BILL ANALYSIS Ó
Bill No: AB
29
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2011-2012 Regular Session
Bill Analysis
AB 29 Author: Perez
As Introduced: December 6, 2010
Hearing Date: June 28, 2011
Consultant: Paul Donahue
SUBJECT : Governor's Office of Economic Development
SUMMARY : Establishes the Office of Economic Development
within the Governor's Office (GOED) to serve as the lead
entity for economic strategy and marketing of California on
issues relating to business development, private sector
investment and economic growth.
Existing law :
1) Establishes various state programs and services to
attract and retain businesses in California.
2) Creates the Office of Small Business Advocate in the
Office of Planning and Research (OPR) in the Governor's
office.
3) Requires the Secretary of Labor and Workforce
Development to lead the development of a biennial
California Economic Development Strategic Plan and, in
doing so, to review the recommendations of the California
Economic Strategy Panel, which was created for this
purpose.
4) Requires the Labor Secretary to convene a biennial
economic strategy panel, conduct meetings, and submit a
report to the Legislature regarding its findings and
recommendations regarding developing a system of
accountability, as specified.
5) Requires the Governor to prepare the Environmental Goals
AB 29 (Perez) continued
Page 2
and Policy Report every four years that outlines the
state's 20-year growth and economic development strategy.
This bill :
1) Creates the Office of Economic Development (OED), whose
director would be appointed by the Governor, subject to
confirmation by the Senate.
2) Designates the OED to serve the Governor as lead entity
for economic strategy and the marketing of California on
issues relating to business development, private sector
investment, and economic growth, and to make
recommendations to the Governor and the Legislature
regarding policies, programs, and actions to advance
statewide economic goals.
3) Creates the California Business Investment Services
Program, as specified, within OED to serve employers,
corporate executives, business owners, and site location
consultants who are considering California for business
investment and expansion.
4) The bill would also move the Office of Small Business
Advocate to the OED.
5) Deletes the date by which the Governor shall prepare the
Environmental Goals and Policy Report that outlines the
20-year growth and economic development strategy, and
requires that the report also be submitted to OED after the
meetings have been held.
COMMENTS :
1) Purpose : In February 2010, the Little Hoover Commission
released a report, entitled Making up for Lost Ground:
Creating a Governor's Office of Economic Development. The
report analyzed the status and effectiveness of the various
entities of the defunct Technology, Trade and Commerce
Agency that had been reorganized into other entities. The
report recommended the creation of a new governmental
entity that would promote
greater economic development, foster job creation, and
deliver specific services such as permitting, tax, and
regulatory information directly to the California business
community.
AB 29 (Perez) continued
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According to the author, the new Office of Economic
Development office will "establish long-term economic goals
and strategies as well as specific and effective services
to California's businesses both large and small."
2) The Little Hoover Commission report : Although the
commission heard substantial criticism about the state's
business climate, its report focused on how the state could
better organize and utilize its existing business focused
and broader economic and workforce development programs and
services. The report noted that the state's current
economic development activities are spread out over
numerous agencies, boards, commissions and financing
authorities.
3) Executive Order S-05-10 , issued on April 8, 2010,
creates the Governor's Office of Economic Development or
GOED. The governor stated that its purpose is to promote
California as a place to do business, to support those
interested in starting, expanding, financing or relocating
a business in California, to the extent possible, help
businesses facing challenges to operating in California.
4) Governor's Office of Economic Development : The GOED
administers several programs and services, including
programs related to international trade, permit assistance,
and the like. The GOED currently has 23 staff, most all of
whom are on loan to GOED from state agencies and
departments.
The GOED is sponsoring a permit streamlining pilot project,
which will offer a One-Stop-Shop for state and local
permits. The pilot project was undertaken in partnership
with the City and County of San Francisco, and allows a
business owner to apply and pay for all necessary city,
county and state permits through a dedicated website.
5) Prior veto of identical bill : In 2010 Governor
Schwarzenegger vetoed a nearly identical bill, AB 2734
(Perez), stating among other things that "I purposefully
placed this entity within the Governor's office to
underscore the importance of this mission to the state.
