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AB-668 Voting Modernization Bond Act of 2018.(2017-2018)

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Date Published: 07/06/2017 09:00 PM
AB668:v95#DOCUMENT

Amended  IN  Senate  July 06, 2017
Amended  IN  Senate  July 03, 2017
Amended  IN  Assembly  May 02, 2017
Amended  IN  Assembly  April 06, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 668


Introduced by Assembly Member Gonzalez Fletcher
(Coauthors: Assembly Members Chiu and Chu)
(Coauthor: Senator Hertzberg)

February 14, 2017


An act to add Chapter 5 (commencing with Section 19400) to Division 19 of the Elections Code, relating to elections, by providing the funds necessary therefor through an election for the issuance and sale of bonds of the State of California and for the handling and disposition of those funds.


LEGISLATIVE COUNSEL'S DIGEST


AB 668, as amended, Gonzalez Fletcher. Voting Modernization Bond Act of 2018.
Existing law, the Voting Modernization Bond Act of 2002, authorizes the Voting Modernization Finance Committee to issue and sell bonds in the amount of $200,000,000, as specified. Existing law authorizes a county to apply to the Voting Modernization Board for money from the proceeds of the sale of bonds (1) to pay for or purchase new voting systems that are certified or conditionally approved by the Secretary of State, (2) to research and develop new voting systems, or (3) to manufacture the minimum number of voting system units reasonably necessary to test and seek certification or conditional approval of the voting system, or test and demonstrate the capabilities of a voting system in a pilot program.
This bill would enact the Voting Modernization Bond Act of 2018 which, if approved, would authorize the issuance and sale of bonds in the amount of $450,000,000, as specified, for similar purposes. This bill would authorize the Voting Modernization Finance Committee and the Voting Modernization Board to administer the Voting Modernization Bond Act of 2018.
This bill would provide for submission of the act to the voters at the June 5, 2018, statewide direct primary election.
Vote: 2/3   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Chapter 5 (commencing with Section 19400) is added to Division 19 of the Elections Code, to read:
CHAPTER  5. Voting Modernization Bond Act of 2018

19400.
 This chapter shall be known and may be cited as the Voting Modernization Bond Act of 2018.

19401.
 The State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), except as otherwise provided herein, is adopted for the purpose of the issuance, sale, and repayment of, and otherwise providing with respect to, the bonds authorized to be issued by this chapter, and the provisions of that law, as amended from time to time, apply to the bonds and are incorporated into this chapter as though set out in full in this chapter.

19402.
 For purposes of this chapter, the following definitions apply:
(a) “Ballot on demand system” means a ballot manufacturing system, as defined in Section 303.4, that is subject to Sections 13004 and 13004.5.
(b) “Board” means the Voting Modernization Board, established pursuant to Section 19256.
(c) “Bond” means a state general obligation bond issued pursuant to this chapter.
(d) “Bond act” means this chapter authorizing the issuance of state general obligation bonds.
(e) “Committee” means the Voting Modernization Finance Committee, established pursuant to Section 19253.
(f) “Electronic poll book” means an electronic list of registered voters that may be transported to the polling location or vote center pursuant to Section 2550.
(g) “Fund” means the Voting Modernization Fund of 2018, established pursuant to Section 19403.
(h) “Remote accessible vote by mail system” means a system, as defined in Section 303.3, that is certified pursuant to Chapter 3.5 (commencing with Section 19280) of Division 19.
(i) “Vote by mail ballot drop box” means a secure receptacle established by a county or city and county elections official whereby a voted vote by mail ballot may be returned to the elections official from whom it was obtained pursuant to Section 3025.
(j) “Voting system” means any voting machine, voting device, or vote tabulating device that does not use prescored punch card ballots.
(k) “Open source software or firmware” means software or firmware licensed using a software license approved by the Open Source Initiative.

19402.5.
 (a) The Voting Modernization Fund of 2018 is hereby established.
(b) The committee may authorize the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter.
(c) The board may administer the fund and may reject any application for fund money it deems inappropriate, excessive, or that does not comply with the intent of this chapter.

