California Legislature—2015–16 Regular Session

Assembly Bill No. 2319

Introduced by Assembly Member Gordon

February 18, 2016

An act to amend Sections 63010, 63041.5, and 63049.64 of the Government Code, and to amend Section 31070.5 of the Streets and Highways Code, relating to state government.

LEGISLATIVE COUNSEL’S DIGEST

AB 2319, as introduced, Gordon. California Infrastructure and Economic Development Bank.

The Bergeson-Peace Infrastructure and Economic Development Bank Act authorizes the California Infrastructure and Economic Development Bank, governed by a board of directors, to, among other things, make loans, issue bonds, and provide other financial assistance for various types of infrastructure and economic development projects. The act defines terms for its purposes and establishes the California Infrastructure and Economic Development Bank Fund, a continuously appropriated fund, for support of the bank.

This bill would expand the authority of the bank by adding affordable housing, as defined, to the types of projects to which the bank is authorized to provide financial assistance. By expanding the banks’s authority to expend funds in a continuously appropriated fund, the bill would make an appropriation. This bill would also make conforming, nonsubstantive changes to cross-references to this provision.

Vote: ²⁄₃. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

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

SECTION 1.  

Section 63010 of the Government Code is
amended to read:

63010.  

For purposes of this division, the following words and
terms shall have the following meanings unless the context clearly
indicates or requires another or different meaning or intent:

(a) “Act” means the Bergeson-Peace Infrastructure and
Economic Development Bank Act.

begin insert

(b) “Affordable housing” means a dwelling available for
purchase or lease by persons and families who qualify as low- or
moderate-income, as defined in Section 50093 of the Health and
Safety Code, very low income households, as defined in Section
50105 of the Health and Safety Code, or extremely low income
households, as defined in Section 50106 of the Health and Safety
Code.

end insert begin delete

(b)

end delete

begin insert (c) end insert  “Bank” means the California Infrastructure and Economic
Development Bank.

begin delete

(c)

end delete

begin insert (d) end insert  “Board” or “bank board” means the Board of Directors of
the California Infrastructure and Economic Development Bank.

begin delete

(d)

end delete

begin insert (e) end insert  “Bond purchase agreement” means a contractual agreement
executed between the bank and a sponsor, or a special purpose
trust authorized by the bank or a sponsor, or both, whereby the
bank or special purpose trust authorized by the bank agrees to
purchase bonds of the sponsor for retention or sale.

begin delete

(e)

end delete

begin insert (f) end insert  “Bonds” means bonds, including structured, senior, and
subordinated bonds or other securities; loans; notes, including
bond, revenue, tax, or grant anticipation notes; commercial paper;
floating rate and variable maturity securities; and any other
evidences of indebtedness or ownership, including certificates of
participation or beneficial interest, asset backed certificates, or
lease-purchase or installment purchase agreements, whether taxable
or excludable from gross income for federal income taxation
purposes.

begin delete

(f)

end delete

begin insert (g) end insert  “Cost,” as applied to a project or portion thereof financed
under this division, means all or any part of the cost of construction,
renovation, and acquisition of all lands, structures, real or personal
property, rights, rights-of-way, franchises, licenses, easements,
and interests acquired or used for a project; the cost of demolishing
or removing any buildings or structures on land so acquired,
including the cost of acquiring any lands to which the buildings
or structures may be moved; the cost of all machinery, equipment,
and financing charges; interest prior to, during, and for a period
after completion of construction, renovation, or acquisition, as
determined by the bank; provisions for working capital; reserves
for principal and interest and for extensions, enlargements,
additions, replacements, renovations, and improvements; and the
cost of architectural, engineering, financial and legal services,
plans, specifications, estimates, administrative expenses, and other
expenses necessary or incidental to determining the feasibility of
any project or incidental to the construction, acquisition, or
financing of any project, and transition costs in the case of an
electrical corporation.

begin delete

(g)

end delete

begin insert (h) end insert  “Economic development facilities” means real and personal
property, structures, buildings, equipment, and supporting
components thereof that are used to provide industrial, recreational,
research, commercial, utility, goods movement, or service
enterprise facilities, community, educational, cultural, or social
welfare facilities and any parts or combinations thereof, and all
facilities or infrastructure necessary or desirable in connection
therewith, including provision for working begin delete capital, but shall not
include any housing. end delete begin insert capital. end insert

begin delete

(h)

end delete

begin insert (i) end insert  “Electrical corporation” has the meaning set forth in Section
218 of the Public Utilities Code.

begin delete

(i)

end delete

begin insert (j) end insert  “Executive director” means the Executive Director of the
California Infrastructure and Economic Development Bank
appointed pursuant to Section 63021.

