BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 2274|
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CONSENT
Bill No: AB 2274
Author: Gordon (D)
Amended: 5/1/14 in Assembly
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 7-0, 6/18/14
AYES: Wolk, Knight, Beall, DeSaulnier, Hernandez, Liu, Walters
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 76-0, 5/15/14 - See last page for vote
SUBJECT : The California Debt and Investment Advisory
Commission
SOURCE : State Treasurers Office
DIGEST : This bill makes several changes to the California
Debt and Investment Advisory Commissions authorizing statute.
ANALYSIS : Created in 1981, the California Debt and Investment
Advisory Commission (CDIAC) provides information, education and
technical assistance on debt issuance and public fund
investments to local public agencies and other public finance
professionals. CDIAC is the clearinghouse for public debt
issuance information and it generally monitors the issuance and
management of public debt. CDIAC charges an underwriter or a
purchaser a fee equal to 1/40th of 1% of the principal amount of
the issue to fund its operations.
CONTINUED
AB 2274
Page
2
This bill enacts several changes to CDIAC's authorizing statute
to assist in its monitoring of state and local debt issues, such
as:
1. Deletes the word "new" and "at public and private sale" to
expand the types of debt for which issuers must report to
CDIAC.
2. Removes the requirement that notice and the final report be
sent by mail, postage prepaid, defaulting to methods CDIAC
prescribes.
3. Erases the specific information that must be included as part
of the notice, defaulting to the information CDIAC deems
appropriate.
4. Requires issuers to send CDIAC the final report or other
information within 21 days of the sale, instead of current
law's 45 days.
5. Allows CDIAC to charge fees of lenders, not just issuers and
purchasers.
6. Makes technical and conforming changes.
Comment
According to the author, "The municipal industry has seen an
increasing trend of municipal issuers taking on non-traditional
financing for projects in the form of direct loans from banks.
This new type of borrowing allows public officials to obtain new
debt without full disclosure to municipal bondholders. This is
problematic because bondholders and rating agencies do not have
a full scope of the entity's total indebtedness.
"AB 2274 would clarify the types of debt reported to the
California Debt and Investment Advisory Commission (CDIAC) and
improve the timeliness of the reporting by making legislative
changes to its statute by defining debt in a manner that is all
inclusive of different forms of state and local debt."
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
AB 2274
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3
SUPPORT : (Verified 6/30/14)
State Treasurer Office (source)
ASSEMBLY FLOOR : 76-0, 5/15/14
AYES: Achadjian, Alejo, Ammiano, Bigelow, Bloom, Bocanegra,
Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon,
Campos, Chau, Ch�vez, Chesbro, Conway, Cooley, Dababneh,
Dahle, Daly, Dickinson, Eggman, Fong, Fox, Frazier, Beth
Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray,
Grove, Hagman, Hall, Harkey, Roger Hern�ndez, Holden, Jones,
Jones-Sawyer, Levine, Linder, Logue, Lowenthal, Maienschein,
Medina, Melendez, Mullin, Muratsuchi, Nazarian, Nestande,
Olsen, Pan, Patterson, Perea, John A. P�rez, V. Manuel P�rez,
Quirk, Quirk-Silva, Rendon, Ridley-Thomas, Rodriguez, Salas,
Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski,
Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Allen, Donnelly, Mansoor, Vacancy
AB:d 6/30/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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