SB 574, as amended, Pan. Public records: public investment funds: disclosure.
Existing law, the California Public Records Act, requires statebegin delete agenciesend delete and local agencies to make public records, as defined, available for inspection, subject to specified criteria, and with specified exceptions. Existing law excludes from disclosure specified records of public investmentbegin delete funds,end deletebegin insert fundsend insert regarding alternative investments, as defined, unless the information in the records has already been publicly released by the keeper of the information. Notwithstanding this exclusion, existing law provides that certain types of information contained in records regarding alternative investments in which public
investment funds invest are subject to disclosure under the act, and provides thatbegin delete these records areend deletebegin insert the information isend insert not to be considered a trade secret exempt from disclosure.
This bill would also subject records with those types of information regarding alternative investments that are in the constructive possession of, or are otherwise accessible or obtainable by, a public investment fund to disclosure under the act and require a public investment fund to obtain and disclose those records.
By increasing the duties of local public investment funds, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
end deleteThis bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.
end deleteThe California Constitution requires local agencies, for the purpose of ensuring public access to the meetings of public bodies and the writings of public officials and agencies, to comply with a statutory enactment that amends or enacts laws relating to public records or open meetings and contains findings demonstrating that the enactment furthers the constitutional requirements relating to this purpose.
end insertbegin insertThis bill would make legislative findings to that effect.
end insertbegin insertThe California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
end insertbegin insertThis bill would provide that no reimbursement is required by this act for a specified reason.
end insertVote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 6254.26 of the Government Code is
2amended to read:
(a) Notwithstanding any provision of this chapter or
4other law, the following records regarding alternative investments
5in which public investment funds invest shall not be subject to
6disclosure pursuant to this chapter, unless the information has
7already been publicly released by the keeper of the information:
8(1) Due diligence materials that are proprietary to the public
9investment fund or the alternative investment vehicle.
10(2) Quarterly and annual financial statements of alternative
11investment vehicles.
12(3) Meeting materials of alternative investment vehicles.
P3 1(4) Records containing information regarding the portfolio
2positions in which alternative investment funds invest.
3(5) Capital call and distribution notices.
4(6) Alternative investment agreements and all related documents.
5(b) Notwithstanding subdivision (a), the following information
6contained in records described in subdivision (a) regarding
7alternative investments in which public investment funds invest
8shall be subject tobegin delete disclosureend deletebegin insert disclosure,end insert shall be obtained and
9
disclosed by a public investment fund pursuant to this chapter, and
10shall not be
considered a trade secret exempt from disclosure:
11(1) The name, address, and vintage year of each alternative
12investment vehicle.
13(2) The dollar amount of the commitment made to each
14alternative investment vehicle by the public investment fund since
15inception.
16(3) The dollar amount of cash contributions made by the public
17investment fund to each alternative investment vehicle since
18inception.
19(4) The dollar amount, on a fiscal yearend basis, of cash
20distributions received by the public investment fund from each
21alternative investment vehicle.
22(5) The dollar amount, on a fiscal
yearend basis, of cash
23distributions received by the public investment fund plus remaining
24value of partnership assets attributable to the public investment
25fund’s investment in each alternative investment vehicle.
26(6) The net internal rate of return of each alternative investment
27vehicle since inception.
28(7) The investment multiple of each alternative investment
29vehicle since inception.
30(8) The dollar amount of the total management fees and costs
31paid on an annual fiscal yearend basis, by the public investment
32fund to each alternative investment vehicle.
33(9) The dollar amount of cash profit received by public
34investment funds from each alternative investment
vehicle on a
35fiscal year-end basis.
36(c) For purposes of this section, the following definitions shall
37apply:
38(1) “Alternative investment” means an investment in a private
39equity fund, venture fund, hedge fund, or absolute return fund.
P4 1(2) “Alternative investment vehicle” means the limited
2partnership, limited liability company, or similar legal structure
3through which the public investment fund invests in portfolio
4companies.
5(3) “Portfolio positions” means individual portfolio investments
6made by the alternative investment vehicles.
7(4) “Public investment fund” means any public pension or
8retirement
system, and any public endowment or foundation.
9(5) “Records” includes public records described in Section 6252
10and records relating to the conduct of the public’s business that
11are in the constructive possession of, or otherwise accessible or
12obtainable by, a public investment fund.
If the Commission on State Mandates determines that
14this act contains costs mandated by the state, reimbursement to
15local agencies and school districts for those costs shall be made
16pursuant to Part 7 (commencing with Section 17500) of Division
174 of Title 2 of the Government Code.
The Legislature finds and declares that Section 1 of
19this act, which amends Section 6254.26 of the Government Code,
20furthers, within the meaning of paragraph (7) of subdivision (b)
21of Section 3 of Article I of the California Constitution, the purposes
22of that constitutional section as it relates to the right of public
23access to the meetings of local public bodies or the writings of
24local public officials and local agencies. Pursuant to paragraph
25(7) of subdivision (b) of Section 3 of Article I of the California
26Constitution, the Legislature makes the following findings:
27Increased information about the performance of alternative
28investments collected by local agencies, that could be leveraged
29by the public to more efficiently access and better monitor the
30investment performance of an agency’s portfolio, would be made
31available to the public under the act in furtherence of the purpose
32of Section 3 of Article I of the California Constitution.
No reimbursement is required by this act pursuant to
34Section 6 of Article XIII B of the California Constitution because
35the only costs that may be incurred by a local agency or school
36district under this act would result from a legislative mandate that
37is within the scope of paragraph (7) of subdivision (b) of Section
383 of Article I of the California Constitution.
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