BILL NUMBER: SB 710 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY FEBRUARY 9, 2016
AMENDED IN ASSEMBLY JUNE 23, 2015
AMENDED IN SENATE MAY 28, 2015
AMENDED IN SENATE MAY 19, 2015
AMENDED IN SENATE MAY 12, 2015
INTRODUCED BY Senator Galgiani
(Coauthors: Senators Cannella and Huff)
(Coauthors: Assembly Members Chávez, Gomez, and Jones)
FEBRUARY 27, 2015
An act to amend, repeal, and add Section 6588 of, and to
add Sections 6507.5 and 6507.7 to, the Government Code, relating to
joint exercise of powers, and declaring the urgency thereof, to take
effect immediately. amend Section 10159.7 of the
Business and Professions Code, relating to real estate licensees, and
declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 710, as amended, Galgiani. Joint exercise of powers.
Real estate licensees: fictitious business names: team
names.
The Real Estate Law provides for the licensure and regulation of
real estate brokers and real estate salespersons by the Bureau of
Real Estate headed by the Real Estate Commissioner. That law requires
advertising and solicitation materials using a fictitious business
name or that contain a team name to display the responsible broker's
identity, as provided. Existing law defines "responsible broker's
identity" to mean a name and the associated license identification
number under which the responsible broker is currently licensed and
conducts business in general or is a substantial division of the real
estate firm, as specified.
This bill would revise the definition of "responsible broker's
identity" to mean the name, the associated license identification
number, or both the name and associated license identification
number.
This bill would declare that it is to take effect immediately as
an urgency statute.
The Joint Exercise of Powers Act authorizes the legislative or
other governing bodies of 2 or more public agencies to jointly
exercise by agreement any power common to the contracting parties, as
specified, and authorizes a joint powers authority to exercise
various powers, including, among others, the power to issue bonds,
including bonds bearing interest, to pay the cost of any public
capital improvement, working capital, or liability or other insurance
program, as specified.
This bill until January 1, 2022, would authorize a joint powers
authority to issue or cause to be issued bonds and enter into a loan
agreement for the financing or refinancing of a project that is
situated in another state, including working capital related to that
project, if the project and its financing meets certain conditions.
This bill would require the Legislative Analyst, on or before January
1, 2021, to prepare and submit to the Legislature a report on the
issuance of those bonds and the financing of those projects. This
bill would require, no later than July 1, 2020, authorities that
issue those bonds to provide information concerning the bonds, the
projects financed, the public benefits accruing to this state and
such other information requested by the Legislative Analyst's Office
for the purpose of preparing the report.
This bill would require a joint powers authority to comply with
the California Public Records Act, the Ralph M. Brown Act, and the
Bagley-Keene Open Meeting Act to the extent those acts are applicable
to any member of the authority, and would provide that these
provisions are declaratory of existing law. The bill would
additionally prohibit a joint powers authority from utilizing any
funds derived from bonds issued pursuant to the provisions of this
bill for political purposes.
The Personal Income Tax Law and the Corporation Tax Law impose a
tax on, or measured by, an individual and corporate taxpayer's
taxable income or net income for the taxable year, but excludes
certain items of income from the computation of tax. Existing law
exempts from personal income tax and the corporation income tax, but
not the corporation franchise tax, interest on bonds issued by this
state or a local government in this state. The Joint Exercise of
Powers Act also provides that all bonds issued by a joint powers
authority and the interest thereon or income therefrom are exempt
from all taxation in this state, except as otherwise provided.
This bill would provide that the interest on bonds authorized by
this bill would not be exempt from income taxes under those laws.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes
no . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10159.7 of the
Business and Professions Code is amended to read:
10159.7. (a) For the purposes of this article, the following
definitions shall apply:
(1) "Responsible broker's identity" means a name and
the name, or the associated license
identification number under which the responsible broker is currently
licensed by the bureau and conducts business in general or is a
substantial division of the real estate firm.
firm, or both the name and the associated license identification
number. Responsible broker's identity does not
include a fictitious business name obtained pursuant to paragraph (2)
of subdivision (a) of Section 10159.5 or the use of a team name
pursuant to Section 10159.6.
