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					         AMENDED IN ASSEMBLY AUGUST 25, 1997
           AMENDED IN ASSEMBLY JULY 14, 1997
            AMENDED IN ASSEMBLY JULY 1, 1997
             AMENDED IN SENATE JUNE 2, 1997
            AMENDED IN SENATE APRIL 15, 1997

SENATE BILL                                             No. 1184


                Introduced by Senator Thompson


                        February 28, 1997




   An act to amend Sections 63000, 63010, 63021, 63025.1, 63026,
63055, and 63071 of, to amend and renumber Sections 63042
and 63048 of, to amend and renumber the headings of Article
4 (commencing with Section 63042) and Article 6
(commencing with Section 63048) of Chapter 2 of Division 1
of Title 6.7 of, to add Sections 63027, 63028, 63040, 63084, 63085,
63086, and 63087 to, to repeal Section 63001 of, to repeal Article
3 (commencing with Section 63040) of Chapter 2 of Division
1 of Title 6.7 of, to repeal the heading of Article 1
(commencing with Section 63050) of Chapter 3 of Division 1
of Title 6.7 of, to repeal Part 10.2 (commencing with Section
15710) of Division 3 of Title 2 of, and to repeal and add Article
5 (commencing with Section 63043) of Chapter 2 of Division
1 of Title 6.7 of, the Government Code, relating to state
infrastructure.




                                                                 94
SB 1184                         —2—
                       LEGISLATIVE COUNSEL’S DIGEST
   SB      1184,    as     amended,        M.   Thompson. California
Infrastructure and Economic Development Bank.
   (1) Under       the      Bergeson-Peace         Infrastructure     and
Economic         Development       Bank       Act,      the     California
Infrastructure     and      Economic        Development       Bank      is
established within state government with a board of directors
having specified duties. The act authorizes the bank to make
secured loans and undertake related activities for the purpose
of financing projects, as defined, that relate to infrastructure
improvements.
   The bill would define ‘‘economic development facilities’’
and ‘‘public development facilities,’’ and revise the definition
of ‘‘sponsor’’ and ‘‘project,’’ for the purposes of the act. This
bill would specify that the bank is within the Trade and
Commerce Agency.
   This bill would revise the authority of the bank board of
directors with regard to the duties it may perform or delegate
to the executive director. This bill would also revise the
authority of the bank to perform various functions, including,
among other things, providing insurance or reinsurance of
loans or their debt service, providing financing for public
development facilities, as defined, and issuing revenue bonds.
This bill would also require the legislative body of the sponsor
applying for financing to make specified findings prior to
submitting a project for bank consideration.
   (2) Existing law establishes the California Economic
Development and Financing Authority within the Trade and
Commerce Agency to perform various activities in providing
or arranging for the financing of specified economic
development projects.
   This     bill   would      repeal      the   California      Economic
Development and Financing Authority, but would require
the bank to assume and perform all the responsibilities of that
authority.
   (3) This bill would incorporate additional changes in
Sections 63010 and 63025.1 of the Government Code,
proposed by SB 477, to be operative only if SB 477 and this bill
are both chaptered and become effective on or before January
1, 1998, and this bill is chaptered last.

                                                                        94
                                —3—                           SB 1184
  Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.

     The people of the State of California do enact as follows:

 1      SECTION 1. Part 10.2 (commencing with Section
 2   15710) of Division 3 of Title 2 of the Government Code is
 3   repealed.
 4      SEC. 2. Section 63000 of the Government Code is
 5   amended to read:
 6      63000. The Legislature finds and declares the
 7   following:
 8      (a) Economic revitalization, future development, and
 9   a healthy climate for jobs in California will depend upon
10   a well-conceived system of public improvements that are
11   essential to the economic well-being of the citizens of the
12   state and are necessary to maintain, as well as create,
13   employment within the state for business.
14      (b) It is necessary for public policy to support the
15   efforts of businesses attempting to expand, businesses
16   seeking to locate in California, and local economic
17   development organizations, public agencies, and new
18   entrepreneurs by dedicating public fiscal resources to
19   confront obstacles and barriers that impede economic
20   growth.
21      (c) Existing     mechanisms       that   coordinate   federal,
22   state, local, and private financial resources are
23   inadequate to attract and sustain that level of private
24   investment that is essential to a growth economy.
25      (d) In order to secure and enhance the economic
26   well-being       of     Californians,      promote     economic
27   development in the state, and provide a healthy climate
28   for the creation of jobs, it is necessary for public policy to
29   support the efforts of expanding businesses, businesses
30   seeking to locate in California, local development
31   organizations, public bodies, and new entrepreneurs to
32   gain access to capital through current and potential
33   operations of financial markets.
34      (e) The high cost and the lack of availability of
35   industrial loans for small- and medium-size businesses is

                                                                    94
SB 1184                        —4—

 1   making it difficult for thousands of these enterprises to
 2   get established, to maintain their present employment
 3   levels, or to expand employment.
 4      (f) The problem of access to capital is acute in the high
 5   technology industry clusters because companies must
 6   often finance large capital expenditures early in their
 7   development       cycle,   and     cannot     obtain    financing
 8   sufficient to cover the cost of those expenditures.
 9   Consideration should be given to industry clusters
10   identified by the Economic Strategy Panel that may
11   include the following:
12      (1) Health care technology.
13      (2) Multimedia.
14      (3) Environmental technology.
15      (4) Information technology.
16      (g) The high cost and limited availability of loans and
17   capital has led a number of states to take action to remedy
18   these conditions through concerted public and private
19   investment programs that include efforts to do the
20   following:
21      (1) Use the state’s access to capital markets more
22   effectively for economic development.
23      (2) Create financing pools to access national capital
24   markets or help government sponsors and public-private
25   economic       development      organizations    obtain     credit
26   enhancement on their own.
27      (3) Facilitate credit enhancement for selected specific
28   projects.
29      (4) Provide or arrange for loan insurance.
30      (5) Create and support secondary markets for loan
31   portfolios of urban and rural economic development
32   corporations and others.
33      (6) Improve access to international capital markets.
34      (7) Provide opportunities for public pension funds and
35   other institutional investors to play a larger role in state
36   economic development.
37      (8) Arrange for or provide subordinated debt for
38   selected projects.
39      (9) Increase      support      for     local     infrastructure
40   development.

                                                                     94
                                —5—                             SB 1184
 1      (g)
 2      (h) Local governments in California bear a primary
 3   responsibility for the business of promoting job creation
 4   and       economic      development         efforts.    California’s
 5   continued reliance on autonomous local entities often
 6   fails to adequately consider regional impacts of business
 7   expansion. Projects of a regional nature need the benefit
 8   of a state coordinating function to augment and enhance
 9   local economic development and environmental efforts.
10      (h)
11      (i) The State of California has not embarked on a
12   major infrastructure financing effort since the decade of
13   the 1960’s, despite persistent unemployment and soaring
14   population growth.
15      (i)
16      (j) California’s ability to compete in a global economy
17   depends upon its capacity to implement policies that take
18   maximum advantage of public and private resources at
19   the local, regional, state, and national levels. These
20   policies should be coordinated with any future legislative
21   plan involving growth management strategies designed
22   to      make       economic       growth        compatible       with
23   environmental protections. It is the intent of the
24   Legislature in enacting this act to create a mechanism to
25   finance      projects   needed      to     implement      economic
26   development and job creation and growth management
27   strategies, and to provide a secure and stable funding
28   source for implementation of this act in order to meet
29   critical economic, social, and environmental concerns.
30      (j)
31      (k) The State of California needs a financing entity
32   structured with broad authority to issue bonds, provide
33   guarantees, and leverage state and federal funds using
34   techniques that will target public investment to facilitate
35   economic development. The goal is to produce more
36   private sector jobs with less public sector investment.
37      (k)
38      (l) The        mechanisms        for       financing        public
39   improvements        and    private     job     creation    strategies
40   provided for in this act are in the public interest, serve a

                                                                       94
SB 1184                         —6—

 1   public purpose, and will promote the health, welfare, and
 2   safety of the citizens of the state.
 3      (l)
 4      (m) The public policies and responsibilities of the
 5   state, including all of the above purposes and functions,
 6   cannot be fully obtained without the use of financing
 7   assistance and can be most effectively furthered by the
 8   creation of the California Infrastructure and Economic
 9   Development Bank.
10      SEC. 3. Section 63001 of the Government Code is
11   repealed.
12      SEC. 4. Section 63010 of the Government Code is
13   amended to read:
14      63010. For purposes of this division, the following
15   words and terms shall have the following meanings unless
16   the context clearly indicates or requires another or
17   different meaning or intent:
18      (a) ‘‘Act’’ means the Bergeson-Peace Infrastructure
19   and Economic Development Bank Act.
20      (b) ‘‘Bank’’ means the California Infrastructure and
21   Economic Development Bank.
22      (c) ‘‘Board’’ or ‘‘bank board’’ means the board of
23   directors of the California Infrastructure and Economic
24   Development Bank.
25      (d) ‘‘Bond purchase agreement’’ means a contractual
26   agreement executed between the bank and a sponsor, or
27   a special purpose trust authorized by the bank or a
28   sponsor, or both, whereby the bank or special purpose
29   trust authorized by the bank agrees to purchase bonds of
30   the sponsor for retention or sale.
31      (e) ‘‘Bonds’’     means       bonds,    including     structured,
32   senior, and subordinated bonds or other securities; loans;
33   notes, including bond, revenue, tax or grant anticipation
34   notes; commercial paper; floating rate, and variable
35   maturity securities; and any other evidences of
36   indebtedness or ownership, including certificates of
37   participation     or    beneficial     interest,   asset     backed
38   certificates, or lease-purchase or installment purchase
39   agreements, whether taxable or excludable from gross
40   income for federal income taxation purposes.

