BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW 
                              Senator Mark Leno, Chair
                                2015 - 2016 Regular 

          Bill No:            AB 1609         Hearing Date:    June 15,  
          2016
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          |Author:   |Committee on Budget                                   |
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          |Version:  |June 13, 2016    As amended                           |
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          |Urgency:  |No                     |Fiscal:    |Yes              |
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          |Consultant|Farra Bracht / Mark Ibele / Samantha Lui              |
          |:         |                                                      |
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                            Subject:  General Government


          Summary: This measure makes various statutory changes necessary to  
          implement the state administration-related provisions of the  
          Budget Act of 2016.
          
          Background:  As part of the 2015-16 budget package, Assembly Bill 1609  
          makes various statutory changes to implement the budget act.

          Proposed  
          Law:  AB 1609 makes the following statutory changes to implement the  
           2016 -17 budget:
          
           Housing  
          
          1.Allows the California Housing Finance Agency to (1) replace  
            the Director of Insurance position with a Director of  
            Enterprise Risk Management and Compliance and (2) to require  
            the annual audit of the California Housing Loan Insurance Fund  
            to be based on agreed upon procedures.

          2.Gives the Department of Housing and Community Development the  
            authority to issue one grant to Habitat for Humanity of  
            California. In turn, Habitat for Humanity will administer a  
            competitive project-specific grant process to eligible local  
            Habitat affiliates throughout the state.

          3.Combines remaining funding from multiple down payment  







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            assistance programs into the MyHOME program for the purpose of  
            making home purchases more affordable to low and  
            moderate0income Californians for owner-occupied homes, with a  
            priority for first-time homebuyers.

          4.Establishes the California Emergency Solutions Grant Program  
            until July 1, 2020 to provide grants through a formula process  
            for permanent housing solutions for people experiencing a  
            housing crisis or homelessness, or both, and to engage and to  
            shelter individuals and families while in the crisis of  
            homelessness.

          5.Establishes the Community-Based Transitional Housing Program,  
            administered by the Department of Finance, for persons who  
            have been released form state prison or county jail after  
            serving a sentence for one or more felony or misdemeanor  
            convictions. The program provides grants of up to $2 million  
            to cities and counties that facilitate such housing, with a  
            total of $25 million available for grants in 2016-17.

          6.Establishes the California Seismic Safety Capital Access Loan  
            Program, which provides a loan loss reserve facility to cover  
            losses on qualified loans to participating lenders for loans  
            made to residential and small business owners for seismic  
            retrofit construction. The program is established in State  
            Treasurer's Office and is funded at $10 million for 2016-17.

           Tax Credits
           
          1.Allows until 2020 the sale of the low-income housing tax  
            credits (LIHTC) allocated by the California Tax Credit  
            Allocation Committee, under certain conditions, thus  
            increasing the efficiency of these tax credits available under  
            the personal income tax, corporation tax and insurance tax.  
            The provision reduces the increased federal tax liability that  
            otherwise is associated with reduced state tax liabilities  
            resulting from the credits.

          2.Extends California's current tax credit for farm donations to  
            food banks from 2017 to 2022, increases the credit amount from  
            10 percent to 15 percent, and changes the basis on which the  
            credit is allowed from inventory cost to the weighted average  
            wholesale cost of the donated item.
           








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          Department of Consumer Affairs  . 

          1.Authorizes the State Board of Optometry to issue a citation,  
            not to exceed $50,000 per investigation, and subject to  
            specified factors, to an optical company, an optometrist, or a  
            registered dispensing optician for violating existing law.  

           Medical Cannabis Regulation Safety Act
           
          1.Requires additional conditions of licensures, such as proof of  
            bond to cover the cost of destroying product.

          2.Establishes a filing deadline for individuals to submit an  
            application for licensure.

          3.Authorizes the Board of Equalization, for purposes of taxation  
            and regulation, to have access to the Department of Food and  
            Agriculture's track and trace electronic database.

          4.Provides the Department of Public Health (DPH) cite and fine  
            authority and the authority for mandatory recalls. Shifts  
            authority to license laboratories from the DPH to the Bureau  
            of Medical Cannabis Regulation.

          5.Excludes a cannabis manufacturer, who infuses butter with  
            cannabis, from having to be licensed as a milk product plant.

          6.Requires the State Water Resources Control Board, in  
            consultation with the Department of Fish and Wildlife, to  
            adopt principles and guidelines for diversion and use of water  
            for cannabis cultivation in areas where cannabis cultivation  
            may have the potential to substantially affect instream flows.  
            The principles and guidelines may include, among others:  
            instream flow objectives, limits on diversions, and  
            requirements for screening of diversions and elimination of  
            barriers to fish passage. The principles and guidelines may  
            also include requirements that apply to groundwater  
            extractions where the board determines those requirements are  
            reasonably necessary for purposes of this section. 

          7.Requires annual filings of statements of diversion and use to  
            report the amount of water used for cannabis cultivation.

          8.Authorizes the State Water Resources Control Board to issue  








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            cease and desist orders for any diversion or use of water for  
            cannabis cultivation if:

               a.     A cannabis cultivation license is required but has  
                 not been obtained.
               b.     The diversion in not in compliance with an  
                 applicable limitation or requirement established by the  
                 board or the Department of Fish and Wildlife.
               c.     The diversion is not in compliance with any relevant  
                 mitigation requirements the Department of Food and  
                 Agriculture imposes as part of its approval of the final  
                 environmental documentation for the cannabis cultivation  
                 licensing program.

          9.Authorizes a licensing authority to promulgate regulations,  
            including emergency regulations.

           Secretary of State  

          1.Clarifies that in the instance when an individual's  
            registration does not show a party preference, the county  
            elections official must designate the individual's party  
            preference as "unknown," and the individual must be treated as  
            a "no party preference" voter.


          Fiscal  
          Effect:  The funding related to the changes in this bill is contained  
          in the 2016-17 budget. In addition, the bill provides for  
          continuous appropriation of funds in the California Seismic  
          Safety Capital Access Loan Program.
          
          Support:   None on file.
          
          Opposed:  None on file. 
          

          
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