(2) "Fictitious business name" means a professional identity or
brand name under which activity requiring a real estate license is
conducted and the use of which is subject to approval by the bureau
pursuant to Section 10159.5.
(3) "Ownership of a fictitious business name" means the right to
use, renew, and control the use of a fictitious business name
obtained in accordance with Section 10159.5.
(4) "Responsible broker" means the broker responsible for the
exercise of control and supervision of salespersons under Section
10159.2, or a licensee subject to discipline under subdivision (h) of
Section 10177 for failure to supervise activity requiring a real
estate license. The supervision of a salesperson required under this
part or any other law is limited to regulatory compliance and
consumer protection.
(5) "Team name" means a professional identity or brand name used
by a salesperson, and one or more other real estate licensees, for
the provision of real estate licensed services. Notwithstanding any
other law, the use of a team name does not require that a separate
license be issued for that name pursuant to Section 10159.5. A team
name does not constitute a fictitious business name for purposes of
this part or any other law or for purposes of filing a fictitious
business name statement with an application as required by
subdivision (a) of Section 10159.5 if all of the following apply:
(A) The name is used by two or more real estate licensees who work
together to provide licensed real estate services, or who represent
themselves to the public as being a part of a team, group, or
association to provide those services.
(B) The name includes the surname of at least one of the licensee
members of the team, group, or association in conjunction with the
term "associates," "group," or "team."
(C) The name does not include any term or terms, such as "real
estate broker," "real estate brokerage," "broker," or "brokerage" or
any other term that would lead a member of the public to believe that
the team is offering real estate brokerage services, that imply or
suggest the existence of a real estate entity independent of a
responsible broker.
(b) Nothing in this section changes a real estate broker's duties
under this division to supervise a salesperson.
SEC. 2. 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:
This act corrects an inadvertent drafting error in Senate Bill 146
of the 2015-16 Regular Session that requires the listing of a
company name and responsible broker's license number on all "team"
advertising, when the intent of that legislation was to require one
or the other, but not both. In order to ensure that the law regarding
advertising is not overly burdensome, it is necessary that this act
take effect immediately.
SECTION 1. Section 6507.5 is added to the
Government Code, to read:
6507.5. An authority created pursuant to this chapter shall
comply with the California Public Records Act (Chapter 3.5
(commencing with Section 6250)), the Ralph M. Brown Act (Chapter 9
(commencing with Section 54950) of Part 1 of Division 2 of Title 5),
and the Bagley-Keene Open Meeting Act (Article 9 (commencing with
Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2), to
the extent those acts are applicable to any member of the authority.
This section is declaratory of existing law.
SEC. 2. Section 6507.7 is added to the
Government Code, to read:
6507.7. (a) An authority created pursuant to this chapter shall
not utilize any funds derived from bonds issued pursuant to
subparagraph (B) of paragraph (2) of subdivision (c) of Section 6588,
as that subparagraph read on the effective date of the act adding
this section, for political purposes, including, but not limited to,
lobbying.
SEC. 3. Section 6588 of the Government Code is
amended to read:
6588. In addition to other powers specified in an agreement
pursuant to Article 1 (commencing with Section 6500) and Article 2
(commencing with Section 6540), the authority may do any or all of
the following:
(a) Adopt bylaws for the regulation of its affairs and the conduct
of its business.
(b) Sue and be sued in its own name.
(c) (1) Issue bonds, including, at the option of the authority,
bonds bearing interest, to pay the cost of any public capital
improvement, working capital, or liability or other insurance
program.
(2) (A) In addition to paragraph (1), for any purpose for which an
authority may execute and deliver or cause to be executed and
delivered certificates of participation in a lease or installment
sale agreement with any public or private entity, the authority, at
its option, may issue or cause to be issued bonds, rather than
certificates of participation, and enter into a loan agreement with
the public or private entity.
