to locate lending
institutions in the region that the corporation serves that are willing
to make guaranteed loans in that amount.

(c) This section shall remain in effect only until January 1, 2018,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2018, deletes or extends that date.

begin insert

begin insert SEC. 36. end insert   

end insert

begin insert Section 14076 of the end insert begin insert Corporations Code end insert begin insert , as amended
by Section 7 of Chapter 648 of the Statutes of 2012, is amended
to read: end insert

14076.  

(a) It is the intent of the Legislature that the
corporations make maximal use of their statutory authority to
guarantee loans and surety bonds, including the authority to secure
loans with a minimum loan loss reserve of only 25 percent, unless
the agency authorizes a higher leverage ratio for an individual
corporation pursuant to subdivision (b) of Section 14037, so that
the financing needs of small business may be met as fully as
possible within the limits of corporations’ loan loss reserves. The
begin delete agency end delete begin insert office end insert shall report annually to the Legislature on the
financial status of the corporations and their portfolio of loans and
surety bonds guaranteed.

(b) Any corporation that serves an area declared to be in a state
of emergency by the Governor or a disaster area by the President
of the United States, the Administrator of the United States Small
Business Administration, or the United States Secretary of
Agriculture shall increase the portfolio of loan guarantees where
the dollar amount of the loan is less than one hundred thousand
dollars ($100,000), so that at least 15 percent of the dollar value
of loans guaranteed by the corporation is for those loans. The
corporation shall comply with this requirement within one year of
the date the emergency or disaster is declared. Upon application
of a corporation, the begin delete director end delete begin insert manager end insert may waive or modify the
rule for the corporation if the corporation demonstrates that it made
a good faith effort to comply and failed to locate lending
institutions in the region that the corporation serves that are willing
to make guaranteed loans in that amount.

(c) This section shall become operative on January 1, 2018.

begin insert

begin insert SEC. 37. end insert   

end insert

begin insert Section 14085 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14085.  

It shall be unlawful for the begin delete director end delete begin insert manager end insert or any
person who is an officer, director, or employee of a corporation,
or who is a member of a loan committee, or who is an employee
of the begin delete agency end delete begin insert office end insert to:

(a) Ask for, consent, or agree to receive, any commission,
emolument, gratuity, money, property, or thing of value for his or
her own use, benefit, or personal advantage, for procuring or
endeavoring to procure for any person, partnership, joint venture,
association, or corporation, any loan, guarantee, financial, or other
assistance from any corporation.

(b) Borrow money, property, or to benefit knowingly, directly
or indirectly, from the use of the money, credit, or property of any
corporation.

(c) Make, maintain, or attempt to make or maintain, a deposit
of the funds of a corporation with any other corporation or
association on condition, or with the understanding, expressed or
implied, that the corporation or association receiving the deposit
shall pay any money or make a loan or advance, directly or
indirectly, to any person, partnership, joint venture, association,
or corporation, other than to a corporation formed under this part.

begin insert

begin insert SEC. 38. end insert   

end insert

begin insert Section 14086 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

14086.  

It shall be unlawful for the begin delete director end delete begin insert manager end insert or any
person who is an officer or director of a corporation, or who is an
employee of the begin delete agency, end delete begin insert office, end insert to purchase or receive, or to be
otherwise interested in the purchase or receipt, directly or
indirectly, of any asset of a corporation, without paying to the
corporation the fair market value of the asset at the time of the
transaction.

begin insert

begin insert SEC. 39. end insert   

end insert

begin insert Section 29503 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

29503.  

“Commissioner” means the Commissioner of
begin delete Corporations. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 40. end insert   

end insert

begin insert Section 31004 of the end insert begin insert Corporations Code end insert begin insert is amended
to read: end insert

31004.  

“Commissioner” means the Commissioner of
begin delete Corporations. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 41. end insert   

end insert

begin insert Section 300 of the end insert begin insert Financial Code end insert begin insert , as amended by
Section 5 of Chapter 147 of the Statutes of 2012, is amended to
read: end insert

300.  

(a) In this section:

(1) “Business and industrial development corporation” means
a corporation licensed under Division 15 (commencing with
Section 31000).

(2) “Payment instrument” has the same meaning as set forth in
Section 33059.

(3) “Traveler’s check” has the same meaning as set forth in
Section 1803.

(b) There is in the state government, in the Business, Consumer
Services, and Housing Agency, a Department of Business
Oversight, which has charge of the execution of, among other laws,
the laws of this state relating to any of the following: (1) banks or
trust companies or the banking or trust business; (2) savings
associations or the savings association business; (3) credit unions
or the credit union business; (4) persons who engage in the business
of receiving money for transmission to foreign nations or such
business; (5) issuers of traveler’s checks or the traveler’s check
business; (6) issuers of payment instruments or the payment
instrument business; (7) business and industrial development
corporations or the business and industrial development corporation
begin delete business, or end delete begin insert business; end insert (8) insurance premium finance agencies or
the insurance premium finance begin delete business. end delete begin insert business; (9) persons
offering or making any contract constituting bucketing; (10)
persons offering or selling off-exchange commodities; (11) deferred
deposit originators; (12) finance lenders and brokers; (13)
residential mortgage lenders and servicers; (14) capital access
companies; (15) check sellers, bill payers, and proraters; (16)
securities issuers, broker-dealers, agents, investment advisers,
and investment adviser representatives; (17) mortgage loan
originators employed or supervised by finance lenders or
residential mortgage lenders; (18) escrow agents; (19) franchisors,
or (20) persons holding securities as custodians on behalf of
securities owners. end insert

begin insert

begin insert SEC. 42. end insert   

end insert

begin insert Section 301 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

301.  

begin insert (a) end insert begin insert   end insert This chapter is applicable to this division, Division
1.1 (commencing with Section 1000), Division 1.2 (commencing
with Section 2000), Division 1.6 (commencing with Section 4800),
Division 5 (commencing with Section 14000), Division 7
(commencing with Section 18000), and Division 15 (commencing
with Section 31000).

begin insert

(b) Except as provided in subdivision (c), this article, and
Articles 2 (commencing with Section 320) and 3 (commencing with
Section 350) are applicable to the administration of laws by the
Division of Corporations.

end insert begin insert

(c) Sections 329, 330, 332, 335, 336, 357, 378, 379, and 381
are not applicable to the Division of Corporations.

end insert

begin insert

begin insert SEC. 43. end insert   

end insert

begin insert Section 320 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

320.  

begin insert (a) end insert begin insert   end insert The chief officer of the Department of begin delete Financial
Institutions end delete begin insert Business Oversight end insert is the Commissioner of begin delete Financial
Institutions. end delete begin insert Business Oversight. end insert The Commissioner of begin delete Financial
Institutions end delete begin insert Business Oversight end insert is the head of the department begin insert with
the authority and responsibility over all officers, employees, and
activities in the department end insert and, except as otherwise provided in
this begin delete code, end delete begin insert code and the Corporations Code, end insert is subject to the
provisions of the Government Code relating to department begin delete heads,
but need not reside in Sacramento. end delete begin insert heads. end insert

begin insert

(b) The Commissioner of Business Oversight shall employ legal
counsel to act as the attorney for the commissioner in actions or
proceedings brought by or against the commissioner under or
pursuant to any law under the commissioner’s jurisdiction, or in
which the commissioner joins or intervenes as to a matter within
the commissioner’s jurisdiction, as a friend of the court or
otherwise, and stenographic reporters to take and transcribe the
testimony in any formal hearing or investigation before the
commissioner or before a person authorized by the commissioner.

end insert begin insert

(c) Sections 11040, 11042, and 11043 of the Government Code
do not apply to the Commissioner of Business Oversight.

end insert

begin insert

begin insert SEC. 44. end insert   

end insert

begin insert Section 326 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

326.  

The begin delete commissioner end delete begin insert Commissioner of Business Oversight end insert
is responsible for the performance of all duties, the exercise of all
powers and jurisdiction, and the assumption and discharge of all
responsibilities vested by law in the begin delete department. end delete begin insert department and
the divisions thereunder. end insert The commissioner has and may exercise
all the powers necessary or convenient for the administration and
enforcement of, among other laws, the laws described in Section
300. The commissioner may issue begin delete such end delete rules and regulations
consistent with law as he or she may deem necessary or advisable
in executing the powers, duties, and responsibilities of the
department.

begin insert

begin insert SEC. 45. end insert   

end insert

begin insert Section 350 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

350.  

The begin delete commissioner shall appoint a end delete chief deputy begin delete who holds end delete
begin insert shall be appointed by the Governor and hold end insert office at the pleasure
of the begin delete commissioner. end delete begin insert Governor. end insert The annual salary of the chief
deputy shall be fixed by the begin delete commissioner with the approval of
the Director of Finance. The chief deputy shall have the same
qualifications as the commissioner. The commissioner shall also
appoint two deputies, one to serve in the City and County of San
Francisco and one to serve in the City of Los Angeles. end delete begin insert Governor. end insert

begin insert

begin insert SEC. 46. end insert   

end insert

begin insert Section 351 of the end insert begin insert Financial Code end insert begin insert is repealed. end insert

begin delete

351.  

The Chief Officer of the Division of Credit Unions is the
Deputy Commissioner of Financial Institutions for the Division
of Credit Unions. The Deputy Commissioner of Financial
Institutions for the Division of Credit Unions shall administer the
laws of this state relating to credit unions or the credit union
business under the direction of the commissioner. The Deputy
Commissioner of Financial Institutions for the Division of Credit
Unions shall be appointed by the Governor and shall hold office
at the pleasure of the Governor. The Deputy Commissioner of
Financial Institutions shall receive an annual salary as fixed by the
Governor.

end delete

begin insert

begin insert SEC. 47. end insert   

end insert

begin insert Section 351 is added to the end insert begin insert Financial Code end insert begin insert , to read: end insert

begin insert

begin insert 351. end insert   

(a) The chief officer of the Division of Corporations is
the Senior Deputy Commissioner of Business Oversight for the
Division of Corporations. The Senior Deputy Commissioner of
Business Oversight for the Division of Corporations shall, under
the direction of the commissioner, administer the laws of this state
that were, prior to July 1, 2013, under the charge of the
Department of Corporations. The Senior Deputy Commissioner
of Business Oversight for the Division of Corporations shall be
appointed by the Governor and shall hold office at the pleasure
of the Governor. The Senior Deputy Commissioner of Business
Oversight for the Division of Corporations shall receive an annual
salary as fixed by the Governor.

(b) The chief officer of the Division of Financial Institutions is
the Senior Deputy Commissioner of Business Oversight for the
Division of Financial Institutions. The Senior Deputy
Commissioner of Business Oversight for the Division of Financial
Institutions shall, under the direction of the commissioner,
administer the laws of this state that were, prior to July 1, 2013,
under the charge of the Department of Financial Institutions. The
Senior Deputy Commissioner of Business Oversight for the Division
of Financial Institutions shall be appointed by the Governor and
shall hold office at the pleasure of the Governor. The Senior Deputy
Commissioner of Business Oversight for the Division of Financial
Institutions shall receive an annual salary as fixed by the Governor.

end insert

begin insert

begin insert SEC. 48. end insert   

end insert

begin insert Section 353 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

353.  

Before entering upon the duties of his office each deputy
and examiner shall take and subscribe to the constitutional oath
of begin delete office and file the same with the Secretary of State. end delete begin insert office. end insert

begin insert

begin insert SEC. 49. end insert   

end insert

begin insert Section 371 of the end insert begin insert Financial Code end insert begin insert is repealed. end insert

begin delete

371.  

There is in the Department of Financial Institutions, the
Division of Credit Unions. The Division of Credit Unions has
charge of the execution of the laws of this state relating to credit
unions and to the credit union business.

end delete

begin insert

begin insert SEC. 50. end insert   

end insert

begin insert Section 371 is added to the end insert begin insert Financial Code end insert begin insert , to read: end insert

begin insert

begin insert 371. end insert   

(a) There is in the Department of Business Oversight, the
Division of Corporations, under the direction of the Senior Deputy
Commissioner of Business Oversight for the Division of
Corporations. The senior deputy commissioner has charge of the
execution of the laws of the state that were, prior to July 1, 2013,
under the charge of the Department of Corporations.

(b) There is in the Department of Business Oversight, the Senior
Deputy Commissioner of the Department of Business Oversight
for the Division of Financial Institutions. Under the direction of
the senior deputy commissioner, the Division of Financial
Institutions has charge of the execution of the laws of the state
that were, prior to July 1, 2013, under the charge of the
Department of Financial Institutions.

end insert

begin insert

begin insert SEC. 51. end insert   

end insert

begin insert Section 4805.055 of the end insert begin insert Financial Code end insert begin insert is amended
to read: end insert

4805.055.  

“Commissioner” means the begin insert Senior Deputy end insert
Commissioner of begin insert Business Oversight for the Division of end insert Financial
Institutions.

begin insert

begin insert SEC. 52. end insert   

end insert

begin insert Section 5104 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

5104.  

“Commissioner” means the begin insert Senior Deputy end insert Commissioner
of begin insert Business Oversight for the Division of end insert Financial Institutions.

begin insert

begin insert SEC. 53. end insert   

end insert

begin insert Section 12003 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

12003.  

“Commissioner” means the begin insert Senior Deputy end insert
Commissioner of begin delete Corporations of end delete begin insert Business Oversight for end insert the begin delete State end delete
begin insert Division end insert of begin delete California, end delete begin insert Corporations, end insert or any deputy, investigator,
auditor, or any other person employed by him.

begin insert

begin insert SEC. 54. end insert   

end insert

begin insert Section 14003 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

14003.  

“Commissioner” means the begin insert Senior Deputy end insert
Commissioner of begin delete Financial Institutions of end delete begin insert Business Oversight for end insert
the begin delete State end delete begin insert Division end insert of begin delete California. end delete begin insert Corporations. end insert

begin insert

begin insert SEC. 55. end insert   

end insert

begin insert Section 14200.1 of the end insert begin insert Financial Code end insert begin insert is amended
to read: end insert

14200.1.  

There is in the begin insert Division of Financial Institutions of
the end insert Department of begin delete Financial Institutions, end delete begin insert Business Oversight end insert the
begin delete Division end delete begin insert Office end insert of Credit Unions. The begin delete Division end delete begin insert Office end insert of Credit
Unions has charge of the execution of the laws of this state relating
to credit unions or to the credit union business.

begin insert

begin insert SEC. 56. end insert   

end insert

begin insert Section 14200.2 of the end insert begin insert Financial Code end insert begin insert is amended
to read: end insert

14200.2.  

The begin delete Chief Officer end delete begin insert chief officer end insert of the begin delete Division end delete begin insert Office end insert
of Credit Unions is the Deputy Commissioner of begin delete Financial
Institutions for end delete the begin delete Division end delete begin insert Office end insert of Credit Unions. The Deputy
Commissioner of begin delete Financial Institutions end delete begin insert the Office of Credit Unions,
under the direction and on behalf of the Senior Deputy
Commissioner end insert for begin insert Business Oversight for end insert the Division of begin delete Credit
Unions end delete begin insert Financial Institutions, end insert shall administer the laws of this
state relating to credit unions or the credit union begin delete business under
the direction of and on behalf of the commissioner. end delete begin insert business. end insert The
Deputy Commissioner of begin delete Financial Institutions for end delete the begin delete Division end delete
begin insert Office end insert of Credit Unions shall be appointed by the Governor and
shall hold office at the pleasure of the Governor. The Deputy
Commissioner of begin delete Financial Institutions end delete begin insert the Office of Credit Unions end insert
shall receive an annual salary as fixed by the Governor.

begin insert

begin insert SEC. 57. end insert   

end insert

begin insert Section 17002 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

17002.  

“Commissioner” means the Commissioner of
begin delete Corporations. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 58. end insert   

end insert

begin insert Section 18002 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

18002.  

“Commissioner” means the Commissioner of begin delete Financial
Institutions of the State of California. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 59. end insert   

end insert

begin insert Section 22005 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

22005.  

“Commissioner” means the Commissioner of
begin delete Corporations. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 60. end insert   

end insert

begin insert Section 30002 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

30002.  

“Commissioner” means the Commissioner of
begin delete Corporations. end delete begin insert Business Oversight. end insert

begin insert

begin insert SEC. 61. end insert   

end insert

begin insert Section 31055 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

31055.  

“Commissioner” means the Commissioner of begin delete Financial
Institutions end delete begin insert Business Oversight, end insert or begin delete any end delete begin insert other end insert person to whom the
begin delete Commissioner of Financial Institutions end delete begin insert commissioner end insert delegates
the authority to act for him or her in the particular matter.

begin insert

begin insert SEC. 62. end insert   

end insert

begin insert Section 50003 of the end insert begin insert Financial Code end insert begin insert is amended to
read: end insert

50003.  

(a) “Annual audit” means a certified audit of the
licensee’s books, records, and systems of internal control performed
by an independent certified public accountant in accordance with
generally accepted accounting principles and generally accepted
auditing standards.

(b) “Borrower” means the loan applicant.

(c) “Buy” includes exchange, offer to buy, or solicitation to
buy.

(d) “Commissioner” means the Commissioner of begin delete Corporations. end delete
begin insert Business Oversight. end insert

(e) “Control” means the possession, directly or indirectly, of
the power to direct, or cause the direction of, the management and
policies of a licensee under this division, whether through voting
or through the ownership of voting power of an entity that
possesses voting power of the licensee, or otherwise. Control is
presumed to exist if a person, directly or indirectly, owns, controls,
or holds 10 percent or more of the voting power of a licensee or
of an entity that owns, controls, or holds, with power to vote, 10
percent or more of the voting power of a licensee. No person shall
be deemed to control a licensee solely by reason of his or her status
as an officer or director of the licensee.

(f) “Depository institution” has the same meaning as in Section
3 of the Federal Deposit Insurance Act, and includes any credit
union.

(g) “Engage in the business” means the dissemination to the
public, or any part of the public, by means of written, printed, or
electronic communication or any communication by means of
recorded telephone messages or spoken on radio, television, or
similar communications media, of any information relating to the
making of residential mortgage loans, the servicing of residential
mortgage loans, or both. “Engage in the business” also means,
without limitation, making residential mortgage loans or servicing
residential mortgage loans, or both.

(h) “Federal banking agencies” means the Board of Governors
of the Federal Reserve System, the Comptroller of the Currency,
the begin delete Director of the Office of Thrift Supervision, the end delete National Credit
Union Administration, and the Federal Deposit Insurance
Corporation.

(i) “In this state” includes any activity of a person relating to
making or servicing a residential mortgage loan that originates
from this state and is directed to persons outside this state, or that
originates from outside this state and is directed to persons inside
this state, or that originates inside this state and is directed to
persons inside this state, or that leads to the formation of a contract
and the offer or acceptance thereof is directed to a person in this
state (whether from inside or outside this state and whether the
offer was made inside or outside the state).

(j) “Institutional investor” means the following:

(1) The United States or any state, district, territory, or
commonwealth thereof, or any city, county, city and county, public
district, public authority, public corporation, public entity, or
political subdivision of a state, district, territory, or commonwealth
of the United States, or any agency or other instrumentality of any
one or more of the foregoing, including, by way of example, the
Federal National Mortgage Association and the Federal Home
Loan Mortgage Corporation.

(2) Any bank, trust company, savings bank or savings and loan
association, credit union, industrial bank or industrial loan
company, personal property broker, consumer finance lender,
commercial finance lender, or insurance company, or subsidiary
or affiliate of one of the preceding entities, doing business under
the authority of or in accordance with a license, certificate, or
charter issued by the United States or any state, district, territory,
or commonwealth of the United States.

(3) Trustees of pension, profit-sharing, or welfare funds, if the
pension, profit-sharing, or welfare fund has a net worth of not less
than fifteen million dollars ($15,000,000), except pension,
profit-sharing, or welfare funds of a licensee or its affiliate,
self-employed individual retirement plans, or individual retirement
accounts.

(4) A corporation or other entity with outstanding securities
registered under Section 12 of the federal Securities Exchange Act
of 1934 or a wholly owned subsidiary of that corporation or entity,
provided that the purchaser represents either of the following:

(A) That it is purchasing for its own account for investment and
not with a view to, or for sale in connection with, any distribution
of a promissory note.

(B) That it is purchasing for resale pursuant to an exemption
under Rule 144A (17 C.F.R. 230.144A) of the Securities and
Exchange Commission.

(5) An investment company registered under the Investment
Company Act of 1940; or a wholly owned and controlled subsidiary
of that company, provided that the purchaser makes either of the
representations provided in paragraph (4).

