BILL ANALYSIS �
SB 511
Page 1
Date of Hearing: June 24, 2014
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT AND THE ECONOMY
Jose Medina, Chair
SB 511 (Lieu) - As Amended: May 19, 2014
SENATE VOTE : 31-0
SUBJECT : Trade promotion and California ports
SUMMARY : Establishes the California Export Finance Office within the
California Infrastructure and Economic Development Bank (I-Bank) and
requires the Governor's Office of Business and Economic Development
(GO-Biz) to convene a statewide business partnership to discuss the
promotion and greater utilization of California ports. Specifically,
this bill :
1)Sets forth findings and declarations, including, but not limited to,
the value of trade to the California economy, that there are
substantial opportunities to strengthen and grow California's trade
sectors, and the benefits small and medium size businesses would
receive from financing and technical assistance.
2)Requires GO-Biz to convene a statewide business partnership by
February 1, 2015, for the purpose of advising the Director on
promoting trade for California ports, while increasing the use of
California ports of entry, and ways to increase the opportunity for
growth and trade activity.
3)Requires representatives from the following groups be included in
the business partnership: ports of entry; ocean carriers; marine
terminal operators; warehouse operators; railroads; trucking
companies; labor representatives; foreign trade zones; environmental
group representatives; and shippers, as specified.
4)Establishes the Export Finance Office within the I-Bank, for the
purpose of expanding employment and income opportunities for
Californians through increased exports of California goods,
services, and agricultural commodities. This purpose is to be
achieved by providing actual and potential California small and
medium-size exporters with information and technical assistance on
export opportunities, exporting techniques, and financial assistance
in support of export transactions.
5)Requires the executive director of the I-Bank or his or her designee
SB 511
Page 2
to serve as the director of the Export Finance Office. Among other
activities the director is authorized to:
a) Hold public hearings;
b) Contract for services;
c) Call upon and reimburse other state entities for assisting in
carrying out the objectives of the Export Finance Office;
d) Participate with government or private industry in programs
for technical assistance, loans, technology, transfer, or any
other programs related to the Export Finance Office;
e) Undertake or commission studies on methods to increase
financial resources to expand the exports of California goods,
services, and agricultural commodities;
f) Exercise other power as may be necessary to carry out the
purpose of the Export Finance Office;
g) Provide export finance training for staff and other
individuals involved.
6)Authorizes the California Export Finance Office to:
a) Insure, coinsure, and guarantee loans related to qualified
export transactions;
b) Coordinate the activities of the California Export Finance
Office with the Export-Import Bank of the U.S., the International
Trade Administration, the Foreign Credit Insurance Association,
and other public and private programs designated to provide
export assistance and export-related financing;
c) Establish a network of contacts among public and private
organizations that provide technical assistance, information, and
financial support for exporting;
d) Assembly, publish, and disseminate information to California
exporters on export opportunities, techniques for exporting,
sources of public and private export assistance, and sources of
export-related financing;
e) Organize, host, and participate in seminars and other forums
designed to disseminate information and technical assistance on
exporting and export financing;
f) Provide individual firms and agricultural enterprises with
information and technical assistance relating to exporting and
exporting finance;
g) Act as an agent for creditworthy California growers,
manufacturers, and other exporters to sell accounts receivable
that are approved by the California Export Finance Office and
insured by the Foreign Credit Insurance Association or an
acceptable insurer, to qualified parties; and
SB 511
Page 3
h) Function as a clearinghouse for the collection and
disbursement of funds relative to those sales through the use of
a segregated bank account.
7)Establishes an 11-member California Export Finance Board (Board) and
authorizes the Board to adopt regulations to implement the
responsibilities and activities of the California Export Finance
Office. Board members are proposed to serve two-year terms, be
compensated for their time, as specified, and include:
a) The Executive Director of the I-Bank or his or her designee;
b) The Secretary of Food and Agriculture;
c) One individual appointed by the Governor who has knowledge of
exporting agricultural products;
d) Three individuals appointed by the Governor and one individual
appointed the Speaker who are knowledgeable and know the needs of
small exporters and are actively employed with an exporting firm;
e) One individual appointed by the Governor and one individual
appointed by the Senate Committee on Rules, each of whom are
knowledgeable about export financing, the problems of small and
entrepreneurial exporters, and actively employed by a financial
institution;
f) One person appointed by the Controller and one person
appointed by the Treasurer, each of whom has expertise as an
accomplished credit evaluation representative experienced in
analyzing financial statements, as specified.