Therefore, I am disappointed at the insistence of the State
Senate to make the director of this office subject to
confirmation, which inappropriately infringes on the rights
and powers of my office."
AB 29 (Perez) continued
Page 4
6) Technical amendment : Both house of the Legislature
recently approved AB 119 (Budget Committee), which
eliminated the California Economic Strategy Panel (Gov.
Code § 15570). That bill is pending before the Governor.
Therefore, the Committee may wish to recommend that the
author delete SEC. 2 of AB 29, which amends Section 15570
of the Government Code.
7) Related legislation :
AB 1233 (V. Manuel Pérez, 2011) requires creation of an
integrated economic and workforce development plan.
(Pending in Assembly Jobs, etc. Committee)
SB 1259 (DeSaulnier, 2010) would have created the Economic
Development and Job Creation Agency and required the new
agency to perform duties relating to economic development
and job creation. It would have required the secretary to
develop a reorganization plan and propose a structure for
the agency. (Held in Senate Appropriations Committee)
AB 2734 (John A. Pérez, 2010) would have established the
Office of Economic Development within the Governor's office
to serve as the lead entity for economic strategy and
marketing of California on issues relating to business
development, private sector investment and economic growth.
(Vetoed)
AB 2287 (Bass, 2010) would have established the Office of
Economic Development, which includes the California
Business Investment Services Program, within the Governor's
office. (Held in Assembly Jobs, Economic Development, and
the Economy Committee)
AB 1558 (V. Manuel Pérez, 2010) would have realigned the
state's economic and workforce development programs within
the Employment Development Department, to be renamed the
Economic and Employment Development Department. (Held in
Senate Appropriations)
AB 699 (Portantino, 2009) would have updated the
requirements for the development of a State Economic
Development Strategy, especially in the areas of technology
and innovation, and requires it be submitted to the
Legislature (Held in Assembly Appropriations Committee)
AB 29 (Perez) continued
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AB 2711 (Portantino, 2008) would have required the
Secretary of the Business, Transportation and Housing
Agency to develop a comprehensive state technology and
innovation strategy to guide future state expenditures and
activities. (Held in Assembly Appropriations Committee)
AB 1916 (Portantino, 2008) would have modified the
requirements of the Economic Development Strategic Plan,
especially in the areas of technology and innovation, and
required that the next State Economic Development Strategy
be submitted to the Legislature by January 1, 2010.
(Vetoed)
AB 1721 (Arambula), Chapter 631, Statutes of 2007
designates the Business, Transportation & Housing Agency as
lead agency on economic development activities, and
established a fund for receiving federal, state, local, and
private economic development moneys that can be used
to further state economic development activities.
AB 1606 (Arambula, 2007) would have required the
development of a strategy to increase private investment in
California's historically underserved communities, also
known as emerging domestic markets. (Vetoed)
SUPPORT:
Bay Area Council
BIOCOM
Business Council, Inc.
California Aerospace Technology Association
California Asian Pacific Chamber of Commerce
California Center for Rural Policy, Humboldt State
University
California Faculty Association
California Labor Federation, AFL-CIO
California Retailers Association
City of San Bernardino
Contra Costa Council
Economic Vitality Corp.
Fresno Business Council
Greater Antelope Valley Economic Alliance
Greater Corona Valley Chamber of Commerce
Hollywood Chamber of Commerce
Joint Venture Silicon Valley Network
AB 29 (Perez) continued
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Little Hoover Commission
Los Angeles Area Chamber of Commerce
Los Angeles County Business Federation
Los Angeles County Economic Development Corporation
North Bay Leadership Council
Oakland Metropolitan Chamber of Commerce
Orange County Business Council
Rafter Group, Inc.
Sacramento Metro Chamber
Sacramento Municipal Utility District
San Diego Chamber of Commerce
San Diego Regional, EDC
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
San Jose Silicon Valley Chamber of Commerce
Sierra Business Council
Silicon Valley Leadership Group
Small Business California
Sonoma County Economic Development Board
South Bay Association of Chambers of Commerce
Southern California Leadership Council
Team California
OPPOSE:
None on file
FISCAL COMMITTEE: Senate Appropriations Committee
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