(6) A residential mortgage lender or servicer licensed to make
residential mortgage loans under this law or an affiliate or
subsidiary of that person.

(7) Any person who is licensed as a securities broker or
securities dealer under any law of this state, or of the United States,
or any employee, officer, or agent of that person, if that person is
acting within the scope of authority granted by that license or an
affiliate or subsidiary controlled by that broker or dealer, in
connection with a transaction involving the offer, sale, purchase,
or exchange of one or more promissory notes secured directly or
indirectly by liens on real property or a security representing an
ownership interest in a pool of promissory notes secured directly
or indirectly by liens on real property, and the offer and sale of
those securities is qualified under the California Corporate
Securities Law of 1968 or registered under federal securities laws,
or exempt from qualification or registration.

(8) A licensed real estate broker selling the loan to an
institutional investor specified in paragraphs (1) to (7), inclusive,
or paragraph (9) or (10).

(9) A business development company as defined in Section
2(a)(48) of the Investment Company Act of 1940 or a Small
Business Investment Company licensed by the United States Small
Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.

(10) A syndication or other combination of any of the foregoing
entities that is organized to purchase a promissory note.

(11) A trust or other business entity established by an
institutional investor for the purpose of issuing or facilitating the
issuance of securities representing undivided interests in, or rights
to receive payments from or to receive payments primarily from,
a pool of financial assets held by the trust or business entity,
provided that all of the following apply:

(A) The business entity is not a sole proprietorship.

(B) The pool of assets consists of one or more of the following:

(i) Interest-bearing obligations.

(ii) Other contractual obligations representing the right to receive
payments from the assets.

(iii) Surety bonds, insurance policies, letters of credit, or other
instruments providing credit enhancement for the assets.

(C) The securities will be either one of the following:

(i) Rated as “investment grade” by Standard and Poor’s
Corporation or Moody’s Investors Service, Inc. “Investment grade”
means that the securities will be rated by Standard and Poor’s
Corporation as AAA, AA, A, or BBB or by Moody’s Investors
Service, Inc. as Aaa, Aa, A, or Baa, including any of those ratings
with “+” or “--” designation or other variations that occur within
those ratings.

(ii) Sold to an institutional investor.

(D) The offer and sale of the securities is qualified under the
California Corporate Securities Law of 1968 or registered under
federal securities laws, or exempt from qualification or registration.

(k) “Institutional lender” means the following:

(1) The United States or any state, district, territory, or
commonwealth thereof, or any city, county, city and county, public
district, public authority, public corporation, public entity, or
political subdivision of a state, district, territory, or commonwealth
of the United States, or any agency or other instrumentality of any
one or more of the foregoing, including, by way of example, the
Federal National Mortgage Association and the Federal Home
Loan Mortgage Corporation.

(2) Any bank, trust company, savings bank or savings and loan
association, credit union, industrial loan company, or insurance
company, or service or investment company that is wholly owned
and controlled by one of the preceding entities, doing business
under the authority of and in accordance with a license, certificate,
or charter issued by the United States or any state, district, territory,
or commonwealth of the United States.

(3) Any corporation with outstanding securities registered under
Section 12 of the Securities Exchange Act of 1934 or any wholly
owned subsidiary of that corporation.

(4) A residential mortgage lender or servicer licensed to make
residential mortgage loans under this law.

(l) “Law” means the California Residential Mortgage Lending
Act.

(m) “Lender” means a person that (1) is an approved lender for
the Federal Housing Administration, Veterans Administration,
Farmers Home Administration, Government National Mortgage
Association, Federal National Mortgage Association, or Federal
Home Loan Mortgage Corporation, (2) directly makes residential
mortgage loans, and (3) makes the credit decision in the loan
transactions.

(n) “Licensee” means, depending on the context, a person
licensed under Chapter 2 (commencing with Section 50120),
Chapter 3 (commencing with Section 50130), or Chapter 3.5
(commencing with Section 50140).

(o) “Makes or making residential mortgage loans” or “mortgage
lending” means processing, underwriting, or as a lender using or
advancing one’s own funds, or making a commitment to advance
one’s own funds, to a loan applicant for a residential mortgage
loan.

(p) “Mortgage loan,” “residential mortgage loan,” or “home
mortgage loan” means a federally related mortgage loan as defined
in Section 3500.2 of Title 24 of the Code of Federal Regulations,
or a loan made to finance construction of a one-to-four family
dwelling.

(q) “Mortgage servicer” or “residential mortgage loan servicer”
means a person that (1) is an approved servicer for the Federal
Housing Administration, Veterans Administration, Farmers Home
Administration, Government National Mortgage Association,
Federal National Mortgage Association, or Federal Home Loan
Mortgage Corporation, and (2) directly services or offers to service
mortgage loans.

(r) “Nationwide Mortgage Licensing System and Registry”
means a mortgage licensing system developed and maintained by
the Conference of State Bank Supervisors and the American
Association of Residential Mortgage Regulators for the licensing
and registration of licensed mortgage loan originators.

(s) “Net worth” has the meaning set forth in Section 50201.

(t) “Own funds” means (1) cash, corporate capital, or warehouse
credit lines at commercial banks, savings banks, savings and loan
associations, industrial loan companies, or other sources that are
liability items on a lender’s financial statements, whether secured
or unsecured, or (2) a lender’s affiliate’s cash, corporate capital,
or warehouse credit lines at commercial banks or other sources
that are liability items on the affiliate’s financial statements,
whether secured or unsecured. “Own funds” does not include funds
provided by a third party to fund a loan on condition that the third
party will subsequently purchase or accept an assignment of that
loan.

(u) “Person” means a natural person, a sole proprietorship, a
corporation, a partnership, a limited liability company, an
association, a trust, a joint venture, an unincorporated organization,
a joint stock company, a government or a political subdivision of
a government, and any other entity.

(v) “Residential real property” or “residential real estate” means
real property located in this state that is improved by a one-to-four
family dwelling.

(w) “SAFE Act” means the federal Secure and Fair Enforcement
for Mortgage Licensing Act of 2008 (Public Law 110-289).

(x) “Service” or “servicing” means receiving more than three
installment payments of principal, interest, or other amounts placed
in escrow, pursuant to the terms of a mortgage loan and performing
services by a licensee relating to that receipt or the enforcement
of its receipt, on behalf of the holder of the note evidencing that
loan.

(y) “Sell” includes exchange, offer to sell, or solicitation to sell.

(z) “Unique identifier” means a number or other identifier
assigned by protocols established by the Nationwide Mortgage
Licensing System and Registry.

(aa) For purposes of Sections 50142, 50143, and 50145,
“nontraditional mortgage product” means any mortgage product
other than a 30-year fixed rate mortgage.

(ab) For purposes of Section 50141, “expungement” means the
subsequent order under the provisions of Section 1203.4 of the
Penal Code allowing such individual to withdraw his or her plea
of guilty and to enter a plea of not guilty, or setting aside the verdict
of guilty or dismissing the accusation, information, or indictment.
With respect to criminal convictions in another state, that state’s
definition of expungement will apply.

begin insert

begin insert SEC. 63. end insert   

end insert

begin insert Section 8684.2 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

8684.2.  

(a) It is the intent of the Legislature:

(1) To provide the Governor with appropriate emergency powers
in order to enable utilization of available emergency funding to
provide guarantees for interim loans to be made by lending
institutions, in connection with relief provided for those persons
affected by disasters or a state of emergency in affected areas
during periods of disaster relief assistance, for the purpose of
supplying interim financing to enable small businesses to continue
operations pending receipt of federal disaster assistance.

(2) That the Governor should utilize this authority to prevent
business insolvencies and loss of employment in areas affected by
these disasters.

(b) In addition to the allocations authorized by Section 8683
and the loan guarantee provisions of Section 14030.1 of the
Corporations Code, the Governor may allocate funds made
available for the purposes of this chapter, in connection with relief
provided, in affected areas during the period of federal disaster
relief, to the Small Business Expansion Fund for use by the
begin insert Governor’s end insert Office of begin delete Small Business, end delete begin insert Business and Economic
Development, end insert pursuant to Chapter 1 (commencing with Section
14000) of Part 5 of Division 3 of Title 1 of the Corporations Code,
to provide guarantees for low-interest interim loans to be made by
lending institutions for the purpose of providing interim financing
to enable small businesses that have suffered actual physical
damage or significant economic losses, as a result of the disaster
or state of emergency for which funding under this section is made
available, to continue or resume operations pending receipt of
loans made or guaranteed by the federal Small Business
Administration. The maximum amount of any loan guarantee
funded under this paragraph shall not exceed two hundred thousand
dollars ($200,000). Each loan guarantee shall not exceed 95 percent
of the loan amount, except that a loan guarantee may be for 100
percent of the loan amount if the applicant can demonstrate that
access to business records pertinent to the loan application has
been precluded by official action prohibiting necessary reentry
into the affected business premises or that those business records
pertinent to the loan application have been destroyed. The term of
the loan shall be determined by the lending institution providing
the loan or shall be made payable on the date the proceeds of a
loan made or guaranteed by the federal Small Business
Administration with respect to the same damage or loss are made
available to the borrower, whichever event first occurs.

(c) Loan guarantees for which the initial 12-month term has
expired and for which an application for disaster assistance funding
from the federal Small Business Administration is still pending
may be extended until the Small Business Administration has
reached a final decision on the application. Applications for interim
loans shall be processed in an expeditious manner. Wherever
possible, lending institutions shall fund nonconstruction loans
within 60 calendar days of application. Loan guarantees for loans
that have been denied funding by the federal Small Business
Administration, may be extended by the financial institution
provided that the loan is for no longer than a maximum of seven
years, if the business demonstrates the ability to repay the loan
with an extended loan term, and a new credit analysis is provided.
All loans extended under this provision shall be repaid in
installments of principal and interest, and be fully amortized over
the term of the loan. begin delete Nothing in this end delete begin insert This end insert section shall begin insert not end insert preclude
the lender from charging reasonable administrative fees in
connection with the loan.

(d) Allocations pursuant to this section shall, for purposes of
all provisions of law, be deemed to be for extraordinary emergency
or disaster response operation costs, as provided in Section 8690.6,
incurred by state employees assigned to work on the financial
development corporation program.

(e) The begin delete Business, Transportation end delete begin insert Governor’s Office of Business end insert
and begin delete Housing Agency end delete begin insert Economic Development end insert may adopt
regulations to implement the loan guarantee program authorized
by this section. The begin delete agency end delete begin insert Governor’s Office of Business and
Economic Development end insert may adopt these regulations as emergency
regulations in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3, and for purposes of that
chapter, including Section 11349.6, the adoption of the regulations
shall be considered by the Office of Administrative Law to be
necessary for the immediate preservation of the public peace, health
and safety, and general welfare. Notwithstanding subdivision (e)
of Section 11346.1, the regulations shall be repealed within 180
days after their effective date unless the agency complies with
Chapter 3.5 (commencing with Section 11340) of Part 1 of Division
3, as provided in subdivision (e) of Section 11346.1.

(f) Within 60 days of the conclusion of the period for
guaranteeing loans under any small business disaster loan guarantee
program conducted for a disaster as authorized by Section 8684.2,
or Section 14075 of the Corporations Code, the begin delete agency end delete begin insert Governor’s
Office of Business and Economic Development end insert shall provide a
report to the Legislature on loan guarantees approved and rejected
by gender, ethnic group, type of business and location, and each
participating loan institution.

begin insert

begin insert SEC. 64. end insert   

end insert

begin insert Section 11532 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11532.  

For purposes of this chapter, the following terms shall
have the following meanings, unless the context requires otherwise:

(a)  begin delete “Director” end delete begin insert “Chief” end insert means the begin delete Director end delete begin insert Chief end insert of the Office
of Technology Services.

(b) “Technology” includes, but is not limited to, all electronic
technology systems and services, automated information handling,
system design and analysis, conversion of data, computer
programming, information storage and retrieval, and business
telecommunications systems and services.

(c) “Business telecommunications systems and services”
includes, but is not limited to, wireless or wired systems for
transport of voice, video, and data communications, network
systems, requisite facilities, equipment, system controls, simulation,
electronic commerce, and all related interactions between people
and machines. Public safety communications are excluded from
this definition.

(d) “Public agencies” include, but are not limited to, all state
and local governmental agencies in the state, including cities,
counties, other political subdivisions of the state, state departments,
agencies, boards, and commissions, and departments, agencies,
boards, and commissions of other states and federal agencies.

begin insert

begin insert SEC. 65. end insert   

end insert

begin insert Section 11534 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11534.  

(a) There is in begin delete state government, end delete begin insert the Government
Operations Agency, end insert in the begin delete California Technology Agency, end delete
begin insert Department of Technology, end insert the Office of Technology Services.

(b) The purpose of this article is to establish a general purpose
technology services provider to serve the common technology
needs of executive branch entities with accountability to customers
for providing secure services that are responsive to client needs at
a cost representing best value to the state.

(c) The purpose of this chapter is to improve and coordinate the
use of technology and to coordinate and cooperate with all public
agencies in the state in order to eliminate duplications and to bring
about economies that could not otherwise be obtained.

(d) Unless the context clearly requires otherwise, whenever the
term “Department of Technology Services” appears in any statute,
regulation, or contract, it shall be deemed to refer to the Office of
Technology Services, and whenever the term “Director of
Technology Services” appears in statute, regulation, or contract,
it shall be deemed to refer to the begin delete Secretary end delete begin insert Chief end insert of begin delete California
Technology. end delete begin insert the Office of Technology Services. end insert

(e) Unless the context clearly requires otherwise, the Office of
Technology Services and the begin delete Secretary end delete begin insert Director end insert of begin delete California end delete
Technology succeed to and are vested with all the duties, powers,
purposes, responsibilities, and jurisdiction vested in the former
Department of Technology Services and the former Director of
Technology Services, begin insert or Secretary of California Technology, end insert
respectively.

(f) All employees serving in state civil service, other than
temporary employees, who are engaged in the performance of
functions transferred to the Office of Technology Services, are
transferred to the Office of Technology Services. The status,
positions, and rights of those persons shall not be affected by their
transfer and shall continue to be retained by them pursuant to the
State Civil Service Act (Part 2 (commencing with Section 18500)
of Division 5), except as to positions the duties of which are vested
in a position exempt from civil service. The personnel records of
all transferred employees shall be transferred to the Office of
Technology Services.

(g) The property of any office, agency, or department related
to functions transferred to the Office of Technology Services is
transferred to the Office of Technology Services. If any doubt
arises as to where that property is transferred, the Department of
General Services shall determine where the property is transferred.

(h) All unexpended balances of appropriations and other funds
available for use in connection with any function or the
administration of any law transferred to the Office of Technology
Services shall be transferred to the Office of Technology Services
for the use and for the purpose for which the appropriation was
originally made or the funds were originally available. If there is
any doubt as to where those balances and funds are transferred,
the Department of Finance shall determine where the balances and
funds are transferred.

begin insert

begin insert SEC. 66. end insert   

end insert

begin insert Section 11538 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11538.  

The begin delete director end delete begin insert Chief of the Office of Technology Services end insert
shall be appointed by, and serve at the pleasure of, the Governor,
subject to Senate confirmation. begin insert The chief shall report to the
Director of Technology. end insert

begin insert

begin insert SEC. 67. end insert   

end insert

begin insert Section 11539 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11539.  

The begin delete director end delete begin insert chief end insert shall be responsible for managing
the affairs of the Office of Technology Services and shall perform
all duties, exercise all powers and jurisdiction, and assume and
discharge all responsibilities necessary to carry out the purposes
of this chapter. The Office of Technology Services shall employ
professional, clerical, technical, and administrative personnel as
necessary to carry out this chapter.

begin insert

begin insert SEC. 68. end insert   

end insert

begin insert Section 11540 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11540.  

The begin delete Secretary end delete begin insert Director end insert of begin delete California end delete Technology shall
propose to the Director of Finance rates for Office of Technology
Services’ services based on a formal rate methodology. The
Director of Finance shall approve the proposal based on the
reasonableness of the rates and any significant impact on
departmental budgets. The begin delete secretary end delete begin insert Director of Technology end insert and
the Director of Finance shall coordinate to develop policies and
procedures to implement this section, including, but not limited
to, the format and timeframe of the rate proposal.

begin insert

begin insert SEC. 69. end insert   

end insert

begin insert Section 11541 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11541.  

(a) The Office of Technology Services may acquire,
install, equip, maintain, and operate new or existing business
telecommunications systems and services. Acquisitions for
information technology goods and services shall be made pursuant
to Chapter 3 (commencing with Section 12100) of Part 2 of
Division 2 of the Public Contract Code. To accomplish that
purpose, the Office of Technology Services may enter into
contracts, obtain licenses, acquire personal property, install
necessary equipment and facilities, and do other acts that will
provide adequate and efficient business telecommunications
systems and services. Any system established shall be made
available to all public agencies in the state on terms that may be
agreed upon by the agency and the Office of Technology Services.

(b) With respect to business telecommunications systems and
services, the Office of Technology Services may do all of the
following:

(1) Provide representation of public agencies before the Federal
Communications Commission in matters affecting the state and
other public agencies regarding business telecommunications
systems and services issues.

(2) Provide, upon request, advice to public agencies concerning
existing or proposed business telecommunications systems and
services between any and all public agencies.

(3) Recommend to public agencies rules, regulations,
procedures, and methods of operation that it deems necessary to
effectuate the most efficient and economical use of business
telecommunications systems and services within the state.

(4) Carry out the policies of this chapter.

(c) The Office of Technology Services has responsibilities with
respect to business telecommunications systems, services, policy,
and planning, which include, but are not limited to, all of the
following:

(1) Assessing the overall long-range business
telecommunications needs and requirements of the state
considering both routine and emergency operations for business
telecommunications systems and services, performance, cost,
state-of-the-art technology, multiuser availability, security,
reliability, and other factors deemed to be important to state needs
and requirements.

(2) Developing strategic and tactical policies and plans for
business telecommunications with consideration for the systems
and requirements of public agencies.

(3) Recommending industry standards, service level agreements,
and solutions regarding business telecommunications systems and
services to ensure multiuser availability and compatibility.

(4) Providing advice and assistance in the selection of business
telecommunications equipment to ensure all of the following:

(A) Ensuring that the business telecommunications needs of
state agencies are met.

(B) Ensuring that procurement is compatible throughout state
agencies and is consistent with the state’s strategic and tactical
plans for telecommunications.

(C) Ensuring that procurement is designed to leverage the buying
power of the state and encourage economies of scale.

(5) Providing management oversight of statewide business
telecommunications systems and services developments.

(6) Providing for coordination of, and comment on, plans and
policies and operational requirements from departments that utilize
business telecommunications systems and services as determined
by the Office of Technology Services.

(7) Monitoring and participating, on behalf of the state, in the
proceedings of federal and state regulatory agencies and in
congressional and state legislative deliberations that have an impact
on state governmental business telecommunications activities.

(d) The Office of Technology Services shall develop and
describe statewide policy on the use of business
telecommunications systems and services by state agencies. In the
development of that policy, the Office of Technology Services
shall ensure that access to state business information and services
is improved, and that the policy is cost effective for the state and
its residents. The Office of Technology Services shall develop
guidelines that do all of the following:

(1) Describe what types of state business information and
services may be accessed using business telecommunications
systems and services.

(2) Characterize the conditions under which a state agency may
utilize business telecommunications systems and services.

(3) Characterize the conditions under which a state agency may
charge for information and services.

(4) Specify pricing policies.

(5) Provide other guidance as may be appropriate at the
discretion of the Office of Technology Services.

begin delete end delete begin delete

(e) It is the intent of the Legislature that this section supersede
Section 11541 of the Government Code, as added by Section 1 of
the Governor’s Reorganization Plan No. 2, effective July 9, 2005.

end delete begin delete end delete

begin insert

begin insert SEC. 70. end insert   

end insert

begin insert Section 11542 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11542.  

(a) (1) The Stephen P. Teale Data Center and the
California Health and Human Services Agency Data Center are
consolidated within, and their functions are transferred to, the
Office of Technology Services.

(2) Except as expressly provided otherwise in this chapter, the
Office of Technology Services is the successor to, and is vested
with, all of the duties, powers, purposes, responsibilities, and
jurisdiction of the Stephen P. Teale Data Center, and the California
Health and Human Services Agency Data Center. Any reference
in statutes, regulations, or contracts to those entities with respect
to the transferred functions shall be construed to refer to the Office
of Technology Services unless the context clearly requires
otherwise.