                                                                       94
                             —7—                         SB 1184
 1      (f) ‘‘Cost,’’ as applied to a project or portion thereof
 2   financed under this division, means all or any part of the
 3   cost of construction, renovation, and acquisition of all
 4   lands, structures, real or personal property, rights,
 5   rights-of-way,      franchises,    licenses, easements,   and
 6   interests acquired or used for a project; the cost of
 7   demolishing or removing any buildings or structures on
 8   land so acquired, including the cost of acquiring any lands
 9   to which the buildings or structures may be moved; the
10   cost of all machinery, equipment, and financing charges;
11   interest prior to, during, and for a period after,
12   completion of construction, renovation, or acquisition, as
13   determined by the bank; provisions for working capital;
14   reserves for principal and interest and for extensions,
15   enlargements, additions, replacements, renovations, and
16   improvements; the cost of architectural, engineering,
17   financial and legal services, plans, specifications,
18   estimates, administrative expenses, and other expenses
19   necessary or incidental to determining the feasibility of
20   any project or incidental to the construction, acquisition,
21   or financing of any project, and transition costs in the case
22   of an electrical corporation.
23      (g) ‘‘Economic development facilities’’ means real
24   and personal property, structures, buildings, equipment,
25   and supporting components thereof that are used to
26   provide industrial, recreational, research, commercial,
27   utility, or service enterprise facilities, community,
28   educational, cultural, or social welfare facilities and any
29   parts or combinations thereof, and all facilities or
30   infrastructure necessary or desirable in connection
31   therewith, including provision for working capital, but
32   shall not include any housing.
33      (h) ‘‘Electrical corporation’’ has the meaning set forth
34   in Section 218 of the Public Utilities Code.
35      (i) ‘‘Executive director’’ means the executive director
36   of      the    California     Infrastructure and    Economic
37   Development Bank appointed pursuant to Section 63021.
38      (j) ‘‘Financial assistance’’ in connection with a project,
39   includes, but is not limited to, any combination of grants,
40   loans, the proceeds of bonds issued by the bank or special

                                                                94
SB 1184                        —8—

 1   purpose trust, insurance, guarantees or other credit
 2   enhancements or liquidity facilities, and contributions of
 3   money, property, labor, or other things of value, as may
 4   be approved by resolution of the board or the sponsor, or
 5   both; the purchase or retention of bank bonds, the bonds
 6   of a sponsor for their retention or for sale by the bank, or
 7   the issuance of bank bonds or the bonds of a special
 8   purpose trust used to fund the cost of a project for which
 9   a sponsor is directly or indirectly liable, including, but not
10   limited to, bonds, the security for which is provided in
11   whole or in part pursuant to the powers granted by
12   Section 63025; bonds for which the bank has provided a
13   guarantee or enhancement, including, but not limited to,
14   the purchase of the subordinated bonds of the sponsor,
15   the subordinated bonds of a special purpose trust, or the
16   retention of the subordinated bonds of the bank pursuant
17   to Chapter 4 (commencing with Section 63060); or any
18   other type of assistance deemed appropriate by the bank
19   or the sponsor, except that no direct loans shall be made
20   to nonpublic entities other than in connection with the
21   issuance of rate reduction bonds pursuant to a financing
22   order or in connection with a financing for an economic
23   development facility.
24      For purposes of this subdivision, ‘‘grant’’ does not
25   include grants made by the bank except when acting as
26   an agent or intermediary for the distribution or
27   packaging of financing available from federal, private, or
28   other public sources.
29      (k) ‘‘Financing order’’ has the meaning set forth in
30   Section 840 of the Public Utilities Code.
31      (l) ‘‘Guarantee trust fund’’ means the California
32   Infrastructure Guarantee Trust Fund.
33      (m) ‘‘Infrastructure bank fund’’ means the California
34   Infrastructure and Economic Development Bank Fund.
35      (n) ‘‘Loan      agreement’’       means     a      contractual
36   agreement executed between the bank or a special
37   purpose trust and a sponsor that provides that the bank
38   or special purpose trust will loan funds to the sponsor and
39   that the sponsor will repay the principal and pay the
40   interest and redemption premium, if any, on the loan.

                                                                    94
                             —9—                          SB 1184
 1      (o) ‘‘Participating party’’ means any person, company,
 2   corporation, partnership, firm, or other entity or group of
 3   entities, whether organized for profit or not for profit,
 4   engaged in business or operations within the state and
 5   that applies for financing from the bank in conjunction
 6   with a sponsor for the purpose of implementing a project.
 7   However, in the case of a project relating to the financing
 8   of transition costs and the acquisition of transition
 9   property on the request of an electrical corporation, or in
10   connection      with     a    financing    for   an  economic
11   development facility, the participating party shall be
12   deemed to be the same entity as the sponsor for the
13   financing.
14      (p) ‘‘Project’’ means designing, acquiring, planning,
15   permitting,        entitling,      constructing,    improving,
16   extending, restoring, financing, and generally developing
17   public development facilities or economic development
18   facilities within the state or financing transition costs and
19   the acquisition of transition property upon approval of a
20   financing order by the Public Utilities Commission, as
21   provided in Article 5.5 (commencing with Section 840) of
22   Chapter 4 of Part 1 of Division 1 of the Public Utilities
23   Code.
24      (q) ‘‘Public development facilities’’ means real and
25   personal property, structures, conveyances, equipment,
26   thoroughfares, buildings, and supporting components
27   thereof, excluding any housing, that are directly related
28   to providing the following:
29      (1) ‘‘City streets’’ including any street, avenue,
30   boulevard, road, parkway, drive, or other way that is any
31   of the following:
32      (A) An existing municipal roadway.
33      (B) Is shown upon a plat approved pursuant to law and
34   includes the land between the street lines, whether
35   improved or unimproved, and may comprise pavement,
36   bridges, shoulders, gutters, curbs, guardrails, sidewalks,
37   parking areas, benches, fountains, plantings, lighting
38   systems, and other areas within the street lines, as well as
39   equipment and facilities used in the cleaning, grading,
40   clearance, maintenance, and upkeep thereof.

                                                                 94
SB 1184                        — 10 —

 1      (2) ‘‘County highways’’ including any county highway
 2   as defined in Section 25 of the Streets and Highways Code,
 3   that includes the land between the highway lines,
 4   whether improved or unimproved, and may comprise
 5   pavement, bridges, shoulders, gutters, curbs, guardrails,
 6   sidewalks, parking areas, benches, fountains, plantings,
 7   lighting systems, and other areas within the street lines,
 8   as well as equipment and facilities used in the cleaning,
 9   grading, clearance, maintenance, and upkeep thereof.
10      (3) ‘‘Drainage and flood control’’ including ditches,
11   canals, levees, pumps, dams, conduits, pipes, storm
12   sewers, and dikes necessary to keep or direct water away
13   from people, equipment, buildings, and other protected
14   areas as may be established by lawful authority, as well as
15   the      acquisition,      improvement,      maintenance,       and
16   management of floodplain areas and all equipment used
17   in the maintenance and operation of the foregoing.
18      (4) ‘‘Educational facilities’’ including libraries, child
19   care facilities, including, but not limited to, day care
20   facilities, and employment training facilities.
21      (5) ‘‘Environmental       mitigation measures’’ including
22   required       construction    or     modification     of    public
23   infrastructure and purchase and installation of pollution
24   control and noise abatement equipment.
25      (6) ‘‘Parks and recreational facilities’’ including local
26   parks, recreational property and equipment, parkways,
27   and property.
28      (7) ‘‘Port facilities’’ including docks, harbors, ports of
29   entry, piers, ships, small boat harbors and marinas, and
30   any other facilities, additions, or improvements in
31   connection therewith.
32      (8) ‘‘Communications’’         including       facilities     for
33   telephone and telecommunications service.
34      (9) ‘‘Public transit’’ including air and rail transport of
35   goods,       airports,   guideways,     vehicles,    rights-of-way,
36   passenger stations, maintenance and storage yards, and
37   related structures, including public parking facilities,
38   equipment used to provide or enhance transportation by
39   bus, rail, ferry, or other conveyance, either publicly or


                                                                       94
                               — 11 —                          SB 1184
 1   privately owned, that provides to the public general or
 2   special service on a regular and continuing basis.
 3      (10) ‘‘Sewage collection and treatment’’ including
 4   pipes, pumps, and conduits that collect wastewater from
 5   residential,         manufacturing,         and           commercial
 6   establishments, the equipment, structures, and facilities
 7   used in treating wastewater to reduce or eliminate
 8   impurities or contaminants, and the facilities used in
 9   disposing of, or transporting, remaining sludge, as well as
10   all equipment used in the maintenance and operation of
11   the foregoing.
12      (11) ‘‘Solid waste collection and disposal’’ including
13   vehicles, vehicle-compatible waste receptacles, transfer
14   stations, recycling centers, sanitary landfills, and waste
15   conversion facilities necessary to remove solid waste,
16   except that which is hazardous as defined by law, from its
17   point of origin.
18      (12) ‘‘Water treatment and distribution’’ including
19   facilities in which water is purified and otherwise treated
20   to meet residential, manufacturing, or commercial
21   purposes and the conduits, pipes, and pumps that
22   transport it to places of use.
23      (13) ‘‘Defense conversion’’ including, but is not
24   limited to, facilities necessary for successfully converting
25   military bases consistent with an adopted base reuse plan.
26      (14) ‘‘Public safety facilities’’ including, but is not
27   limited to, police stations, fire stations, court buildings,
28   jails, juvenile halls, and juvenile detention facilities.
29      (15) ‘‘State highways’’ including any state highway as
30   described in Chapter 2 (commencing with Section 230)
31   of Division 1 of the Streets and Highways Code, and the
32   related components necessary for safe operation of the
33   highway.
34      (r) ‘‘Rate reduction bonds’’ has the meaning set forth
35   in Section 840 of the Public Utilities Code.
36      (s) ‘‘Revenues’’       means       all    receipts,      purchase
37   payments, loan repayments, lease payments, and all other
38   income or receipts derived by the bank or a sponsor from
39   the sale, lease, or other financing arrangement
40   undertaken by the bank, a sponsor or a participating