19403.
 (a) The committee may create a debt or debts, liability or liabilities, of the State of California, in the aggregate amount of not more than four hundred fifty million dollars ($450,000,000), exclusive of refunding bonds, in the manner provided herein for the purpose of creating a fund to assist counties in paying for an expense listed in subdivision (d).
(b) The proceeds of bonds (exclusive of refunding bonds issued pursuant to Section 19410) issued and sold pursuant to this chapter shall be deposited in the fund.
(c) A county is eligible to apply to the board for fund money if it meets both of the following requirements:
(1) After January 1, 2017, April 29, 2015, the county has agreed to pay for an expense listed in subdivision (d) for which it continues to make payments on the date that this chapter becomes effective.
(2) The county matches fund moneys at one of the following ratios:
(A) If the county conducts an election pursuant to Section 4005 or 4007, one dollar ($1) of county moneys for every three dollars ($3) of fund moneys.
(B) If the county does not conduct an election pursuant to Section 4005 or 4007, one dollar ($1) of county moneys for every two dollars ($2) of fund moneys.
(d) (1) A county may use fund moneys to purchase or lease the following:
(A) Voting systems certified or conditionally approved by the Secretary of State that do not use prescored punch card ballots.
(B) Electronic poll books certified by the Secretary of State.
(C) Ballot on demand systems certified by the Secretary of State.
(D) Vote by mail ballot drop boxes that comply with any relevant regulations promulgated by the Secretary of State pursuant to subdivision (b) of Section 3025.
(E) Remote accessible vote by mail systems certified or conditionally approved by the Secretary of State.
(F) Technology to facilitate electronic connection between polling places, vote centers, and the office of the county elections official or the Secretary of State’s office.
(G) Vote by mail ballot sorting and processing equipment.
(2) A county may use fund moneys to contract and pay for the following:
(A) Research and development of a new voting system that has not been certified or conditionally approved by the Secretary of State. A voting system developed pursuant to this subparagraph shall use only nonproprietary software and firmware with disclosed source code, except that it may use unmodified commercial off-the-shelf software and firmware, as defined in paragraph (1) of subdivision (a) of Section 19209.
(B) Manufacture of the minimum number of voting system units reasonably necessary for either of the following purposes:
(i) Testing and seeking certification or conditional approval for the voting system pursuant to Sections 19210 to 19214, inclusive.
(ii) Testing and demonstrating the capabilities of the voting system in a pilot program pursuant to paragraph (2) of subdivision (b) and subdivision (c) of Section 19209.
(iii) For purposes of this paragraph, “voting system” includes a part of a voting system.
(e) Any voting system purchased or leased using bond funds that does not require a voter to directly mark on the ballot must produce, at the time the voter votes his or her ballot or at the time the polls are closed, a paper version or representation of the voted ballot or of all the ballots cast on a unit of the voting system. The paper version shall not be provided to the voter but shall be retained by elections officials for use during the 1 percent manual tally described in Section 15360, or any recount, audit, or contest.

19404.
 The Legislature may amend subdivision (c) of Section 19402.5, subdivisions (c) and (d) of Section 19403, and Section 19256 by a statute, passed in each house of the Legislature by rollcall vote entered in the respective journals, by not less than two-thirds of the membership in each house concurring, if the statute is consistent with, and furthers the purposes of, this chapter.

19405.
 (a) All bonds authorized by this chapter, when duly sold, issued, and delivered as provided herein, constitute valid and legally binding general obligations of the State of California, and the full faith and credit of the state is hereby pledged for the punctual payment of both principal of, and interest on, the bonds as that interest becomes due and payable. The bonds issued pursuant to this chapter shall be repaid within 10 years from the date they are issued.
(b) There shall be collected annually, in the same manner and at the same time as other state revenue is collected, a sum of money, in addition to the ordinary revenues of the state, sufficient to pay the principal of, and interest on, the bonds as provided herein. All officers required by law to perform any duty in regard to the collection of state revenues shall collect this additional sum.