(B) (i) Notwithstanding Sections 6586 and 6586.5 or any other law,
an authority may issue or cause to be issued bonds and enter into a
loan agreement, pursuant to subparagraph (A), for the financing or
refinancing of a project that is situated in another state, including
working capital related to that project, if all of the following
apply:
(I) The project is owned, developed, or operated by a private
entity.
(II) The issuance of bonds by the authority and the financing of
the project is approved by resolution, order, or other official
action of the city, county, or other public body with land use
planning authority over the project, or of the state in which the
project is situated. This clause does not apply to the issuance of
refunding bonds if a prior financing or refinancing of the project
was approved by the city, county, public body, or state.
(III) The authority has at least 25 local agency members and the
authority has issued bonds and entered into loan agreements to
finance at least 25 separate projects.
(IV) (ia) The authority finds, based on the facts and
circumstances attendant to the project or the financing or
refinancing of the project, that the issuance of the bonds or the
financing or refinancing of the project will result in a substantial
public benefit to this state because one or more of the following is
satisfied:
(Ia) At least 20 percent of the net proceeds of the issue are
allocated to the financing of one or more projects, including working
capital related thereto, located in this state.
(Ib) The borrower of the bond proceeds has its principal place of
business in this state and, if that borrower is subject to income or
franchise tax in this state or any other state, that borrower has
paid to this state for the most recent tax year income or franchise
tax of at least fifty thousand dollars ($50,000) or one-half of its
total income or franchise tax liability to all states, whichever is
less. If the borrower has little or no assets other than the project
to be financed and is owned by another company or companies, then the
company or companies that own a majority of interest in the borrower
shall have its or their principal place of business in this state.
(Ic) The borrower of the bond proceeds or a controlled group of
which it is a member has at least 50 full-time equivalent employees
in this state.
(Id) The borrower of the bond proceeds or a controlled group of
which it is a member has paid to this state for the most recent tax
year income or franchise tax of at least one hundred thousand dollars
($100,000).
(Ie) In the case of the financing of one or more multifamily
rental housing projects, the developer of that project or projects
has its principal place of business in this state, and any such
developer subject to personal or corporate income tax in California
or other states has paid to this state for the most recent tax year
income or franchise tax of at least fifty thousand dollars ($50,000)
or one-half of its total income or franchise tax liability to all
states, whichever is less.
(ib) The finding required by this subclause shall be conclusive
and incontestable 30 days following the adoption of a resolution of
the authority containing this finding.
(V) The authority authorizes the issuance of the bonds in a public
meeting subject to the Ralph M. Brown Act (Chapter 9 (commencing
with Section 54950) of Part 1 of Division 2 of Title 5) or the
Bagley-Keene Open Meeting Act (Article 9 (commencing with Section
11120) of Chapter 1 of Part 1 of Division 3 of Title 2), as those
acts are applicable to any member of the authority, including any
applicable public notice requirements.
(ii) Proceeds of bonds issued pursuant to this subdivision, other
than those amounts required to pay bond issuance or administration
fees of the authority, shall not be used to finance any working
capital of the authority.
(iii) For purposes of this subparagraph, the following definitions
apply:
(I) "Controlled group" means a group of corporations,
partnerships, limited liability companies or other persons that are
wholly owned or controlled by a single corporation, partnership,
limited liability company, or other person.
(II) "Developer" means a corporation, partnership, limited
liability company, or other person that is the initial controlling
party within the legal entity that owns the multifamily rental
housing project to be financed with proceeds of the bonds and that
undertakes the development or rehabilitation of the project.
(III) "Financing" shall include refinancing of bonds of the
authority or of bonds issued by any other state or local entity
located within this state.
(IV) "Issue" shall have the same meaning as in United States
Treasury Regulations Section 1.150-1(c), as in effect on July 1,
2014.
(V) "Net proceeds of an issue" means the aggregate principal
amount of that issue, less the amount of that issue allocated to
original issue discount, issuance costs, reserve funds, and credit
enhancement costs.
(VI) "Principal place of business" of an entity means the
principal place from which the trade or business of the entity is
directed or managed.