                                                                       94
SB 1184                     — 12 —

 1   party, including, but not limited to, all receipts from a
 2   bond purchase agreement, and any income or revenue
 3   derived from the investment of any money in any fund
 4   or account of the bank or a sponsor and any receipts
 5   derived from transition property. Revenues shall not
 6   include moneys in the General Fund of the state.
 7      (t) ‘‘Special purpose trust’’ means a trust, partnership,
 8   limited partnership, association, corporation, nonprofit
 9   corporation, or other entity authorized under the laws of
10   the state to serve as an instrumentality of the state to
11   accomplish public purposes and authorized by the bank
12   to acquire, by purchase or otherwise, for retention or sale,
13   the bonds of a sponsor or of the bank made or entered into
14   pursuant to this division and to issue special purpose trust
15   bonds or other obligations secured by these bonds or
16   other sources of public or private revenues. In addition,
17   special purpose trust also means any entity authorized
18   under the laws of the state to serve as an instrumentality
19   of the state to accomplish public purposes and authorized
20   by the bank to acquire transition property and to issue
21   rate reduction bonds.
22      (u) ‘‘Sponsor’’ means any subdivision of the state or
23   local     government    including   departments,    agencies,
24   commissions, cities, counties, nonprofit corporations
25   formed on behalf of a sponsor, special districts, assessment
26   districts, and joint powers authorities within the state or
27   any combination of these subdivisions that has, or
28   proposes to acquire, an interest in a project and that
29   makes application to the bank for financial assistance in
30   connection with a project in a manner prescribed by the
31   bank. In addition, an electrical corporation shall be
32   deemed to be the sponsor as well as the participating
33   party for any project relating to the financing of transition
34   costs and the acquisition of transition property on the
35   request of the electrical corporation and any person,
36   company, corporation, partnership, firm, or other entity
37   or group engaged in business or operation within the state
38   that applies for financing of any economic development
39   facility, shall be deemed to be the sponsor as well as the


                                                                94
                               — 13 —                         SB 1184
 1   participating party for the project relating to the
 2   financing of that economic development facility.
 3      (v) ‘‘State’’ means the State of California.
 4      (w) ‘‘Transition costs’’ has the meaning set forth in
 5   Section 840 of the Public Utilities Code.
 6      (x) ‘‘Transition property’’ has the meaning set forth in
 7   Section 840 of the Public Utilities Code.
 8      SEC. 4.5. Section 63010 of the Government Code is
 9   amended to read:
10      63010. For purposes of this division, the following
11   words and terms shall have the following meanings unless
12   the context clearly indicates or requires another or
13   different meaning or intent:
14      (a) ‘‘Act’’ means the Bergeson-Peace Infrastructure
15   and Economic Development Bank Act.
16      (b) ‘‘Bank’’ means the California Infrastructure and
17   Economic Development Bank.
18      (c) ‘‘Board’’ or ‘‘bank board’’ means the board Board
19   of directors Directors of the California Infrastructure and
20   Economic Development Bank.
21      (d) ‘‘Bond purchase agreement’’ means a contractual
22   agreement executed between the bank and a sponsor, or
23   a special purpose trust authorized by the bank or a
24   sponsor, or both, whereby the bank or special purpose
25   trust authorized by the bank agrees to purchase bonds of
26   the sponsor for retention or sale.
27      (e) ‘‘Bonds’’     means     bonds,     including     structured,
28   senior, and subordinated bonds or other securities; loans;
29   notes, including bond, revenue, tax or grant anticipation
30   notes; commercial paper; floating rate, and variable
31   maturity securities; and any other evidences of
32   indebtedness or ownership, including certificates of
33   participation     or    beneficial   interest,    asset     backed
34   certificates, or lease-purchase or installment purchase
35   agreements, whether taxable or excludable from gross
36   income for federal income taxation purposes.
37      (f) ‘‘Cost,’’ as applied to a project or portion thereof
38   financed under this division, means all or any part of the
39   cost of construction, renovation, and acquisition of all
40   lands, structures, real or personal property, rights,

                                                                      94
SB 1184                     — 14 —

 1   rights-of-way,        franchises, licenses,  easements,   and
 2   interests acquired or used for a project; the cost of
 3   demolishing or removing any buildings or structures on
 4   land so acquired, including the cost of acquiring any lands
 5   to which the buildings or structures may be moved; the
 6   cost of all machinery, equipment, and financing charges;
 7   interest prior to, during, and for a period after,
 8   completion of construction, renovation, or acquisition, as
 9   determined by the bank; provisions for working capital;
10   reserves for principal and interest and for extensions,
11   enlargements, additions, replacements, renovations, and
12   improvements; the cost of architectural, engineering,
13   financial and legal services, plans, specifications,
14   estimates, administrative expenses, and other expenses
15   necessary or incidental to determining the feasibility of
16   any project or incidental to the construction, acquisition,
17   or financing of any project, and transition costs in the case
18   of an electrical corporation.
19      (g) ‘‘Economic development facilities’’ means real
20   and personal property, structures, buildings, equipment,
21   and supporting components thereof that are used to
22   provide industrial, recreational, research, commercial,
23   utility, or service enterprise facilities, community,
24   educational, cultural, or social welfare facilities and any
25   parts or combinations thereof, and all facilities or
26   infrastructure necessary or desirable in connection
27   therewith, including provision for working capital, but
28   shall not include any housing.
29      (h) ‘‘Electrical corporation’’ has the meaning set forth
30   in Section 218 of the Public Utilities Code.
31      (h)
32      (i) ‘‘Executive director’’ means the executive director
33   Executive Director of the California Infrastructure and
34   Economic Development Bank appointed pursuant to
35   Section 63021.
36      (i) ‘‘Facilities’’
37      (j) ‘‘Financial assistance’’ in connection with a project,
38   includes, but is not limited to, any combination of grants,
39   loans, the proceeds of bonds issued by the bank or special
40   purpose trust, insurance, guarantees or other credit

                                                                94
                              — 15 —                        SB 1184
 1   enhancements or liquidity facilities, and contributions of
 2   money, property, labor, or other things of value, as may
 3   be approved by resolution of the board or the sponsor, or
 4   both; the purchase or retention of bank bonds, the bonds
 5   of a sponsor for their retention or for sale by the bank, or
 6   the issuance of bank bonds or the bonds of a special
 7   purpose trust used to fund the cost of a project for which
 8   a sponsor is directly or indirectly liable, including, but not
 9   limited to, bonds, the security for which is provided in
10   whole or in part pursuant to the powers granted by
11   Section 63025; bonds for which the bank has provided a
12   guarantee or enhancement, including, but not limited to,
13   the purchase of the subordinated bonds of the sponsor,
14   the subordinated bonds of a special purpose trust, or the
15   retention of the subordinated bonds of the bank pursuant
16   to Chapter 4 (commencing with Section 63060); or any
17   other type of assistance deemed appropriate by the bank
18   or the sponsor, except that no direct loans shall be made
19   to nonpublic entities other than in connection with the
20   issuance of rate reduction bonds pursuant to a financing
21   order or in connection with a financing for an economic
22   development facility.
23      For purposes of this subdivision, ‘‘grant’’ does not
24   include grants made by the bank except when acting as
25   an agent or intermediary for the distribution or
26   packaging of financing available from federal, private, or
27   other public sources.
28      (k) ‘‘Financing order’’ has the meaning set forth in
29   Section 840 of the Public Utilities Code.
30      (l) ‘‘Guarantee trust fund’’ means the California
31   Infrastructure Guarantee Trust Fund.
32      (m) ‘‘Infrastructure bank fund’’ means the California
33   Infrastructure and Economic Development Bank Fund.
34      (n) ‘‘Loan      agreement’’       means     a      contractual
35   agreement executed between the bank or a special
36   purpose trust and a sponsor that provides that the bank
37   or special purpose trust will loan funds to the sponsor and
38   that the sponsor will repay the principal and pay the
39   interest and redemption premium, if any, on the loan.


                                                                    94
SB 1184                      — 16 —

 1      (o) ‘‘Participating party’’ means any person, company,
 2   corporation, partnership, firm, or other entity or group of
 3   entities, whether organized for profit or not for profit,
 4   engaged in business or operations within the state and
 5   that applies for financing from the bank in conjunction
 6   with a sponsor for the purpose of implementing a project.
 7   However, in the case of a project relating to the financing
 8   of transition costs or the acquisition of transition property,
 9   or both, on the request of an electrical corporation, or in
10   connection      with      a    financing   for    an  economic
11   development facility, the participating party shall be
12   deemed to be the same entity as the sponsor for the
13   financing.
14      (p) ‘‘Project’’ means designing, acquiring, planning,
15   permitting,         entitling,      constructing,    improving,
16   extending, restoring, financing, and generally developing
17   public development facilities or economic development
18   facilities within the state or financing transition costs or
19   the acquisition of transition property, or both, upon
20   approval of a financing order by the Public Utilities
21   Commission, as provided in Article 5.5 (commencing
22   with Section 840) of Chapter 4 of Part 1 of Division 1 of
23   the Public Utilities Code.
24      (q) ‘‘Public development facilities’’ means real and
25   personal property, structures, conveyances, equipment,
26   thoroughfares, buildings, and supporting components
27   thereof, excluding any housing, that are directly related
28   to providing the following:
29      (1) ‘‘City streets’’ includes including any street,
30   avenue, boulevard, road, parkway, drive, or other way
31   that is any of the following:
32      (A) An existing municipal roadway.
33      (B) Is shown upon a plat approved pursuant to law and
34   includes the land between the street lines, whether
35   improved or unimproved, and may comprise pavement,
36   bridges, shoulders, gutters, curbs, guardrails, sidewalks,
37   parking areas, benches, fountains, plantings, lighting
38   systems, and other areas within the street lines, as well as
39   equipment and facilities used in the cleaning, grading,
40   clearance, maintenance, and upkeep thereof.