19406.
 (a) Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund, for purposes of this chapter, a sum of money that will equal the sum annually necessary to pay the principal of, and the interest on, the bonds issued and sold as provided in this chapter, as that principal and interest become due and payable.
(b) The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for purposes of this chapter. The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold, excluding any refunding bonds authorized pursuant to Section 19410, for purposes of this chapter, less any amount withdrawn pursuant to subdivision (c). The board shall execute any documents as required by the Pooled Money Investment Board to obtain and repay the loan. Any amount loaned shall be deposited in the fund to be allocated in accordance with this chapter.
(c) For purposes of carrying out this chapter, the Director of Finance may, by executive order, authorize the withdrawal from the General Fund of any amount or amounts not to exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold, excluding any refunding bonds authorized pursuant to Section 19410, for purposes of this chapter, less any amount withdrawn pursuant to subdivision (b). Any amounts withdrawn shall be deposited in the fund to be allocated in accordance with this chapter. Any moneys made available under this subdivision shall be returned to the General Fund, plus the interest that the amounts would have earned in the Pooled Money Investment Account, from moneys received from the sale of bonds which would otherwise be deposited in that fund.

19407.
 Upon request of the board, supported by a statement of its plans and projects approved by the Governor, the committee shall determine whether to issue any bonds authorized under this chapter in order to carry out the board’s plans and projects and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out these plans and projects progressively, and it is not necessary that all of the bonds be issued or sold at any one time.

19408.
 (a) The committee may authorize the Treasurer to sell all or any part of the bonds authorized by this chapter at the time or times established by the Treasurer. Bonds shall be sold upon the terms and conditions specified in one or more resolutions adopted by the committee pursuant to Section 16731 of the Government Code.
(b) Whenever the committee deems it necessary for an effective sale of the bonds, the committee may authorize the Treasurer to sell any issue of bonds at less than their par value, notwithstanding Section 16754 of the Government Code. However, the discount on the bonds shall not exceed 3 percent of the par value thereof.

19409.
 Out of the first money realized from the sale of bonds as provided by this chapter, there shall be redeposited in the General Obligation Bond Expense Revolving Fund, established by Section 16724.5 of the Government Code, the amount of all expenditures made for purposes specified in that section, and this money may be used for the same purpose and repaid in the same manner whenever additional bond sales are made.

19410.
 Any bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code. The approval of the voters for the issuance of bonds under this chapter includes approval for the issuance of bonds issued to refund bonds originally issued or any previously issued refunding bonds. Any bond refunded with the proceeds of a refunding bond as authorized by this section may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended from time to time, authorizing that refunded bond.

19411.
 Notwithstanding any provision of the bond act, if the Treasurer sells bonds under this chapter for which bond counsel has issued an opinion to the effect that the interest on the bonds is excludable from gross income for purposes of federal income tax, subject to any conditions that may be designated, the Treasurer may establish separate accounts for the investment of bond proceeds and for the earnings on those proceeds, and may use those proceeds or earnings to pay any rebate, penalty, or other payment required by federal law or take any other action with respect to the investment and use of bond proceeds required or permitted under federal law necessary to maintain the tax-exempt status of the bonds or to obtain any other advantage under federal law on behalf of the funds of this state.

19412.
 All moneys derived from premiums and accrued interest on bonds sold pursuant to this chapter shall be transferred to the General Fund as a credit to expenditures for bond interest; provided, however, that amounts derived from premiums may be reserved and used to pay the costs of issuance of the related bonds prior to transfer to the General Fund.

19413.
 The Legislature hereby finds and declares that, inasmuch as the proceeds from the sale of bonds authorized by this chapter are not “proceeds of taxes” as that term is used in Article XIII B of the California Constitution, the disbursement of these proceeds is not subject to the limitations imposed by Article XIII B.

SEC. 2.

 Section 1 of this act shall take effect upon the approval by the people of the Voting Modernization Bond Act of 2018, submitted to the voters pursuant to Section 3 of this act.

SEC. 3.

 Notwithstanding Section 9040 of the Elections Code, a ballot measure that sets forth the Voting Modernization Bond Act of 2018, as set forth in Section 1 of this act, shall be submitted to the voters at the June 5, 2018, statewide direct primary election.