8)Authorizes the Board to elect a chair and vice chair from among its
members, oversee the programs and promulgate rules and regulations
that are necessary to establish those programs, including, but not
limited to, programs to insure, co-insure, and provide loan
guarantees to support export transactions. The Board is also
required to adopt by-laws; appoint advisory committees; and hold
regularly scheduled meetings, at least quarterly.
9)Requires, as part of adopting the rules and regulations, to adopt
criteria establishing which exports and export transactions are
eligible for insurance, coinsurance, and loan guarantees, which
include all the following:
a) Borrowers have a minimum equity interest in the business, as
specified;
b) Loan guarantees, insurance, and coinsurance are extended
exclusively to support the export of goods, services, and
agricultural commodities produced or grown primarily in
SB 511
Page 4
California by companies or agricultural enterprises that have
California as a principal place from which their trade or
business is directed or managed;
c) Financing assistance, which is backed by money in the Export
Finance Funds, which is created in this bill, is only offered
under the following circumstances:
i) As part of a state match that is required to secure
participation of California firms or agricultural enterprise in
federal, state, or private financing;
ii) If inadequate financing assistance is not otherwise
readily available from other public or private sources in a
timely manner;
d) Collateral and security requirements to ensure full repayment
of loan guarantees and solvency of any insurance and coinsurance
program, as well as assisting in the evaluation of the program.
e) Approve all extensions of insurance, coinsurance, or loan
guarantees. This authority may be delegated to three or more
members of the Board, as specified.
10)Requires the Board to issue an annual report critiquing the
program, its needs, and recommend changes. Requires the report to
also include an evaluation of the program's impact on all of the
following:
a) Participation of financial institutions in export finance
programs;
b) Access of California firms to federal export financing
programs;
c) Export volume of California firms; and
d) Economic and social benefits of exports to the state.
11)Requires the California Export Finance Office to comply with the
Bagley-Keene Open Meeting Act and the California Public Records Act.
12)Authorizes the executive director of the I-Bank to determine
whether the disclosure of financial data contained in applications
for financial assistance would be competitively injurious to the
applicant and, if so, not require such information.
13)Establishes the Export Finance Fund, as a continuously appropriated
fund, for the purpose of receiving state, federal, and private
funds, fees and collections, and the return from investments made
pursuant to this bill.
14)Provides that the state is not liable or obligated beyond the state
SB 511
Page 5
funds deposited in the Export Finance Fund.
EXISTING LAW:
1)Establishes GO-Biz for the purpose of serving as the lead state
entity for economic strategy and marketing of California on issues
related to business development, private sector investment, and
economic growth.
2)Establishes the I-Bank, within GO-Biz, to administer a range of
programs including the Small Business Finance Center, the State
Infrastructure Revolving Loan Fund, and to serve as a conduit bond
issuer.
FISCAL EFFECT : Unknown
COMMENTS :
1)Author's Purpose : "Currently, the Government Code does not
explicitly require the California Infrastructure and Economic
Development Bank (I-Bank) to allocate funds for export finance.
From 1985-2003, California had a state entity, the California Export
Finance Office (CEFO), that provided capital loan guarantees to
banks and other financial institutions on behalf of small and
medium-sized California companies to support their export efforts,
much like the proposed office in SB 511. The program was successful
in that it helped many companies, generated nearly a half billion
dollars in export sales and was primarily fiscally self-sustaining.
Unfortunately, CEFO expired with the elimination of the Technology,
Trade and Commerce Agency in 2004.