                                                                  94
                                — 17 —                           SB 1184
 1      (2) ‘‘County highways’’ includes including any county
 2   highway as defined in Section 25 of the Streets and
 3   Highways Code, that includes the land between the
 4   highway lines, whether improved or unimproved, and
 5   may comprise pavement, bridges, shoulders, gutters,
 6   curbs, guardrails, sidewalks, parking areas, benches,
 7   fountains, plantings, lighting systems, and other areas
 8   within the street lines, as well as equipment and facilities
 9   used in the cleaning, grading, clearance, maintenance,
10   and upkeep thereof.
11      (3) ‘‘Drainage and flood control’’ includes including
12   ditches, canals, levees, pumps, dams, conduits, pipes,
13   storm sewers, and dikes necessary to keep or direct water
14   away from people, equipment, buildings, and other
15   protected areas as may be established by lawful authority,
16   as well as the acquisition, improvement, maintenance,
17   and management of floodplain areas and all equipment
18   used in the maintenance and operation of the foregoing.
19      (4) ‘‘Educational       facilities’’       includes       including
20   libraries, child care facilities, including, but not limited to,
21   day care facilities, and employment training facilities.
22      (5) ‘‘Environmental       mitigation        measures’’      includes
23   including required construction or modification of public
24   infrastructure and purchase and installation of pollution
25   control and noise abatement equipment.
26      (6) ‘‘Parks      and    recreational        facilities’’    includes
27   including     local     parks,      recreational       property     and
28   equipment, parkways, and property.
29      (7) ‘‘Port facilities’’ includes including docks, harbors,
30   ports of entry, piers, ships, small boat harbors and
31   marinas,     and      any    other      facilities,    additions,    or
32   improvements in connection therewith.
33      (8) ‘‘Communications’’ includes including facilities for
34   telephone and telecommunications service.
35      (9) ‘‘Public transit’’ includes including air and rail
36   transport    of     goods,     airports,      guideways,      vehicles,
37   rights-of-way,      passenger      stations,      maintenance       and
38   storage yards, and related structures, including public
39   parking facilities, equipment used to provide or enhance
40   transportation by bus, rail, ferry, or other conveyance,

                                                                         94
SB 1184                       — 18 —

 1   either publicly or privately owned, that provides to the
 2   public general or special service on a regular and
 3   continuing basis.
 4      (10) ‘‘Sewage collection and treatment’’ includes
 5   including pipes, pumps, and conduits that collect
 6   wastewater        from      residential,  manufacturing,     and
 7   commercial establishments, the equipment, structures,
 8   and facilities used in treating wastewater to reduce or
 9   eliminate impurities or contaminants, and the facilities
10   used in disposing of, or transporting, remaining sludge, as
11   well as all equipment used in the maintenance and
12   operation of the foregoing.
13      (11) ‘‘Solid-waste collection and disposal’’ includes
14   including vehicles, vehicle-compatible waste receptacles,
15   transfer stations, recycling centers, sanitary landfills, and
16   waste conversion facilities necessary to remove solid
17   waste, except that which is hazardous as defined by law,
18   from its point of origin.
19      (12) ‘‘Water      treatment      and  distribution’’ includes
20   including facilities in which water is purified and
21   otherwise treated to meet residential, manufacturing, or
22   commercial purposes and the conduits, pipes, and pumps
23   that transport it to places of use.
24      (13) ‘‘Defense conversion’’ includes including, but is
25   not limited to, facilities necessary for successfully
26   converting military bases consistent with an adopted base
27   reuse plan.
28      (14) ‘‘Public safety facilities’’ includes including, but is
29   not limited to, police stations, fire stations, court
30   buildings, jails, juvenile halls, and juvenile detention
31   facilities.
32      (15) ‘‘State highways’’ includes including any state
33   highway as described in Chapter 2 (commencing with
34   Section 230) of Division 1 of the Streets and Highways
35   Code, and the related components necessary for safe
36   operation of the highway.
37      (j) ‘‘Financial assistance’’ in connection with a project,
38   includes, but is not limited to, any combination of grants,
39   loans, the proceeds of bonds issued by the bank or special
40   purpose trust, insurance, guarantees or other credit

                                                                   94
                              — 19 —                        SB 1184
 1   enhancements or liquidity facilities, and contributions of
 2   money, property, labor, or other things of value, as may
 3   be approved by resolution of the board or the sponsor, or
 4   both; the purchase or retention of bank bonds, the bonds
 5   of a sponsor for their retention or for sale by the bank, or
 6   the issuance of bank bonds or the bonds of a special
 7   purpose trust used to fund the cost of a project for which
 8   a sponsor is directly or indirectly liable, including, but not
 9   limited to, bonds, the security for which is provided in
10   whole or in part pursuant to the powers granted by
11   Section 63025; bonds for which the bank has provided a
12   guarantee or enhancement, including, but not limited to,
13   the purchase of the subordinated bonds of the sponsor,
14   the subordinated bonds of a special purpose trust, or the
15   retention of the subordinated bonds of the bank pursuant
16   to Chapter 4 (commencing with Section 63060); or any
17   other type of assistance deemed appropriate by the bank
18   or the sponsor, except that no direct loans shall be made
19   to nonpublic entities other than in connection with the
20   issuance of rate reduction bonds pursuant to a financing
21   order.
22      For purposes of this subdivision, ‘‘grant’’ does not
23   include grants made by the bank except when acting as
24   an agent or intermediary for the distribution or
25   packaging of financing available from federal, private, or
26   other public sources.
27      (k) ‘‘Financing order’’ has the meaning set forth in
28   Section 840 of the Public Utilities Code.
29      (l) ‘‘Guarantee trust fund’’ means the California
30   Infrastructure Guarantee Trust Fund.
31      (m) ‘‘Infrastructure bank fund’’ means the California
32   Infrastructure and Economic Development Bank Fund.
33      (n) ‘‘Loan       agreement’’      means     a      contractual
34   agreement executed between the bank or a special
35   purpose trust and a sponsor that provides that the bank
36   or special purpose trust will loan funds to the sponsor and
37   that the sponsor will repay the principal and pay the
38   interest and redemption premium, if any, on the loan.
39      (o) ‘‘Participating party’’ means any person, company,
40   corporation, partnership, firm, or other entity or group of

                                                                    94
SB 1184                      — 20 —

 1   entities engaged in business within the state and that
 2   applies for financing from the bank in conjunction with
 3   a sponsor for the purpose of implementing a project.
 4   However, in the case of a project relating to the financing
 5   of transition costs and the acquisition of transition
 6   property on the request of an electrical corporation, the
 7   participating party shall be deemed to be the same entity
 8   as the sponsor for the financing.
 9      (p) ‘‘Project’’ means designing, acquiring, planning,
10   permitting,       entitling,       constructing,     improving,
11   extending, restoring, financing, and generally developing
12   facilities within the state or financing transition costs and
13   the acquisition of transition property upon approval of a
14   financing order by the Public Utilities Commission, as
15   provided in Article 5.5 (commencing with Section 840) of
16   Chapter 4 of Part 1 of Division 1 of the Public Utilities
17   Code.
18      (q)
19      (r) ‘‘Rate reduction bonds’’ has the meaning set forth
20   in Section 840 of the Public Utilities Code.
21      (r)
22      (s) ‘‘Revenues’’      means       all   receipts,   purchase
23   payments, loan repayments, lease payments, and all other
24   income or receipts derived by the bank or a sponsor from
25   the sale, lease, or other financing arrangement
26   undertaken by the bank, a sponsor or a participating
27   party, including, but not limited to, all receipts from a
28   bond purchase agreement, and any income or revenue
29   derived from the investment of any money in any fund
30   or account of the bank or a sponsor and any receipts
31   derived from transition property. Revenues shall not
32   include moneys in the General Fund of the state.
33      (s)
34      (t) ‘‘Special purpose trust’’ means a trust, partnership,
35   limited partnership, association, corporation, nonprofit
36   corporation, or other entity authorized under the laws of
37   the state to serve as an instrumentality of the state to
38   accomplish public purposes and authorized by the bank
39   to acquire, by purchase or otherwise, for retention or sale,
40   the bonds of a sponsor or of the bank made or entered into

                                                                  94
                             — 21 —                       SB 1184
 1   pursuant to this division and to issue special purpose trust
 2   bonds or other obligations secured by these bonds or
 3   other sources of public or private revenues. In addition,
 4   special Special purpose trust also means any entity
 5   authorized under the laws of the state to serve as an
 6   instrumentality of the state to accomplish public purposes
 7   and authorized by the bank to acquire transition property
 8   and by the bank to acquire transition property or to issue
 9   rate reduction bonds, or both, subject to the approvals by
10   the bank and powers of the bank as are provided by the
11   bank in its resolution authorizing the entity to issue rate
12   reduction bonds.
13      (t)
14      (u) ‘‘Sponsor’’ means any subdivision of the state or
15   local     government      including     departments, agencies,
16   commissions, cities, counties, nonprofit corporations
17   formed on behalf of a sponsor, special districts, assessment
18   districts, and joint powers authorities within the state or
19   any combination of these subdivisions that has, or
20   proposes to acquire, an interest in a project and that
21   makes application to the bank for financial assistance in
22   connection with a project in a manner prescribed by the
23   bank. In addition, an electrical corporation shall be
24   deemed to be the sponsor as well as the participating
25   party for any project relating to the financing of transition
26   costs and the acquisition of transition property on the
27   request of the electrical corporation and any person,
28   company, corporation, partnership, firm, or other entity
29   or group engaged in business or operation within the state
30   that applies for financing of any economic development
31   facility, shall be deemed to be the sponsor as well as the
32   participating party for the project relating to the
33   financing of that economic development facility.
34      (u)
35      (v) ‘‘State’’ means the State of California.
36      (v)
37      (w) ‘‘Transition costs’’ has the meaning set forth in
38   Section 840 of the Public Utilities Code.
39      (w)


