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AB-232 Housing and community development: Economic Opportunity Initiative Program.(2007-2008)

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AB232:v98#DOCUMENT

Amended  IN  Assembly  April 10, 2007

CALIFORNIA LEGISLATURE— 2007–2008 REGULAR SESSION

Assembly Bill
No. 232

Introduced  by  Assembly Member Price

January 30, 2007

An act to add and repeal Chapter 12.9 (commencing with Section 7090) of Division 7 of Title 1 of the Government Code, relating to housing and community development.


LEGISLATIVE COUNSEL'S DIGEST


AB 232, as amended, Price. Housing and community development: Economic Opportunity Initiative. Initiative Program.
Existing law provides for various programs to promote economic development opportunities in the state.
This bill would state the intent of the Legislature to establish a statewide action plan to revitalize the low-income neighborhoods of Los Angeles, Oakland, Sacramento, San Diego, and San Francisco, through an integrated investment and development strategy, as provided, until January 1, 2013, enact the Economic Opportunity Initiative Act of 2007, to require the Business, Transportation and Housing Agency to establish a pilot project to be known as the Economic Opportunity Initiative Program. It would require the agency to enter into technical and partnership assistance agreements with economic development corporations meeting specified criteria. It would require the agency to conduct a study on the impact of the program and report the results of the study to the Governor and the Legislature on or before December 31, 2012.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NOYES   Local Program: NO  

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


SECTION 1.

 The Legislature finds and declares the following:
(a) Far too many of this state’s urban residents and areas continue to be neglected and plagued by unemployment, poverty, crime, drugs, neighborhood blight, and a poor quality of life.
(b) According to recent findings by the United States Department of Housing and Urban Development, the unemployment rate in this state’s five major urban centers hovers around 20 percent, which is four times this state’s average. Those five major urban centers contain just under 18 million people, which is nearly 52 percent of this state’s population. The poverty rate remains at 40 percent.
(c) Aside from the variety of social, economic, and environmental ills associated with the above-referenced findings, chief among these problems are wasted resources and lost tax revenues, declining property values, the effects on community aesthetics, and generational wealth gaps.
(d) Distressed neighborhood conditions often lead to a sense of resignation and hopelessness, which is interpreted by children, youth, and families as a signal that no one cares and often prompts the belief that further damage to human life or property is costless.
(e) The California Economic Strategy Panel has found that quality of life is one of the key public policy issues that profoundly affects the capacity and prospects of this state’s businesses to prosper and grow economically. A thriving neighborhood commercial district is a paramount component of each community’s quality of life. It provides a central gathering place for entertainment, civic life, and commerce; supplies a focal point for community identity and pride; offers a sense of place, connectivity, integration, and cohesion for residents; attracts visitors and projects a healthy community image upon which industrial investors rely in part when making their location decisions; and provides small-business ownership opportunities, jobs, retail sales, and property tax revenues.
(f) In its 2002 report, “Creating a Shared California Economic Strategy: A Call to Action,” the California Economic Strategy Panel recognizes economic development is widely distributed across many organizations and jurisdictions. The report calls for a more focused strategy tailored on regional diversity, and recommends economic development investment goals with measurable outcomes including rising per capita income, job growth, new business creation, growing private sector investment, increased minority entrepreneurship, and reduced income inequality.
(g) Based on years of research and experience, the basic ingredients of innovative and inclusive communities include:
(1) A skilled workforce with opportunities for lifelong learning.
(2) Access to capital with a positive environment for private investment.
(3) Quality infrastructure, including transportation and housing.
(4) Effective governance, including proinnovative tax and regulatory policies.
(5) Collaboration between the public, private, and civic sectors.
(h) Based on extensive research, low-income neighborhoods can create the conditions for competitive industry and job creation if the right factors are in place.

(i)It is the intent of the Legislature in enacting this act to do all of the following:

(1)Increase state assistance to civic and regional leaders in order to pilot the development of a statewide action plan to simultaneously revitalize the five low-income neighborhoods of Los Angeles, Oakland, Sacramento, San Diego, and San Francisco, through an integrated business investment, homeownership, and workforce development strategy.

(2)Provide incentives to the private sector to invest in the implementation of a statewide action plan.

(3)Foster innovation in strengthening this state’s competitive advantages and key industry clusters by employing broad-based collaboration focused on the targeted inner-city neighborhoods and economic regions.

(i) Although many of California’s inner city business and community leaders are addressing economic challenges with innovative approaches, limited capacity, fragmented or insufficient state economic development supports, and the lack of adequate private and public sector partnerships impedes their ability to reach critical mass in neighborhood and regional competitiveness.
(j) The continued neglect of mixed-use and infill development, along with business and job attraction, retention, incubation, and training opportunities in California’s low- to moderate-income urban areas, particularly in the wake of a rapidly growing population, leads to many economic inefficiencies in the state, including the following:
(1) Further creating a disconnect between land and transportation management.
(2) Undermining the state’s clean air and climate stabilization measures.
(3) Undermining the state’s global competitiveness in agriculture.
(4) Increasing traffic and pollution.
(5) Contributing to decreased levels of family interaction.
(k) The absence of state support for neighborhood revitalization strategies that are community-based, collaborative, and market-driven makes it difficult to mitigate private equity investment risks in underserved markets, and to reverse the economic marginalization of California’s low- to moderate-income populations.
(l) Therefore, it is the intent of the Legislature in enacting this act to do both of the following:
(1) Promote economic development and the creation of wealth and job opportunities in low- to moderate-income geographic areas and among individuals living in those areas by encouraging developmental venture capital investments in those areas.
(2) Foster innovation in strengthening California’s competitive advantages and key industry clusters by employing broad-based collaboration focused on inner city neighborhoods and economic regions.