(3)  begin delete No end delete begin insert A end insert contract, lease, license, or any other agreement to
which either the Stephen P. Teale Data Center or the California
Health and Human Services Agency Data Center is a party shall
begin insert not end insert be void or voidable by reason of this chapter, but shall continue
in full force and effect, with the Office of Technology Services
assuming all of the rights, obligations, and duties of the Stephen
P. Teale Data Center or the California Health and Human Services
Agency Data Center, respectively.

(4) Notwithstanding subdivision (e) of Section 11793 and
subdivision (e) of Section 11797, on and after the effective date
of this chapter, the balance of any funds available for expenditure
by the Stephen P. Teale Data Center and the California Health and
Human Services Agency Data Center, with respect to business
telecommunications systems and services functions in carrying
out any functions transferred to the Office of Technology Services
by this chapter, shall be transferred to the Technology Services
Revolving Fund created by Section 11544, and shall be made
available for the support and maintenance of the Office of
Technology Services.

(5) All references in statutes, regulations, or contracts to the
former Stephen P. Teale Data Center Fund or the California Health
and Human Services Data Center Revolving Fund shall be
construed to refer to the Technology Services Revolving Fund
unless the context clearly requires otherwise.

(6) All books, documents, records, and property of the Stephen
P. Teale Data Center and the California Health and Human Services
Agency Data Center, excluding the Systems Integration Division,
shall be transferred to the Office of Technology Services.

(7) (A) All officers and employees of the former Stephen P.
Teale Data Center and the California Health and Human Services
Agency Data Center, are transferred to the Office of Technology
Services.

(B) The status, position, and rights of any officer or employee
of the Stephen P. Teale Data Center and the California Health and
Human Services Agency Data Center, shall not be affected by the
transfer and consolidation of the functions of that officer or
employee to the Office of Technology Services.

(b) (1) All duties and functions of the Telecommunications
Division of the Department of General Services are transferred to
the begin delete California Technology Agency. end delete begin insert Department of Technology. end insert

(2) Unless the context clearly requires otherwise, whenever the
term “Telecommunications Division of the Department of General
Services” begin insert or “California Technology Agency” end insert appears in any
statute, regulation, or contract, it shall be deemed to refer to the
begin delete California Technology Agency. end delete begin insert Department of Technology. end insert

(3) All employees serving in state civil service, other than
temporary employees, who are engaged in the performance of
functions transferred to the begin delete California Technology Agency, end delete
begin insert Department of Technology, end insert are transferred to the begin delete California
Technology Agency. end delete begin insert Department of Technology. end insert The status,
positions, and rights of those persons shall not be affected by their
transfer and shall continue to be retained by them pursuant to the
State Civil Service Act (Part 2 (commencing with Section 18500)
of Division 5), except as to positions the duties of which are vested
in a position exempt from civil service. The personnel records of
all transferred employees shall be transferred to the begin delete California
Technology Agency. end delete begin insert Department of Technology. end insert

(4) The property of any office, agency, or department related
to functions transferred to the begin delete California Technology Agency, end delete
begin insert Department of Technology, end insert are transferred to the begin delete California
Technology Agency. end delete begin insert Department of Technology. end insert If any doubt
arises as to where that property is transferred, the Department of
General Services shall determine where the property is transferred.

(5) All unexpended balances of appropriations and other funds
available for use in connection with any function or the
administration of any law transferred to the begin delete California end delete begin insert Department
of end insert Technology begin delete Agency end delete shall be transferred to the begin delete California end delete
begin insert Department of end insert Technology begin delete Agency end delete for the use and for the purpose
for which the appropriation was originally made or the funds were
originally available. If there is any doubt as to where those balances
and funds are transferred, the Department of Finance shall
determine where the balances and funds are transferred.

begin insert

begin insert SEC. 71. end insert   

end insert

begin insert Section 11544 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11544.  

(a) The Technology Services Revolving Fund, hereafter
known as the fund, is hereby created within the State Treasury.
The fund shall be administered by the begin delete Secretary end delete begin insert Director end insert of
begin delete California end delete Technology to receive all revenues from the sale of
technology or technology services provided for in this chapter, for
other services rendered by the begin delete California Technology Agency, end delete
begin insert Department of Technology, end insert and all other moneys properly credited
to the begin delete California end delete begin insert Department of end insert Technology begin delete Agency end delete from any
other source, to pay, upon appropriation by the Legislature, all
costs arising from this chapter and rendering of services to state
and other public agencies, including, but not limited to,
employment and compensation of necessary personnel and
expenses, such as operating and other expenses of the begin delete California
Technology Agency, end delete begin insert Department of Technology, end insert and costs
associated with approved information technology projects, and to
establish reserves. At the discretion of the begin delete Secretary end delete begin insert Director end insert of
begin delete California end delete Technology, segregated, dedicated accounts within the
fund may be established. The amendments made to this section
by the act adding this sentence shall apply to all revenues earned
on or after July 1, 2010.

(b) The fund shall consist of all of the following:

(1) Moneys appropriated and made available by the Legislature
for the purposes of this chapter.

(2) Any other moneys that may be made available to the
begin delete California end delete begin insert Department of end insert Technology begin delete Agency end delete from any other
source, including the return from investments of moneys by the
Treasurer.

(c) The begin delete California end delete begin insert Department of end insert Technology begin delete Agency end delete may
collect payments from public agencies for providing services to
those agencies that the agencies have requested from the begin delete California
Technology Agency. end delete begin insert Department of Technology. end insert The begin delete California end delete
begin insert Department of end insert Technology begin delete Agency end delete may require monthly payments
by client agencies for the services the agencies have requested.
Pursuant to Section 11255, the Controller shall transfer any
amounts so authorized by the begin delete California Technology Agency, end delete
begin insert Department of Technology, end insert consistent with the annual budget of
each department, to the fund. The begin delete California end delete begin insert Department of end insert
Technology begin delete Agency end delete shall notify each affected state agency upon
requesting the Controller to make the transfer.

(d) At the end of any fiscal year, if the balance remaining in the
fund at the end of that fiscal year exceeds 25 percent of the portion
of the begin delete California Technology Agency’s end delete begin insert Department of
Technology’s end insert current fiscal year budget used for support of data
center and other client services, the excess amount shall be used
to reduce the billing rates for services rendered during the following
fiscal year.

begin insert

begin insert SEC. 72. end insert   

end insert

begin insert Section 11546 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11546.  

(a) The begin delete California end delete begin insert Department of end insert Technology begin delete Agency end delete
shall be responsible for the approval and oversight of information
technology projects, which shall include, but are not limited to,
all of the following:

(1) Establishing and maintaining a framework of policies,
procedures, and requirements for the initiation, approval,
implementation, management, oversight, and continuation of
information technology projects. Unless otherwise required by
law, a state department shall not procure oversight services of
information technology projects without the approval of the
begin delete California Technology Agency. end delete begin insert Department of Technology. end insert

(2) Evaluating information technology projects based on the
business case justification, resources requirements, proposed
technical solution, project management, oversight and risk
mitigation approach, and compliance with statewide strategies,
policies, and procedures. Projects shall continue to be funded
through the established Budget Act process.

(3) Consulting with agencies during initial project planning to
ensure that project proposals are based on well-defined
programmatic needs, clearly identify programmatic benefits, and
consider feasible alternatives to address the identified needs and
benefits consistent with statewide strategies, policies, and
procedures.

(4) Consulting with agencies prior to project initiation to review
the project governance and management framework to ensure that
it is best designed for success and will serve as a resource for
agencies throughout the project implementation.

(5) Requiring agencies to provide information on information
technology projects including, but not limited to, all of the
following:

(A) The degree to which the project is within approved scope,
cost, and schedule.

(B) Project issues, risks, and corresponding mitigation efforts.

(C) The current estimated schedule and costs for project
completion.

(6) Requiring agencies to perform remedial measures to achieve
compliance with approved project objectives. These remedial
measures may include, but are not limited to, any of the following:

(A) Independent assessments of project activities, the cost of
which shall be funded by the agency administering the project.

(B) Establishing remediation plans.

(C) Securing appropriate expertise, the cost of which shall be
funded by the agency administering the project.

(D) Requiring additional project reporting.

(E) Requiring approval to initiate any action identified in the
approved project schedule.

(7) Suspending, reinstating, or terminating information
technology projects. The begin delete agency end delete begin insert Department of Technology end insert shall
notify the Joint Legislative Budget Committee of any project
suspension, reinstatement, and termination within 30 days of that
suspension, reinstatement, or termination.

(8) Establishing restrictions or other controls to mitigate
nonperformance by agencies, including, but not limited to, any of
the following:

(A) The restriction of future project approvals pending
demonstration of successful correction of the identified
performance failure.

(B) The revocation or reduction of authority for state agencies
to initiate information technology projects or acquire information
technology or telecommunications goods or services.

(b) The begin delete California end delete begin insert Department of end insert Technology begin delete Agency end delete shall
have the authority to delegate to another agency any authority
granted under this section based on its assessment of the agency’s
project management, project oversight, and project performance.

begin insert

begin insert SEC. 73. end insert   

end insert

begin insert Section 11549 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11549.  

(a) There is in state government, in the begin delete California
Technology Agency, end delete begin insert Department of Technology, end insert the Office of
Information Security. The purpose of the Office of Information
Security is to ensure the confidentiality, integrity, and availability
of state systems and applications, and to promote and protect
privacy as part of the development and operations of state systems
and applications to ensure the trust of the residents of this state.

(b) The office shall be under the direction of a begin delete director, end delete begin insert chief, end insert
who shall be appointed by, and serve at the pleasure of, the
Governor. The begin delete director end delete begin insert chief end insert shall report to the begin delete Secretary end delete begin insert Director end insert
of begin delete California end delete Technology, and shall lead the Office of Information
Security in carrying out its mission.

(c) The duties of the Office of Information Security, under the
direction of the begin delete director, end delete begin insert chief, end insert shall be to provide direction for
information security and privacy to state government agencies,
departments, and offices, pursuant to Section 11549.3.

(d) (1) Unless the context clearly requires otherwise, whenever
the term “Office of Information Security and Privacy Protection”
appears in any statute, regulation, or contract, it shall be deemed
to refer to the Office of Information Security, and whenever the
term “executive director of the Office of Information Security and
Privacy Protection” appears in statute, regulation, or contract, it
shall be deemed to refer to the begin delete Director end delete begin insert Chief end insert of the Office of
Information Security.

(2) All employees serving in state civil service, other than
temporary employees, who are engaged in the performance of
functions transferred from the Office of Information Security and
Privacy Protection to the Office of Information Security, are
transferred to the Office of Information Security. The status,
positions, and rights of those persons shall not be affected by their
transfer and shall continue to be retained by them pursuant to the
State Civil Service Act (Part 2 (commencing with Section 18500)
of Division 5), except as to positions the duties of which are vested
in a position exempt from civil service. The personnel records of
all transferred employees shall be transferred to the Office of
Information Security.

(3) The property of any office, agency, or department related
to functions transferred to the Office of Information Security is
transferred to the Office of Information Security. If any doubt
arises as to where that property is transferred, the Department of
General Services shall determine where the property is transferred.

(4) All unexpended balances of appropriations and other funds
available for use in connection with any function or the
administration of any law transferred to the Office of Information
Security shall be transferred to the Office of Information Security
for the use and for the purpose for which the appropriation was
originally made or the funds were originally available. If there is
any doubt as to where those balances and funds are transferred,
the Department of Finance shall determine where the balances and
funds are transferred.

begin insert

begin insert SEC. 74. end insert   

end insert

begin insert Section 11549.1 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11549.1.  

As used in this article, the following terms have the
following meanings:

(a)  begin delete “Director” end delete begin insert “Chief” end insert means the begin delete Director end delete begin insert Chief end insert of the Office
of Information Security.

(b) “Office” means the Office of Information Security.

(c) “Program” means an information security program
established pursuant to Section 11549.3.

begin insert

begin insert SEC. 75. end insert   

end insert

begin insert Section 11549.3 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

11549.3.  

(a) The begin delete director end delete begin insert Chief of the Office of Information
Security end insert shall establish an information security program. The
program responsibilities include, but are not limited to, all of the
following:

(1) The creation, updating, and publishing of information
security and privacy policies, standards, and procedures for state
agencies in the State Administrative Manual.

(2) The creation, issuance, and maintenance of policies,
standards, and procedures directing state agencies to effectively
manage security and risk for all of the following:

(A) Information technology, which includes, but is not limited
to, all electronic technology systems and services, automated
information handling, system design and analysis, conversion of
data, computer programming, information storage and retrieval,
telecommunications, requisite system controls, simulation,
electronic commerce, and all related interactions between people
and machines.

(B) Information that is identified as mission critical, confidential,
sensitive, or personal, as defined and published by the office.

(3) The creation, issuance, and maintenance of policies,
standards, and procedures directing state agencies for the collection,
tracking, and reporting of information regarding security and
privacy incidents.

(4) The creation, issuance, and maintenance of policies,
standards, and procedures directing state agencies in the
development, maintenance, testing, and filing of each agency’s
disaster recovery plan.

(5) Coordination of the activities of agency information security
officers, for purposes of integrating statewide security initiatives
and ensuring compliance with information security and privacy
policies and standards.

(6) Promotion and enhancement of the state agencies’ risk
management and privacy programs through education, awareness,
collaboration, and consultation.

(7) Representing the state before the federal government, other
state agencies, local government entities, and private industry on
issues that have statewide impact on information security and
privacy.

(b) An information security officer appointed pursuant to Section
11546.1 shall implement the policies and procedures issued by the
Office of Information Security, including, but not limited to,
performing all of the following duties:

(1) Comply with the information security and privacy policies,
standards, and procedures issued pursuant to this chapter by the
Office of Information Security.

(2) Comply with filing requirements and incident notification
by providing timely information and reports as required by policy
or directives of the office.

(c) The office may conduct, or require to be conducted,
independent security assessments of any state agency, department,
or office, the cost of which shall be funded by the state agency,
department, or office being assessed.

(d) The office may require an audit of information security to
ensure program compliance, the cost of which shall be funded by
the state agency, department, or office being audited.

(e) The office shall report to the begin delete California end delete begin insert Department of end insert
Technology begin delete Agency end delete any state agency found to be noncompliant
with information security program requirements.

begin insert

begin insert SEC. 76. end insert   

end insert

begin insert Section 12802.8 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

12802.8.  

The Governor may, with respect to the begin delete Business, end delete
Transportation begin delete and Housing end delete Agency, appoint a Deputy Secretary
of begin delete Housing, end delete begin insert Housing Coordination, end insert who shall serve as the
secretary’s primary advisor on housing begin insert matters, including, but not
limited to, sustainable growth policy matters, and other strategies
to achieve the state’s greenhouse gas emission reduction objectives
as it pertains to those housing end insert matters.

The Deputy Secretary of Housing begin insert Coordination end insert shall hold office
at the pleasure of the begin delete secretary end delete begin insert Governor end insert and shall receive a salary
as shall be fixed by the begin delete secretary end delete begin insert Governor end insert with the approval of
the Department of Finance.

begin insert

begin insert SEC. 77. end insert   

end insert

begin insert The heading of Article 5 (commencing with Section
13995.50) of Chapter 1 of Part 4.7 of Division 3 of Title 2 of the end insert begin insert Government Code end insert begin insert is amended to read: end insert

 

Article 5.  begin delete Secretary end delete begin insert Director end insert

 

begin insert

begin insert SEC. 78. end insert   

end insert

begin insert Section 13995.60 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

13995.60.  

(a) As used in this article and Article 7 (commencing
with Section 13995.65), “assessment level” means the estimated
gross dollar amount received by assessment from all assessed
businesses on an annual basis, and “assessment formula” means
the allocation method used within each industry segment (for
example, percentage of gross revenue or percentage of transaction
charges).

(b) Commencing on January 1, 2003, a referendum shall be
called every two years, and the commission, by adopted resolution,
shall determine the slate of individuals who will run for
commissioner. The resolution shall also cover, but not be limited
to, the proposed assessment level for each industry category, based
upon specified assessment formulae, together with necessary
information to enable each assessed business to determine what
its individual assessment would be. Commencing with the
referendum held in 2007 and every six years thereafter, the
resolution shall also cover the termination or continuation of the
commission. The resolution may also include an amended industry
segment allocation formula and the percentage allocation of
assessments between industry categories and segments. The
commission may specify in the resolution that a special, lower
assessment rate that was set pursuant to subdivision (c) of Section
13995.30 for a particular business will no longer apply due to
changes in the unique circumstance that originally justified the
lower rate. The resolution may include up to three possible
assessment levels for each industry category, from which the
assessed businesses will select one assessment level for each
industry category by plurality weighted vote.

(c) The commission shall deliver to the begin delete secretary end delete begin insert director end insert the
resolution described in subdivision (b). The begin delete secretary end delete begin insert director end insert shall
call a referendum containing the information required by
subdivision (b) plus any additional matters complying with the
procedures of subdivision (b) of Section 13995.62.

(d) When the begin delete secretary end delete begin insert director end insert calls a referendum, all assessed
businesses shall be sent a ballot for the referendum. Every ballot
that the secretary receives by the ballot deadline shall be counted,
utilizing the weighted formula adopted initially by the selection
committee, and subsequently amended by referendum.

(e) If the commission’s assessment level is significantly different
from what was projected when the existing assessment formula
was last approved by referendum, a majority of members, by
weighted votes of an industry category, may petition for a
referendum to change the assessment formula applicable to that
industry category.

(f) If the referendum includes more than one possible assessment
rate for each industry category, the rate with the plurality of
weighted votes within a category shall be adopted.

(g) Notwithstanding any other provision of this section, if the
commission delivers to the begin delete secretary end delete begin insert director end insert a resolution
pertaining to any matter described in subdivision (b), the begin delete secretary end delete
begin insert director end insert shall call a referendum at a time or times other than as
specified in this section. Each referendum shall contain only those
matters contained in the resolution.

(h) Notwithstanding any other provision of this section, the
begin delete secretary end delete begin insert director end insert shall identify, to the extent reasonably feasible,
those businesses that would become newly assessed due to a change
in category, segment, threshold, or exemption status sought via
referendum, and provide those businesses the opportunity to vote
in that referendum.

begin delete end delete begin delete

(i) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.

end delete begin delete end delete

begin insert

begin insert SEC. 79. end insert   

end insert

begin insert Section 13995.64.5 of the end insert begin insert Government Code end insert begin insert is
amended to read: end insert

13995.64.5.  

begin delete (a) end delete begin delete end delete begin delete   end delete begin delete end delete Notwithstanding subdivision (a) of Section
13995.64, if an assessed business within the passenger car rental
category pays an assessment greater than the maximum assessment,
determined by the commission for other industry categories, the
weighted percentage assigned to that assessed business shall be
the same as though its assessment were equal to the highest
maximum assessment.

begin delete end delete begin delete

(b) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.

end delete begin delete end delete

begin insert

begin insert SEC. 80. end insert   

end insert

begin insert Section 13995.65.5 of the end insert begin insert Government Code end insert begin insert is
amended to read: end insert

13995.65.5.  

begin delete (a) end delete begin delete end delete begin delete   end delete begin delete end delete Notwithstanding Section 13995.65 or any
other provision of this chapter, for purposes of calculating the
assessment for a business within the passenger car rental category,
the assessment shall be collected only on each rental transaction
that commences at either an airport or at a hotel or other overnight
lodging with respect to which a city, city and county, or county is
authorized to levy a tax as described in Section 7280 of the
Revenue and Taxation Code. A transaction commencing at an
airport or hotel or other overnight lodging subject to a transient
occupancy tax as described in Section 7280 of the Revenue and
Taxation Code, including those that commence at a location that
might otherwise by regulation be exempt from assessment, shall
be subject to the assessment. The assessment shall always be
expressed as a fixed percentage of the amount of the rental
transaction.

begin delete end delete begin delete

(b) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.

end delete begin delete end delete

begin insert

begin insert SEC. 81. end insert   

end insert

begin insert Section 13995.92 of the end insert begin insert Government Code end insert begin insert is repealed. end insert

begin delete

13995.92.  

(a) The California Travel and Tourism Commission
shall submit a referendum to the passenger rental car industry as
soon as possible, but not later than March 31, 2007. The
referendum shall propose an assessment level upon the passenger
rental car industry, as an industry category, under this chapter. The
proposed assessment rate shall be set at a level determined by the
commission that will generate funding that will be sufficient, when
aggregated together with other funding for the commission, minus
amounts reverted to the general fund pursuant to Item 0520-495
of Section 2 of the Budget Act of 2006, for a spending plan for
the 2006-07 fiscal year of twenty-five million dollars
($25,000,000), and for the 2007-08 fiscal year of fifty million
dollars ($50,000,000).