(iv) The Legislative Analyst shall, on or before January 1, 2021,
prepare and submit to the Legislature a report on the issuance of
bonds and the financing of projects pursuant to this subparagraph. No
later than July 1, 2020, authorities that issue bonds pursuant to
this subparagraph shall provide information concerning those bonds,
the projects financed, the public benefits accruing to this state,
and such other information requested by the Legislative Analyst's
Office for the purpose of preparing the report. The report may
include recommendations for modifying or extending the application of
this subparagraph.
(v) Notwithstanding Section 6598 of the Government Code and
Sections 17131 and 17133 of the Revenue and Taxation Code or any
other law, the interest on bonds issued pursuant to this subparagraph
shall not be exempt from income taxation, and shall be included in
gross income under Part 10 (commencing with Section 17001) of
Division 2 and Chapter 3 (commencing with Section 23501) of Part 11
of Division 2 of the Revenue and Taxation Code.
(d) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this article.
(e) As provided by applicable law, employ and compensate bond
counsel, financial consultants, and other advisers determined
necessary by the authority in connection with the issuance and sale
of any bonds.
(f) Contract for engineering, architectural, accounting, or other
services determined necessary by the authority for the successful
development of a public capital improvement.
(g) Pay the reasonable costs of consulting engineers, architects,
accountants, and construction, land-use, recreation, and
environmental experts employed by any sponsor or participant if the
authority determines those services are necessary for the successful
development of public capital improvements.
(h) Take title to, sell by installment sale or otherwise, or lease
lands, structures, real or personal property, rights, rights-of-way,
franchises, easements, and other interests in lands that are located
within the state that the authority determines are necessary or
convenient for the financing of public capital improvements, or any
portion thereof.
(i) Receive and accept from any source, loans, contributions, or
grants, in either money, property, labor, or other things of value,
for, or in aid of, the construction financing, or refinancing of
public capital improvement, or any portion thereof, or for the
financing of working capital or insurance programs, or for the
payment of the principal of and interest on bonds if the proceeds of
those bonds are used for one or more of the purposes specified in
this section.
(j) Make secured or unsecured loans to any local agency in
connection with the financing of capital improvement projects,
working capital or insurance programs in accordance with an agreement
between the authority and the local agency. However, no loan shall
exceed the total cost of the public capital improvements, working
capital or insurance needs of the local agency as determined by the
local agency and by the authority.
(k) Make secured or unsecured loans to any local agency in
accordance with an agreement between the authority and the local
agency to refinance indebtedness incurred by the local agency in
connection with public capital improvements undertaken and completed.
(l) Mortgage all or any portion of its interest in public capital
improvements and the property on which any project is located,
whether owned or thereafter acquired, including the granting of a
security interest in any property, tangible or intangible.
(m) Assign or pledge all or any portion of its interests in
mortgages, deeds of trust, indentures of mortgage or trust, or
similar instruments, notes, and security interests in property,
tangible or intangible, of a local agency to which the authority has
made loans, and the revenues therefrom, including payment or income
from any interest owned or held by the authority, for the benefit of
the holders of bonds issued to finance public capital improvements.
The pledge of moneys, revenues, accounts, contract rights, or rights
to payment of any kind made by or to the authority pursuant to the
authority granted in this part shall be valid and binding from the
time the pledge is made for the benefit of the pledgees and
successors thereto, against all parties irrespective of whether the
parties have notice of the claim.
(n) Lease the public capital improvements being financed to a
local agency, upon terms and conditions that the authority deems
proper; charge and collect rents therefor; terminate any lease upon
the failure of the lessee to comply with any of the obligations of
the lease; include in any lease provisions that the lessee shall have
options to renew the lease for a period or periods, and at rents as
determined by the authority; purchase or sell by an installment
agreement or otherwise any or all of the public capital improvements;
or, upon payment of all the indebtedness incurred by the authority
for the financing or refinancing of the public capital improvements,
the authority may convey any or all of the project to the lessee or
lessees.