SEC. 2.

 Chapter 12.9 (commencing with Section 7090) is added to Division 7 of Title 1 of the Government Code, to read:
CHAPTER  12.9. Economic Opportunity Initiative Act of 2007

7090.
 This chapter shall be known and may be cited as the Economic Opportunity Initiative Act of 2007.

7091.
 (a) The Business, Transportation and Housing Agency shall establish a pilot project to be known as the Economic Opportunity Initiative Program, pursuant to which the agency may enter into technical and partnership development assistance agreements with community development corporations selected pursuant to subdvision (c) of Section 7092 for the purposes of this chapter.
(b) In implementing the program established pursuant to this chapter, the agency shall work in conjunction with the following entities, as appropriate:
(1) The California Arts Council.
(2) The California Community Colleges.
(3) The Department of Insurance.
(4) The California Environmental Protection Agency.
(5) The California Film Commission.
(6) The California State University.
(7) The Workforce Investment Board.
(8) The State Department of Education.
(9) The Department of Housing and Community Development.
(10) The Employment Training Panel.
(11) The Labor and Workforce Development Agency.
(12) The Public Employees’ Retirement System.
(13) The State Teachers’ Retirement System.
(14) The University of California.
(15) Any state entity deemed necessary by the agency.

7092.
 (a) A community development corporation may apply to participate in the program established under this chapter if it meets all of the following criteria:
(1) The organization is a nonprofit entity certified under Section 501(c)(3) of the Internal Revenue Code.
(2) The organization has a management or volunteer team with experience in community development.
(3) The organization is rooted in the community it serves, and has a primary objective of contributing to a well-balanced statewide economy by facilitating the increase of business investment, homeownership, and workforce development assistance for persons and neighborhoods whose participation in the free enterprise system is hampered because of social or economic disadvantages.
(b) To participate in the program established under this chapter, an organization meeting the eligibility requirements set forth in subdivision (a) shall submit an application to the Business, Transportation and Housing Agency that includes all of the following:
(1) Information regarding the community development qualifications and the general reputation of the organization’s management.
(2) A description of how the organization intends to work with private investors, banks, and other financial institutions to address the unmet capital needs of the communities served.
(3) With respect to commitments to be made to the organization under this chapter, an estimate of the ratio of cash to in-kind contributions.
(4) A description of the organization’s community action plan containing all of the following elements:
(A) A strategy to make investments along a commercial district thoroughfare in a low- to moderate-income geographic area that has a history of commercial and residential blight or developmental stagnancy, as documented by a state or local government authority.
(B) The Main Street Four Point Approach to organization, promotion, design, and economic restructuring for neighborhood commercial district revitalization as developed by the National Trust for Historic Preservation.
(C) A description of how implementation of the community action plan will do all of the following:
(i) Enhance technical assistance to small businesses, create opportunities for microbusinesses, attract and retain businesses in the area, increase access to capital and markets, and enhance the entrepreneurial climate in the area by preventing, controlling, and reducing crime, and forming partnerships to cultivate ongoing arts and entertainment venues in the area.
(ii) Revitalize the neighborhood by eliminating blight and increasing the availability of quality affordable owner-occupied, as well as market rate, housing.
(iii) Steer low- and moderate-income youth into science and engineering-related educational and career pathways by involving parents, academia, industry, after school programs, and community groups in a comprehensive case management and support system.
(iv) Steer at-risk youth, low-income adults, and ex-offenders away from destructive lifestyles and help them to be economically self-sufficient and productive members of the community through comprehensive career technical education and job placement services.
(9) Any other information the agency may require.
(c) (1) The agency shall select organizations to participate in the program from among organizations submitting applications pursuant to subdivision (b).
(2) In selecting organizations pursuant to this subdivision, the agency shall consider all of the following:
(A) The likelihood that the organization will meet the goals of its community action plan.
(B) The experience and background of the organization’s management team.
(C) The need for developmental venture capital investments in the geographic areas in which the organization intends to serve.
(D) The extent to which the organization will concentrate its activities on serving the geographic areas in which it intends to operate.
(F) The extent to which the activities proposed by the organization will expand economic opportunities in the geographic area and region in which it intends to serve.
(H) Any other factors deemed appropriate by the agency.
(3) The agency shall select organizations pursuant to this subdivision in a way that promotes neighborhood revitalization through integrated business investment, homeownership, and workforce development strategies in geographic areas across the state.

7093.
 The Business, Transportation and Housing Agency shall conduct a study on the impact of the program established by this chapter, including, but not limited to, the costs to the state of, and revenues generated by, the program. The agency shall report the results of the study to the Governor and the Legislature on or before December 31, 2012.

7094.
 This chapter shall remain in effect only until January 1, 2013, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2013, deletes or extends that date.