(b) The commission shall report to the Secretary of Business,
Transportation and Housing if the referendum and assessment rates
described in subdivision (a) are agreed to. The secretary shall
immediately provide notice of that agreement to the Legislature
and the Secretary of State and shall also post notice of that
agreement on its Internet Web site.

end delete

begin insert

begin insert SEC. 82. end insert   

end insert

begin insert Section 13997.7 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

13997.7.  

(a) Notwithstanding any other provision of law,
effective January 1, 2008, the Economic Adjustment Assistance
Grant funded through the United States Economic Development
Administration under Title IX of the Public Works and Economic
Development Act of 1965 (Grant No. 07-19-02709 and
07-19-2709.1) shall be administered by the begin delete Secretary end delete begin insert Director end insert of
begin delete Business, Transportation end delete begin insert the Governor’s Office of Business end insert and
begin delete Housing, end delete begin insert Economic Development, end insert and, for the purpose of state
administration of this grant, the begin delete secretary end delete begin insert Director of the
Governor’s Office of Business and Economic Development end insert shall
be deemed to be the successor to the former Secretary of
Technology, Trade and Commerce. The begin delete secretary end delete begin insert Director of the
Governor’s Office of Business and Economic Development end insert may
assign and contract administration of the grant to a public agency
created pursuant to Chapter 5 (commencing with Section 6500)
of Division 7 of Title 1.

(b) On January 1, 2008, all federal moneys held in the Sudden
and Severe Economic Dislocation Grant Account within the Special
Deposit Fund are hereby transferred to the Small Business
Expansion Fund created pursuant to Section 14030 of the
Corporations Code for expenditure by the begin delete Business, Transportation end delete
begin insert Governor’s Office of Business end insert and begin delete Housing Agency end delete begin insert Economic
Development end insert pursuant to Article 9 (commencing with Section
14070) of the Corporations Code for purposes of the Sudden and
Severe Economic Dislocation Grant program, or other purposes
permitted by the cognizant federal agency.

(c) All loan repayments received on or after January 1, 2008,
for the Sudden and Severe Economic Dislocation Grant program
loans issued pursuant to former Section 15327 (repealed by Section
1.8 of Chapter 229 of the Statutes of 2003 (AB 1757)) and this
section, shall be deposited into the Small Business Expansion Fund
and shall be available to the begin delete Business, Transportation end delete begin insert Governor’s
Office of Business end insert and begin delete Housing Agency end delete begin insert Economic Development end insert
for expenditure pursuant to the provisions of Article 9
(commencing with Section 14070) of the Corporations Code for
the Sudden and Severe Economic Dislocation Grant program, or
other purposes permitted by the cognizant federal agency.

begin insert

begin insert SEC. 83. end insert   

end insert

begin insert Section 14030 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

14030.  

The powers and duties of the department begin delete shall end delete include,
but begin insert are end insert not begin delete be end delete limited to, all of the following activities:

(a) Supporting the commission in coordinating and developing,
in cooperation with local and regional entities, comprehensive
balanced transportation planning and policy for the movement of
people and goods within the state.

(b) Coordinating and assisting, upon request of, the various
public and private transportation entities in strengthening their
development and operation of balanced integrated mass
transportation, highway, aviation, maritime, railroad, and other
transportation facilities and services in support of statewide and
regional goals.

(c) Developing, in cooperation with local and regional
transportation entities, the full potential of all resources and
opportunities begin delete which end delete begin insert that end insert are now, and may become, available to
the state and to regional and local agencies for meeting California’s
transportation needs, as provided by statutes and, in particular,
maximizing the amount of federal funds begin delete which end delete begin insert that end insert may be
available to the state and increasing the efficiency by which begin delete such end delete
begin insert those end insert funds are utilized.

(d) Planning, designing, constructing, operating, and maintaining
those transportation systems begin delete which end delete begin insert that end insert the Legislature has made,
or may make, the responsibility of the department; provided that
the department is not authorized to assume the functions of project
planning, designing, constructing, operating, or maintaining
maritime or aviation facilities without express prior approval of
the Legislature with the exception of those aviation functions begin delete which end delete
begin insert that end insert have been designated for the department in the Public Utilities
Code.

(e) Coordinating and developing transportation research projects
of statewide interest.

(f) Exercising begin delete such end delete other functions, powers, and duties as are
or may be provided for by law.

(g) With the Department of Housing and Community
Development, investigating and reporting to the Secretary of begin delete the
Business, end delete Transportation and begin insert the Secretary of Business, Consumer
Services and end insert Housing begin delete Agency end delete upon the consistency between state,
local, and federal housing plans and programs and state, local, and
federal transportation plans and programs.

begin insert

begin insert SEC. 84. end insert   

end insert

begin insert Section 14998.3 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

14998.3.  

(a) The commission shall submit a list of
recommended candidates for the position of Director of the Film
Commission to the Governor for consideration. The Governor
shall appoint the director.

(b) The Director of the Film Commission shall receive a salary
to be determined by the Department of Human Resources.

(c) The begin delete secretary, end delete begin insert Director of the Governor’s Office of Business
and Economic Development, end insert or his or her designee, shall act as
the director during the absence from the state or other temporary
absence, disability, or unavailability of the director, or during a
vacancy in that position.

begin insert

begin insert SEC. 85. end insert   

end insert

begin insert Section 14998.4 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

14998.4.  

(a) The commission shall meet at least quarterly and
shall select a chairperson and a vice chairperson from among its
members. The vice chairperson shall act as chairperson in the
chairperson’s absence.

(b) Each commission member shall serve without compensation
but shall be reimbursed for traveling outside the county in which
he or she resides to attend meetings.

(c) The commission shall work to encourage motion picture and
television filming in California and to that end, shall exercise all
of the powers provided in this chapter.

(d) The commission shall make recommendations to the
Legislature, the Governor, the begin delete Business, Transportation end delete begin insert Governor’s
Office of Business end insert and begin delete Housing Agency, end delete begin insert Economic Development, end insert
and other state agencies on legislative or administrative actions
that may be necessary or helpful to maintain and improve the
position of the state’s motion picture industry in the national and
world markets.

(e) In addition, subject to the provision of funding appropriated
for these purposes, the commission shall do all of the following:

(1) Adopt guidelines for a standardized permit to be used by
state agencies and the director.

(2) Approve or modify the marketing and promotion plan
developed by the director pursuant to subdivision (d) of Section
14998.9 to promote filmmaking in the state.

(3) Conduct workshops and trade shows.

(4) Provide expertise in promotional activities.

(5) Hold hearings.

(6) Adopt its own operational rules and procedures.

(7) Counsel the Legislature and the Governor on issues relating
to the motion picture industry.

begin insert

begin insert SEC. 86. end insert   

end insert

begin insert Section 14998.6 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

14998.6.  

The director of the commission shall provide staff
support to the California Film Commission. When needed, the
begin delete secretary end delete begin insert Director of the Governor’s Office of Business and
Economic Development end insert may assign additional staff on a temporary
or permanent basis.

begin insert

begin insert SEC. 87. end insert   

end insert

begin insert Section 14998.7 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

14998.7.  

Any funds appropriated to, or for use by, the
California Film Commission for purposes of this chapter, shall be
under the control of the begin delete secretary end delete begin insert Director of the Governor’s Office
of Business and Economic Development end insert or his or her designee.

begin insert

begin insert SEC. 88. end insert   

end insert

begin insert Section 15251 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

15251.  

Unless the context requires otherwise, as used in this
part, the following terms shall have the following meanings:

(a)  begin delete “Agency” end delete begin insert “Department” end insert means the begin delete California Technology
Agency. end delete begin insert Department of Technology. end insert

(b)  begin delete “Division” end delete begin insert “Office” end insert means the Public Safety
Communications begin delete Division end delete begin insert Office end insert established by this part.

begin insert

begin insert SEC. 89. end insert   

end insert

begin insert Section 15277 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

15277.  

The Public Safety Communications begin delete Division end delete begin insert Office end insert is
established within the begin delete agency. end delete begin insert department. end insert The duties of the
begin delete division end delete begin insert office end insert shall include, but not be limited to, all of the
following:

(a) Assessing the overall long-range public safety
communications needs and requirements of the state considering
emergency operations, performance, cost, state-of-the-art
technology, multiuser availability, security, reliability, and other
factors deemed to be important to state needs and requirements.

(b) Developing strategic and tactical policies and plans for public
safety communications with consideration for the systems and
requirements of the state and all public agencies in this state, and
preparing an annual strategic communications plan that includes
the feasibility of interfaces with federal and other state
telecommunications networks and services.

(c) Recommending industry standards for public safety
communications systems to ensure multiuser availability and
compatibility.

(d) Providing advice and assistance in the selection of
communications equipment to ensure that the public safety
communications needs of state agencies are met and that
procurements are compatible throughout state agencies and are
consistent with the state’s strategic and tactical plans for public
safety communications.

(e) Providing management oversight of statewide public safety
communications systems developments.

(f) Providing for coordination of, and comment on, plans,
policies, and operational requirements from departments that utilize
public safety communications in support of their principal function,
such as the California Emergency Management Agency, National
Guard, health and safety agencies, and others with primary public
safety communications programs.

(g) Monitoring and participating on behalf of the state in the
proceedings of federal and state regulatory agencies and in
congressional and state legislative deliberations that have an impact
on state government public safety communications activities.

(h) Developing plans regarding teleconferencing as an
alternative to state travel during emergency situations.

(i) Ensuring that all radio transmitting devices owned or operated
by state agencies and departments are licensed, installed, and
maintained in accordance with the requirements of federal law. A
request for a federally required license for a state-owned radio
transmitting device shall be sought only in the name of the “State
of California.”

(j) Acquiring, installing, equipping, maintaining, and operating
new or existing public safety communications systems and facilities
for public safety agencies. To accomplish that purpose, the begin delete division end delete
begin insert office end insert is authorized to enter into contracts, obtain licenses, acquire
property, install necessary equipment and facilities, and do other
necessary acts to provide adequate and efficient public safety
communications systems. Any systems established shall be
available to all public agencies in the state on terms that may be
agreed upon by the public agency and the begin delete division. end delete begin insert office. end insert

(k) Acquiring, installing, equipping, maintaining, and operating
all new or replacement microwave communications systems
operated by the state, except microwave equipment used
exclusively for traffic signal and signing control, traffic metering,
and roadway surveillance systems. To accomplish that purpose,
the begin delete division end delete begin insert office end insert is authorized to enter into contracts, obtain
licenses, acquire property, install necessary equipment and
facilities, and do other necessary acts to provide adequate and
efficient microwave communications systems. Any system
established shall be available to all public safety agencies in the
state on terms that may be agreed upon by the public agency and
the begin delete division. end delete begin insert office. end insert

(l) This chapter shall not apply to Department of Justice
communications operated pursuant to Chapter 2.5 (commencing
with Section 15150) of Part 6.

begin insert

begin insert SEC. 90. end insert   

end insert

begin insert Section 53108.5 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53108.5.  

begin delete “Division,” end delete begin insert “Office,” end insert as used in this article, means
the Public Safety Communications begin delete Division end delete begin insert Office end insert within the
begin delete California Technology Agency. end delete begin insert Department of Technology. end insert

begin insert

begin insert SEC. 91. end insert   

end insert

begin insert Section 53113 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53113.  

The Legislature finds that, because of overlapping
jurisdiction of public agencies, public safety agencies, and
telephone service areas, a general overview or plan should be
developed prior to the establishment of any system. In order to
ensure that proper preparation and implementation of those systems
is accomplished by all public agencies by December 31, 1985, the
begin delete division, end delete begin insert office, end insert with the advice and assistance of the Attorney
General, shall secure compliance by public agencies as provided
in this article.

begin insert

begin insert SEC. 92. end insert   

end insert

begin insert Section 53114 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53114.  

The begin delete division, end delete begin insert office, end insert with the advice and assistance of
the Attorney General, shall coordinate the implementation of
systems established pursuant to the provisions of this article. The
begin delete division, end delete begin insert office, end insert with the advice and assistance of the Attorney
General, shall assist local public agencies and local public safety
agencies in obtaining financial help to establish emergency
telephone service, and shall aid agencies in the formulation of
concepts, methods, and procedures that will improve the operation
of systems required by this article and that will increase cooperation
between public safety agencies.

begin insert

begin insert SEC. 93. end insert   

end insert

begin insert Section 53114.1 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53114.1.  

To accomplish the responsibilities specified in this
article, the begin delete division end delete begin insert office end insert is directed to consult at regular intervals
with the State Fire Marshal, the State Department of Public Health,
the Office of Traffic Safety, the begin delete California end delete begin insert Office of end insert Emergency
begin delete Management Agency, end delete begin insert Services, end insert a local representative from a city,
a local representative from a county, the public utilities in this state
providing telephone service, the Association of Public-Safety
Communications Officials, the Emergency Medical Services
Authority, the Department of the California Highway Patrol, and
the Department of Forestry and Fire Protection. These agencies
shall provide all necessary assistance and consultation to the
begin delete division end delete begin insert office end insert to enable it to perform its duties specified in this
article.

begin insert

begin insert SEC. 94. end insert   

end insert

begin insert Section 53114.2 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53114.2.  

On or before December 31, 1976, and each
even-numbered year thereafter, after consultation with all agencies
specified in Section 53114.1, the begin delete division end delete begin insert office end insert shall review and
update technical and operational standards for public agency
systems.

begin insert

begin insert SEC. 95. end insert   

end insert

begin insert Section 53115 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53115.  

The begin delete division end delete begin insert office end insert shall monitor all emergency
telephone systems to ensure they comply with minimal operational
and technical standards as established by the begin delete division. end delete begin insert office. end insert If
any system does not comply the begin delete division end delete begin insert office end insert shall notify in
writing the public agency or agencies operating the system of its
deficiencies. The public agency shall bring the system into
compliance with the operational and technical standards within 60
days of notice by the begin delete division. end delete begin insert office. end insert Failure to comply within
begin delete such end delete begin insert this end insert time shall subject the public agency to action by the
Attorney General pursuant to Section 53116.

begin insert

begin insert SEC. 96. end insert   

end insert

begin insert Section 53115.1 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53115.1.  

(a) There is in state government the State 911
Advisory Board.

(b) The advisory board shall be comprised of the following
members appointed by the Governor who shall serve at the pleasure
of the Governor.

(1) The Chief of the California 911 Emergency Communications
Office shall serve as the nonvoting chair of the board.

(2) One representative from the Department of the California
Highway Patrol.

(3) Two representatives on the recommendation of the California
Police Chiefs Association.

(4) Two representatives on the recommendation of the California
State Sheriffs’ Association.

(5) Two representatives on the recommendation of the California
Fire Chiefs Association.

(6) Two representatives on the recommendation of the CalNENA
Executive Board.

(7) One representative on the joint recommendation of the
executive boards of the state chapters of the Association of
Public-Safety Communications Officials-International, Inc.

(c) Recommending authorities shall give great weight and
consideration to the knowledge, training, and expertise of the
appointee with respect to their experience within the California
911 system. Board members should have at least two years of
experience as a Public Safety Answering Point (PSAP) manager
or county coordinator, except where a specific person is designated
as a member.

(d) Members of the advisory board shall serve at the pleasure
of the Governor, but may not serve more than two consecutive
two-year terms, except as follows:

(1) The presiding Chief of the California 911 Emergency
Communications Office shall serve for the duration of his or her
tenure.

(2) Four of the members shall serve an initial term of three years.

(e) Advisory board members shall not receive compensation
for their service on the board, but may be reimbursed for travel
and per diem for time spent in attending meetings of the board.

(f) The advisory board shall meet quarterly in public sessions
in accordance with the Bagley-Keene Open Meeting Act (Article
9 (commencing with Section 11120) of Chapter 2 of Part 1 of
Division 3 of Title 2). The begin delete division end delete begin insert office end insert shall provide
administrative support to the State 911 Advisory Board. The State
911 Advisory Board, at its first meeting, shall adopt bylaws and
operating procedures consistent with this article and establish
committees as necessary.

(g) Notwithstanding any other provision of law, any member
of the advisory board may designate a person to act as that member
in his or her place and stead for all purposes, as though the member
were personally present.

begin insert

begin insert SEC. 97. end insert   

end insert

begin insert Section 53115.2 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53115.2.  

(a) The State 911 Advisory Board shall advise the
begin delete division end delete begin insert office end insert on all of the following subjects:

(1) Policies, practices, and procedures for the California 911
Emergency Communications Office.

(2) Technical and operational standards for the California 911
system consistent with the National Emergency Number
Association (NENA) standards.

(3) Training standards for county coordinators and Public Safety
Answering Point (PSAP) managers.

(4) Budget, funding, and reimbursement decisions related to
the State Emergency Number Account.

(5) Proposed projects and studies conducted or funded by the
State Emergency Number Account.

(6) Expediting the rollout of Enhanced 911 Phase II technology.

(b) Upon request of a local public agency, the board shall
conduct a hearing on any conflict between a local public agency
and the begin delete division end delete begin insert office end insert regarding a final plan that has not been
approved by the begin delete division end delete begin insert office end insert pursuant to Section 53114. The
board shall meet within 30 days following the request, and shall
make a recommendation to resolve the conflict to the begin delete division end delete
begin insert office end insert within 90 days following the initial hearing by the board
pursuant to the request.

begin insert

begin insert SEC. 98. end insert   

end insert

begin insert Section 53115.3 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53115.3.  

When proposed implementation of the 911 system
by a single public agency within its jurisdiction may adversely
affect the implementation of the system by a neighboring public
agency or agencies, such neighboring public agency may request
that the begin delete division end delete begin insert office end insert evaluate the impact of implementation by
the proposing public agency and evaluate and weigh that impact
in its decision to approve or disapprove the proposing public
agency’s final plan pursuant to Section 53115. In order to effectuate
this process, each city shall file a notice of filing of its final plan
with each adjacent city and with the county in which the proposing
public agency is located at the same time such final plan is filed
with the begin delete division end delete begin insert office end insert and each county shall file a notice of filing
of its final plan with each city within the county and each adjacent
county at the time the final plan is filed with the begin delete division. end delete begin insert office. end insert
Any public agency wishing to request review pursuant to this
section shall file its request with the begin delete division end delete begin insert office end insert within 30 days
of filing of the final plan for which review is sought.

begin insert

begin insert SEC. 99. end insert   

end insert

begin insert Section 53116 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53116.  

The Attorney General may, on behalf of the begin delete division end delete
begin insert office end insert or on his or her own initiative, commence judicial
proceedings to enforce compliance by any public agency or public
utility providing telephone service with the provisions of this
article.

begin insert

begin insert SEC. 100. end insert   

end insert

begin insert Section 53119 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53119.  

Any telephone corporation serving rural telephone areas
that cannot currently provide enhanced “911” emergency telephone
service capable of selective routing, automatic number
identification, or automatic location identification shall present to
the begin delete division end delete begin insert office end insert a comprehensive plan detailing a schedule by
which those facilities will be converted to be compatible with the
enhanced emergency telephone system.

begin insert

begin insert SEC. 101. end insert   

end insert

begin insert Section 53120 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53120.  

The begin delete division end delete begin insert office end insert shall not delay implementation of
the enhanced “911” emergency telephone system in those portions
of cities or counties, or both, served by a local telephone
corporation that has equipment compatible with the enhanced
“911” emergency telephone system.

begin insert

begin insert SEC. 102. end insert   

end insert

begin insert Section 53126.5 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53126.5.  

For purposes of this article, the following definitions
apply:

(a) “Local public agency” means a city, county, city and county,
and joint powers authority that provides a public safety answering
point (PSAP).

(b) “Nonemergency telephone system” means a system
structured to provide access to only public safety agencies such
as police and fire, or a system structured to provide access to public
safety agencies and to all other services provided by a local public
agency such as street maintenance and animal control.

(c) “Public Safety Communications begin delete Division” end delete begin insert Office” end insert means
the Public Safety Communications begin delete Division end delete begin insert Office end insert within the
begin delete California Technology Agency. end delete begin insert Department of Technology. end insert

begin insert

begin insert SEC. 103. end insert   

end insert

begin insert Section 53661 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

53661.  