Given that China, India, and other Asian countries are now growing
their economies, a huge number of new middle class consumers will
emerge, providing an enormous market that California, as the gateway
to the Pacific Rim, is well positioned to go after. To remain
competitive with Mexico and British Columbia - both of which have
dramatically increased exports in 2012 - California needs to engage
small and medium sized businesses into the export market. Namely,
reinstating CEFO would achieve this goal by providing transactional
export financing for small and medium sized businesses."
2)Framing the Policy Issue : This measure proposes the
re-establishment of the California Export Finance Office, a
government entity which last existed in 2003 within the Technology,
Trade, and Commerce Agency (TTCA). In 2003, the TTCA was eliminated
SB 511
Page 6
along with all of the trade-related programs. The California Export
Finance Office was a very popular state program and served as an
important link within California's network of export-related
programs and services.
Today, however, California and the federal government offer small
business financing and technical assistance programs in an
organizational framework which is different from a decade ago.
Integrating, rather than duplicating, export program and service
responsibilities would result in a leaner California Export Finance
Office structure and offer opportunities to leverage existing
program proficiencies, while compensating for weaknesses.
The analysis includes information on the state's current
international trade programs and services, California's trade
dependent economy, and the national trade initiate. Amendments are
discussed in Comment 8.
3)Traded industries and Economic Growth : California's $2 trillion
economy naturally functions as an independent economic power within
the global economy. In fact, compared to other nations, California
has one of the 10 largest economies in the world, due to it being a
top-tier trade partner, a best-in-class investment location, a high
quality producer of goods and services, and the home and key access
point for a massive consumer-base. In 2013, California exported
$168 billion in products to over 220 foreign countries. While
California has been significantly impacted by the recession, exports
continued to increase in almost every quarter from 2010 through
2013.
Recently, the value of trade-related industries, as a component of
the broader economy, was the subject of a study by the Brookings
Institute and JP Morgan Chase, Export Nation 2013. The report found
that between 2003 to 2012 exports drove post-recession growth in the
100 largest metro areas including Los Angeles, San Diego, and the
Inland Empire.
The study is unique in that it collected data by origin of
production rather than origin of export movement, as is the case
with the U.S. Department of Commerce export data. Using the Export
Nation methodology, total California exports for goods and services
in 2012 was $252 billion, as compared to the U.S. Census Bureau's
2012 number of $162 billion for goods only, as measured by origin of
movement.
SB 511
Page 7
In 2012, exports represented 8.8% of California GDP, based on Export
Nation data. The top five California metro areas with the highest
concentration of export-related GDP in the report period include:
(1) Los Angeles (37.1%); (2) San Francisco (15%); (3) San Jose
(13.7%); (4) San Diego (11.5%), and (5) the Inland Empire (9.2%).
Chart 1 includes more specific data on selected California exports
of goods and services, as expressed in 2012 dollars (adjusted for
inflation) and based on the Export Nation methodology.
-----------------------------------------------------------------
| Chart 1 - Southern California Largest Metro Areas |
| Exports (2007-2012)(in millions, adjusted for inflation) |
-----------------------------------------------------------------
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Metropolitan | 2003 Exports | 2012 Exports | Export Share | Export in | Export in |Annualized |
|Statistical | (millions) | (millions) | of GDP | Goods 2012 |Services 2012 |2009-2012 |
|Area | | | | | |Growth in |
| | | | | | |Manufacturing |
| | | | | | |(Post-Recessio|
| | | | | | |n) |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|El Centro, CA |432.7954 |586.8708 |9.3% |456.5946 |130.2762 | 8.9% |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Los |62850.51 |93871.65 |12.0% |56462.39 |37409.26 | 4.0% |
|Angeles-Long | | | | | | |
|Beach-Santa | | | | | | |
|Ana, CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Oxnard-Thousan|3997.99 |6462.674 |15.2% |4822.016 |1640.658 | 3.8% |
|d | | | | | | |
|Oaks-Ventura, | | | | | | |
|CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Riverside-San |7999.825 |13128.07 |9.2% |8407.373 |4720.697 | 5.9% |
|Bernardino-Ont| | | | | | |
SB 511
Page 8
|ario, CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|San |11996.96 |21613.47 |11.5% |13702.52 |7910.954 | 7.2% |
|Diego-Carlsbad| | | | | | |
|-San Marcos, | | | | | | |
|CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|San |15417.44 |38046.75 |12.5% |23306.12 |14740.64 | -0.7% |
|Francisco-Oakl| | | | | | |
|and-Fremont, | | | | | | |
|CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|San |21384.90 |34641.22 |23.8% |26418.39 |8222.831 | 10.9% |
|Jose-Sunnyvale| | | | | | |
|-Santa Clara, | | | | | | |
|CA | | | | | | |
|Metropolitan | | | | | | |
|Statistical | | | | | | |
|Area | | | | | | |
--------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------
| Source: Export Nation 2013, Global Cities Initiative, a joint |
|project of Brookings Institute and JP Morgan Chase |
-----------------------------------------------------------------
According to research by the California Employment Development
Department, the state's future economic growth will be strongly
correlated to the strength of its trade-related industry sectors
including advanced manufacturing, information technology, and
professional services. The high growth potential of these industry
sectors is based on their links to external markets, as well as
internal markets in the U.S. and California.