(o) Charge and apportion to local agencies that benefit from its
services the administrative costs and expenses incurred in the
exercise of the powers authorized by this article. These fees shall
be set at a rate sufficient to recover, but not exceed, the authority'
s costs of issuance and administration. The fee charged to each local
obligation acquired by the pool shall not exceed that obligation's
proportionate share of those costs. The level of these fees shall be
disclosed to the California Debt and Investment Advisory Commission
pursuant to Section 6599.1.
(p) Issue, obtain, or aid in obtaining, from any department or
agency of the United States or of the state, or any private company,
any insurance or guarantee to, or for, the payment or repayment of
interest or principal, or both, or any part thereof, on any loan,
lease, or obligation or any instrument evidencing or securing the
same, made or entered into pursuant to this article.
(q) Notwithstanding any other provision of this article, enter
into any agreement, contract, or any other instrument with respect to
any insurance or guarantee; accept payment in the manner and form as
provided therein in the event of default by a local agency; and
assign any insurance or guarantee that acts as security for the
authority's bonds.
(r) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary, convenient, or desirable to
carry out any power authorized by this article.
(s) Invest any moneys held in reserve or sinking funds, or any
moneys not required for immediate use or disbursement, in obligations
that are authorized by law for the investment of trust funds.
(t) At the request of affected local agencies, combine and pledge
revenues to public capital improvements for repayment of one or more
series of bonds issued pursuant to this article.
(u) Delegate to any of its individual parties or other responsible
individuals the power to act on its behalf subject to its general
direction, guidelines, and oversight.
(v) Purchase, with the proceeds of its bonds or its revenue, bonds
issued by any local agency at public or negotiated sale. Bonds
purchased pursuant to this subdivision may be held by the authority
or sold to public or private purchasers at public or negotiated sale,
in whole or in part, separately or together with other bonds issued
by the authority.
(w) Purchase, with the proceeds of its bonds or its revenue, VLF
receivables sold to the authority pursuant to Section 6588.5. VLF
receivables so purchased may be pledged to the payment of bonds
issued by the authority or may be resold to public or private
purchasers at public or negotiated sale, in whole or in part,
separately or together with other VLF receivables purchased by the
authority.
(x) (1) Purchase, with the proceeds of its bonds or its revenue,
Proposition 1A receivables pursuant to Section 6588.6. Proposition 1A
receivables so purchased may be pledged to the payment of bonds
issued by the authority or may be resold to public or private
purchasers at public or negotiated sales, in whole or in part,
separately or together with other Proposition 1A receivables
purchased by the authority.
(2) (A) All entities subject to a reduction of ad valorem property
tax revenues required under Section 100.06 of the Revenue and
Taxation Code pursuant to the suspension set forth in Section 100.05
of the Revenue and Taxation Code shall be afforded the opportunity to
sell their Proposition 1A receivables to the authority.
(B) If these entities offer Proposition 1A receivables to the
authority for purchase and duly authorize the sale of the Proposition
1A receivables pursuant to documentation approved by the authority,
the authority shall purchase all Proposition 1A receivables so
offered to the extent it can sell bonds therefor. If the authority
does not purchase all Proposition 1A receivables offered, it shall
purchase a pro rata share of each entity's offered Proposition 1A
receivables.
(C) The authority may establish a deadline, no earlier than
November 3, 2009, by which these entities shall offer their
Proposition 1A receivables for sale to the authority and complete the
application required by the authority.
(3) For purposes of meeting costs incurred in performing its
duties relative to the purchase and sale of Proposition 1A
receivables, the authority shall be authorized to charge a fee to
each entity from which it purchases a Proposition 1A receivable. The
fee shall be computed based on the percentage value of the
Proposition 1A receivable purchased from each entity, in relation to
the value of all Proposition 1A receivables purchased by the
authority. The amount of the fee shall be paid from the proceeds of
the bonds and shall be included in the principal amount of the bonds.