                                                                 94
SB 1184                      — 22 —

 1      (x) ‘‘Transition property’’ has the meaning set forth in
 2   Section 840 of the Public Utilities Code.
 3      SEC. 5. Section 63021 of the Government Code is
 4   amended to read:
 5      63021. (a) There is within the Trade and Commerce
 6   Agency the Infrastructure and Economic Development
 7   Bank which shall be responsible for administering this
 8   division.
 9      (b) The bank shall be under the direction of an
10   executive director appointed by the Governor, and who
11   shall serve at the pleasure of the Governor. The
12   appointment shall be subject to confirmation by the
13   Senate.
14      SEC. 6. Section 63025.1 of the Government Code is
15   amended to read:
16      63025.1. The bank board may do or delegate the
17   following to the executive director:
18      (a) Sue and be sued in its own name.
19      (b) As provided in Chapter 5 (commencing with
20   Section 63070), issue bonds and authorize special purpose
21   trusts to issue bonds, including, at the option of the board,
22   bonds bearing interest that is taxable for the purpose of
23   federal income taxation, or borrow money, to pay all or
24   any part of the cost of any project, or to otherwise carry
25   out the purposes of this division.
26      (c) Engage the services of private consultants to
27   render professional and technical assistance and advice in
28   carrying out the purposes of this division.
29      (d) Employ attorneys, financial consultants, and other
30   advisers as may, in the bank’s judgment, be necessary in
31   connection with the issuance and sale, or authorization of
32   special purpose trusts for the issuance and sale, of any
33   bonds, notwithstanding Sections 11042 and 11043.
34      (e) Contract        for       engineering,    architectural,
35   accounting, or other services of appropriate state
36   agencies as may, in its judgment, be necessary for the
37   successful development of a project.
38      (f) Pay the reasonable costs of consulting engineers,
39   architects, accountants, and construction, land use,
40   recreation, and environmental experts employed by any

                                                                  94
                             — 23 —                       SB 1184
 1   sponsor or participating party if, in the bank’s judgment,
 2   those services are necessary for the successful
 3   development of a project.
 4      (g) Acquire, take title to, and sell by installment sale
 5   or otherwise, lands, structures, real or personal property,
 6   rights, rights-of-way, franchises, easements, and other
 7   interests in lands that are located within the state, or
 8   transition property as the bank may deem necessary or
 9   convenient for the financing of the project, upon terms
10   and conditions that it considers to be reasonable.
11      (h) Receive and accept from any source, including,
12   but not limited to, the federal government, the state, or
13   any agency thereof, loans, contributions, or grants, in
14   money, property, labor, or other things of value, for, or in
15   aid of, a project, or any portion thereof.
16      (i) Make loans to any sponsor or participating party,
17   either directly or by making a loan to a lending
18   institution, in connection with the financing of a project
19   in accordance with an agreement between the bank and
20   the sponsor or a participating party, either as a sole lender
21   or in participation with other lenders. However, no loan
22   shall exceed the total cost of the project as determined by
23   the sponsor or the participating party and approved by
24   the bank.
25      (j) Make loans to any sponsor or participating party,
26   either directly or by making a loan to a lending
27   institution, in accordance with an agreement between
28   the bank and the sponsor or participating party to
29   refinance indebtedness incurred by the sponsor or
30   participating      party    in     connection    with  projects
31   undertaken and completed prior to any agreement with
32   the bank or expectation that the bank would provide
33   financing, either as sole lender or in participation with
34   other lenders.
35      (k) Mortgage all or any portion of the bank’s interest
36   in a project and the property on which any project is
37   located,     whether      owned       or   thereafter acquired,
38   including the granting of a security interest in any
39   property, tangible or intangible.


                                                                  94
SB 1184                       — 24 —

 1      (l) Assign or pledge all or any portion of the bank’s
 2   interests in transition property and the revenues
 3   therefrom, or assets, things of value, mortgages, deeds of
 4   trust,     bonds,     bond      purchase      agreements,    loan
 5   agreements, indentures of mortgage or trust, or similar
 6   instruments, notes, and security interests in property,
 7   tangible or intangible, and the revenues therefrom, of a
 8   sponsor or a participating party to which the bank has
 9   made loans, and the revenues therefrom, including
10   payment or income from any interest owned or held by
11   the bank, for the benefit of the holders of bonds.
12      (m) Make, receive, or serve as a conduit for the
13   making of, or otherwise provide for, grants, contributions,
14   guarantees, insurance, credit enhancements or liquidity
15   facilities, or other financial enhancements to a sponsor or
16   a participating party as financial assistance for a project.
17      (n) Lease the project being financed to a sponsor or a
18   participating party, upon terms and conditions that the
19   bank deems proper but shall not be leased at a loss; charge
20   and collect rents therefor; terminate any lease upon the
21   failure of the lessee to comply with any of the obligations
22   thereof; include in any lease, if desired, provisions that the
23   lessee shall have options to renew the lease for a period
24   or periods, and at rents determined by the bank; purchase
25   any or all of the project; or, upon payment of all the
26   indebtedness incurred by the bank for the financing of
27   the project, the bank may convey any or all of the project
28   to the lessee or lessees.
29      (o) Charge and equitably apportion among sponsors
30   and participating parties the bank’s administrative costs
31   and expenses incurred in the exercise of the powers and
32   duties conferred by this division.
33      (p) Issue, obtain, or aid in obtaining, from any
34   department or agency of the United States, from other
35   agencies of the state, or from any private company, any
36   insurance or guarantee to, or for, the payment or
37   repayment of interest or principal, or both, or any part
38   thereof, on any loan, lease, or obligation or any
39   instrument evidencing or securing the same, made or
40   entered into pursuant to this division.

                                                                    94
                            — 25 —                      SB 1184
 1      (q) Notwithstanding any other provision of this
 2   division, enter into any agreement, contract, or any other
 3   instrument with respect to any insurance or guarantee;
 4   accept payment in the manner and form as provided
 5   therein in the event of default by a sponsor or a
 6   participating party; and issue or assign any insurance or
 7   guarantee as security for the bank’s bonds.
 8      (r) Enter into any agreement or contract, execute any
 9   instrument, and perform any act or thing necessary or
10   convenient to, directly or indirectly, secure the bank’s
11   bonds, the bonds issued by a special purpose trust, or a
12   sponsor’s obligations to the bank or to a special purpose
13   trust, including, but not limited to, bonds of a sponsor
14   purchased by the bank or a special purpose trust for
15   retention or sale, with funds or moneys that are legally
16   available and that are due or payable to the sponsor by
17   reason of any grant, allocation, apportionment or
18   appropriation of the state or agencies thereof, to the
19   extent that the Controller shall be the custodian at any
20   time of these funds or moneys, or with funds or moneys
21   that are or will be legally available to the sponsor, the
22   bank, or the state or any agencies thereof by reason of any
23   grant, allocation, apportionment, or appropriation of the
24   federal government or agencies thereof; and in the event
25   of written notice that the sponsor has not paid or is in
26   default on its obligations to the bank or a special purpose
27   trust, direct the Controller to withhold payment of those
28   funds or moneys from the sponsor over which it is or will
29   be custodian and to pay the same to the bank or special
30   purpose trust or their assignee, or direct the state or any
31   agencies thereof to which any grant, allocation,
32   apportionment      or      appropriation    of the   federal
33   government or agencies thereof is or will be legally
34   available to pay the same upon receipt by the bank or
35   special purpose trust or their assignee, until the default
36   has been cured and the amounts then due and unpaid
37   have been paid to the bank or special purpose trust or
38   their assignee, or until arrangements satisfactory to the
39   bank or special purpose trust have been made to cure the
40   default.

                                                               94
SB 1184                     — 26 —

 1      (s) Enter into any agreement or contract, execute any
 2   instrument, and perform any act or thing necessary,
 3   convenient, or appropriate to carry out any power
 4   expressly given to the bank by this division, including, but
 5   not limited to, agreements for the sale of all or any part,
 6   including principal, interest, redemption rights or any
 7   other rights or obligations, of bonds of the bank or of a
 8   special purpose trust, liquidity agreements, contracts
 9   commonly known as interest rate swap agreements,
10   forward payment conversion agreements, futures or
11   contracts providing for payments based on levels of, or
12   changes in, interest rates or currency exchange rates, or
13   contracts to exchange cash-flows or a series of payments,
14   or contracts, including options, puts or calls to hedge
15   payments, rate, spread, currency exchange, or similar
16   exposure, or any other financial instrument commonly
17   known as a structured financial product.
18      (t) Purchase, with the proceeds of the bank’s bonds,
19   transition property or bonds issued by, or for the benefit
20   of, any sponsor in connection with a project, pursuant to
21   a bond purchase agreement or otherwise. Bonds or
22   transition property purchased pursuant to this division
23   may be held by the bank, pledged or assigned by the
24   bank, or sold to public or private purchasers at public or
25   negotiated sale, in whole or in part, separately or together
26   with other bonds issued by the bank, and notwithstanding
27   any other provision of law, may be bought by the bank at
28   private sale.
29      (u) Enter into purchase and sale agreements with all
30   entities, public and private, including state and local
31   government pension funds, with respect to the sale or
32   purchase of bonds or transition property.
33      (v) Invest any moneys held in reserve or sinking funds,
34   or any moneys not required for immediate use or
35   disbursement, in obligations that are authorized by law
36   for the investment of trust funds in the custody of the
37   Treasurer.
38      (w) Authorize a special purpose trust or trusts to
39   purchase or retain, with the proceeds of the bonds of a
40   special purpose trust, transition property or bonds issued