4)California's Trade Framework : In California, the primary state
agency responsible for state trade and foreign investment activity
(excluding agriculture) is GO-Biz. Initially established in 2011,
SB 511
Page 9
international trade responsibility was transferred from the
Business, Transportation, and Housing Agency to GO-Biz in 2012.
Among GO-Biz' assets are the Office of the Small Business Advocate,
the Permit Assistance Unit, the Office of Foreign Trade and
Investment, and the Business Investment Services Unit. [AB 29 (John
A. P�rez), Chapter 475, Statutes of 2011 and AB 2012 (John A.
P�rez), Chapter 294, Statutes of 2012]
The Governor's Reorganization Plan transferred a number of
additional economic development related entities under the purview
of GO-Biz in 2012 including the California Travel and Tourism
Commission, the I-Bank, the Small Business Loan Guarantee Program,
and the California Film Commission.
The graphic below illustrates the organization of GO-Biz. Areas of
similar services or programs with SB 511 are marked with a *.
SB 511
Page 10
In 2013, the Innovation Hub Program and the EB-5 investment visa
program were codified under the administration of GO-Biz. There are
14 ihubs throughout California, each focusing on specific industry
sectors including the Southern California Link that includes
Riverside, San Bernardino, and Los Angeles Counties which
collaborate on issues related to trade, manufacturing, and
logistics. [AB 250 (Holden and V. Manuel P�rez), Chapter 530,
Statutes of 2013]
Also in 2013, a Small Business Finance Center was established within
the I-Bank and the small business debt and credit enhancement
programs were transferred from within GO-Biz to be managed under the
auspices of the new Center. A range of finance programs are
delivered through a statewide network of 11 small business finance
development corporations (FDCs) using both state and federal Jobs
Act funds. Among other financial products, the FDCs offer loan
guarantees and lines of credit that can be used to support export
activities. [AB 1247 (Medina and Bocanegra), Chapter 537, Statutes
of 2013]
In addition, GO-Biz is responsible for preparing the International
Trade and Investment Strategy to guide state activities, oversee the
use of federal money received through the State Trade and Export
Promotion (STEP) Program, work with EB-5 investors and regional
centers, provide data and track global business and trade trends,
and to collaborate on the activities of California's new China Trade
Office.
STEP is a three-year pilot trade and export initiative authorized by
the federal Small Business Jobs Act of 2010. The program is
regionally administered through a partnership between GO-Biz and the
California Community Colleges their network of Centers for
International Trade and Development. The primary purpose of the
program is to create jobs by increasing the number of, and the
volume of, small businesses exporting.
The California Trade and Investment Office in Shanghai is the first
trade office opened under the AB 2012 program authority. The Trade
Office is self-funded through private contributions and operates
under a cooperative agreement between GO-Biz and the Bay Area
Council, a San Francisco-headquartered nonprofit business
organization. Opened in October 2012, the purpose of the Trade
Office is to provide Californian companies increased access to
Chinese business contacts, Chinese investors with access to
California projects, and spur new investment and trade growth
SB 511
Page 11
between California and China.