(a) The Commissioner of begin delete Financial Institutions end delete
begin insert Business Oversight end insert shall act as Administrator of Local Agency
Security and shall be responsible for the administration of Sections
53638, 53651, 53651.2, 53651.4, 53651.6, 53652, 53654, 53655,
53656, 53657, 53658, 53659, 53660, 53661, 53663, 53664, 53665,
53666, and 53667.

(b) The administrator shall have the powers necessary or
convenient to administer and enforce the sections specified in
subdivision (a).

(c) (1) The administrator shall issue regulations consistent with
law as the administrator may deem necessary or advisable in
executing the powers, duties, and responsibilities assigned by this
article. The regulations may include regulations prescribing
standards for the valuation, marketability, and liquidity of the
eligible securities of the class described in subdivision (m) of
Section 53651, regulations prescribing procedures and
documentation for adding, withdrawing, substituting, and holding
pooled securities, and regulations prescribing the form, content,
and execution of any application, report, or other document called
for in any of the sections specified in subdivision (a) or in any
regulation or order issued under any of those sections.

(2) The administrator, for good cause, may waive any provision
of any regulation adopted pursuant to paragraph (1) or any order
issued under this article, where the provision is not necessary in
the public interest.

(d) The administrator may enter into any contracts or agreements
as may be necessary, including joint underwriting agreements, to
sell or liquidate eligible securities securing local agency deposits
in the event of the failure of the depository or if the depository
fails to pay all or part of the deposits of a local agency.

(e) The administrator shall require from every depository a
report certified by the agent of depository listing all securities, and
the market value thereof, which are securing local agency deposits
together with the total deposits then secured by the pool, to
determine whether there is compliance with Section 53652. These
reports may be required whenever deemed necessary by the
administrator, but shall be required at least four times each year
at the times designated by the Comptroller of the Currency for
reports from national banking associations. These reports shall be
filed in the office of the administrator by the depository within 20
business days of the date the administrator calls for the report.

(f) The administrator may have access to reports of examination
made by the Comptroller of the Currency insofar as the reports
relate to national banking association trust department activities
which are subject to this article.

(g) (1) The administrator shall require the immediate
substitution of an eligible security, where the substitution is
necessary for compliance with Section 53652, if (i) the
administrator determines that a security listed in Section 53651 is
not qualified to secure public deposits, or (ii) a treasurer, who has
deposits secured by the securities pool, provides written notice to
the administrator and the administrator confirms that a security in
the pool is not qualified to secure public deposits.

(2) The failure of a depository to substitute securities, where
the administrator has required the substitution, shall be reported
by the administrator promptly to those treasurers having money
on deposit in that depository and, in addition, shall be reported as
follows:

(A) When that depository is a national bank, to the Comptroller
of the Currency of the United States.

(B) When that depository is a state bank, to the Commissioner
of begin delete Financial Institutions. end delete begin insert Business Oversight. end insert

(C) When that depository is a federal association, to the Office
of begin delete Thrift Supervision. end delete begin insert the Comptroller of the Currency. end insert

(D) When that depository is a savings association, to the
Commissioner of begin delete Financial Institutions. end delete begin insert Business Oversight. end insert

(E) When that depository is a federal credit union, to the
National Credit Union Administration.

(F) When that depository is a state credit union or a federally
insured industrial loan company, to the Commissioner of begin delete Financial
Institutions. end delete begin insert Business Oversight. end insert

(h) The administrator may require from each treasurer a
registration report and at appropriate times a report stating the
amount and location of each deposit together with other
information deemed necessary by the administrator for effective
operation of this article. The facts recited in any report from a
treasurer to the administrator are conclusively presumed to be true
for the single purpose of the administrator fulfilling responsibilities
assigned to him or her by this article and for no other purpose.

(i) (1) If, after notice and opportunity for hearing, the
administrator finds that any depository or agent of depository has
violated or is violating, or that there is reasonable cause to believe
that any depository or agent of depository is about to violate, any
of the sections specified in subdivision (a) or any regulation or
order issued under any of those sections, the administrator may
order the depository or agent of depository to cease and desist from
the violation or may by order suspend or revoke the authorization
of the agent of depository. The order may require the depository
or agent of depository to take affirmative action to correct any
condition resulting from the violation.

(2) (A) If the administrator makes any of the findings set forth
in paragraph (1) with respect to any depository or agent of
depository and, in addition, finds that the violation or the
continuation of the violation is likely to seriously prejudice the
interests of treasurers, the administrator may order the depository
or agent of depository to cease and desist from the violation or
may suspend or revoke the authorization of the agent of depository.
The order may require the depository or agent of depository to
take affirmative action to correct any condition resulting from the
violation.

(B) Within five business days after an order is issued under
subparagraph (A), the depository or agent of depository may file
with the administrator an application for a hearing on the order.
The administrator shall schedule a hearing at least 30 days, but
not more than 40 days, after receipt of an application for a hearing
or within a shorter or longer period of time agreed to by a
depository or an agent of depository. If the administrator fails to
schedule the hearing within the specified or agreed to time period,
the order shall be deemed rescinded. Within 30 days after the
hearing, the administrator shall affirm, modify, or rescind the order;
otherwise, the order shall be deemed rescinded. The right of a
depository or agent of depository to which an order is issued under
subparagraph (A) to petition for judicial review of the order shall
not be affected by the failure of the depository or agent of
depository to apply to the administrator for a hearing on the order
pursuant to this subparagraph.

(3) Whenever the administrator issues a cease and desist order
under paragraph (1) or (2), the administrator may in the order
restrict the right of the depository to withdraw securities from a
security pool; and, in that event, both the depository to which the
order is directed and the agent of depository which holds the
security pool shall comply with the restriction.

(4) In case the administrator issues an order under paragraph
(1) or (2) suspending or revoking the authorization of an agent of
depository, the administrator may order the agent of depository at
its own expense to transfer all pooled securities held by it to such
agent of depository as the administrator may designate in the order.
The agent of depository designated in the order shall accept and
hold the pooled securities in accordance with this article and
regulations and orders issued under this article.

(j) In the discretion of the administrator, whenever it appears
to the administrator that any person has violated or is violating, or
that there is reasonable cause to believe that any person is about
to violate, any of the sections specified in subdivision (a) or any
regulation or order issued thereunder, the administrator may bring
an action in the name of the people of the State of California in
the superior court to enjoin the violation or to enforce compliance
with those sections or any regulation or order issued thereunder.
Upon a proper showing a permanent or preliminary injunction,
restraining order, or writ of mandate shall be granted, and the court
may not require the administrator to post a bond.

(k) In addition to other remedies, the administrator shall have
the power and authority to impose the following sanctions for
noncompliance with the sections specified in subdivision (a) after
a hearing if requested by the party deemed in noncompliance. Any
fine assessed pursuant to this subdivision shall be paid within 30
days after receipt of the assessment.

(1) Assess against and collect from a depository a fine not to
exceed two hundred fifty dollars ($250) for each day the depository
fails to maintain with the agent of depository securities as required
by Section 53652.

(2) Assess against and collect from a depository a fine not to
exceed one hundred dollars ($100) for each day beyond the time
period specified in subdivision (b) of Section 53663 the depository
negligently or willfully fails to file in the office of the administrator
a written report required by that section.

(3) Assess against and collect from a depository a fine not to
exceed one hundred dollars ($100) for each day beyond the time
period specified in subdivision (e) that a depository negligently or
willfully fails to file in the office of the administrator a written
report required by that subdivision.

(4) Assess and collect from an agent of depository a fine not to
exceed one hundred dollars ($100) for each day the agent of
depository fails to comply with any of the applicable sections
specified in subdivision (a) or any applicable regulation or order
issued thereunder.

(l) (1) In the event that a depository or agent of depository fails
to pay a fine assessed by the administrator pursuant to subdivision
(k) within 30 days of receipt of the assessment, the administrator
may assess and collect an additional penalty of 5 percent of the
fine for each month or part thereof that the payment is delinquent.

(2) If a depository fails to pay the fines or penalties assessed by
the administrator, the administrator may notify local agency
treasurers with deposits in the depository.

(3) If an agent of depository fails to pay the fines or penalties
assessed by the administrator, the administrator may notify local
agency treasurers who have authorized the agent of depository as
provided in Sections 53649 and 53656, and may by order revoke
the authorization of the agent of depository as provided in
subdivision (i).

(m) The amendments to this section enacted by the Legislature
during the 1999-2000 Regular Session shall become operative on
January 1, 2001.

begin insert

begin insert SEC. 104. end insert   

end insert

begin insert Section 65040.12 of the end insert begin insert Government Code end insert begin insert is
amended to read: end insert

65040.12.  

(a) The office shall be the coordinating agency in
state government for environmental justice programs.

(b) The director shall do all of the following:

(1) Consult with the Secretaries of begin delete the end delete California Environmental
begin delete Protection Agency, the Resources Agency, end delete begin insert Protection, National
Resources, Transportation, end insert and begin delete the end delete Business, begin delete Transportation end delete
begin insert Consumer Services, end insert and begin delete Housing Agency, end delete begin insert Housing, end insert the Working
Group on Environmental Justice established pursuant to Section
begin delete 72002 end delete begin insert 71113 end insert of the Public Resources Code, any other appropriate
state agencies, and all other interested members of the public and
private sectors in this state.

(2) Coordinate the office’s efforts and share information
regarding environmental justice programs with the Council on
Environmental Quality, the United States Environmental Protection
Agency, the General Accounting Office, the Office of Management
and Budget, and other federal agencies.

(3) Review and evaluate any information from federal agencies
that is obtained as a result of their respective regulatory activities
under federal Executive Order 12898, and from the Working Group
on Environmental Justice established pursuant to Section begin delete 72002 end delete
begin insert 71113 end insert of the Public Resources Code.

(c) When it adopts its next edition of the general plan guidelines
pursuant to Section 65040.2, but in no case later than July 1, 2003,
the office shall include guidelines for addressing environmental
justice matters in city and county general plans. The office shall
hold at least one public hearing prior to the release of any draft
guidelines, and at least one public hearing after the release of the
draft guidelines. The hearings may be held at the regular meetings
of the Planning Advisory and Assistance Council.

(d) The guidelines developed by the office pursuant to
subdivision (c) shall recommend provisions for general plans to
do all of the following:

(1) Propose methods for planning for the equitable distribution
of new public facilities and services that increase and enhance
community quality of life throughout the community, given the
fiscal and legal constraints that restrict the siting of these facilities.

(2) Propose methods for providing for the location, if any, of
industrial facilities and uses that, even with the best available
technology, will contain or produce material that, because of its
quantity, concentration, or physical or chemical characteristics,
poses a significant hazard to human health and safety, in a manner
that seeks to avoid over-concentrating these uses in proximity to
schools or residential dwellings.

(3) Propose methods for providing for the location of new
schools and residential dwellings in a manner that seeks to avoid
locating these uses in proximity to industrial facilities and uses
that will contain or produce material that because of its quantity,
concentration, or physical or chemical characteristics, poses a
significant hazard to human health and safety.

(4) Propose methods for promoting more livable communities
by expanding opportunities for transit-oriented development so
that residents minimize traffic and pollution impacts from traveling
for purposes of work, shopping, schools, and recreation.

(e) For the purposes of this section, “environmental justice”
means the fair treatment of people of all races, cultures, and
incomes with respect to the development, adoption,
implementation, and enforcement of environmental laws,
regulations, and policies.

begin insert

begin insert SEC. 105. end insert   

end insert

begin insert Section 71.4 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

71.4.  

(a) (1) The begin delete department, end delete begin insert division, end insert subject to the approval
of the Legislature in accordance with Section 85.2, may make
loans to qualified cities, counties, or districts having power to
acquire, construct, and operate small craft harbors, for the design,
planning, acquisition, construction, improvement, maintenance,
or operation of small craft harbors and facilities in connection with
the harbors, and connecting waterways, if the begin delete department end delete begin insert division end insert
finds that the project is feasible.

(2) The minimum annual rate of interest charged by the
begin delete department end delete begin insert division end insert for a loan shall be set annually by the
begin delete commission end delete begin insert division end insert and shall be based on the Pooled Money
Investment Account interest rate.

(b) The begin delete department end delete begin insert division end insert shall establish, by rules and
regulations, policies and standards to be followed in making loans
pursuant to this section so as to further the proper development
and maintenance of a statewide system of small craft harbors and
connecting waterways. To the greatest extent possible, the
begin delete department end delete begin insert division end insert shall adhere to customary commercial practices
to ensure that loans made pursuant to this section are adequately
secured and that the loans are repaid consistent with the terms of
the loan agreement. Any rules and regulations shall include policies
and standards for restrooms, vessel pumpout facilities, oil recycling
facilities, and receptacles for the purpose of separating, reusing,
or recycling all solid waste materials.

(c) The begin delete department end delete begin insert division end insert shall develop weighing and ranking
criteria to qualify and prioritize the public loans.

(d) A loan under this section shall be repaid as provided in
Section 70.

(e) Rates to be charged for the use of the boating facilities shall
be established by the city, county, or district, subject to the approval
of the begin delete department, end delete begin insert division, end insert in every loan contract. The begin delete department end delete
begin insert division end insert shall concern itself with the rates charged only as
prescribed in Section 71.8. The rates set shall be based on a
monthly berthing charge, and the begin delete department end delete begin insert division end insert shall monitor
these rates to ensure that the berthing charges are sufficient to
ensure timely and complete repayment of the loan.

(f) The begin delete department end delete begin insert division end insert shall submit any project for which
it recommends any loan be made to the Governor for inclusion in
the Budget Bill.

(g) The begin delete department end delete begin insert division end insert may restate an existing loan under
this article, upon written request by the begin delete borrower, and upon
approval by the commission. end delete begin insert borrower. end insert

begin insert

begin insert SEC. 106. end insert   

end insert

begin insert Section 71.7 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

71.7.  

Notwithstanding any other provision of this chapter,
Section 82, or any contract or agreement to the contrary, loan
payments on the loan on behalf of Spud Point Marina in the County
of Sonoma, as authorized by Schedule (b)(8) of Item 3680-101-516
of Section 2.00 of the Budget Act of 1982, and administered by
the begin delete department, end delete begin insert division, end insert may be renegotiated by the begin delete department end delete
begin insert division end insert and the County of Sonoma, begin delete with the advice and consent
of the commission, end delete to solve the fiscal problems involving the
marina existing on the effective date of this section as enacted
during the 1994 portion of the 1993-94 Regular Session.

begin insert

begin insert SEC. 107. end insert   

end insert

begin insert Section 72.6 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

72.6.  

Transfers pursuant to Section 70, loans pursuant to
Section 71.4, and grants pursuant to Section 72.5 shall be made
by the begin delete department end delete begin insert division end insert with the advice begin delete and consent end delete of the
commission.

begin insert

begin insert SEC. 108. end insert   

end insert

begin insert Section 76.5 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

76.5.  

In processing applications under this article, the
begin delete department end delete begin insert division end insert shall give priority to applications from
qualified private marina owners who have not received previous
loans from the department. If the department finds a proposed loan
project is feasible, the loan request shall be submitted to the
commission for its begin delete advice and consent. end delete begin insert advice. end insert

begin insert

begin insert SEC. 109. end insert   

end insert

begin insert Section 76.6 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

76.6.  

Loans made under this article shall include, but are not
limited to, the following terms and conditions:

(a) The minimum annual rate of interest charged by the
begin delete department end delete begin insert division end insert for a loan shall be set annually by the
begin delete commission end delete begin insert division end insert and shall be a rate equal to 1 percent per
annum plus the prime or base rate of interest.

(b) The begin delete department end delete begin insert division end insert shall require collateral in a
minimum amount of 110 percent of the loan.

(c) The repayment period of a loan shall not exceed 20 years,
or be longer than the length of the borrower’s leasehold estate,
including renewal options, if the loan is based upon a leasehold
estate of the borrower.

(d) All loans shall amortize the principal over the term of the
loan. However, a loan shall become due and payable in full if the
borrower sells or otherwise transfers the recreational marina
developed with begin delete departmental end delete begin insert divisional end insert funds, unless the transfer
is, by reason of the death of the borrower, to the borrower’s heirs.

(e) The begin delete department’s end delete begin insert division’s end insert loans shall not be subordinated
to any future loans obtained by a private marina owner, except in
those cases involving loans acquired for refinancing previous senior
loans.

(f) The begin delete department end delete begin insert division end insert may allow assumption of loans from
the original borrower by future parties, subject to completion of
the application process and upon approval by the begin delete department and
the commission. end delete begin insert division. end insert

(g) The begin delete department end delete begin insert division end insert may, upon written request by the
borrower, begin delete and upon the approval of the commission, end delete restate an
existing loan.

begin insert

begin insert SEC. 110. end insert   

end insert

begin insert Section 82 of the end insert begin insert Harbors and Navigation Code end insert begin insert , as
added by Section 2 of Chapter 136 of the Statutes of 2012, is
amended to read: end insert

82.  

The division, consistent with Section 82.3, and in
furtherance of the public interest and in accordance therewith, shall
have only the following duties with respect to the commission:

(a) To submit any proposed changes in regulations pertaining
to boating functions and responsibilities of the division to the
commission for its advice and comment prior to enactment of
changes.

(b) To submit proposals for transfers pursuant to Section 70,
loans pursuant to Section 71.4 or 76.3, and grants pursuant to
Section 72.5 to the commission for its advice and comment.

(c) To submit any proposed project begin insert for which end insert it is begin delete considering
approving end delete begin insert making a determination of eligibility for funding from
the Harbors and Watercraft Revolving Fund end insert to the commission if
that project could have a potentially significant impact on either
public health or safety, public access, or the environment for the
commission’s advice and comment prior to begin delete approval by the
division. end delete begin insert making that determination. end insert

(d) To annually submit a report on its budget and expenditures
to the commission for its advice and comment.

(e) To cause studies and surveys to be made of the need for
small craft harbors and connecting waterways throughout the state
and the most suitable sites therefore, and submit those studies and
surveys to the commission for advice and comment.

begin insert

begin insert SEC. 111. end insert   

end insert

begin insert Section 82.3 of the end insert begin insert Harbors and Navigation Code end insert
begin insert is amended to read: end insert

82.3.  

The commission shall have the following particular duties
and responsibilities:

(a) To be fully informed regarding all governmental activities
affecting programs administered by the division.

(b) To meet at least four times per year at various locations
throughout the state to receive comments on the implementation
of the programs administered by the division and establish an
annual calendar of proposed meetings at the beginning of each
calendar year. The meetings shall include a public meeting, before
the beginning of each begin insert funding cycle of a loan and end insert grant program
begin delete cycle, end delete begin insert funded from the Harbors and Watercraft Revolving Fund, end insert
to collect public input concerning the program, recommendations
for program improvements, and specific project needs for the
system.

(c) To hold a public hearing to receive public comment regarding
any proposed project subject to subdivision (c) of Section 82 at a
location in close geographic proximity to the proposed project,
unless a hearing consistent with federal law or regulation has
already been held regarding the project.

(d) To consider, upon the request of any owner or tenant whose
property is in the vicinity of any proposed project subject to
subdivision (c) of Section 82, any alleged adverse impacts
occurring on that person’s property from activities undertaken
pursuant to this code, and recommend to the division suitable
measures for the prevention of any adverse impacts determined
by the commission to be occurring, and suitable measures for the
restoration of adversely impacted property.

(e) To review and comment annually to the division on the
proposed budget of expenditures from the revolving fund.

(f) To review all begin delete plans end delete begin insert proposals end insert for begin delete new and expanded end delete local
and regional waterways, piers, harbors, docks, or other recreational
areas that have applied for grant or loan funds from the division
prior to begin delete approval end delete begin insert a final determination of eligibility end insert by the division.

(g) (1) With support and assistance from the division, to prepare
and submit a program report to the Governor, the Assembly
Committee on Water, Parks and Wildlife, the Senate Committee
on Natural Resources and Water, the Senate Committee on
Appropriations, and the Assembly Committee on Appropriations
on or before January 1, 2013, and every three years thereafter. The
report shall be adopted by the commission after discussing the
contents during two or more public meetings. The report shall
address the status of any regulations adopted or being considered
by the begin delete division, end delete begin insert division and end insert any loan or grant that has been or is
being considered for begin delete approval end delete begin insert a determination of eligibility end insert by the
division pending the previous begin delete report, and a summary of resource
monitoring data compiled and restoration work completed. end delete begin insert report. end insert

(2) A report required to be submitted pursuant to paragraph (1)
shall be submitted in compliance with Section 9795 of the
Government Code.

begin insert

begin insert SEC. 112. end insert   

end insert

begin insert Section 40448.6 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

40448.6.  