begin delete

(j)

end delete

begin insert (k) end insert  “Financial assistance” in connection with a project, includes,
but is not limited to, any combination of grants, loans, the proceeds
of bonds issued by the bank or special purpose trust, insurance,
guarantees or other credit enhancements or liquidity facilities, and
contributions of money, property, labor, or other things of value,
as may be approved by resolution of the board or the sponsor, or
both; the purchase or retention of bank bonds, the bonds of a
sponsor for their retention or for sale by the bank, or the issuance
of bank bonds or the bonds of a special purpose trust used to fund
the cost of a project for which a sponsor is directly or indirectly
liable, including, but not limited to, bonds, the security for which
is provided in whole or in part pursuant to the powers granted by
Section 63025.1; bonds for which the bank has provided a
guarantee or enhancement, including, but not limited to, the
purchase of the subordinated bonds of the sponsor, the subordinated
bonds of a special purpose trust, or the retention of the subordinated
bonds of the bank pursuant to Chapter 4 (commencing with Section
63060); or any other type of assistance deemed appropriate by the
bank or the sponsor, except that no direct loans shall be made to
nonpublic entities other than in connection with the issuance of
rate reduction bonds pursuant to a financing order or in connection
with a financing for an economic development facility.

For purposes of this subdivision, “grant” does not include grants
made by the bank except when acting as an agent or intermediary
for the distribution or packaging of financing available from
federal, private, or other public sources.

begin delete

(k)

end delete

begin insert ( end insert begin insert l end insert begin insert ) end insert  “Financing order” has the meaning set forth in Section 840
of the Public Utilities Code.

begin delete

(l) 

end delete

begin insert (m) end insert begin insert   end insert “Guarantee trust fund” means the California Infrastructure
Guarantee Trust Fund.

begin delete

(m)

end delete

begin insert (n) end insert  “Infrastructure bank fund” means the California
Infrastructure and Economic Development Bank Fund.

begin delete

(n)

end delete

begin insert (o) end insert  “Loan agreement” means a contractual agreement executed
between the bank or a special purpose trust and a sponsor that
provides that the bank or special purpose trust will loan funds to
the sponsor and that the sponsor will repay the principal and pay
the interest and redemption premium, if any, on the loan.

begin delete

(o)

end delete

begin insert (p) end insert  “Participating party” means any person, company,
corporation, association, state, or municipal governmental entity,
partnership, firm, or other entity or group of entities, whether
organized for profit or not for profit, engaged in business or
operations within the state and that applies for financing from the
bank in conjunction with a sponsor for the purpose of implementing
a project. However, in the case of a project relating to the financing
of transition costs or the acquisition of transition property, or both,
on the request of an electrical corporation, or in connection with
financing for an economic development facility, or for the financing
of insurance claims, the participating party shall be deemed to be
the same entity as the sponsor for the financing.

begin delete

(p)

end delete

begin insert (q) end insert  “Project” means designing, acquiring, planning, permitting,
entitling, constructing, improving, extending, restoring, financing,
and generally developing public development facilities begin delete or end delete begin insert facilities,
affordable housing, or end insert economic development facilities within the
state or financing transition costs or the acquisition of transition
property, or both, upon approval of a financing order by the Public
Utilities Commission, as provided in Article 5.5 (commencing
with Section 840) of Chapter 4 of Part 1 of Division 1 of the Public
Utilities Code.

begin delete

(q)

end delete

begin insert (r) end insert  “Public development facilities” means real and personal
property, structures, conveyances, equipment, thoroughfares,
buildings, and supporting components begin delete thereof, excluding any
housing, end delete begin insert thereof end insert that are directly related to providing the following:

(1) “City streets” including any street, avenue, boulevard, road,
parkway, drive, or other way that is any of the following:

(A) An existing municipal roadway.

(B) Is shown upon a plat approved pursuant to law and includes
the land between the street lines, whether improved or unimproved,
and may comprise pavement, bridges, shoulders, gutters, curbs,
guardrails, sidewalks, parking areas, benches, fountains, plantings,
lighting systems, and other areas within the street lines, as well as
equipment and facilities used in the cleaning, grading, clearance,
maintenance, and upkeep thereof.

(2) “County highways” including any county highway as defined
in Section 25 of the Streets and Highways Code, that includes the
land between the highway lines, whether improved or unimproved,
and may comprise pavement, bridges, shoulders, gutters, curbs,
guardrails, sidewalks, parking areas, benches, fountains, plantings,
lighting systems, and other areas within the street lines, as well as
equipment and facilities used in the cleaning, grading, clearance,
maintenance, and upkeep thereof.