SB 511 proposes the establishment of a number of new programs and
the undertaking of new activities that are materially similar to
existing programs and services. Overlaps include, but are not
limited to: providing credit enhancements to assist small
businesses access capital, marketing promotion activities, and
technical assistance. These similar programs are identified with a
* (see chart on previous page). As an example $2 million was just
approved in 2014-15 budget for the Small Business Development
Centers to assist small businesses prepare and access capital
support including for those businesses interested in export
activities.
5)California Export Activities : If California were a country, it
would be the 17th largest exporter and the 14th largest importer in
the world. Merchandise exports from California ($168 billion)
accounted for over 10.6% of total U.S. exports in goods, shipping to
over 220 foreign destinations in 2013. California's land, sea, and
air ports of entry served as key international commercial gateways
for the $538 billion in products entering and exiting the U.S. in
2012. Statewide, 4.4 million California jobs are dependent on
foreign trade. Over 562,700 California workers benefit from jobs
with foreign-owned firms, which accounts for 5.1% of all private
sector jobs in the state.
Mexico has been California's top trading partner since 1999 and in
2013, California exported $23.9 billion (14%) in goods. Chart 2
shows export data on the state's top five trade partners. Other
top-ranking export destinations not shown on the chart include Hong
Kong, Taiwan, Germany, the Netherlands, and the United Kingdom.
--------------------------------------------------------------------
| Chart 2 - California Export based on Movement of Goods 2012 and |
| 2013 |
--------------------------------------------------------------------
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| Rank | Country | 2012 Value | 2013 Value | 2012 % Share | 2013 % Share | % Change, |
| | | | | | | 2012 - 2013 |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| --- |Total | 161,880| 168,128| 10.5| 10.6| 3.9|
| |California | | | | | |
| |Exports and % | | | | | |
| |Share of U.S. | | | | | |
SB 511
Page 12
| |Total | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| --- |Total, Top 25 | 143,671| 149,020| 88.8| 88.6| 3.7|
| |Countries and | | | | | |
| |% Share of | | | | | |
| |State Total | | | | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| 1 |Mexico | 26,370| 23,933| 16.3| 14.2| -9.2|
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| 2 |Canada | 17,424| 18,819| 10.8| 11.2| 8.0|
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| 3 |China | 13,970| 16,359| 8.6| 9.7| 17.1|
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| 4 |Japan | 13,033| 12,711| 8.1| 7.6| -2.5|
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
| 5 |South Korea | 8,246| 8,394| 5.1| 5.0| 1.8|
--------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------
|Source: tradeport.org |
| |
| |
--------------------------------------------------------------------
California's largest industry sector by employment is Trade,
Transportation, and Utilities, which encompasses everything from
major retail outlets, to import-export businesses, to transportation
and warehousing. California leads the nation in export-related
jobs. The U.S. Department of Commerce estimates that for every one
million dollars of increased trade activity, 11 new jobs are
supported. Workers in trade-related jobs earn on average 13% to 28%
higher wages than the national average.
In today's globally linked economy, manufacturing utilizes products
from across the U.S., as well as from other nations. In 2012, 61%
($1.3 trillion) of the products imported into the U.S. were inputs
and components intended for use by American producers. In addition,
U.S. imports often include components or benefited from services
provided by U.S. firms, including many California companies. The
Wilson Center estimates that Mexican imports and Canadian imports
contain 40% and 20% U.S. components, respectively.
Trade and foreign investment support new job creation, bring new
technologies and skills to California workers, generate local and
state revenues, and generally strengthen the state's economic base.
In the future, California's economy will become increasingly reliant
SB 511
Page 13
on accessing foreign markets where a majority of global economic
growth is expected to occur.