                                                               94
                             — 27 —                       SB 1184
 1   by, or for the benefit of, any sponsor in connection with
 2   a project or issued by the bank or a special purpose trust,
 3   pursuant to a bond purchase agreement or otherwise.
 4   Bonds or transition property purchased pursuant to this
 5   title may be held by a special purpose entity, pledged or
 6   assigned by a special purpose entity, or sold to public or
 7   private purchasers at public or negotiated sale, in whole
 8   or in part, with or without structuring, subordination or
 9   credit enhancement, separately or together with other
10   bonds issued by a special purpose trust, and
11   notwithstanding any other provision of law, may be
12   bought by the bank or by a special purpose trust at private
13   sale.
14       (x) Approve the issuance of any bonds, notes, or other
15   evidences of indebtedness by the Rural Economic
16   Development Infrastructure Panel, established pursuant
17   to Section 15373.7.
18       (y) Approve the issuance of rate reduction bonds by
19   an entity other than the bank to acquire transition
20   property upon approval of the transaction in a financing
21   order by the Public Utilities Commission, as provided in
22   Article 5.5 (commencing with Section 840) of Chapter 4
23   of Part 1 of Division 1 of the Public Utilities Code.
24       (z) Apply for and accept subventions, grants, loans,
25   advances, and contributions from any source of money,
26   property, labor, or other things of value. The sources may
27   include      bond     proceeds,      dedicated     taxes, state
28   appropriations, federal appropriations, federal grant and
29   loan funds, public and private sector retirement system
30   funds, and proceeds of loans from the Pooled Money
31   Investment Account.
32       (aa) Do all things necessary and convenient to carry
33   out its purposes and exercise its powers, provided,
34   however, that nothing herein shall be construed to
35   authorize the bank to engage directly in the business of
36   a manufacturing, industrial, real estate development, or
37   nongovernmental service enterprise. Further, the bank
38   shall not be organized to accept deposits of money for
39   time or demand deposits or to constitute a bank or trust
40   company.

                                                                  94
SB 1184                       — 28 —

 1      SEC. 6.5. Section 63025.1 of the Government Code is
 2   amended to read:
 3      63025.1. The bank board may do or delegate the
 4   following to the executive director:
 5      (a) Sue and be sued in its own name.
 6      (b) As provided in Chapter 5 (commencing with
 7   Section 63070), issue bonds and authorize special purpose
 8   trusts to issue bonds, including, at the option of the board,
 9   bonds bearing interest that is taxable for the purpose of
10   federal income taxation, or borrow money, to pay all or
11   any part of the cost of any project, or to otherwise carry
12   out the purposes of this division.
13      (c) Engage the services of private consultants to
14   render professional and technical assistance and advice in
15   carrying out the purposes of this division.
16      (d) Employ attorneys, financial consultants, and other
17   advisers as may, in the bank’s judgment, be necessary in
18   connection with the issuance and sale, or authorization of
19   special purpose trusts for the issuance and sale, of any
20   bonds, notwithstanding Sections 11042 and 11043.
21      (e) Contract        for        engineering,     architectural,
22   accounting, or other services of appropriate state
23   agencies as may, in its judgment, be necessary for the
24   successful development of a project.
25      (f) Pay the reasonable costs of consulting engineers,
26   architects, accountants, and construction, land use,
27   recreation, and environmental experts employed by any
28   sponsor or participating party if, in the bank’s judgment,
29   those services are necessary for the successful
30   development of a project.
31      (g) Acquire, take title to, and sell by installment sale
32   or otherwise, lands, structures, real or personal property,
33   rights, rights-of-way, franchises, easements, and other
34   interests in lands that are located within the state, or
35   transition property as the bank may deem necessary or
36   convenient for the financing of the project, upon terms
37   and conditions that it considers to be reasonable.
38      (h) Receive and accept from any source, including,
39   but not limited to, the federal government, the state, or
40   any agency thereof, loans, contributions, or grants, in

                                                                    94
                               — 29 —                         SB 1184
 1   money, property, labor, or other things of value, for, or in
 2   aid of, a project, or any portion thereof.
 3      (i) Make secured loans to any sponsor or participating
 4   party, either directly or by making a loan to a lending
 5   institution, in connection with the financing of a project
 6   in accordance with an agreement between the bank and
 7   the sponsor or a participating party, either as a sole lender
 8   or in participation with other lenders. However, no loan
 9   shall exceed the total cost of the project as determined by
10   the sponsor or the participating party and approved by
11   the bank.
12      (j) Make secured loans to any sponsor or participating
13   party, either directly or by making a loan to a lending
14   institution, in accordance with an agreement between
15   the bank and the sponsor or participating party to
16   refinance indebtedness incurred by the sponsor or
17   participating      party    in     connection     with     projects
18   undertaken and completed prior to any agreement with
19   the bank or expectation that the bank would provide
20   financing, either as a sole lender or in participation with
21   other lenders.
22      (k) Mortgage all or any portion of the bank’s interest
23   in a project and the property on which any project is
24   located,     whether      owned       or    thereafter    acquired,
25   including the granting of a security interest in any
26   property, tangible or intangible.
27      (l) Assign or pledge all or any portion of the bank’s
28   interests in transition property and the revenues
29   therefrom, or assets, things of value, mortgages, deeds of
30   trust,     bonds,      bond     purchase      agreements,     loan
31   agreements, indentures of mortgage or trust, or similar
32   instruments, notes, and security interests in property,
33   tangible or intangible, and the revenues therefrom, of a
34   sponsor or a participating party to which the bank has
35   made loans, and the revenues therefrom, including
36   payment or income from any interest owned or held by
37   the bank, for the benefit of the holders of bonds.
38      (m) Receive Make, receive, or serve as a conduit for
39   the making of grants, and, or otherwise provide for,
40   grants,     contributions,     guarantees,     insurance,    credit

                                                                      94
SB 1184                      — 30 —

 1   enhancements or liquidity facilities, or other financial
 2   enhancements to a sponsor or a participating party as
 3   financial assistance for a project.
 4      (n) Lease the project being financed to a sponsor or a
 5   participating party, upon terms and conditions that the
 6   bank deems proper but shall not be leased at a loss; charge
 7   and collect rents therefor; terminate any lease upon the
 8   failure of the lessee to comply with any of the obligations
 9   thereof; include in any lease, if desired, provisions that the
10   lessee shall have options to renew the lease for a period
11   or periods, and at rents determined by the bank; purchase
12   any or all of the project; or, upon payment of all the
13   indebtedness incurred by the bank for the financing of
14   the project, the bank may convey any or all of the project
15   to the lessee or lessees.
16      (o) Charge and equitably apportion among sponsors
17   and participating parties the bank’s administrative costs
18   and expenses incurred in the exercise of the powers and
19   duties conferred by this division.
20      (p) Issue, obtain, or aid in obtaining, from any
21   department or agency of the United States, from other
22   agencies of the state, or from any private company, any
23   insurance or guarantee to, or for, the payment or
24   repayment of interest or principal, or both, or any part
25   thereof, on any loan, lease, or obligation or any
26   instrument evidencing or securing the same, made or
27   entered into pursuant to this division.
28      (q) Notwithstanding any other provision of this
29   division, enter into any agreement, contract, or any other
30   instrument with respect to any insurance or guarantee;
31   accept payment in the manner and form as provided
32   therein in the event of default by a sponsor or a
33   participating party; and issue or assign any insurance or
34   guarantee as security for the bank’s bonds.
35      (r) Enter into any agreement or contract, execute any
36   instrument, and perform any act or thing necessary or
37   convenient to, directly or indirectly, secure the bank’s
38   bonds, the bonds issued by a special purpose trust, or a
39   sponsor’s obligations to the bank or to a special purpose
40   trust, including, but not limited to, bonds of a sponsor

                                                                 94
                            — 31 —                       SB 1184
 1   purchased by the bank or a special purpose trust for
 2   retention or sale, with funds or moneys that are legally
 3   available and that are due or payable to the sponsor by
 4   reason of any grant, allocation, apportionment or
 5   appropriation of the state or agencies thereof, to the
 6   extent that the Controller shall be the custodian at any
 7   time of these funds or moneys, or with funds or moneys
 8   that are or will be legally available to the sponsor, the
 9   bank, or the state or any agencies thereof by reason of any
10   grant, allocation, apportionment, or appropriation of the
11   federal government or agencies thereof; and in the event
12   of written notice that the sponsor has not paid or is in
13   default on its obligations to the bank or a special purpose
14   trust, direct the Controller to withhold payment of those
15   funds or moneys from the sponsor over which it is or will
16   be custodian and to pay the same to the bank or special
17   purpose trust or their assignee, or direct the state or any
18   agencies thereof to which any grant, allocation,
19   apportionment     or     appropriation  of    the     federal
20   government or agencies thereof is or will be legally
21   available to pay the same upon receipt by the bank or
22   special purpose trust or their assignee, until the default
23   has been cured and the amounts then due and unpaid
24   have been paid to the bank or special purpose trust or
25   their assignee, or until arrangements satisfactory to the
26   bank or special purpose trust have been made to cure the
27   default.
28      (s) Enter into any agreement or contract, execute any
29   instrument, and perform any act or thing necessary,
30   convenient, or appropriate to carry out any power
31   expressly given to the bank by this division, including, but
32   not limited to, agreements for the sale of all or any part,
33   including principal, interest, redemption rights or any
34   other rights or obligations, of bonds of the bank or of a
35   special purpose trust, liquidity agreements, contracts
36   commonly known as interest rate swap agreements,
37   forward payment conversion agreements, futures or
38   contracts providing for payments based on levels of, or
39   changes in, interest rates or currency exchange rates, or
40   contracts to exchange cash-flows or a series of payments,

                                                                94
SB 1184                     — 32 —

 1   or contracts, including options, puts or calls to hedge
 2   payments, rate, spread, currency exchange, or similar
 3   exposure, or any other financial instrument commonly
 4   known as a structured financial product.
 5       (t) Purchase, with the proceeds of the bank’s bonds,
 6   transition property or bonds issued by, or for the benefit
 7   of, any sponsor in connection with a project, pursuant to
 8   a bond purchase agreement or otherwise. Bonds or
 9   transition property purchased pursuant to this part
10   division may be held by the bank, pledged or assigned by
11   the bank, or sold to public or private purchasers at public
12   or negotiated sale, in whole or in part, separately or
13   together with other bonds issued by the bank, and
14   notwithstanding any other provision of law, may be
15   bought by the bank at private sale.
16       (u) Enter into purchase and sale agreements with all
17   entities, public and private, including state and local
18   government pension funds, with respect to the sale or
19   purchase of bonds or transition property.
20       (v) Invest any moneys held in reserve or sinking funds,
21   or any moneys not required for immediate use or
22   disbursement, in obligations that are authorized by law
23   for the investment of trust funds in the custody of the
24   Treasurer.
25       (w) Authorize a special purpose trust or trusts to
26   purchase or retain, with the proceeds of the bonds of a
27   special purpose trust, transition property or bonds issued
28   by, or for the benefit of, any sponsor in connection with
29   a project or issued by the bank or a special purpose trust,
30   pursuant to a bond purchase agreement or otherwise.
31   Bonds or transition property purchased pursuant to this
32   title may be held by a special purpose entity, pledged or
33   assigned by a special purpose entity, or sold to public or
34   private purchasers at public or negotiated sale, in whole
35   or in part, with or without structuring, subordination or
36   credit enhancement, separately or together with other
37   bonds issued by a special purpose trust, and
38   notwithstanding any other provision of law, may be
39   bought by the bank or by a special purpose trust at private
40   sale.