(3) “Drainage, water supply, and flood control” including, but
not limited to, ditches, canals, levees, pumps, dams, conduits,
pipes, storm sewers, and dikes necessary to keep or direct water
away from people, equipment, buildings, and other protected areas
as may be established by lawful authority, as well as the
acquisition, improvement, maintenance, and management of
floodplain areas and all equipment used in the maintenance and
operation of the foregoing.

(4) “Educational facilities” including libraries, child care
facilities, including, but not limited to, day care facilities, and
employment training facilities.

(5) “Environmental mitigation measures” including required
construction or modification of public infrastructure and purchase
and installation of pollution control and noise abatement
equipment.

(6) “Parks and recreational facilities” including local parks,
recreational property and equipment, parkways, and property.

(7) “Port facilities” including airports, landports, waterports,
railports, docks, harbors, ports of entry, piers, ships, small boat
harbors and marinas, and any other facilities, additions, or
improvements in connection therewith, that transport goods or
persons.

(8) “Power and communications” including facilities for the
transmission or distribution of electrical energy, natural gas, and
telephone and telecommunications service.

(9) “Public transit” including air and rail transport, airports,
guideways, vehicles, rights-of-way, passenger stations,
maintenance and storage yards, and related structures, including
public parking facilities, and equipment used to provide or enhance
transportation by bus, rail, ferry, or other conveyance, either
publicly or privately owned, that provides to the public general or
special service on a regular and continuing basis.

(10) “Sewage collection and treatment” including pipes, pumps,
and conduits that collect wastewater from residential,
manufacturing, and commercial establishments, the equipment,
structures, and facilities used in treating wastewater to reduce or
eliminate impurities or contaminants, and the facilities used in
disposing of, or transporting, remaining sludge, as well as all
equipment used in the maintenance and operation of the foregoing.

(11) “Solid waste collection and disposal” including vehicles,
vehicle-compatible waste receptacles, transfer stations, recycling
centers, sanitary landfills, and waste conversion facilities necessary
to remove solid waste, except that which is hazardous as defined
by law, from its point of origin.

(12) “Water treatment and distribution” including facilities in
which water is purified and otherwise treated to meet residential,
manufacturing, or commercial purposes and the conduits, pipes,
and pumps that transport it to places of use.

(13) “Defense conversion” including, but not limited to, facilities
necessary for successfully converting military bases consistent
with an adopted base reuse plan.

(14) “Public safety facilities” including, but not limited to, police
stations, fire stations, court buildings, jails, juvenile halls, and
juvenile detention facilities.

(15) “State highways” including any state highway as described
in Chapter 2 (commencing with Section 230) of Division 1 of the
Streets and Highways Code, and the related components necessary
for safe operation of the highway.

(16) (A) “Military infrastructure,” including, but not limited
to, facilities on or near a military installation, that enhance the
military operations and mission of one or more military
installations in this state. To be eligible for funding, the project
shall be endorsed by the Office of Planning and Research.

(B) For purposes of this subdivision, “military installation”
means any facility under the jurisdiction of the Department of
Defense, as defined in paragraph (1) of subsection (e) of Section
2687 of Title 10 of the United States Code.

(17) “Goods movement-related infrastructure” including port
facilities, roads, rail, and other facilities and projects that move
goods, energy, and information.

begin delete

(r)

end delete

begin insert (s) end insert  “Rate reduction bonds” has the meaning set forth in Section
840 of the Public Utilities Code.

begin delete

(s)

end delete

begin insert (t) end insert  “Revenues” means all receipts, purchase payments, loan
repayments, lease payments, and all other income or receipts
derived by the bank or a sponsor from the sale, lease, or other
financing arrangement undertaken by the bank, a sponsor, or a
participating party, including, but not limited to, all receipts from
a bond purchase agreement, and any income or revenue derived
from the investment of any money in any fund or account of the
bank or a sponsor and any receipts derived from transition property.
Revenues shall not include moneys in the General Fund of the
state.

begin delete

(t)

end delete

begin insert (u) end insert  “Special purpose trust” means a trust, partnership, limited
partnership, association, corporation, nonprofit corporation, or
other entity authorized under the laws of the state to serve as an
instrumentality of the state to accomplish public purposes and
authorized by the bank to acquire, by purchase or otherwise, for
retention or sale, the bonds of a sponsor or of the bank made or
entered into pursuant to this division and to issue special purpose
trust bonds or other obligations secured by these bonds or other
sources of public or private revenues. Special purpose trust also
means any entity authorized by the bank to acquire transition
property or to issue rate reduction bonds, or both, subject to the
approvals by the bank and powers of the bank as are provided by
the bank in its resolution authorizing the entity to issue rate
reduction bonds.