The Legislature hereby finds and declares all of the
following:

(a) It is necessary to increase the availability of financial
assistance to small businesses that are subject to the rules and
regulations of the south coast district, in order to minimize
economic dislocation and adverse socioeconomic impacts.

(b) It is in the public interest that a portion of the funds collected
by the south coast district from violators of air pollution regulations
be allocated for the purpose of guaranteeing or otherwise reducing
the financial risks of providing financial assistance to small
businesses which face increased borrowing requirements in order
to comply with air pollution control requirements.

(c) Public agencies and private lenders have a variety of methods
available for providing financing assistance to small businesses
and other employers, including taxable bonds, composite or pooled
financing instruments, loan guarantees, and credit insurance, which
could be utilized in combination with the penalties collected by
the south coast district to expand the availability and reduce the
cost of financing assistance.

(d) The California Pollution Control Financing Authority has
funds set aside from previous bond issues, which could be used to
guarantee the issuance of bonds or other financing for small
businesses for the purchase and installation of pollution control
equipment.

(e) The begin delete Business, Transportation end delete begin insert Governor’s Office of Business end insert
and begin delete Housing Agency, end delete begin insert Economic Development, end insert through the small
business financial development corporations established pursuant
to Chapter 1 (commencing with Section 14000) of Part 5 of
Division 3 of Title 1 of the Corporations Code, has the ability to
provide state loan guarantees and technical assistance to small
businesses needing financial assistance.

(f) The Job Training Partnership Division of the Employment
Development Department makes funds available for job training
programs, including funds for dislocated workers, through the
federal Job Training Partnership Act (29 U.S.C. Sec. 1501 et seq.).

(g) It is the policy of the state that the Job Training Partnership
Division of the Employment Development Department, in
cooperation with the districts and the state board, are encouraged
to provide job training programs for workers who, as determined
by the department or the local private industry council, have been
laid off or dislocated as a result of actions resulting from air quality
regulations.

(h) It is the policy of the state that the California Pollution
Control Financing Authority and other state agencies implementing
small business assistance programs, in cooperation with the districts
and the state board, are encouraged to provide technical and
financial assistance to small businesses to facilitate compliance
with air quality regulations.

begin insert

begin insert SEC. 113. end insert   

end insert

begin insert Section 44272 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

44272.  

(a) The Alternative and Renewable Fuel and Vehicle
Technology Program is hereby created. The program shall be
administered by the commission. The commission shall implement
the program by regulation pursuant to the requirements of Chapter
3.5 (commencing with Section 11340) of Part 1 of Division 3 of
Title 2 of the Government Code. The program shall provide, upon
appropriation by the Legislature, competitive grants, revolving
loans, loan guarantees, loans, or other appropriate funding
measures, to public agencies, vehicle and technology entities,
businesses and projects, public-private partnerships, workforce
training partnerships and collaboratives, fleet owners, consumers,
recreational boaters, and academic institutions to develop and
deploy innovative technologies that transform California’s fuel
and vehicle types to help attain the state’s climate change policies.
The emphasis of this program shall be to develop and deploy
technology and alternative and renewable fuels in the marketplace,
without adopting any one preferred fuel or technology.

(b) A project that receives more than seventy-five thousand
dollars ($75,000) in funds from the commission shall be approved
at a noticed public meeting of the commission and shall be
consistent with the priorities established by the investment plan
adopted pursuant to Section 44272.5. Under this article, the
commission may delegate to the commission’s executive director,
or his or her designee, the authority to approve either of the
following:

(1) A contract, grant, loan, or other agreement or award that
receives seventy-five thousand dollars ($75,000) or less in funds
from the commission.

(2) Amendments to a contract, grant, loan, or other agreement
or award as long as the amendments do not increase the amount
of the award, change the scope of the project, or modify the purpose
of the agreement.

(c) The commission shall provide preferences to those projects
that maximize the goals of the Alternative and Renewable Fuel
and Vehicle Technology Program, based on the following criteria,
as applicable:

(1) The project’s ability to provide a measurable transition from
the nearly exclusive use of petroleum fuels to a diverse portfolio
of viable alternative fuels that meet petroleum reduction and
alternative fuel use goals.

(2) The project’s consistency with existing and future state
climate change policy and low-carbon fuel standards.

(3) The project’s ability to reduce criteria air pollutants and air
toxics and reduce or avoid multimedia environmental impacts.

(4) The project’s ability to decrease, on a life cycle basis, the
discharge of water pollutants or any other substances known to
damage human health or the environment, in comparison to the
production and use of California Phase 2 Reformulated Gasoline
or diesel fuel produced and sold pursuant to California diesel fuel
regulations set forth in Article 2 (commencing with Section 2280)
of Chapter 5 of Division 3 of Title 13 of the California Code of
Regulations.

(5) The project does not adversely impact the sustainability of
the state’s natural resources, especially state and federal lands.

(6) The project provides nonstate matching funds. Costs incurred
from the date a proposed award is noticed may be counted as
nonstate matching funds. The commission may adopt further
requirements for the purposes of this paragraph. The commission
is not liable for costs incurred pursuant to this paragraph if the
commission does not give final approval for the project or the
proposed recipient does not meet requirements adopted by the
commission pursuant to this paragraph.

(7) The project provides economic benefits for California by
promoting California-based technology firms, jobs, and businesses.

(8) The project uses existing or proposed fueling infrastructure
to maximize the outcome of the project.

(9) The project’s ability to reduce on a life cycle assessment
greenhouse gas emissions by at least 10 percent, and higher
percentages in the future, from current reformulated gasoline and
diesel fuel standards established by the state board.

(10) The project’s use of alternative fuel blends of at least 20
percent, and higher blend ratios in the future, with a preference
for projects with higher blends.

(11) The project drives new technology advancement for
vehicles, vessels, engines, and other equipment, and promotes the
deployment of that technology in the marketplace.

(d) Only the following shall be eligible for funding:

(1) Alternative and renewable fuel projects to develop and
improve alternative and renewable low-carbon fuels, including
electricity, ethanol, dimethyl ether, renewable diesel, natural gas,
hydrogen, and biomethane, among others, and their feedstocks
that have high potential for long-term or short-term
commercialization, including projects that lead to sustainable
feedstocks.

(2) Demonstration and deployment projects that optimize
alternative and renewable fuels for existing and developing engine
technologies.

(3) Projects to produce alternative and renewable low-carbon
fuels in California.

(4) Projects to decrease the overall impact of an alternative and
renewable fuel’s life cycle carbon footprint and increase
sustainability.

(5) Alternative and renewable fuel infrastructure, fueling
stations, and equipment. The preference in paragraph (10) of
subdivision (c) shall not apply to renewable diesel or biodiesel
infrastructure, fueling stations, and equipment used solely for
renewable diesel or biodiesel fuel.

(6) Projects to develop and improve light-, medium-, and
heavy-duty vehicle technologies that provide for better fuel
efficiency and lower greenhouse gas emissions, alternative fuel
usage and storage, or emission reductions, including propulsion
systems, advanced internal combustion engines with a 40 percent
or better efficiency level over the current market standard,
light-weight materials, energy storage, control systems and system
integration, physical measurement and metering systems and
software, development of design standards and testing and
certification protocols, battery recycling and reuse, engine and fuel
optimization electronic and electrified components, hybrid
technology, plug-in hybrid technology, battery electric vehicle
technology, fuel cell technology, and conversions of hybrid
technology to plug-in technology through the installation of safety
certified supplemental battery modules.

(7) Programs and projects that accelerate the commercialization
of vehicles and alternative and renewable fuels including buy-down
programs through near-market and market-path deployments,
advanced technology warranty or replacement insurance,
development of market niches, supply-chain development, and
research related to the pedestrian safety impacts of vehicle
technologies and alternative and renewable fuels.

(8) Programs and projects to retrofit medium- and heavy-duty
on-road and nonroad vehicle fleets with technologies that create
higher fuel efficiencies, including alternative and renewable fuel
vehicles and technologies, idle management technology, and
aerodynamic retrofits that decrease fuel consumption.

(9) Infrastructure projects that promote alternative and renewable
fuel infrastructure development connected with existing fleets,
public transit, and existing transportation corridors, including
physical measurement or metering equipment and truck stop
electrification.

(10) Workforce training programs related to alternative and
renewable fuel feedstock production and extraction, renewable
fuel production, distribution, transport, and storage,
high-performance and low-emission vehicle technology and high
tower electronics, automotive computer systems, mass transit fleet
conversion, servicing, and maintenance, and other sectors or
occupations related to the purposes of this chapter.

(11) Block grants or incentive programs administered by public
entities or not-for-profit technology entities for multiple projects,
education and program promotion within California, and
development of alternative and renewable fuel and vehicle
technology centers. The commission may adopt guidelines for
implementing the block grant or incentive program, which shall
be approved at a noticed public meeting of the commission.

(12) Life cycle and multimedia analyses, sustainability and
environmental impact evaluations, and market, financial, and
technology assessments performed by a state agency to determine
the impacts of increasing the use of low-carbon transportation fuels
and technologies, and to assist in the preparation of the investment
plan and program implementation.

(13) A program to provide funding for homeowners who
purchase a plug-in electric vehicle to offset costs associated with
modifying electrical sources to include a residential plug-in electric
vehicle charging station. In establishing this program, the
commission shall consider funding criteria to maximize the public
benefit of the program.

(e) The commission may make a single source or sole source
award pursuant to this section for applied research. The same
requirements set forth in Section 25620.5 of the Public Resources
Code shall apply to awards made on a single source basis or a sole
source basis. This subdivision does not authorize the commission
to make a single source or sole source award for a project or
activity other than for applied research.

(f) The commission may do all of the following:

(1) Contract with the Treasurer to expend funds through
programs implemented by the Treasurer, if the expenditure is
consistent with all of the requirements of this article and Article
1 (commencing with Section 44270).

(2) Contract with small business financial development
corporations established by the begin delete Business, Transportation end delete
begin insert Governor’s Office of Business end insert and begin delete Housing Agency end delete begin insert Economic
Development end insert to expend funds through the Small Business Loan
Guarantee Program if the expenditure is consistent with all of the
requirements of this article and Article 1 (commencing with Section
44270).

(3) Advance funds, pursuant to an agreement with the
commission, to any of the following:

(A) A public entity.

(B) A recipient to enable it to make advance payments to a
public entity that is a subrecipient of the funds and under a binding
and enforceable subagreement with the recipient.

(C) An administrator of a block grant program.

begin insert

begin insert SEC. 114. end insert   

end insert

begin insert Section 326.3 of the end insert begin insert Penal Code end insert begin insert is amended to read: end insert

326.3.  

(a) The Legislature finds and declares all of the
following:

(1) Nonprofit organizations provide important and essential
educational, philanthropic, and social services to the people of the
State of California.

(2) One of the great strengths of California is a vibrant nonprofit
sector.

(3) Nonprofit and philanthropic organizations touch the lives
of every Californian through service and employment.

(4) Many of these services would not be available if nonprofit
organizations did not provide them.

(5) There is a need to provide methods of fundraising to
nonprofit organizations to enable them to provide these essential
services.

(6) Historically, many nonprofit organizations have used
charitable bingo as one of their key fundraising strategies to
promote the mission of the charity.

(7) Legislation is needed to provide greater revenues for
nonprofit organizations to enable them to fulfill their charitable
purposes, and especially to meet their increasing social service
obligations.

(8) Legislation is also needed to clarify that existing law requires
that all charitable bingo must be played using a tangible card and
that the only permissible electronic devices to be used by charitable
bingo players are card-minding devices.

(b) Neither the prohibition on gambling in this chapter nor in
Chapter 10 (commencing with Section 330) applies to any remote
caller bingo game that is played or conducted in a city, county, or
city and county pursuant to an ordinance enacted under Section
19 of Article IV of the California Constitution, if the ordinance
allows a remote caller bingo game to be played or conducted only
in accordance with this section, including the following
requirements:

(1) The game may be conducted only by the following
organizations:

(A) An organization that is exempted from the payment of the
taxes imposed under the Corporation Tax Law by Section 23701a,
23701b, 23701d, 23701e, 23701f, 23701g, 23701k, 23701l, or
23701w of the Revenue and Taxation Code.

(B) A mobilehome park association.

(C) A senior citizens organization.

(D) Charitable organizations affiliated with a school district.

(2) The organization conducting the game shall have been
incorporated or in existence for three years or more.

(3) The organization conducting the game shall be licensed
pursuant to subdivision (l) of Section 326.5.

(4) The receipts of the game shall be used only for charitable
purposes. The organization conducting the game shall determine
the disbursement of the net receipts of the game.

(5) The operation of bingo may not be the primary purpose for
which the organization is organized.

(c) (1) A city, county, or city and county may adopt an
ordinance in substantially the following form to authorize remote
caller bingo in accordance with the requirements of subdivision
(b):

 

Sec. _.01. Legislative Authorization.

This chapter is adopted pursuant to Section 19 of Article IV of
the California Constitution, as implemented by Sections 326.3 and
326.4 of the Penal Code.

Sec. _.02. Remote Caller Bingo Authorized.

Remote Caller Bingo may be lawfully played in the [City,
County, or City and County] pursuant to the provisions of Sections
326.3 and 326.4 of the Penal Code, and this chapter, and not
otherwise.

Sec. _.03. Qualified Applicants: Applicants for Licensure.

(a) The following organizations are qualified to apply to the
License Official for a license to operate a bingo game if the receipts
of those games are used only for charitable purposes:

(1) An organization exempt from the payment of the taxes
imposed under the Corporation Tax Law by Section 23701a,
23701b, 23701d, 23701e, 23701f, 23701g, 23701k, 23701l, or
23701w of the Revenue and Taxation Code.

(2) A mobile home park association of a mobile home park that
is situated in the [City, County, or City and County].

(3) Senior citizen organizations.

(4) Charitable organizations affiliated with a school district.

(b) The application shall be in a form prescribed by the License
Official and shall be accompanied by a nonrefundable filing fee
in an amount determined by resolution of the [Governing Body of
the City, County, or City and County] from time to time. The
following documentation shall be attached to the application, as
applicable:

(1) A certificate issued by the Franchise Tax Board certifying
that the applicant is exempt from the payment of the taxes imposed
under the Corporation Tax Law pursuant to Section 23701a,
23701b, 23701d, 23701e, 23701f, 23701g, 23701k, 23701l, or
23701w of the Revenue and Taxation Code. In lieu of a certificate
issued by the Franchise Tax Board, the License Official may refer
to the Franchise Tax Board’s Internet Web site to verify that the
applicant is exempt from the payment of the taxes imposed under
the Corporation Tax Law.

(2) Other evidence as the License Official determines is
necessary to verify that the applicant is a duly organized mobile
home park association of a mobile home park situated in the [City,
County, or City and County].

Sec. _.04. License Application: Verification.

The license shall not be issued until the License Official has
verified the facts stated in the application and determined that the
applicant is qualified.

Sec. _.05. Annual Licenses.

A license issued pursuant to this chapter shall be valid until the
end of the calendar year, at which time the license shall expire. A
new license shall only be obtained upon filing a new application
and payment of the license fee. The fact that a license has been
issued to an applicant creates no vested right on the part of the
licensee to continue to offer bingo for play. The [Governing Body
of the City, County, or City and County] expressly reserves the
right to amend or repeal this chapter at any time by resolution. If
this chapter is repealed, all licenses issued pursuant to this chapter
shall cease to be effective for any purpose on the effective date of
the repealing resolution.

Sec. _.06. Conditions of Licensure.

(a) Any license issued pursuant to this chapter shall be subject
to the conditions contained in Sections 326.3 and 326.4 of the
Penal Code, and each licensee shall comply with the requirements
of those provisions.

(b) Each license issued pursuant to this chapter shall be subject
to the following additional conditions:

(1) Bingo games shall not be conducted by any licensee on more
than two days during any week, except that a licensee may hold
one additional game, at its election, in each calendar quarter.

(2) The licensed organization is responsible for ensuring that
the conditions of this chapter and Sections 326.3 and 326.4 of the
Penal Code are complied with by the organization and its officers
and members. A violation of any one or more of those conditions
or provisions shall constitute cause for the revocation of the
organization’s license. At the request of the organization, the
[Governing Body of the City, County, or City and County] shall
hold a public hearing before revoking any license issued pursuant
to this chapter.

 

begin delete

(2)

end delete

begin insert (3) end insert   begin delete Nothing in this end delete begin insert This end insert section shall begin insert not end insert require a city, county,
or city and county to use this model ordinance in order to authorize
remote caller bingo.

begin delete

(d)

end delete

begin insert (c) end insert  It is a misdemeanor for any person to receive or pay a profit,
wage, or salary from any remote caller bingo game, provided that
administrative, managerial, technical, financial, and security
personnel employed by the organization conducting the bingo
game may be paid reasonable fees for services rendered from the
revenues of bingo games, as provided in subdivision (m), except
that fees paid under those agreements shall not be determined as
a percentage of receipts or other revenues from, or be dependant
on the outcome of, the game.

begin delete

(e)

end delete

begin insert (d) end insert  A violation of subdivision (d) shall be punishable by a fine
not to exceed ten thousand dollars ($10,000), which fine shall be
deposited in the general fund of the city, county, or city and county
that enacted the ordinance authorizing the remote caller bingo
game. A violation of any provision of this section, other than
subdivision (d), is a misdemeanor.

begin delete

(f)

end delete

begin insert (e) end insert  The city, county, or city and county that enacted the
ordinance authorizing the remote caller bingo game, or the Attorney
General, may bring an action to enjoin a violation of this section.

begin delete

(g)

end delete

begin insert (f) end insert  No minors shall be allowed to participate in any remote caller
bingo game.

begin delete

(h)

end delete

begin insert (g) end insert  A remote caller bingo game shall not include any site that
is not located within this state.

begin delete

(i)

end delete

begin insert (h) end insert  An organization authorized to conduct a remote caller bingo
game pursuant to subdivision (b) shall conduct the game only on
property that is owned or leased by the organization, or the use of
which is donated to the organization. begin delete Nothing in this end delete begin insert This end insert
subdivision shall begin insert not end insert be construed to require that the property that
is owned or leased by, or the use of which is donated to, the
organization be used or leased exclusively by, or donated
exclusively to, that organization.

begin delete

(j)

end delete

begin insert (i) end insert  (1) All remote caller bingo games shall be open to the public,
not just to the members of the authorized organization.

(2) No more than 750 players may participate in a remote caller
bingo game in a single location.

(3) If the Governor of California or the President of the United
States declares a state of emergency in response to a natural disaster
or other public catastrophe occurring in California, an organization
authorized to conduct remote caller bingo games may, while that
declaration is in effect, conduct a remote caller bingo game
pursuant to this section with more than 750 participants in a single
venue if the net proceeds of the game, after deduction of prizes
and overhead expenses, are donated to or expended exclusively
for the relief of the victims of the disaster or catastrophe, and the
organization gives the California Gambling Control Commission
at least 10 days’ written notice of the intent to conduct that game.

(4) An organization authorized to conduct remote caller bingo
games shall provide the begin delete commission end delete begin insert department end insert with at least 30
days’ advance written notice of its intent to conduct a remote caller
bingo game. That notice shall include all of the following:

(A) The legal name of the organization and the address of record
of the agent upon whom legal notice may be served.

(B) The locations of the caller and remote players, whether the
property is owned by the organization or donated, and if donated,
by whom.

(C) The name of the licensed caller and site manager.

(D) The names of administrative, managerial, technical,
financial, and security personnel employed.

(E) The name of the vendor and any person or entity maintaining
the equipment used to operate and transmit the game.

(F) The name of the person designated as having a fiduciary
responsibility for the game pursuant to paragraph (2) of subdivision
(k).

(G) The license numbers of all persons specified in
subparagraphs (A) to (F), inclusive, who are required to be licensed.