                                                              94
                              — 33 —                         SB 1184
 1      (x) Approve the issuance of any bonds, notes, or other
 2   evidences of indebtedness by the California Economic
 3   Development        and    Financing    Authority,     established
 4   pursuant to Section 15712, and the Rural Economic
 5   Development Infrastructure Panel, established pursuant
 6   to Section 15373.7.
 7      (y) Approve the issuance of rate reduction bonds by
 8   an entity other than the bank or a special purpose trust
 9   to acquire transition property upon approval of the
10   transaction in a financing order by the Public Utilities
11   Commission, as provided in Article 5.5 (commencing
12   with Section 840) of Chapter 4 of Part 1 of Division 1 of
13   the Public Utilities Code.
14      (z) Apply for and accept subventions, grants, loans,
15   advances, and contributions from any source of money,
16   property, labor, or other things of value. The sources may
17   include     bond       proceeds,    dedicated     taxes,     state
18   appropriations, federal appropriations, federal grant and
19   loan funds, public and private sector retirement system
20   funds, and proceeds of loans from the Pooled Money
21   Investment Account.
22      (aa) Do all things necessary and convenient to carry
23   out its purposes and exercise its powers, provided,
24   however, that nothing herein shall be construed to
25   authorize the bank to engage directly in the business of
26   a manufacturing, industrial, real estate development, or
27   nongovernmental service enterprise. Further, the bank
28   shall not be organized to accept deposits of money for
29   time or demand deposits or to constitute a bank or trust
30   company.
31      SEC. 7. Section 63026 of the Government Code is
32   amended to read:
33      63026. The fiscal powers granted to the bank by this
34   part may be exercised without regard or reference to any
35   other department, division, or agency of the state, except
36   the Legislature. This division shall be deemed to provide
37   an alternative method of doing the things authorized by
38   this division, and shall be regarded as supplemental and
39   additional to powers conferred by other laws.


                                                                     94
SB 1184                       — 34 —

 1      SEC. 8. Section 63027 is added to the Government
 2   Code, to read:
 3      63027. (a) The bank may provide insurance or
 4   reinsurance of loans or portions thereof, or their debt
 5   service, including amounts payable as premiums of
 6   penalties in the event of mandatory or optional
 7   prepayment, made to finance a project, and to provide
 8   insurance or reinsurance or reserves, or portions thereof,
 9   or the yield therefrom, established to secure bonds issued
10   to fund those loans or reserves.
11      (b) The bank may enter into or arrange agreements
12   for insurance or reinsurance with users, mortgagors,
13   lending institutions, insurers, and others, the bank being
14   authorized to reinsure or cede risks to the insurers in any
15   amounts as the bank may determine and the insurers, if
16   otherwise authorized to reinsure or insure those risks in
17   California, being hereby authorized to reinsure the bank
18   or cede risks to the bank to the same extent as if the bank
19   were a company authorized to reinsure or insure those
20   risks.
21      (c) The bank may fix a rate or rates of premium for
22   insurance or reinsurance, which need not be uniform,
23   and may reflect any risks and classifications of risk as the
24   bank determines to be reasonable.
25      (d) The bank may exercise those other powers as are
26   necessary or incidental to insurance, reinsurance, and
27   related matters.
28      (e) The bank shall make reasonable provisions for the
29   security of loans made by the bank, and any insurance,
30   reinsurance,       and      other     financing       arrangements
31   negotiated by the bank.
32      (f) The insurance or reinsurance provided for by the
33   bank shall not constitute a debt or pledge of the faith and
34   credit of the state or any subdivision of the state.
35      SEC. 9. Section 63028 is added to the Government
36   Code, to read:
37      63028. The bank assumes and shall observe, keep, and
38   perform all of the responsibilities, liabilities, and
39   obligations      of     the    former      California    Economic
40   Development Financing Authority established under

                                                                     94
                            — 35 —                       SB 1184
 1   Part 10.2 (commencing with Section 15710) of Division 2
 2   of Title 2, as it read prior to the effective date of this
 3   section, and the assumption of the responsibilities,
 4   liabilities, and obligations of the former California
 5   Economic Development Financing Authority shall occur
 6   without any execution or filing of any paper or any
 7   further act. Any reference in any law, contract, bond,
 8   indenture, or other document to the former California
 9   Economic Development Financing Authority shall be
10   deemed, hereafter, to mean the bank.
11      SEC. 10. Article 3 (commencing with Section 63040)
12   of Chapter 2 of Division 1 of Title 6.7 of the Government
13   Code is repealed.
14      SEC. 11. Section 63040 is added to the Government
15   Code, to read:
16      63040. (a) Following consultation with appropriate
17   state and local agencies, the bank shall establish criteria,
18   priorities, and guidelines for the selection of projects to
19   receive assistance from the bank. Projects shall comply
20   with the criteria, priorities, and guidelines adopted by the
21   bank.
22      (b) The criteria, priorities, and guidelines shall, at a
23   minimum, be based upon the following:
24      (1) The State Environmental Goals and Policy Report,
25   or its successor, approved pursuant to Article 5
26   (commencing with Section 65041) of Chapter 1.5 of
27   Division 1 of Title 7.
28      (2) If the sponsor is a state agency, board, commission,
29   or department, the Capital and Infrastructure Project
30   Planning Report, prepared by the Director of Finance
31   pursuant to Article 2 (commencing with Section 13100)
32   of Chapter 2 of Part 3 of Division 3 of Title 2.
33      (c) The resolution required in Section 63041 shall have
34   been adopted prior to the project’s selection by the bank.
35      SEC. 12. The heading of Article 4 (commencing with
36   Section 63042) of Chapter 2 of Division 1 of Title 6.7 of the
37   Government Code is amended and renumbered to read:
38



                                                                94
SB 1184                         — 36 —

 1          Article 3.     Local Resolution Applying for Bank
 2                                Financing
 3
 4      SEC. 13. Section 63042 of the Government Code is
 5   amended and renumbered to read:
 6      63041. (a) Prior to submitting a project to the bank
 7   for consideration, the legislative body or bodies of the
 8   sponsor or sponsors of the project shall find, by resolution,
 9   each of the following:
10      (1) The project is consistent with the general plan of
11   both the city and county, or city and county in the case
12   of San Francisco, or only the county for projects in
13   unincorporated areas, in which the project is located.
14      (2) The proposed financing is appropriate for the
15   specific project.
16      (3) The project facilitates effective and efficient use of
17   existing and future public resources so as to promote both
18   economic development and conservation of natural
19   resources. The project develops and enhances public
20   infrastructure in a manner that will attract, create, and
21   sustain long-term employment opportunities.
22      (b) Upon the adoption of the resolution in subdivision
23   (a) by the legislative body, the legislative body shall
24   transmit the resolution to the executive director of the
25   infrastructure bank.
26      SEC. 14. Article 5 (commencing with Section 63043)
27   of Chapter 2 of Division 1 of Title 6.7 of the Government
28   Code is repealed.
29      SEC. 15. Article 5 (commencing with Section 63043)
30   is added to Chapter 2 of Division 1 of Title 6.7 of the
31   Government Code, to read:
32
33        Article 5.     Financing Public Development Facilities
34
35      63043. Notwithstanding any other provision of this
36   division, Article 3 (commencing with Section 63040) and
37   Article 4 (commencing with Section 63042), shall not
38   apply     to     any     conduit financing  for   economic
39   development facilities by the bank directly for the benefit
40   of a participating party.