begin delete

(u)

end delete

begin insert (v) end insert  “Sponsor” means any subdivision of the state or local
government including departments, agencies, commissions, cities,
counties, nonprofit corporations formed on behalf of a sponsor,
special districts, assessment districts, and joint powers authorities
within the state or any combination of these subdivisions that
makes an application to the bank for financial assistance in
connection with a project in a manner prescribed by the bank. This
definition shall not be construed to require that an applicant have
an ownership interest in the project. In addition, an electrical
corporation shall be deemed to be the sponsor as well as the
participating party for any project relating to the financing of
transition costs and the acquisition of transition property on the
request of the electrical corporation and any person, company,
corporation, partnership, firm, or other entity or group engaged in
business or operation within the state that applies for financing of
any economic development facility, shall be deemed to be the
sponsor as well as the participating party for the project relating
to the financing of that economic development facility.

begin delete

(v)

end delete

begin insert (w) end insert  “State” means the State of California.

begin delete

(w)

end delete

begin insert (x) end insert  “Transition costs” has the meaning set forth in Section 840
of the Public Utilities Code.

begin delete

(x)

end delete

begin insert (y) end insert  “Transition property” has the meaning set forth in Section
840 of the Public Utilities Code.

SEC. 2.  

Section 63041.5 of the Government Code is amended
to read:

63041.5.  

(a) It is the intent of the Legislature to provide a
one-time appropriation for financial assistance to local government
to meet capital outlay and infrastructure needs.

(b) From the funds appropriated in Item 2920-111-0001 of the
Budget Act of 1999, the sum of four hundred twenty-five million
dollars ($425,000,000) shall be available for financial assistance,
including, but not limited to, leveraged revolving fund loans, to
local government sponsors for public development facilities, as
specified in subdivision begin delete (q) end delete begin insert (r) end insert of Section 63010 of the Government
Code.

(c) From the funds appropriated in Item 2920-111-0001 of the
Budget Act of 1999 and in Item 2920-111-0001 of the Budget Act
of 1998 (Chapter 324 of the Statutes of 1998), the California
Infrastructure and Economic Development Bank shall make no
single loan in excess of 10 percent of the combined amount of
these appropriations to the bank unless approved by unanimous
consent of the membership of the Board of Directors of the
California Infrastructure and Economic Development Bank and
the Director of Finance provides a 30-day written notice to the
Chairperson and Vice-Chairperson of the Joint Legislative Budget
Committee.

SEC. 3.  

Section 63049.64 of the Government Code is amended
to read:

63049.64.  

(a) The bank may issue bonds pursuant to Chapter
5 (commencing with Section 63070) and may loan the proceeds
thereof to the association, and deposit the proceeds into a separate
account in the fund, or use the proceeds to refund bonds previously
issued under this article. Bond proceeds may also be used to fund
necessary reserves, capitalized interest, credit enhancement costs,
or costs of issuance.

(b) Bonds issued under this article shall not be deemed to
constitute a debt or liability of the state or of any political
subdivision thereof, other than the bank, or a pledge of the faith
and credit of the state or of any political subdivision, but shall be
payable solely from the fund and other revenues and assets securing
the bonds. All bonds issued under this article shall contain on the
face of the bonds a statement to that effect.

(c) For purposes of this article, the term “project,” as defined
in subdivision begin delete (p) end delete begin insert (q) end insert of Section 63010, shall include financing of
the costs of claims of insolvent workers’ compensation insurers,
in an amount (together with associated costs of financing) that
may be determined by the association in making a request for
financing to the bank.

SEC. 4.  

Section 31070.5 of the Streets and Highways Code is
amended to read:

31070.5.  

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

(a) “Authority” means the Bay Area Toll Authority established
under Section 30950.

(b) “Account” means the Toll Bridge Seismic Retrofit Account
established in the State Transportation Fund under Section 188.12.

(c) “Bank” means the California Infrastructure and Economic
Development Bank established under Section 63021 of the
Government Code.

(d) “Bay area bridges” means the state-owned toll bridges in
the region within the area of the jurisdiction of the Metropolitan
Transportation Commission.

(e) “Bonds” has the meaning defined in subdivision begin delete (e) end delete begin insert (f) end insert of
Section 63010 of the Government Code.

(f) “Department” means the Department of Transportation.

(g) “TIFIA” means the federal Transportation Infrastructure
Finance and Innovation Act of 1998 (P.L. 105-178).

(h) “Toll surcharge” means the seismic retrofit surcharge
imposed under Section 31010.