6)National Export Initiative : In January 2010, the President launched
the National Export Initiative with the goal of doubling U.S.
exports over 5 years ($1.5 trillion to $3.17 trillion). The
initiative is directed through a newly established Export Promotion
Cabinet and an internal Trade Promotion Coordinating Committee which
has been tasked to coordinate and align their export promotion
activities including counseling, customer matchmaking services, and
financing for exporters. Chart 3 shows the U.S.' progress toward
meeting the national export goal. The chart was developed using a
GAO analysis based on data from the U.S. Bureau of Economic
Analysis. Priority initiatives include:
a) Exports by small and medium-sized businesses
b) Federal export assistance
c) Increased export credit
d) Reduced barriers to trade
e) Export promotion of services
As noted earlier in the analysis, California is currently
participating in the federal STEP program. Over the term of the
initiative, California exports have increased from $120 billion in
2009 to $169 billion in 2013, representing a 40% increase.
7)Export Competition: Domestic and Foreign : The California Center at
the Milken Institute released a study in 2012 that considered what
actions the state should consider in expanding export opportunities
for California businesses. The report's major recommendation called
for the state to develop and implement a comprehensive trade
strategy that utilizes existing resources, leverages private sector
expertise, focuses on key export destinations, and includes a
detailed export promotion strategy. Top barriers to export
promotion (cited from a prior BTH study) included regulatory
problems, access to capital, difficulty in identifying foreign
business partners, lack of internal resources and market knowledge,
and the fragmented state of trade services offered by California.
As shown in Chart 4, the California Center found that California's
export growth fell far short of other states. By comparison, the
study noted, states that had aggressively advanced trade promotion
strategies were more successful including Florida, Alabama, and
Pennsylvania. These strategies often included partnerships with
private industry, overseas trade promotion, and trade assistance to
SB 511
Page 14
exporting businesses. Other examples highlighted in the report
included Germany and South Korea who both implemented robust trade
strategies which included direct investment in export promotion.
Germany also offered loan guarantees to small and medium-sized
businesses and South Korea help businesses identify growing markets
for goods and then assisting its companies to penetrate those
markets.
------------------------------------------- -------------------------------------------- ------------------------------------------- In February 2014, GO-Biz issued the California International Trade
and Investment Strategy, which called for expanding the export of
California goods and services, and by increasing foreign direct
investment into the state. Based on these guiding policy goals, the
California strategy sets forth a comprehensive set of
recommendations around six strategic objectives:
1. Develop a comprehensive, coordinated and cohesive strategy
framework with a clear vision to expand trade and investment,
which includes other relevant state agencies, with input from
private and public sector stakeholders;
2. Implement more proactive outreach, awareness, education and
engagement programs both within the state for California-based
companies and through foreign partners and trade office(s);
3. Maximize China Trade Office resources and opportunities to
expand exports and investment;
4. Develop an action plan to address key challenges facing our
ports and related infrastructure to ensure their competitiveness;
5. Re-engage and strengthen working relationships with the Office
of the U.S. Trade Representative and the state's Congressional
delegation to advocate California interests related to
international trade and investment; and
6. Develop and implement a more user-friendly, comprehensive,
interactive and useful website to assist California companies
wanting to export and to attract foreign investment.
SB 511 could assist in the implementation of these strategic
objectives and serve as a key facilitator for bringing resources
together into a comprehensive network for services for smaller size
exporting businesses.
SB 511
Page 15
1)Amendments : In re-establishing the 2003 California Export Office in
a 2014 GO-Biz administrative structure a number of technical issues
arise including duplicative programs and services including, but not
limited to, the Small Business Finance Center, Small Business Loan
Guarantee Program, small business technical assistance, and
coordination with federal small business and export related
programs. While duplications exist, given the significant role that
trade plays within the California economy, the Committee may wish to
consider the following:
a) Shifting the California Export Finance Office to a position
within the Small Business Finance Center, which is located at the
I-Bank;
b) Expanding the Small Business Finance Center's existing
authority to include insurance and co-insurance;
c) Designating the I-Bank Board to set and adopt directives and
requirements for the operations of the California Export Office
(removes the need for regulations); and
d) Expanding the scope of the Small Business Advisory Committee
to include members with export experience.
