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AB-964 Economic development: Capital Access Loan Program: low-emission vehicles.(2017-2018)

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Date Published: 04/27/2017 09:00 PM
AB964:v98#DOCUMENT

Amended  IN  Assembly  April 27, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 964


Introduced by Assembly Member Gomez

February 16, 2017


An act to add Section 44559.15 to the Health and Safety Code, relating to low-emission vehicles, and making an appropriation therefore. therefor.


LEGISLATIVE COUNSEL'S DIGEST


AB 964, as amended, Gomez. Economic development: Capital Access Loan Program: low emission low-emission vehicles.
Existing law establishes the Capital Access Loan Program to assist small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties, as specified. Existing law establishes within the program the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in financing the costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law also establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses by covering losses on qualified loans for those purposes. Under existing law, the California Pollution Control Financing Authority (authority) administers all of these programs and is authorized to establish small business assistance funds for certain purposes, including, among others, funding the programs.
This bill would create the California Affordable Clean Vehicle Program to assist low-income or high financial risk individuals in the purchase or lease of low-emission vehicles. The bill would require the authority to adopt regulations regulations, subject to the approval of the State Air Resources Board, to implement the program. The bill would establish the California Affordable Clean Vehicle Program Fund, a continuously appropriated fund, for purposes of the program, and would transfer $50,000,000 from the Greenhouse Gas Reduction Fund to the California Affordable Clean Vehicle Program Fund. program. The bill would require annual reports by the authority to be submitted to the Legislature regarding the finance programs administered pursuant to the provisions of the bill.
Vote: MAJORITY   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 44559.15 is added to the Health and Safety Code, to read:

44559.15.
 (a) It is the intent of the Legislature in this act to create and fund the California Affordable Clean Vehicle Program to assist low-income or high financial risk individuals in the purchase or lease of low-emission vehicles. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program for Small Businesses in this article, as appropriate, with the additional program requirements specified under this section.
(b) The Legislature hereby establishes the California Affordable Clean Vehicle Program. The program shall cover losses on qualified loans by participating lenders to qualified purchasers, purchasers or lessees, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority Authority, in consultation with the State Air Resources Board, and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section. The authority shall administer the program consistent with the goals of the Charge Ahead California Initiative (Chapter 8.5 (commencing with Section 44258) of Part 5 of Division 26) described in subdivision (b) of Section 44258.4, and of the programs of that initiative described in paragraph (4) of subdivision (c) of Section 44258.4.
(c) For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1) “Interest rate” means an annual interest rate not to exceed 1 percent.
(2) “Qualified loan” means a loan or portion of a loan, in an amount not to exceed the lower of 100 percent of the sales price or $45,000.
(3) “Sales price” means the purchase price of vehicle, including sales and use tax and vehicle registration fee, not to exceed $45,000.
(d) The authority shall establish the definitions of “clean vehicle” and “low-income” in consultation with the California Environmental Protection Agency and the Air Resources Board.
(e) The California Affordable Clean Vehicle Program Fund is hereby established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549. Notwithstanding Section 13340 of the Government Code, all money in the fund is, without regard to fiscal year, continuously appropriated to the authority for carrying out the purposes of this section. The authority may divide the fund into separate accounts. All moneys accruing to the authority pursuant to this section from any source shall be deposited into the fund.
(f) All moneys in the California Affordable Clean Vehicle Program Fund derived from any source shall be held in trust for the life of this program and shall be expended exclusively for the program and costs of administration, as follows:
(1) Program expenditures shall include both of the following:
(A) Contributions paid by the authority in support of qualified loans.
(B) Reasonable costs to provide education to car buyers and participating lenders about the program, including staff time, contracts with program partners, and travel within the state.
(2) Administrative expenditures shall be limited to 5 percent of the initial appropriation plus 5 percent of all moneys recaptured, and shall include all of the following:
(A) Personnel costs.
(B) Service and vending contracts necessary to administer the program.
(C) Other reasonable direct and indirect administrative costs.
(g) The authority may direct the State Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state, or alternatively may require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of the Government Code, excepting the Surplus Money Investment Fund.
(h) The authority shall adopt regulations regulations, subject to the approval of the State Air Resources Board, pursuant to subdivision (c) of Section 44520 to implement the program, including provisions specific to this program as described in this section and further including provisions to do all of the following:
(1) Establish a new loss reserve account for each participating lender enrolling loans in this program.
(2) Obtain a certification from each participating lender and car dealer upon enrollment of a qualified loan that the proceeds of the loan will be used for acquiring an eligible clean vehicle, as defined by the authority.
(3) Contingent on the availability of funds, contribute an additional incentive from the fund for each loan enrolled for a qualified person that resides in a severely affected community.
(4) Limit the term of loss coverage for each qualified loan to no more than five years.
(5) Recapture from the loss reserve account the authority’s contribution for each enrolled loan upon the maturation of such loan or after five years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(6) Provide assistance to low-income or high-financial-risk individuals to gain access to more favorable lease terms.
(7) Provide consumer protections that include, but are not limited to, the following:
(A) A review of the applicant’s ability to afford the monthly payment of the loan.
(B) A provision prohibiting a participating lender from collecting from an applicant an amount of money for nonpayment that is in excess of the value, at the time of collection, of the clean vehicle purchased or leased with the assistance of the authority.
(i) Notwithstanding Section 10231.5 of the Government Code, commencing in 2018 and annually thereafter, the authority shall submit a report to the Legislature, pursuant to Section 9795 of the Government Code, regarding alternative financing programs administered pursuant to this section.
(j) Notwithstanding any other law, the authority may establish and maintain loss reserve accounts with any financial institution under any policies the authority may adopt, including the policies of other funding sources, pursuant to subdivision (b) of Section 44559.11.
(k) All moneys in a loss reserve account established pursuant to this article are the exclusive property of, and solely controlled by, the authority. Interest or income earned on moneys credited to the loss reserve account shall be deemed to be part of the loss reserve account. The authority may withdraw from the loss reserve account all, or a portion of, the interest or other income that has been credited to the loss reserve account. Any withdrawal made pursuant to this subdivision may be made prior to paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.
(l) The combined amount to be deposited by the participating financial institution into any individual loss reserve account over a three-year period, in connection with any single borrower or any group of borrowers among which a common enterprise exists, shall be not more than an amount determined by the authority.
(m) Provide for a rebate of 5 percent of the purchase price of the vehicle at the end of the five-year term of the loan, or at the time the loan is repaid if the loan is kept for more than three years.

SEC. 2.

Notwithstanding Section 16428.8 of the Government Code, the sum of fifty million dollars ($50,000,000) is hereby transferred from the Greenhouse Gas Reduction Fund to the California Affordable Clean Vehicle Program Fund established by Section 44559.15 of the Health and Safety Code.