(H) A copy of the local ordinance for any city, county, or city
and county in which the game will be played. The begin delete commission end delete
begin insert department end insert shall post the ordinance on its Internet Web site.

begin delete

(k)

end delete

begin insert (j) end insert  (1) A remote caller bingo game shall be operated and staffed
only by members of the authorized organization that organized it.
Those members shall not receive a profit, wage, or salary from
any remote caller bingo game. Only the organization authorized
to conduct a remote caller bingo game shall operate that game, or
participate in the promotion, supervision, or any other phase of a
remote caller bingo game. Subject to the provisions of subdivision
(m), this subdivision shall not preclude the employment of
administrative, managerial, technical, financial, or security
personnel who are not members of the authorized organization at
a location participating in the remote caller bingo game by the
organization conducting the game. Notwithstanding any other
provision of law, exclusive or other agreements between the
authorized organization and other entities or persons to provide
services in the administration, management, or conduct of the game
shall not be considered a violation of the prohibition against
holding a legally cognizable financial interest in the conduct of
the remote caller bingo game by persons or entities other than the
charitable organization, or other entity authorized to conduct the
remote caller bingo games, provided that those persons or entities
obtain the gambling licenses, the key employee licenses, or the
work permits required by, and otherwise comply with, Chapter 5
(commencing with Section 19800) of Division 8 of the Business
and Professions Code. Fees to be paid under any such agreements
shall be reasonable and shall not be determined as a percentage of
receipts or other revenues from, or be dependent on the outcome
of, the game.

(2) An organization that conducts a remote caller bingo game
shall designate a person as having fiduciary responsibility for the
game.

begin delete

(l)

end delete

begin insert (k) end insert  No individual, corporation, partnership, or other legal entity,
except the organization authorized to conduct or participate in a
remote caller bingo game, shall hold a legally cognizable financial
interest in the conduct of such a game.

begin delete

(m)

end delete

begin insert (l) end insert  An organization authorized to conduct a remote caller bingo
game pursuant to this section shall not have overhead costs
exceeding 20 percent of gross sales, except that the limitations of
this section shall not apply to one-time, nonrecurring capital
acquisitions. For purposes of this subdivision, “overhead costs”
includes, but is not limited to, amounts paid for rent and equipment
leasing and the reasonable fees authorized to be paid to
administrative, managerial, technical, financial, and security
personnel employed by the organization pursuant to subdivision
(d). For the purpose of keeping its overhead costs below 20 percent
of gross sales, an authorized organization may elect to deduct all
or a portion of the fees paid to financial institutions for the use and
processing of credit card sales from the amount of gross revenues
awarded for prizes. In that case, the redirected fees for the use and
processing of credit card sales shall not be included in “overhead
costs” as defined in the California Remote Caller Bingo Act.
Additionally, fees paid to financial institutions for the use and
processing of credit card sales shall not be deducted from the
proceeds retained by the charitable organization.

begin delete

(n) No

end delete

begin insert (m) end insert begin insert   end insert begin insert A end insert person shall begin insert not end insert be allowed to participate in a remote
caller bingo game unless the person is physically present at the
time and place where the remote caller bingo game is being
conducted. A person shall be deemed to be physically present at
the place where the remote caller bingo game is being conducted
if he or she is present at any of the locations participating in the
remote caller bingo game in accordance with this section.

begin delete

(o)

end delete

begin insert (n) end insert  (1) An organization shall not cosponsor a remote caller
bingo game with one or more other organizations unless one of
the following is true:

(A) All of the cosponsors are affiliated under the master charter
or articles and bylaws of a single organization.

(B) All of the cosponsors are affiliated through an organization
described in paragraph (1) of subdivision (b), and have the same
Internal Revenue Service activity code.

(2) Notwithstanding paragraph (1), a maximum of 10
unaffiliated organizations described in paragraph (1) of subdivision
(b) may enter into an agreement to cosponsor a remote caller game,
provided that the game shall have not more than 10 locations.

(3) An organization shall not conduct remote caller bingo more
than two days per week.

(4) Before sponsoring or operating any game authorized under
paragraph (1) or (2), each of the cosponsoring organizations shall
have entered into a written agreement, a copy of which shall be
provided to the begin delete commission, end delete begin insert Department of Justice, end insert setting forth
how the expenses and proceeds of the game are to be allocated
among the participating organizations, the bank accounts into
which all receipts are to be deposited and from which all prizes
are to be paid, and how game records are to be maintained and
subjected to annual audit.

begin delete

(p)

end delete

begin insert (o) end insert  The value of prizes awarded during the conduct of any
remote caller bingo game shall not exceed 37 percent of the gross
receipts for that game. When an authorized organization elects to
deduct fees paid for the use and processing of credit card sales
from the amount of gross revenues for that game awarded for
prizes, the maximum amount of gross revenues that may be
awarded for prizes shall not exceed 37 percent of the gross receipts
for that game, less the amount of redirected fees paid for the use
and processing of credit card sales. Every remote caller bingo game
shall be played until a winner is declared. Progressive prizes are
prohibited. The declared winner of a remote caller bingo game
shall provide his or her identifying information and a mailing
address to the onsite manager of the remote caller bingo game.
Prizes shall be paid only by check; no cash prizes shall be paid.
The organization conducting the remote caller bingo game may
issue a check to the winner at the time of the game, or may send
a check to the declared winner by United States Postal Service
certified mail, return receipt requested. All prize money exceeding
state and federal exemption limits on prize money shall be subject
to income tax reporting and withholding requirements under
applicable state and federal laws and regulations and those reports
and withholding shall be forwarded, within 10 business days, to
the appropriate state or federal agency on behalf of the winner. A
report shall accompany the amount withheld identifying the person
on whose behalf the money is being sent. Any game interrupted
by a transmission failure, electrical outage, or act of God shall be
considered void in the location that was affected. A refund for a
canceled game or games shall be provided to the purchasers.

begin delete

(q)

end delete

begin insert (p) end insert  (1) The California Gambling Control Commission shall
regulate remote caller bingo, including, but not limited to, licensure
and operation. The commission shall establish reasonable criteria
regulating, and shall require the licensure of, the following:

(A) Any person who conducts a remote caller bingo game
pursuant to this section, including, but not limited to, an employee,
a person having fiduciary responsibility for a remote caller bingo
game, a site manager, and a bingo caller.

(B) Any person who directly or indirectly manufactures,
distributes, supplies, vends, leases, or otherwise provides supplies,
devices, services, or other equipment designed for use in the
playing of a remote caller bingo game by any nonprofit
organization.

(C) Beginning January 31, 2009, or a later date as may be
established by the commission, all persons described in
subparagraph (A) or (B) may submit to the commission a letter of
intent to submit an application for licensure. The letter shall clearly
identify the principal applicant, all categories under which the
application will be filed, and the names of all those particular
individuals who are applying. Each charitable organization shall
provide an estimate of the frequency with which it plans to conduct
remote caller bingo operations, including the number of locations.
The letter of intent may be withdrawn or updated at any time.

(2) (A) The Department of Justice shall conduct background
investigations and conduct field enforcement as it relates to remote
caller bingo consistent with the Gambling Control Act (Chapter 5
(commencing with Section 19800) of Division 8 of the Business
and Professions Code) and as specified in regulations promulgated
by the commission.

(B) Fees to cover background investigation costs shall be paid
and accounted for in accordance with Section 19867 of the
Business and Professions Code.

(3) (A) Every application for a license or approval shall be
accompanied by a nonrefundable fee, the amount of which shall
be adopted by the commission by regulation.

(B) Fees and revenue collected pursuant to this paragraph shall
be deposited in the California Bingo Fund, which is hereby created
in the State Treasury. The funds deposited in the California Bingo
Fund shall be available, upon appropriation by the Legislature, for
expenditure by the commission and the department exclusively
for the support of the commission and department in carrying out
their duties and responsibilities under this section and Section
326.5.

(C) A loan is hereby authorized from the Gambling Control
Fund to the California Bingo Fund on or after January 1, 2009, in
an amount of up to five hundred thousand dollars ($500,000) to
fund operating, personnel, and other startup costs incurred by the
commission relating to this act. Funds from the California Bingo
Fund shall be available to the commission upon appropriation by
the Legislature in the annual Budget Act. The loan shall be subject
to all of the following conditions:

(i) The loan shall be repaid to the Gambling Control Fund as
soon as there is sufficient money in the California Bingo Fund to
repay the amount loaned, but no later than five years after the date
of the loan.

(ii) Interest on the loan shall be paid from the California Bingo
Fund at the rate accruing to moneys in the Pooled Money
Investment Account.

(iii) The terms and conditions of the loan are approved, prior
to the transfer of funds, by the Department of Finance pursuant to
appropriate fiscal standards.

The commission may assess and collect reasonable fees and
deposits as necessary to defray the costs of regulation and
oversight.

begin delete

(r)

end delete

begin insert (q) end insert  The administrative, managerial, technical, financial, and
security personnel employed by an organization that conducts
remote caller bingo games shall apply for, obtain, and thereafter
maintain valid work permits, as defined in Section 19805 of the
Business and Professions Code.

begin delete

(s)

end delete

begin insert (r) end insert  An organization that conducts remote caller bingo games
shall retain records in connection with the remote caller bingo
game for five years.

begin delete

(t)

end delete

begin insert (s) end insert  (1) All equipment used for remote caller bingo shall be
approved in advance by the begin delete California Gambling Control
Commission end delete begin insert Department of Justice end insert pursuant to regulations adopted
pursuant to subdivision (r) of Section 19841 of the Business and
Professions Code.

(2) The begin delete California Gambling Control Commission end delete begin insert department end insert
shall monitor operation of the transmission and other equipment
used for remote caller bingo, and monitor the game.

begin delete

(u)

end delete

begin insert (t) end insert  (1) As used in this section, “remote caller bingo game”
means a game of bingo, as defined in subdivision (o) of Section
326.5, in which the numbers or symbols on randomly drawn plastic
balls are announced by a natural person present at the site at which
the live game is conducted, and the organization conducting the
bingo game uses audio and video technology to link any of its
in-state facilities for the purpose of transmitting the remote calling
of a live bingo game from a single location to multiple locations
owned, leased, or rented by that organization, or as described in
subdivision (o) of this section. The audio or video technology used
to link the facilities may include cable, Internet, satellite,
broadband, or telephone technology, or any other means of
electronic transmission that ensures the secure, accurate, and
simultaneous transmission of the announcement of numbers or
symbols in the game from the location at which the game is called
by a natural person to the remote location or locations at which
players may participate in the game. The drawing of each ball
bearing a number or symbol by the natural person calling the game
shall be visible to all players as the ball is drawn, including through
a simultaneous live video feed at remote locations at which players
may participate in the game.

(2) The caller in the live game must be licensed by the California
Gambling Control Commission. A game may be called by a
nonlicensed caller if the drawing of balls and calling of numbers
or symbols by that person is observed and personally supervised
by a licensed caller.

(3) Remote caller bingo games shall be played using traditional
paper or other tangible bingo cards and daubers, and shall not be
played by using electronic devices, except card-minding devices,
as described in paragraph (1) of subdivision (p) of Section 326.5.

(4) Prior to conducting a remote caller bingo game, the
organization that conducts remote caller bingo shall submit to the
begin delete commission end delete begin insert Department of Justice end insert the controls, methodology, and
standards of game play, which shall include, but not be limited to,
the equipment used to select bingo numbers and create or originate
cards, control or maintenance, distribution to participating
locations, and distribution to players. Those controls,
methodologies, and standards shall be subject to prior approval by
the begin delete commission, end delete begin insert department, end insert provided that the controls shall be
deemed approved by the begin delete commission end delete begin insert department end insert after 90 days
from the date of submission unless disapproved.

begin delete

(v)

end delete

begin insert (u) end insert  A location shall not be eligible to participate in a remote
caller bingo game if bingo games are conducted at that location
in violation of Section 326.5 or any regulation adopted by the
commission pursuant to Section 19841 of the Business and
Professions Code, including, but not limited to, a location at which
unlawful electronic devices are used.

begin delete

(w)

end delete

begin insert (v) end insert  (1) The vendor of the equipment used in a remote caller
bingo game shall have its books and records audited at least
annually by an independent California certified public accountant
and shall submit the results of that audit to the begin delete California Gambling
Control Commission end delete begin insert department end insert within 120 days after the close
of the vendor’s fiscal year. In addition, the begin delete California Gambling
Control Commission end delete begin insert department end insert may audit the books and records
of the vendor at any time.

(2) An authorized organization that conducts remote caller bingo
games shall provide copies of the records pertaining to those games
to the begin delete California Gambling Control Commission end delete begin insert department end insert within
30 days after the end of each calendar quarter. In addition, those
records shall be audited by an independent California certified
public accountant at least annually and copies of the audit reports
shall be provided to the begin delete California Gambling Control Commission end delete
begin insert department end insert within 120 days after the close of the organization’s
fiscal year. The audit report shall account for the annual amount
of fees paid to financial institutions for the use and processing of
credit card sales by the authorized organization and the amount of
fees for the use and processing of credit card sales redirected from
“overhead costs” and deducted from the amount of gross revenues
awarded for prizes.

(3) The costs of the licensing and audits required by this section
shall be borne by the person or entity required to be licensed or
audited. The audit shall enumerate the receipts for remote caller
bingo, the prizes disbursed, the overhead costs, and the amount
retained by the nonprofit organization. The begin delete commission end delete begin insert department end insert
may audit the books and records of an organization that conducts
remote caller bingo games at any time.

(4) If, during an audit, the begin delete commission end delete begin insert department end insert identifies
practices in violation of this section, the license for the audited
entity may be suspended pending review and hearing before the
commission for a final determination.

(5)  begin delete No end delete begin insert Any end insert audit required to be conducted by the begin delete commission end delete
begin insert department end insert shall begin insert not end insert commence before January 1, 2010.

begin delete

(x)

end delete

begin insert (w) end insert  (1) The provisions of this section are severable. If any
provision of this section or its application is held invalid, that
invalidity shall not affect other provisions or applications that can
be given effect without the invalid provision or application.

(2) Notwithstanding paragraph (1), if paragraph (1) or (3) of
subdivision (u), or the application of either of those provisions, is
held invalid, this entire section shall be invalid.

begin delete

(y)

end delete

begin insert (x) end insert  The commission shall submit a report to the Legislature, on
or before January 1, 2012, on the fundraising effectiveness and
regulation of remote caller bingo, and other matters that are relevant
to the public interest regarding remote caller bingo.

begin delete

(z)

end delete

begin insert (y) end insert  The following definitions apply for purposes of this section:

(1) “Commission” means the California Gambling Control
Commission.

begin insert

(2) “Department” means the Department of Justice.

end insert begin delete

(2)

end delete

begin insert (3) end insert  “Person” includes a natural person, corporation, limited
liability company, partnership, trust, joint venture, association, or
any other business organization.

begin insert

begin insert SEC. 115. end insert   

end insert

begin insert Section 326.5 of the end insert begin insert Penal Code end insert begin insert is amended to read: end insert

326.5.  

(a) Neither the prohibition on gambling in this chapter
nor in Chapter 10 (commencing with Section 330) applies to any
bingo game that is conducted in a city, county, or city and county
pursuant to an ordinance enacted under Section 19 of Article IV
of the State Constitution, if the ordinance allows games to be
conducted only in accordance with this section and only by
organizations exempted from the payment of the bank and
corporation tax by Sections 23701a, 23701b, 23701d, 23701e,
23701f, 23701g, 23701k, 23701w, and 23701l of the Revenue and
Taxation Code and by mobilehome park associations, senior
citizens organizations, and charitable organizations affiliated with
a school district; and if the receipts of those games are used only
for charitable purposes.

(b) It is a misdemeanor for any person to receive or pay a profit,
wage, or salary from any bingo game authorized by Section 19 of
Article IV of the State Constitution. Security personnel employed
by the organization conducting the bingo game may be paid from
the revenues of bingo games, as provided in subdivisions (j) and
(k).

(c) A violation of subdivision (b) shall be punishable by a fine
not to exceed ten thousand dollars ($10,000), which fine is
deposited in the general fund of the city, county, or city and county
that enacted the ordinance authorizing the bingo game. A violation
of any provision of this section, other than subdivision (b), is a
misdemeanor.

(d) The city, county, or city and county that enacted the
ordinance authorizing the bingo game may bring an action to enjoin
a violation of this section.

(e)  begin delete No minors end delete begin insert Minors end insert shall begin insert not end insert be allowed to participate in any
bingo game.

(f) An organization authorized to conduct bingo games pursuant
to subdivision (a) shall conduct a bingo game only on property
owned or leased by it, or property whose use is donated to the
organization, and which property is used by that organization for
an office or for performance of the purposes for which the
organization is organized. Nothing in this subdivision shall be
construed to require that the property owned or leased by, or whose
use is donated to, the organization be used or leased exclusively
by, or donated exclusively to, that organization.

(g) All bingo games shall be open to the public, not just to the
members of the authorized organization.

(h) A bingo game shall be operated and staffed only by members
of the authorized organization that organized it. Those members
shall not receive a profit, wage, or salary from any bingo game.
Only the organization authorized to conduct a bingo game shall
operate such a game, or participate in the promotion, supervision,
or any other phase of a bingo game. This subdivision does not
preclude the employment of security personnel who are not
members of the authorized organization at a bingo game by the
organization conducting the game.

(i)  begin delete No end delete begin insert Any end insert individual, corporation, partnership, or other legal
entity, except the organization authorized to conduct a bingo game,
shall begin insert not end insert hold a financial interest in the conduct of a bingo game.

(j) With respect to organizations exempt from payment of the
bank and corporation tax by Section 23701d of the Revenue and
Taxation Code, all profits derived from a bingo game shall be kept
in a special fund or account and shall not be commingled with any
other fund or account. Those profits shall be used only for
charitable purposes.

(k) With respect to other organizations authorized to conduct
bingo games pursuant to this section, all proceeds derived from a
bingo game shall be kept in a special fund or account and shall not
be commingled with any other fund or account. Proceeds are the
receipts of bingo games conducted by organizations not within
subdivision (j). Those proceeds shall be used only for charitable
purposes, except as follows:

(1) The proceeds may be used for prizes.

(2) (A) Except as provided in subparagraph (B), a portion of
the proceeds, not to exceed 20 percent of the proceeds before the
deduction for prizes, or two thousand dollars ($2,000) per month,
whichever is less, may be used for the rental of property and for
overhead, including the purchase of bingo equipment,
administrative expenses, security equipment, and security
personnel.

(B) For the purposes of bingo games conducted by the Lake
Elsinore Elks Lodge, a portion of the proceeds, not to exceed 20
percent of the proceeds before the deduction for prizes, or three
thousand dollars ($3,000) per month, whichever is less, may be
used for the rental of property and for overhead, including the
purchase of bingo equipment, administrative expenses, security
equipment, and security personnel. Any amount of the proceeds
that is additional to that permitted under subparagraph (A), up to
one thousand dollars ($1,000), shall be used for the purpose of
financing the rebuilding of the facility and the replacement of
equipment that was destroyed by fire in 2007. The exception to
subparagraph (A) that is provided by this subparagraph shall remain
in effect only until the cost of rebuilding the facility is repaid, or
January 1, 2019, whichever occurs first.

(3) The proceeds may be used to pay license fees.

(4) A city, county, or city and county that enacts an ordinance
permitting bingo games may specify in the ordinance that if the
monthly gross receipts from bingo games of an organization within
this subdivision exceed five thousand dollars ($5,000), a minimum
percentage of the proceeds shall be used only for charitable
purposes not relating to the conducting of bingo games and that
the balance shall be used for prizes, rental of property, overhead,
administrative expenses, and payment of license fees. The amount
of proceeds used for rental of property, overhead, and
administrative expenses is subject to the limitations specified in
paragraph (2).

(l) (1) A city, county, or city and county may impose a license
fee on each organization that it authorizes to conduct bingo games.
The fee, whether for the initial license or renewal, shall not exceed
fifty dollars ($50) annually, except as provided in paragraph (2).
If an application for a license is denied, one-half of any license
fee paid shall be refunded to the organization.

(2) In lieu of the license fee permitted under paragraph (1), a
city, county, or city and county may impose a license fee of fifty
dollars ($50) paid upon application. If an application for a license
is denied, one-half of the application fee shall be refunded to the
organization. An additional fee for law enforcement and public
safety costs incurred by the city, county, or city and county that
are directly related to bingo activities may be imposed and shall
be collected monthly by the city, county, or city and county issuing
the license; however, the fee shall not exceed the actual costs
incurred in providing the service.

(m)  begin delete No end delete begin insert A end insert person shall begin insert not end insert be allowed to participate in a bingo
game, unless the person is physically present at the time and place
where the bingo game is being conducted.

(n) The total value of prizes available to be awarded during the
conduct of any bingo games shall not exceed five hundred dollars
($500) in cash or kind, or both, for each separate game which is
held.

