BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1230|
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THIRD READING
Bill No: AB 1230
Author: Gomez (D)
Amended: 6/30/15 in Senate
Vote: 27
SENATE BUS, PROF. & ECON. DEV. COMMITTEE: 9-0, 7/6/15
AYES: Hill, Bates, Berryhill, Block, Galgiani, Hernandez,
Jackson, Mendoza, Wieckowski
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/27/15
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
ASSEMBLY FLOOR: 77-1, 6/2/15 - See last page for vote
SUBJECT: California Americans With Disabilities Small
Business Capital Access Loan Program
SOURCE: Author
DIGEST: This bill establishes the California Americans With
Disabilities Act Small Business Capital Access Loan Program
within the California Capital Access Loan Program in order to
create a self-sustaining program to provide loans to assist
small businesses in financing the costs of projects that alter
or retrofit existing small business facilities according to
certain criteria, to comply with the federal Americans with
Disabilities Act.
ANALYSIS:
Existing law:
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1)Provides, pursuant to federal law, under the Americans with
Disabilities Act (ADA), that no individual shall be
discriminated against on the basis of disability in the full
and equal enjoyment of the goods, services, facilities,
privileges, advantages, or accommodations of any place of
public accommodation by any person who owns, leases, or leases
to, or operates a place of public accommodation. (42 U.S.C.
Sec. 12182.)
2)Provides, under the Unruh Civil Rights Act (Unruh Act), that
all persons, regardless of sex, race, color, religion,
ancestry, national origin, disability or medical condition,
are entitled to the full and equal accommodations, advantages,
facilities, privileges, or services in all business
establishments of every kind whatsoever. (Civil Code (Civ) §
51 et seq.)
3)Establishes the California Commission on Disability Access
(Commission), an independent state agency composed of 19
members, with general responsibility for monitoring disability
access compliance in California, and with authority to make
recommendations to the Legislature for necessary changes in
order to facilitate implementation of state and federal laws
on disability access. Makes it a priority for the Commission
to provide educational resources to promote and facilitate
disability access compliance. (Government Code § 8299 et
seq.)
4)Establishes the California Pollution Control Financing
Authority Act (CPCFA Act) with the purpose of providing
industry within the state, irrespective of company size, with
an alternative method of financing in providing, acquiring,
enlarging, or installing facilities for establishing pollution
control, providing supplies of clean water, and producing
energy from alternative or renewable sources, that are needed
to accomplish the purposes of this division; to assist
economically distressed counties and cities to develop and
implement growth policies and programs that reduce pollution
hazards and the degradation of the environment or promote
infill development and; to assist with the financing of the
costs of assessment, remedial planning and reporting,
technical assistance, and the cleanup, remediation, or
development of brownfield sites, or other similar or related
costs. (Health and Safety Code (HSC) § 44502)
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5)Establishes the Capital Access Loan Program for Small
Businesses (CalCAP) which encourages banks and other financial
institutions to make loans to small businesses that have
difficulty obtaining financing. (HSC §§ 44559 - 44559.12)
This bill:
1)States legislative intent to create and fund the California
Americans With Disabilities Act Small Business Capital Access
Loan Program (Small Business ADA Program) to assist small
businesses in complying with the ADA. Specifies that it is
not the intent of the Legislature to assist the physical
expansion of small businesses that includes modifications that
comply with the ADA. Requires the Small Business ADA Program
to be administered by the CPCFA and follow the terms and
conditions for the CalCAP.
2)Establishes the Small Business ADA Program Fund (Fund) in the
State Treasury to be administered by CPCFA and provides a
continuous appropriation for carrying out the purposes of this
section.
3)Transfers $50 million from the General Fund (GF) to the Small
Business ADA Program Fund for the purposes of funding loss
reserve accounts and administering Small Business ADA Program.
Background
CPCFA administers the CalCAP which insures loans made by
participating financial institutions to small businesses.
CalCAP is a form of loan portfolio insurance which may provide
up to 100 percent coverage on certain loan defaults. Each
lender is entirely liable for its loan losses; however, those
losses can be reimbursed from each lender's loan loss reserve
account. The loss reserve accounts are built through
contributions made by the borrower, lender, and CPCFA.
Historically, CalCAP was funded from small business assistance
fees collected from its bond issuance, but the Legislature
appropriated $6 million from the GF to the program in 2010. In
recent years, CalCAP has grown significantly due to federal
funding: CPCFA received $27.8 million in 2011, the same amount
again in 2013, and expects a third transfer of the same amount
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in 2015. In 2014, CalCAP recruited 10 new lenders to
participate in the various programs, and 43 lenders enrolled
loans. CalCAP lenders enrolled 3,491 loans totaling $247
million in 2014, an increase of about eight percent in the
number of loans and 20 percent in the amount of money loaned
compared with 2013.
Multiple legislative efforts have been pursued over the years
aimed at encouraging compliance with ADA but also curbing
frivolous ADA lawsuits. The author states that more than 40
percent of the nation's ADA cases are filed in California and
often, these lawsuits are filed by a handful of attorneys,
usually in limited jurisdiction, seeking only statutory penalty
damages, as opposed to injunctive or remedial relief centered on
securing substantial public value for the disability community.
According to the author, this type of predatory litigation
arguably weakens the rights of the disabled community by
compelling small businesses to spend more money on legal fees
and costs than on improving their establishments to improve
accessibility. The author states that this bill is not intended
to provide loans for small businesses to pay for legal fees or
settlements to ADA complaints but rather the goal is to assist
the small business with paying for changes to existing
facilities in order to be compliant with ADA. The author notes
that the $50 million from the GF is designed to serve as seed
money for the Small Business ADA Program, which is meant to be
self-sustaining.
FISCAL EFFECT: Appropriation: Yes Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee, this bill will
result in a one-time GF appropriation of $50 million and
administrative costs to CPCFA of $376,000 from special funds.
SUPPORT: (Verified8/28/15)
State Treasurer John Chiang
California Citizens Against Lawsuit Abuse
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California Small Business Association
City of Thousand Oaks
Civil Justice Association of California
Consumer Attorneys of California
Disability Rights California
National Federation of Independent Business
Orange County Business Council
State Farm
OPPOSITION: (Verified8/28/15)
None received
ARGUMENTS IN SUPPORT: Supporters note that by helping small
businesses afford the costs for changes to buildings to comply
with the ADA that they may otherwise not be able to, this bill
helps reduce the inevitable litigation that can cripple small
businesses. Supporters believe that this bill provides a
critical source of funding to assist small businesses stay in
operation and also provide access to the goods and services they
offer to senior and disabled patrons.
ASSEMBLY FLOOR: 77-1, 6/2/15
AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,
Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd,
Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Grove, Harper, Roger Hernández, Holden, Irwin, Jones,
Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,
Maienschein, Mathis, Mayes, McCarty, Medina, Mullin, Nazarian,
Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon,
Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark
Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,
Wood, Atkins
NOES: Hadley
NO VOTE RECORDED: Chávez, Melendez
Prepared by:Sarah Mason / B., P. & E.D. / (916) 651-4104
8/30/15 19:27:43
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