                                                                   94
                              — 37 —                       SB 1184
 1      63044. The bank shall consider a project for conduit
 2   financing for economic development facilities upon filing
 3   of an application with the bank by an appropriate
 4   participating party, on the terms and conditions the bank
 5   shall determine. The bank shall establish procedures for
 6   the expeditious review of applications for the issuance or
 7   approval of bonds to finance economic development
 8   facilities.
 9      63045. In order to provide or arrange for the financing
10   of economic development facilities, the bank may:
11      (a) Issue taxable revenue bonds pursuant to Chapter
12   5 (commencing with Section 63070) to provide financing
13   for economic development projects compatible with the
14   public interest as specified in Section 63046.
15      (b) Issue taxable revenue bonds pursuant to Chapter
16   5 (commencing with Section 63070) to provide financing
17   for the revolving loan funds and economic development
18   projects of small business development corporations,
19   local economic development corporations, community
20   development corporations, and nonprofit organizations,
21   which revolving loan funds and economic development
22   projects shall be compatible with the public interest.
23      (c) Issue tax-exempt revenue bonds pursuant to
24   Chapter 5 (commencing with Section 63070) to provide
25   financing      for   economic      development     facilities as
26   permitted by federal law and in accordance with
27   applicable California law relating to the distribution of
28   state allocations for private activity bonds. Projects so
29   financed shall be compatible with the public interest as
30   specified in Section 63046.
31      (d) Issue tax-exempt revenue bonds pursuant to
32   Chapter 5 (commencing with Section 63070) for
33   economic development facilities of public sector and
34   nonprofit organizations qualifying for exemption under
35   federal law.
36      63046. No financing shall be made by the bank under
37   this article unless the bank shall have first determined
38   that the financing or assistance meets the following public
39   interest criteria:


                                                                   94
SB 1184                       — 38 —

 1      (a) The financing, loan, grant, or other assistance is for
 2   a project or a use in the State of California.
 3      (b) Those seeking funds or other assistance are
 4   capable of meeting obligations incurred under relevant
 5   agreements.
 6      (c) In the case of loans or bonds, payments to be made
 7   under applicable financing documents are adequate to
 8   pay the current expenses of the bank in connection with
 9   the financing and to make payments on the bonds.
10      (d) The proposed financing is appropriate for the
11   specific project.
12      63047. (a) Any loan entered into pursuant to this
13   article may contain provisions for payment of a penalty
14   if any recipient of funds under this article leaves this state
15   prior to the completion of the full term of the loan.
16      (b) Projects that the board determines will produce
17   long-term      employment creation or retention shall
18   receive first priority for financing.
19      (c) Any recipient of funds under this article that
20   utilizes the funds for construction purposes, shall certify
21   that the contractors are properly licensed by the
22   Contractors’ State License Board.
23      (d) The bank shall require that the proposed
24   economic development facilities be consistent with any
25   existing local or regional comprehensive plan.
26      (e) The bank shall develop a policy regarding
27   financing companies that move within this state so as to
28   minimize any displacement of jobs.
29      (f) In addition to any other methods the bank may use
30   to identify economic development projects, the bank
31   shall utilize existing local economic development
32   networks to identify these projects and prepare a plan, in
33   consultation with local economic development networks
34   and      their     organizations      and     representatives, to
35   implement this policy.
36      SEC. 16. The heading of Article 6 (commencing with
37   Section 63048) of Chapter 2 of Division 1 of Title 6.7 of the
38   Government Code is amended and renumbered to read:
39


                                                                    94
                             — 39 —                         SB 1184
 1             Article 4.   Financing of Transition Costs
 2
 3      SEC. 17. Section 63048 of the Government Code is
 4   amended and renumbered to read:
 5      63042. Notwithstanding any other provision of this
 6   division, a project for the financing of transition costs and
 7   the acquisition of transition property upon the request of
 8   an electrical corporation shall be deemed to be in the
 9   public interest and eligible for financing by the bank, and
10   Article 3 (commencing with Section 63040) and Article
11   5 (commencing with Section 63043) shall not apply to the
12   project or financing. The bank shall consider a project for
13   financing transition costs and the acquisition of transition
14   property upon filing of an application by an appropriate
15   participating party, on the terms and conditions the bank
16   shall determine. The bank shall establish procedures for
17   the expeditious review of applications from electrical
18   corporations for the issuance or approval of rate
19   reduction bonds. The review may be concurrent with the
20   Public Utilities Commission’s processing of an application
21   for the pertinent financing order, so as to allow for the
22   issuance of rate reduction bonds as quickly as feasible
23   after the issuance of the pertinent financing order by the
24   Public Utilities Commission. Notwithstanding any other
25   provision of this division, the bank shall have no authority
26   to alter or modify any term or condition related to the
27   transition costs or the transition property as set forth in
28   the pertinent financing order, and shall have no authority
29   over any matter that is subject to the approval of the
30   Public      Utilities  Commission        under  Article   5.5
31   (commencing with Section 840) of Chapter 4 of Part 1 of
32   Division 1 of the Public Utilities Code.
33      SEC. 18. The heading of Article 1 (commencing with
34   Section 63050) of Chapter 3 of Division 1 of Title 6.7 of the
35   Government Code is repealed.
36      SEC. 19. Section 63055 of the Government Code is
37   amended to read:
38      63055. (a) Moneys in the infrastructure bank fund
39   received from the proceeds of bonds issued pursuant to
40   this division may not be transferred to any other fund

                                                                 94
SB 1184                      — 40 —

 1   except as necessary to pay the expenses of operating the
 2   program authorized by this division, nor shall the bank
 3   utilize any moneys under the direction and control of the
 4   California Housing Finance Agency, including, but not
 5   limited to, moneys in the California Housing Loan
 6   Insurance Fund and the Housing Finance Fund, other
 7   than moneys in the infrastructure bank fund to satisfy
 8   liabilities arising from projects authorized by this division.
 9      (b) The infrastructure bank fund, on behalf of the
10   bank, may borrow or receive moneys from the bank or
11   from any federal, state, or local agency or private entity,
12   in order to create reserves in the infrastructure bank fund
13   as provided in this division and as authorized by
14   resolution of the board.
15      SEC. 20. Section 63071 of the Government Code is
16   amended to read:
17      63071. (a) Notwithstanding any other provision of
18   law, but consistent with Sections 1 and 18 of Article XVI
19   of the California Constitution, a sponsor may issue bonds
20   for purchase by the bank pursuant to a bond purchase
21   agreement. The bank may issue bonds or authorize a
22   special purpose trust to issue bonds. These bonds may be
23   issued pursuant to the charter of any city or any city and
24   county that authorized the issuance of these bonds as a
25   sponsor and may also be issued by any sponsor pursuant
26   to the Revenue Bond Law of 1941 (Chapter 6
27   (commencing with Section 54300) of Division 2 of Title
28   5) to pay the costs and expenses pursuant to this title,
29   subject to the following conditions:
30      (1) With the prior approval of the bank, the sponsor
31   may sell these bonds in any manner as it may determine,
32   either by private sale or by means of competitive bid.
33      (2) Notwithstanding Section 54418, the bonds may be
34   sold at a discount at any rate as the bank and sponsor shall
35   determine.
36      (3) Notwithstanding Section 54402, the bonds shall
37   bear interest at any rate and be payable at any time as the
38   sponsor shall determine with the consent of the bank.
39      (b) The total amount of bonds that may be outstanding
40   at any one time under this chapter shall not exceed five

                                                                 94
                            — 41 —                       SB 1184
 1   billion dollars ($5,000,000,000), exclusive of rate reduction
 2   bonds and bonds issued by the bank pursuant to Article
 3   5 (commencing with Section 63043) of Chapter 2 to
 4   finance economic development facilities. The total
 5   amount of rate reduction bonds that may be outstanding
 6   at any one time under this chapter shall not exceed ten
 7   billion dollars ($10,000,000,000).
 8      (c) Bonds for which moneys or securities have been
 9   deposited in trust, in amounts necessary to pay or redeem
10   the principal, interest, and any redemption premium
11   thereon, shall be deemed not to be outstanding for
12   purposes of this section.
13      SEC. 21. Section 63084 is added to the Government
14   Code, to read:
15      63084. (a) Any issue of revenue bonds by the bank
16   may be secured and made more attractive to capital
17   markets through financial instruments, including, but not
18   limited to:
19      (1) Deeds of trust on the resources, facilities, and
20   revenues of the projects.
21      (2) Credit enhancements, including, but not limited
22   to, letters of credit, bond insurance, and surety bonds
23   provided by private financial institutions.
24      (3) Insurance and guarantees provided by the bank
25   itself.
26      (b) The bank may make loans to help establish and
27   support the revolving loan funds of small business
28   development        corporations,      economic   development
29   corporations, community development corporations, and
30   nonprofit corporations. The loans may be made from any
31   appropriate account or subaccount of the California
32   Infrastructure and Economic Development Bank Fund
33   and as determined by the bank.
34      SEC. 22. Section 63085 is added to the Government
35   Code, to read:
36      63085. Whenever the bank deems that it will increase
37   the salability or the price of the bonds to obtain, prior to
38   or after sale, a legal opinion from private counsel as to the
39   validity or tax-exempt nature of the bonds, the bank may


                                                                94
SB 1184                     — 42 —

 1   obtain a legal opinion. Payment for legal services may be
 2   made out of the proceeds of the sale of the bonds.
 3      SEC. 23. Section 63086 is added to the Government
 4   Code, to read:
 5      63086. The bank may employ financial consultants,
 6   advisers, and accountants, as may be necessary in its
 7   judgment, in connection with the issuance and sale of any
 8   bonds of the bank. Payment for these services may be
 9   made out of the proceeds of the sale of the bonds.
10      SEC. 24. Section 63087 is added to the Government
11   Code, to read:
12      63087. Section 10295 and Sections 10335 to 10382,
13   inclusive, of the Public Contract Code shall not apply to
14   agreements entered into by the bank in connection with
15   the sale of bonds or notes authorized under this division.
16      SEC. 25. Section 4.5 of this bill incorporates
17   amendments to Section 63010 of the Government Code
18   proposed by this bill and SB 477. It shall only become
19   operative if (1) both bills are enacted and become
20   effective on or before January 1, 1998, (2) each bill
21   amends Section 63010 of the Government Code, and (3)
22   this bill is enacted after SB 477, in which case Section
23   63010 of the Government Code, as amended by SB 477,
24   shall remain operative only until the operative date of this
25   bill, at which time Section 4.5 of this bill shall become
26   operative, and Section 4 of this bill shall not become
27   operative.
28      SEC. 26. Section 6.5 of this bill incorporates
29   amendments to Section 63025.1 of the Government Code
30   proposed by this bill and SB 477. It shall only become
31   operative if (1) both bills are enacted and become
32   effective on or before January 1, 1998, (2) each bill
33   amends Section 63025.1 of the Government Code, and (3)
34   this bill is enacted after SB 477, in which case Section
35   63025.1 of the Government Code, as amended by SB 477,
36   shall remain operative only until the operative date of this
37   bill, at which time Section 6.5 of this bill shall become




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                       — 43 —                   SB 1184
1 operative, and Section 6 of this bill shall not become
2 operative.




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