(o) As used in this section, “bingo” means a game of chance in
which prizes are awarded on the basis of designated numbers or
symbols that are marked or covered by the player on a tangible
card in the player’s possession and that conform to numbers or
symbols, selected at random and announced by a live caller.
Notwithstanding Section 330c, as used in this section, the game
of bingo includes tangible cards having numbers or symbols that
are concealed and preprinted in a manner providing for distribution
of prizes. Electronics or video displays shall not be used in
connection with the game of bingo, except in connection with the
caller’s drawing of numbers or symbols and the public display of
that drawing, and except as provided in subdivision (p). The
winning cards shall not be known prior to the game by any person
participating in the playing or operation of the bingo game. All
preprinted cards shall bear the legend, “for sale or use only in a
bingo game authorized under California law and pursuant to local
ordinance.” Only a covered or marked tangible card possessed by
a player and presented to an attendant may be used to claim a prize.
It is the intention of the Legislature that bingo as defined in this
subdivision applies exclusively to this section and shall not be
applied in the construction or enforcement of any other provision
of law.

(p) (1) Players who are physically present at a bingo game may
use hand-held, portable card-minding devices, as described in this
subdivision, to assist in monitoring the numbers or symbols
announced by a live caller as those numbers or symbols are called
in a live game. Card-minding devices may not be used in
connection with any game where a bingo card may be sold or
distributed after the start of the ball draw for that game. A
card-minding device shall do all of the following:

(A) Be capable of storing in the memory of the device bingo
faces of tangible cards purchased by a player.

(B) Provide a means for bingo players to input manually each
individual number or symbol announced by a live caller.

(C) Compare the numbers or symbols entered by the player to
the bingo faces previously stored in the memory of the device.

(D) Identify winning bingo patterns that exist on the stored
bingo faces.

(2) A card-minding device shall perform no functions involving
the play of the game other than those described in paragraph (1).
Card-minding devices shall not do any of the following:

(A) Be capable of accepting or dispensing any coins, currency,
or other representative of value or on which value has been
encoded.

(B) Be capable of monitoring any bingo card face other than
the faces of the tangible bingo card or cards purchased by the
player for that game.

(C) Display or represent the game result through any means,
including, but not limited to, video or mechanical reels or other
slot machine or casino game themes, other than highlighting the
winning numbers or symbols marked or covered on the tangible
bingo cards or giving an audio alert that the player’s card has a
prize-winning pattern.

(D) Determine the outcome of any game or be physically or
electronically connected to any component that determines the
outcome of a game or to any other bingo equipment, including,
but not limited to, the ball call station, or to any other card-minding
device. No other player-operated or player-activated electronic or
electromechanical device or equipment is permitted to be used in
connection with a bingo game.

(3) (A) A card-minding device shall be approved in advance
by the begin delete commission end delete begin insert department end insert as meeting the requirements of this
section and any additional requirements stated in regulations
adopted by the commission. Any proposed material change to the
device, including any change to the software used by the device,
shall be submitted to the begin delete commission end delete begin insert department end insert and approved
by the begin delete commission end delete begin insert department end insert prior to implementation.

(B) In accordance with Chapter 5 (commencing with Section
19800) of Division 8 of the Business and Professions Code, the
commission shall establish reasonable criteria for, and require the
licensure of, any person that directly or indirectly manufactures,
distributes, supplies, vends, leases, or otherwise provides
card-minding devices or other supplies, equipment, or services
related to card-minding devices designed for use in the playing of
bingo games by any nonprofit organization.

(C) A person or entity that supplies or services any card-minding
device shall meet all licensing requirements established by the
commission in regulations.

(4) The costs of any testing, certification, license, or
determination required by this subdivision shall be borne by the
person or entity seeking it.

(5) On and after January 1, 2010, the commission and the
Department of Justice may inspect all card-minding devices at any
time without notice, and may immediately prohibit the use of any
device that does not comply with the requirements begin delete of end delete begin insert made
pursuant to end insert subdivision (r) of Section 19841 of the Business and
Professions Code. The Department of Justice may at any time,
without notice, impound any device the use of which has been
prohibited by the commission.

(6) The begin delete California Gambling Control Commission end delete begin insert Department
of Justice end insert shall issue regulations to implement the requirements
of this begin delete subdivision end delete begin insert subdivision, end insert and begin insert the California Gambling
Control Commission end insert may issue regulations regarding the means
by which the operator of a bingo game, as required by applicable
law, may offer assistance to a player with disabilities in order to
enable that player to participate in a bingo game, provided that the
means of providing that assistance shall not be through any
electronic, electromechanical, or other device or equipment that
accepts the insertion of any coin, currency, token, credit card, or
other means of transmitting value, and does not constitute or is
not a part of a system that constitutes a video lottery terminal, slot
machine, or device prohibited by Chapter 10 (commencing with
Section 330).

(7) The following definitions apply for purposes of this
subdivision:

(A) “Commission” means the California Gambling Control
Commission.

begin insert

(B) “Department” means the Department of Justice.

end insert begin delete

(B)

end delete

begin insert (C) end insert  “Person” includes a natural person, corporation, limited
liability company, partnership, trust, joint venture, association, or
any other business organization.

begin insert

begin insert SEC. 116. end insert   

end insert

begin insert Section 25464 of the end insert begin insert Public Resources Code end insert begin insert is
amended to read: end insert

25464.  

(a) For purposes of this section, the following
definitions apply:

(1) “Fund” means the Clean and Renewable Energy Business
Financing Revolving Loan Fund.

(2) “Program” means the Clean and Renewable Energy Business
Financing Revolving Loan Program.

(b) (1) The commission may use federal funds available
pursuant to this chapter to implement the Clean and Renewable
Energy Business Financing Revolving Loan Program to provide
low interest loans to California clean and renewable energy
manufacturing businesses.

(2) The commission may use other funding sources to leverage
loans awarded under the program.

(c) The commission may work directly with the begin delete Business,
Transportation end delete begin insert Governor’s Office of Business end insert and begin delete Housing Agency, end delete
begin insert Economic Development, end insert the Treasurer, or any other state agency,
board, commission, or authority to implement and administer the
program, and may contract for private services as needed to
implement the program.

(d) The commission may collect an application fee from
applicants applying for funding under the program to help offset
the costs of administering the program.

(e) (1) The Clean and Renewable Energy Business Financing
Revolving Loan Fund is hereby established in the State Treasury
to implement the program. The commission is authorized to
administer the fund for this purpose. Notwithstanding Section
13340 of the Government Code, the money in the fund is
continuously appropriated to the commission, without regard to
fiscal years, to implement the program.

(2) Upon direction by the commission, the Controller shall create
any accounts or subaccounts within the fund that the commission
determines are necessary to facilitate management of the fund.

(3) The Controller shall disburse and receive moneys in the fund
for purposes of the program and as authorized by the commission.

(4) All loans and repayments of loans made pursuant to this
section, including interest payments, penalty payments, and all
interest earning on or accruing to any moneys in the fund, shall be
deposited in the fund and shall be available for the purposes of
this section.

(5) The commission may expend up to 5 percent of moneys in
the fund for its administrative costs to implement the program.

(f) Federal funds available to the commission pursuant to this
chapter shall be transferred to the fund in the loan amounts when
loans are awarded under the program by the commission.

begin insert

begin insert SEC. 117. end insert   

end insert

begin insert Section 41136 of the end insert begin insert Revenue and Taxation Code end insert
begin insert is amended to read: end insert

41136.  

begin delete Funds end delete begin insert From the funds end insert in the State Emergency
Telephone Number Account begin insert , a minimum of one-half of 1 percent
of the charges for intrastate telephone communications and VoIP
service to which the surcharge applies end insert shall, when appropriated
by the Legislature, be spent solely for the following purposes:

begin delete

(a) A minimum of one-half of 1 percent of the charges for
intrastate telephone communications services and VoIP service to
which the surcharge applies, as follows:

end delete begin delete

(1)

end delete

begin insert (a) end insert  To pay refunds authorized by this part.

begin delete

(2)

end delete

begin insert (b) end insert  To pay the State Board of Equalization for the cost of the
administration of this part.

begin delete

(3)

end delete

begin insert (c) end insert  To pay the begin delete office end delete begin insert Department end insert of begin delete the State Chief Information
Officer end delete begin insert Technology end insert for its costs in administration of the “911”
emergency telephone number system.

begin delete

(4)

end delete

begin insert (d) end insert  To pay bills submitted to the begin delete office end delete begin insert Department end insert of begin delete the State
Chief Information Officer end delete begin insert Technology end insert by service suppliers or
communications equipment companies for the installation of, and
ongoing expenses for, the following communications services
supplied to local agencies in connection with the “911” emergency
phone number system:

begin delete

(A)

end delete

begin insert (1) end insert  A basic system.

begin delete

(B)

end delete

begin insert (2) end insert  A basic system with telephone central office identification.

begin delete

(C)

end delete

begin insert (3) end insert  A system employing automatic call routing.

begin delete

(D)

end delete

begin insert (4) end insert  Approved incremental costs.

begin delete

(5)

end delete

begin insert (e) end insert  To pay claims of local agencies for approved incremental
costs, not previously compensated for by another governmental
agency.

begin delete

(6)

end delete

begin insert (f) end insert  To pay claims of local agencies for incremental costs and
amounts, not previously compensated for by another governmental
agency, incurred prior to the effective date of this part, for the
installation and ongoing expenses for the following communication
services supplied in connection with the “911” emergency
telephone number system:

begin delete

(A)

end delete

begin insert (1) end insert  A basic system.

begin delete

(B)

end delete

begin insert (2) end insert  A basic system with telephone central office identification.

begin delete

(C)

end delete

begin insert (3) end insert  A system employing automatic call routing.

begin delete

(D)

end delete

begin insert (4) end insert  Approved incremental costs. Incremental costs shall not be
allowed unless the costs are concurred in by the begin delete office end delete begin insert Department end insert
of begin delete the State Chief Information Officer. end delete begin insert Technology. end insert

begin delete

(b) (1) For the purposes of paragraph (5) of subdivision (a), the
term incremental costs shall include a maximum of one-quarter of
1 percent of the charges for intrastate telephone communications
services and VoIP service to which the surcharge applies for a
one-time payment to Primary Public Safety Answering Points for
the cost necessary to recruit and train additional personnel
necessary to accept wireless enhanced “911” calls from within
their jurisdiction routed directly to their call centers.

end delete begin delete

(2) Funds allocated pursuant to this subdivision shall
supplement, and not supplant, existing funding for these services.

end delete begin delete

(3) This subdivision shall remain in effect only until December
31, 2011.

end delete

begin insert

begin insert SEC. 118. end insert   

end insert

begin insert Section 335 of the end insert begin insert Unemployment Insurance Code end insert
begin insert is amended to read: end insert

335.  

The department, in consultation and coordination with
the film and movie industry, the begin delete Business, Transportation end delete
begin insert Governor’s Office of Business end insert and begin delete Housing Agency, end delete begin insert Economic
Development, end insert and the California Film Commission shall do all of
the following, contingent upon the appropriation of funds in the
annual Budget Act for these specified purposes:

(a) Research and maintain data on the employment and output
of the film industry, including full-time, part-time, contract, and
short duration or single event employees.

(b) Examine the ethnic diversity and representation of minorities
in the entertainment industry.

(c) Determine the overall direct and indirect economic impact
of the film industry.

(d) Monitor film industry employment and activity in other
states and countries that compete with California for film
production.

(e) Review the effect that federal and state laws and local
ordinances have on the filmed entertainment industry.

(f) Prepare and release biannually a report to the chairpersons
of the appropriate Senate and Assembly policy committees that
details the information required by this section.

begin insert

begin insert SEC. 119. end insert   

end insert

begin insert Section 10200 of the end insert begin insert Unemployment Insurance Code end insert
begin insert is amended to read: end insert

10200.  

The Legislature finds and declares the following:

(a) California’s economy is being challenged by competition
from other states and overseas. In order to meet this challenge,
California’s employers, workers, labor organizations, and
government need to invest in a skilled and productive workforce,
and in developing the skills of frontline workers. For purposes of
this section, “frontline worker” means a worker who directly
produces or delivers goods or services.

The purpose of this chapter is to establish a strategically designed
employment training program to promote a healthy labor market
in a growing, competitive economy that shall fund only projects
that meet the following criteria:

(1) Foster creation of high-wage, high-skilled jobs, or foster
retention of high-wage, high-skilled jobs in manufacturing and
other industries that are threatened by out-of-state and global
competition, including, but not limited to, those industries in which
targeted training resources for California’s small and medium-sized
business suppliers will increase the state’s competitiveness to
secure federal, private sector, and other nonstate funds. In addition,
provide for retraining contracts in companies that make a monetary
or in-kind contribution to the funded training enhancements.

(2) Encourage industry-based investment in human resources
development that promotes the competitiveness of California
industry through productivity and product quality enhancements.

(3) Result in secure jobs for those who successfully complete
training. All training shall be customized to the specific
requirements of one or more employers or a discrete industry and
shall include general skills that trainees can use in the future.

(4) Supplement, rather than displace, funds available through
existing programs conducted by employers and government-funded
training programs, such as the Workforce Investment Act of 1998
(29 U.S.C. Sec. 2801 et seq.), the Carl D. Perkins Vocational
Education Act begin delete (P.L. end delete begin insert (Public Law end insert 98-524), CalWORKs (Chapter
2 (commencing with Section 11200) of Part 3 of Division 9 of the
Welfare and Institutions Code), the Enterprise Zone Act (Chapter
12.8 (commencing with Section 7070) of Division 7 of Title 1 of
the Government Code), and the McKinney-Vento Homeless
Assistance Act (42 U.S.C. Sec. 11301 et seq.), the California
Community Colleges Economic Development Program, or
apportionment funds allocated to the community colleges, regional
occupational centers and programs, or other local educational
agencies. In addition, it is further the intention of the Legislature
that programs developed pursuant to this chapter shall not replace,
parallel, supplant, compete with, or duplicate in any way already
existing approved apprenticeship programs.

(b) The Employment Training Panel, in funding projects that
meet the requirements of subdivision (a), shall give funding priority
to those projects that best meet the following goals:

(1) Result in the growth of the California economy by
stimulating exports from the state and the production of goods and
services that would otherwise be imported from outside the state.

(2) Train new employees of firms locating or expanding in the
state that provide high-skilled, high-wage jobs and are committed
to an ongoing investment in the training of frontline workers.

(3) Develop workers with skills that prepare them for the
challenges of a high performance workplace of the future.

(4) Train workers who have been displaced, have received
notification of impending layoff, or are subject to displacement,
because of a plant closure, workforce reduction, changes in
technology, or significantly increasing levels of international and
out-of-state competition.

(5) Are jointly developed by business management and worker
representatives.

(6) Develop career ladders for workers.

(7) Promote the retention and expansion of the state’s
manufacturing workforce.

(c) The program established through this chapter is to be
coordinated with all existing employment training programs and
economic development programs, including, but not limited to,
programs such as the Workforce Investment Act of 1998 (29 U.S.C.
Sec. 2801 et seq.), the California Community Colleges, the regional
occupational programs, vocational education programs, joint
labor-management training programs, and related programs under
the Employment Development Department and the begin insert Governor’s
Office of Business and Economic Development, and the end insert Business,
begin delete Transportation end delete begin insert Consumer Services, end insert and Housing Agency.

begin insert

begin insert SEC. 120. end insert   

end insert

begin insert Section 10202.5 of the end insert begin insert Unemployment Insurance
Code end insert begin insert is amended to read: end insert

10202.5.  

(a) The panel shall consist of eight persons, seven
of whom shall be appointed as provided in subdivision (b), and
shall have experience and a demonstrated interest in business
management and employment relations. The begin delete Secretary end delete begin insert Director end insert
of begin delete Business, Transportation end delete begin insert the Governor’s Office of Business end insert and
begin delete Housing, end delete begin insert Economic Development, end insert or his or her designee, shall also
serve on the panel as an ex officio, voting member.

(b) (1) Two members of the panel shall be appointed by the
Speaker of the Assembly. One of those members shall be a private
sector labor representative and the other member shall be a business
representative.

(2) Two members of the panel shall be appointed by the
President pro Tempore of the Senate. One of those members shall
be a private sector labor representative and the other member shall
be a business representative.

(3) Three members of the panel shall be appointed by the
Governor. One of those members shall be a private sector labor
representative, one member shall be a business representative, and
one member shall be a public member.

(4) Labor appointments shall be made from nominations from
state labor federations. Business appointments shall be made from
nominations from state business organizations and business trade
associations.

(5) The Governor shall designate a member to chair the panel,
and the person so designated shall serve as the chair of the panel
at the pleasure of the Governor.

(c) The appointive members of the panel shall serve for two-year
terms.

(d) Appointive members of the panel shall receive the necessary
traveling and other expenses incurred by them in the performance
of their official duties out of appropriations made for the support
of the panel. In addition, each appointive member of the panel
shall receive one hundred dollars ($100) for each day attending
meetings of the panel, and may receive one hundred dollars ($100)
for each day spent conducting other official business of the panel,
but not exceeding a maximum of three hundred dollars ($300) per
month.

begin insert

begin insert SEC. 121. end insert   

end insert

begin insert Section 15002 of the end insert begin insert Unemployment Insurance Code end insert
begin insert is amended to read: end insert

15002.  

(a) The California Workforce Investment Board
(CWIB) shall establish a special committee known as the Green
Collar Jobs Council (GCJC), comprised of the appropriate
representatives from the CWIB existing membership, including
the K-12 representative, the California Community Colleges
representative, the begin delete Business, Transportation end delete begin insert Governor’s Office of
Business end insert and begin delete Housing Agency end delete begin insert Economic Development end insert
representative, the Employment Development Department
representative, and other appropriate members. The GCJC may
consult with other state agencies, other higher education
representatives, local workforce investment boards, and industry
representatives as well as philanthropic, nongovernmental, and
environmental groups, as appropriate, in the development of a
strategic initiative. To the extent private funds are available, is the
intent of the Legislature that the GCJC will develop an annual
award for outstanding achievement for workforce training programs
operated by local or state agencies, businesses, or nongovernment
organizations to be named after Parrish R. Collins.

(b) As part of the strategic initiative, the GCJC shall focus on
developing the framework, funding, strategies, programs, policies,
partnerships, and opportunities necessary to address the growing
need for a highly skilled and well-trained workforce to meet the
needs of California’s emerging green economy. The GCJC shall
do all of the following:

(1) Assist in identifying and linking green collar job
opportunities with workforce development training opportunities
in local workforce investment areas (LWIAs), encouraging regional
collaboration among LWIAs to meet regional economic demands.

(2) Align workforce development activities with regional
economic recovery and growth strategies.

(3) Develop public, private, philanthropic, and nongovernmental
partnerships to build and expand the state’s workforce development
programs, network, and infrastructure.

(4) Provide policy guidance for job training programs for the
clean and green technology sectors to help them prepare specific
populations, such as at-risk youth, displaced workers, veterans,
formerly incarcerated individuals, and others facing barriers to
employment.

(5) Develop, collect, analyze, and distribute statewide and
regional labor market data on California’s new and emerging green
industries workforce needs, trends, and job growth.

(6) Collaborate with community colleges and other educational
institutions, registered apprenticeship programs, business and labor
organizations, and community-based and philanthropic
organizations to align workforce development services with
strategies for regional economic growth.

(7) Identify funding resources and make recommendations on
how to expand and leverage these funds.

(8) Foster regional collaboratives in the green economic sector.

(c) The CWIB may accept any revenues, moneys, grants, goods,
or services from federal and state entities, philanthropic
organizations, and other sources, to be used for purposes relating
to the administration and implementation of the strategic initiative,
as described in subdivision (b). The CWIB shall also ensure the
highest level of transparency and accountability and make
information available on the CWIB Internet Web site.

(d) Upon appropriation by the Legislature, the department may
expend the moneys and revenues received pursuant to subdivision
(c) for purposes related to the administration and implementation
of the strategic initiative, and for the award of workforce training
grants implementing the strategic initiative.

begin insert

begin insert SEC. 122. end insert   

end insert begin insert

This act shall become operative on July 1, 2013,
except that Section 7 of this act, amending Section 5405 of the
Civil Code, shall become operative on January 1, 2014.

end insert

begin insert

begin insert SEC. 123. end insert   

end insert begin insert

This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

end insert begin insert

To allow programmatic changes in statute to be operative at the
same time the Governor’s Reorganization Plan No. 2 of 2012
becomes operative, it is necessary that this act take effect
immediately.

end insert

begin delete

SECTION 1.  

It is the intent of the Legislature to enact
legislation to make conforming programmatic changes to
implement the provisions of the Governor’s Reorganization Plan
No. 2 of 2012.

end delete