(4) Terms and conditions of any and all fees and expenses charged
by the authority, or those it contracts with, and the terms and
conditions of sales of Proposition 1A receivables and bonds issued
pursuant to this subdivision, including the terms of optional early
redemption provisions, if any, shall be approved by the Treasurer and
the Director of Finance, who shall not unreasonably withhold their
approval. The aggregate principal amount of all bonds issued pursuant
to this subdivision shall not exceed two billion two hundred fifty
million dollars ($2,250,000,000), and the rate of interest paid on
those bonds shall not exceed 8 percent per annum. The authority shall
exercise its best efforts to obtain the lowest cost financing
possible. Any and all premium obtained shall be used for either of
the following:
(A) Applied to pay the costs of issuance of the bonds.
(B) Deposited in a trust account that is pledged to bondholders
and used solely for the payment of interest on, or for repayment of,
the bonds.
(5) (A) In connection with any financing backed by Proposition 1A
receivables, the Treasurer may retain financial advisors, legal
counsel, and other consultants to assist in performing the duties
required by this chapter and related to that financing.
(B) Notwithstanding any other law, none of the following shall
apply to any agreements entered into by the Treasurer pursuant to
subparagraph (A) in connection with any Proposition 1A financing:
(i) Section 11040 of the Government Code.
(ii) Section 10295 of the Public Contract Code.
(iii) Article 3 (commencing with Section 10300) and Article 4
(commencing with Section 10335) of, Chapter 2 of Part 2 of Division 2
of the Public Contract Code, except for the authority of the
Department of Finance under Section 10336 of the Public Contract Code
to direct a state agency to transmit to it a contract for review,
and except for Section 10348.5 of the Public Contract Code.
(C) Any costs incurred by the Treasurer in connection with any
Proposition 1A financing shall be reimbursed out of the proceeds of
the financing.
(y) Set any other terms and conditions on any purchase or sale
pursuant to this section as it deems by resolution to be necessary,
appropriate, and in the public interest, in furtherance of the
purposes of this article.
(z) This section shall remain in effect only until January 1,
2022, and as of that date, is repealed.
SEC. 4. Section 6588 is added to the Government
Code, to read:
6588. In addition to other powers specified in an agreement
pursuant to Article 1 (commencing with Section 6500) and Article 2
(commencing with Section 6540), the authority may do any or all of
the following:
(a) Adopt bylaws for the regulation of its affairs and the conduct
of its business.
(b) Sue and be sued in its own name.
(c) Issue bonds, including, at the option of the authority, bonds
bearing interest, to pay the cost of any public capital improvement,
working capital, or liability or other insurance program. In
addition, for any purpose for which an authority may execute and
deliver or cause to be executed and delivered certificates of
participation in a lease or installment sale agreement with any
public or private entity, the authority, at its option, may issue or
cause to be issued bonds, rather than certificates of participation,
and enter into a loan agreement with the public or private entity.
(d) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this article.
(e) As provided by applicable law, employ and compensate bond
counsel, financial consultants, and other advisers determined
necessary by the authority in connection with the issuance and sale
of any bonds.
(f) Contract for engineering, architectural, accounting, or other
services determined necessary by the authority for the successful
development of a public capital improvement.
(g) Pay the reasonable costs of consulting engineers, architects,
accountants, and construction, land-use, recreation, and
environmental experts employed by any sponsor or participant if the
authority determines those services are necessary for the successful
development of public capital improvements.
(h) Take title to, sell by installment sale or otherwise, or lease
lands, structures, real or personal property, rights, rights-of-way,
franchises, easements, and other interests in lands that are located
within the state that the authority determines are necessary or
convenient for the financing of public capital improvements, or any
portion thereof.
(i) Receive and accept from any source, loans, contributions, or
grants, in either money, property, labor, or other things of value,
for, or in aid of, the construction financing, or refinancing of
public capital improvement, or any portion thereof, or for the
financing of working capital or insurance programs, or for the
payment of the principal of and interest on bonds if the proceeds of
those bonds are used for one or more of the purposes specified in
this section.