2)Related Legislation : Below is a list of legislation from the
current and prior legislative sessions.
a) AB 1067 (Medina) EB-5 Immigration Oversight: This bill
establishes the California Foreign Investment Program within the
Governor's Office of Business and Economic Development to oversee
the state's participation in the federal EB-5 foreign investment
visa program. Among other things, this office will set the terms
and conditions regarding the designation of targeted employment
areas, as related to the EB-5 visas. Status: Signed by the
Governor, Chapter 535, Statutes of 2013.
b) AB 1545 (V. Manuel P�rez) Bi-National Infrastructure and
Economic Development Bank: This bill would have expanded the
role of the California Infrastructure and Economic Development
Bank to include facilitating infrastructure and economic
development financing activities within the California and Mexico
border region. Status: Held on the Suspense File of the Senate
Committee on Appropriations, 2012.
c) AB 2012 (John A. P�rez) Economic Development Reorganization:
This bill transferred the authority for undertaking international
trade and foreign investment activities from the Business,
SB 511
Page 16
Transportation and Housing Agency to the Governor's Office of
Business and Economic Development. In addition, the bill
transferred the responsibility for establishing an Internet-based
permit assistance center from the Secretary of the California
Environmental Protection Agency to GO-Biz. Status: Signed by
the Governor, Chapter 294, Statutes of 2012.
d) AB 2713 (Qurik-Silva) Public Private Partnerships to Promote
Trade: This bill authorizes the Governor's Office of Business
and Economic Development to establish public-private partnerships
to help guide state activities related to the export of
California products and the attraction of employment-producing
foreign investment. The bill requires the establishment of a
subaccount to hold private donation for county and
industry-specific marketing activities. The bill also requires
the establishment of a partnership to support California trade
and investment within South Korea. Status: Pending in the
Senate Appropriations Committee.
e) AB 337 (Allen) Ports and International Trade Strategy: This
bill requires the Governor's Office of Business and Economic
Development (GO-Biz) to evaluate key issues affecting trade and
foreign investment as part of the development of the previously
mandated international trade and investment strategy. In
undertaking this evaluation, GO-Biz is directed, to the greatest
extent possible, to use existing reports and other resources.
The evaluation required by this measure applies to the second
update of the strategy, which should occur no later than February
1, 2019. Status: Pending in the Senate Appropriations
Committee.
f) SB 460 (Price) International Trade Marketing and Promotion:
This bill would have required the Secretary of the Business,
Transportation and Housing Agency to convene a statewide business
partnership for international trade marketing and promotion.
Status: Held on the Suspense File of the Assembly Committee on
Appropriations, 2011.
g) SB 592 (Lieu) Trade Promotion of California Ports: This bill
would have required the Governor's Office of Business and
Economic Development to provide a port trade promotion strategy
to the Legislature and convene a statewide business partnership
for port trade promotion. Status: Held on the Suspense File of
the Assembly Committee on Appropriations, 2013.
SB 511
Page 17
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Port Authorities
California Small Business Association
California State Controller
California Trucking Association
CleanTECH San Diego
CONNECT
Greater Los Angeles African American Chamber of Commerce
Harbor Association of Industry & Commerce
Jobs 1st Alliance
Los Angeles County Economic Corporation
National Association of Women Business Owners
Port of San Diego
Redondo Beach Chamber of Commerce
Regional Economic Association Leader of California
San Diego & Imperial District Export Council
San Diego North Economic Development Council
San Diego Regional Chamber of Commerce
Southern California Association of Governments
Southern California Leadership Council
Southern California Leadership Council
The California Contract Cities Association
The California Export Finance Office
The California Taxpayers Association
The Greater Los Angeles African American Chamber of Commerce
The Inland Empire Economic Partnership
The Los Angeles Area Chamber of Commerce
The Los Angeles Customs Brokers and Freight Forwarders Association,
Inc.
The North San Diego Business Chamber
The Port of Los Angeles
The San Diego East County Economic Development Council
The San Diego Imperial District Export Council
The Southern California Association of Governments
The Valley Economic Development Center
Opposition
None received
Analysis Prepared by : Toni Symonds / J., E.D. & E. / (916) 319-2090
SB 511
Page 18