(1)The

The bill would require the executive director, by January 1, 2020, to prepare, or cause to be prepared, a proposed projected 5-year budget detailing the costs expected to be incurred during that period due to the transfer of the bank, as described above, and the operation of the bank as a depository institution, as described below. The bill would require the executive director to submit the proposed projected budget to the board for approval and the final projected budget to the Legislature, as provided, and to take specified actions in order to facilitate the transfer of the bank and the operation of the bank as a depository institution. The bill, until January 1, 2020, would require the executive director to employ as necessary professional staff or consultants with expertise in the regulatory and other policy practices of the Federal Reserve System to assist in those activities. The bill would transfer $500,000 from the General Fund to the I-Bank fund to be used for the employment of professional staff or consultants for these purposes. By transferring money to a continuously appropriated fund, this bill would make an appropriation.

(2)Existing law requires the Treasurer, if possible, to deposit all money in the State Treasury or under the control of the Treasurer into an eligible bank. Existing law requires a state officer or employee, other than the Treasurer, to deposit all money in the custody of the state or under the control of that officer or employee in a state or national bank, as defined. Existing law requires a local agency, as defined, to deposit all money belonging to, or in the custody of that local agency, into specified state or national banks, as defined.

This bill would require that the I-Bank be chartered as a depository institution and authorize the Treasurer, a state officer or employee having control over money belonging to or in the custody of the state, a local agency, as defined, or, upon approval by the board of directors, a quasi-public nonprofit entity to establish a deposit account with the bank. The bill would require that the bank, among other things, become a member of the Federal Reserve System and the Federal Home Loan Bank System and prohibit the bank from engaging in prohibited high-risk activities, as defined. The bill would provide that moneys in the I-Bank fund for purposes of these provisions are subject to appropriation by the Legislature.

(3)Existing law requires the I-Bank, by November 1 of each year, to submit to the Governor and the Legislature a report for the preceding fiscal year containing specified information relating to the I-Bank fund and programs, including information on the impact of the activities funded by moneys in the fund such as the number of jobs created and retained. Existing law also requires the manager of the California Small Business Finance Center, by January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year relating to the activities of the California Small Business Expansion Fund and moneys within that fund held in trust by a financial institution or financial company that includes specified information.

This bill would additionally require the I-Bank and the program manager to submit these reports to the Infrastructure and Economic Development Bank Commission and the bank’s board of directors. The bill would also expand the report required to be submitted by the I-Bank to include the number of jobs projected to be created and retained as an impact of the activities funded from the I-Bank fund and programs and information about deposit accounts established as described above.