(j) Make secured or unsecured loans to any local agency in
connection with the financing of capital improvement projects,
working capital or insurance programs in accordance with an agreement
between the authority and the local agency. However, no loan shall
exceed the total cost of the public capital improvements, working
capital or insurance needs of the local agency as determined by the
local agency and by the authority.
(k) Make secured or unsecured loans to any local agency in
accordance with an agreement between the authority and the local
agency to refinance indebtedness incurred by the local agency in
connection with public capital improvements undertaken and completed.
(l) Mortgage all or any portion of its interest in public capital
improvements and the property on which any project is located,
whether owned or thereafter acquired, including the granting of a
security interest in any property, tangible or intangible.
(m) Assign or pledge all or any portion of its interests in
mortgages, deeds of trust, indentures of mortgage or trust, or
similar instruments, notes, and security interests in property,
tangible or intangible, of a local agency to which the authority has
made loans, and the revenues therefrom, including payment or income
from any interest owned or held by the authority, for the benefit of
the holders of bonds issued to finance public capital improvements.
The pledge of moneys, revenues, accounts, contract rights, or rights
to payment of any kind made by or to the authority pursuant to the
authority granted in this part shall be valid and binding from the
time the pledge is made for the benefit of the pledgees and
successors thereto, against all parties irrespective of whether the
parties have notice of the claim.
(n) Lease the public capital improvements being financed to a
local agency, upon terms and conditions that the authority deems
proper; charge and collect rents therefor; terminate any lease upon
the failure of the lessee to comply with any of the obligations of
the lease; include in any lease provisions that the lessee shall have
options to renew the lease for a period or periods, and at rents as
determined by the authority; purchase or sell by an installment
agreement or otherwise any or all of the public capital improvements;
or, upon payment of all the indebtedness incurred by the authority
for the financing or refinancing of the public capital improvements,
the authority may convey any or all of the project to the lessee or
lessees.
(o) Charge and apportion to local agencies that benefit from its
services the administrative costs and expenses incurred in the
exercise of the powers authorized by this article. These fees shall
be set at a rate sufficient to recover, but not exceed, the authority'
s costs of issuance and administration. The fee charged to each local
obligation acquired by the pool shall not exceed that obligation's
proportionate share of those costs. The level of these fees shall be
disclosed to the California Debt and Investment Advisory Commission
pursuant to Section 6599.1.
(p) Issue, obtain, or aid in obtaining, from any department or
agency of the United States or of the state, or any private company,
any insurance or guarantee to, or for, the payment or repayment of
interest or principal, or both, or any part thereof, on any loan,
lease, or obligation or any instrument evidencing or securing the
same, made or entered into pursuant to this article.
(q) Notwithstanding any other provision of this article, enter
into any agreement, contract, or any other instrument with respect to
any insurance or guarantee; accept payment in the manner and form as
provided therein in the event of default by a local agency; and
assign any insurance or guarantee that acts as security for the
authority's bonds.
(r) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary, convenient, or desirable to
carry out any power authorized by this article.
(s) Invest any moneys held in reserve or sinking funds, or any
moneys not required for immediate use or disbursement, in obligations
that are authorized by law for the investment of trust funds.
(t) At the request of affected local agencies, combine and pledge
revenues to public capital improvements for repayment of one or more
series of bonds issued pursuant to this article.
(u) Delegate to any of its individual parties or other responsible
individuals the power to act on its behalf subject to its general
direction, guidelines, and oversight.
(v) Purchase, with the proceeds of its bonds or its revenue, bonds
issued by any local agency at public or negotiated sale. Bonds
purchased pursuant to this subdivision may be held by the authority
or sold to public or private purchasers at public or negotiated sale,
in whole or in part, separately or together with other bonds issued
by the authority.
(w) Purchase, with the proceeds of its bonds or its revenue, VLF
receivables sold to the authority pursuant to Section 6588.5. VLF
receivables so purchased may be pledged to the payment of bonds
issued by the authority or may be resold to public or private
purchasers at public or negotiated sale, in whole or in part,
separately or together with other VLF receivables purchased by the
authority.
(x) (1) Purchase, with the proceeds of its bonds or its revenue,
Proposition 1A receivables pursuant to Section 6588.6. Proposition 1A
receivables so purchased may be pledged to the payment of bonds
issued by the authority or may be resold to public or private
purchasers at public or negotiated sales, in whole or in part,
separately or together with other Proposition 1A receivables
purchased by the authority.
(2) (A) All entities subject to a reduction of ad valorem property
tax revenues required under Section 100.06 of the Revenue and
Taxation Code pursuant to the suspension set forth in Section 100.05
of the Revenue and Taxation Code shall be afforded the opportunity to
sell their Proposition 1A receivables to the authority.
(B) If these entities offer Proposition 1A receivables to the
authority for purchase and duly authorize the sale of the Proposition
1A receivables pursuant to documentation approved by the authority,
the authority shall purchase all Proposition 1A receivables so
offered to the extent it can sell bonds therefor. If the authority
does not purchase all Proposition 1A receivables offered, it shall
purchase a pro rata share of each entity's offered Proposition 1A
receivables.
(C) The authority may establish a deadline, no earlier than
November 3, 2009, by which these entities shall offer their
Proposition 1A receivables for sale to the authority and complete the
application required by the authority.
(3) For purposes of meeting costs incurred in performing its
duties relative to the purchase and sale of Proposition 1A
receivables, the authority shall be authorized to charge a fee to
each entity from which it purchases a Proposition 1A receivable. The
fee shall be computed based on the percentage value of the
Proposition 1A receivable purchased from each entity, in relation to
the value of all Proposition 1A receivables purchased by the
authority. The amount of the fee shall be paid from the proceeds of
the bonds and shall be included in the principal amount of the bonds.
(4) Terms and conditions of any and all fees and expenses charged
by the authority, or those it contracts with, and the terms and
conditions of sales of Proposition 1A receivables and bonds issued
pursuant to this subdivision, including the terms of optional early
redemption provisions, if any, shall be approved by the Treasurer and
the Director of Finance, who shall not unreasonably withhold their
approval. The aggregate principal amount of all bonds issued pursuant
to this subdivision shall not exceed two billion two hundred fifty
million dollars ($2,250,000,000), and the rate of interest paid on
those bonds shall not exceed 8 percent per annum. The authority shall
exercise its best efforts to obtain the lowest cost financing
possible. Any and all premium obtained shall be used for either of
the following:
(A) Applied to pay the costs of issuance of the bonds.
(B) Deposited in a trust account that is pledged to bondholders
and used solely for the payment of interest on, or for repayment of,
the bonds.
(5) (A) In connection with any financing backed by Proposition 1A
receivables, the Treasurer may retain financial advisors, legal
counsel, and other consultants to assist in performing the duties
required by this chapter and related to that financing.
(B) Notwithstanding any other law, none of the following shall
apply to any agreements entered into by the Treasurer pursuant to
subparagraph (A) in connection with any Proposition 1A financing:
(i) Section 11040 of the Government Code.
(ii) Section 10295 of the Public Contract Code.
(iii) Article 3 (commencing with Section 10300) and Article 4
(commencing with Section 10335) of, Chapter 2 of Part 2 of Division 2
of the Public Contract Code, except for the authority of the
Department of Finance under Section 10336 of the Public Contract Code
to direct a state agency to transmit to it a contract for review,
and except for Section 10348.5 of the Public Contract Code.
(C) Any costs incurred by the Treasurer in connection with any
Proposition 1A financing shall be reimbursed out of the proceeds of
the financing.
(y) Set any other terms and conditions on any purchase or sale
pursuant to this section as it deems by resolution to be necessary,
appropriate, and in the public interest, in furtherance of the
purposes of this article.
(z) This section shall become operative on January 1, 2022.
SEC. 5. 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:
In order to timely provide essential bonding authority for the
funding of multistate, public-private projects that are necessary to
ensure California's national and international competitiveness and
public benefits in this state, it is necessary that this act take
effect immediately.