Bill Text

Bill Information

PDF |Add To My Favorites |Track Bill | print page

AB-1547 State finance: financing authorities.(2017-2018)

SHARE THIS:share this bill in Facebookshare this bill in Twitter
Date Published: 09/05/2018 09:00 PM
AB1547:v92#DOCUMENT

Enrolled  September 05, 2018
Passed  IN  Senate  August 31, 2018
Passed  IN  Assembly  August 31, 2018
Amended  IN  Senate  August 24, 2018
Amended  IN  Senate  August 17, 2018
Amended  IN  Senate  June 18, 2018
Amended  IN  Senate  May 01, 2018
Amended  IN  Assembly  January 11, 2018
Amended  IN  Assembly  January 03, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 1547


Introduced by Assembly Member Quirk-Silva
(Principal coauthors: Assembly Members Berman, Cervantes, and Rodriguez)

February 17, 2017


An act to amend Sections 91504, 91529, 91560, 91561.3, and 91561.5 of, to amend and renumber the heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of, to repeal Sections 91531, 91532, 91561, and 91562.5 of, to repeal Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of, and to repeal Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of, the Government Code, to amend Sections 44559.13 and 44559.14 of the Health and Safety Code, and to amend Section 6010.8 of the Revenue and Taxation Code, relating to state finance, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.


LEGISLATIVE COUNSEL'S DIGEST


AB 1547, Quirk-Silva. State finance: financing authorities.
(1) Existing law, the California Industrial Development Financing Act, authorizes cities, counties, cities and counties, and redevelopment agencies to establish industrial development authorities that are authorized to issue industrial development bonds, the proceeds of which may be used to fund capital projects of private enterprise under terms and conditions specified in the act. The act authorizes an authority to issue tax-exempt bonds, and defines “tax-exempt” for these purposes to mean that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes. The act establishes the California Industrial Development Financing Advisory Commission, and requires the commission to approve the issuance of industrial development bonds pursuant to these provisions. The act also authorizes the commission to carry out other specified powers related to the issuance of industrial development bonds, including authorizing the commission to act as a bond pooling agent and requires fees to be charged to cover the costs of the commission in carrying out these provisions. Existing law requires these fees to be deposited in the Industrial Development Fund, which is available, upon appropriation, to the commission for expenses.
This bill would abolish the California Industrial Development Financing Advisory Commission, and would make conforming changes to that effect. The bill would also provide that “tax-exempt” for purposes of the act includes that the interest on the bonds is otherwise entitled to any federal tax advantage. The bill would transfer any moneys, including interest earned, in the Industrial Development Fund to the California Debt Limit Allocation Committee Fund, established in existing law, and appropriate those moneys to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the abolishment of the California Industrial Development Financing Advisory Commission, as specified, and also to the California Debt Limit Allocation Committee.
(2) 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. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program (ADA program), within the Capital Access Loan Program, to assist small businesses in financing the eligible costs of projects that alter or retrofit existing small business facilities to comply with the federal Americans with Disabilities Act. Existing law defines a small business for purposes of the ADA program to mean a business that meets certain criteria, including that it be a small business concern, as defined under specified federal law, and additionally that it has 15 or fewer full-time employees, has less than $5,000,000 in total gross annual income from all sources, and does not provide overnight accommodations. Existing law establishes the California Americans with Disabilities Act Small Business Capital Access Loan Program Fund as a continuously appropriated fund, and requires the authority to use the fund for specified purposes related to the ADA program.
This bill would modify the definition of a small business for purposes of the ADA program to instead mean a business that is independently owned and operated and not dominant in its field, and that has 30 or fewer full-time employees or that has less than $5,000,000 in total gross annual income from all sources. The bill would thereby expand the types of businesses that qualify for funding under the ADA program. By expanding the authorized uses of moneys in a continuously appropriated fund, the bill would make an appropriation.
(3) Existing law establishes within the Capital Access Loan Program the California Seismic Safety Capital Access Loan Program to assist qualified residential property owners and qualified small business owners in seismically retrofitting qualified buildings by covering losses on qualified loans for those purposes. Existing law defines the term “qualified building” for these purposes to mean a building that is certified by the appropriate local building code enforcement authority as hazardous and in danger of collapse during an earthquake. Existing law requires a “qualified small business” and “qualified residential property owner” to own and occupy the qualified building, and prohibits a qualified loan under the program from being used to finance passive real estate ownership. Existing law requires the California Pollution Control Financing Authority to administer the program, including regulations and funds received for the program, as specified. Existing law establishes the California Seismic Safety Capital Access Loan Program Fund, which is continuously appropriated to the authority to carry out the purposes of the California Seismic Safety Capital Access Loan Program.
This bill would modify the term “qualified building” to mean a residential or commercial building identified by the local building code official as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981. This bill would no longer require a “qualified small business” or a “qualified residential property owner” to occupy a qualified building in order to be eligible under the program, and would authorize a qualified loan under the program to be used to finance passive real estate ownership. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
(4) The California Alternative Energy and Advanced Transportation Financing Authority Act authorizes, until January 1, 2021, the authority to provide financial assistance in the form of a sales and use tax exclusion for projects, including those that promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. The act prohibits the sales and use tax exclusions from exceeding $100,000,000 for each calendar year. The act authorizes the authority, until July 1, 2021, to grant financial assistance in the form of a sales and use tax exclusion for projects that promote the use of advanced manufacturing.
This bill would expand the sales and use tax exemption to include the lease or transfer of tangible personal property, constituting any project, to any contractor for use in the performance of a construction contract that will use the property as an integral part of the approved project.
(5) This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2/3   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 91504 of the Government Code is amended to read:

91504.
 Unless the context otherwise requires, the definitions in this article shall govern the construction of this title, as follows:
(a) “Acquire” and its variants means acquire, construct, improve, furnish, equip, repair, reconstruct, or rehabilitate.
(b) “Administration expenses” means the reasonable and necessary expenses incurred by an authority in the administration of this title, including, without limitation, fees and costs of paying agents, trustees, attorneys, consultants, and others.
(c) “Authority” means any industrial development authority established pursuant to this title.
(d) “Board” means the board of directors of an authority.
(e) “Bonds” means the revenue obligations, inclusive of principal (premium, if any) and interest authorized to be issued by any authority pursuant to this title, including a single bond, a promissory note or notes, including bond anticipation notes, or other instruments evidencing an indebtedness or obligation.
(f) “Bond proceeds” means all amounts received by an authority upon sale or other disposition of any bonds.
(g) “Company” means a person, partnership, corporation, whether for profit or not, limited liability company, trust, or other private enterprise of whatever legal form, for which a project is undertaken or proposed to be undertaken pursuant to this title or which is in possession of property owned by an authority, and may include more than a single enterprise.
(h) “Cost” as applied to any project, may embrace:
(1) The cost of construction, improvement, repair, rehabilitation, and reconstruction.
(2) The cost of acquisition, including rights in land and other property, both real and personal and improved and unimproved, and franchises, and disposal rights.
(3) The cost of demolishing, removing, or relocating any building or structures on lands so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved or relocated.
(4) The cost of machinery, equipment and furnishings, of engineering and architectural surveys, plans, and specifications, and of transportation and storage until the facility is operational.
(5) The cost of agents or consultants, including, without limitation, legal, financial, engineering, accounting, and auditing, necessary or incident to a project and of the determination as to the feasibility or practicability of undertaking the project.
(6) The cost of issuance of any bonds and of financing, interest prior to, during, and for a reasonable period after completion of a project, and reserves for principal and interest and for extensions, enlargements, additions, repairs, replacements, renovations, rehabilitations, and improvements.
(7) The cost of acquiring or refinancing existing obligations incident to the undertaking and carrying out, including the financing, of a project, and the reimbursement to any governmental entity or agency, or any company, of expenditures made by or on behalf of the entity, agency, or company that are costs of the project hereunder, without regard to whether or not the expenditures may have been made before or after the adoption of a resolution of intention with respect to that project by an authority.
(8) The cost of making relocation assistance payments as provided by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1.
(9) In the case only of taxable bonds, the cost of refunding or refinancing any outstanding debt or obligations with respect to any facilities, or the cost of any other working capital.
(10) Except as provided in paragraph (9), “cost” does not otherwise include working capital.
(i) “Facilities” mean property suitable for any one or more of the activities or uses described in Section 91503 and includes incidental facilities.
(j) “Governing body” means the board of supervisors, city council, or board of directors of a redevelopment agency, as the case may be.
(k)  “Indenture” means any mortgage, deed of trust, trust indenture, security agreement, or other instrument relating to establishing a lien or security interest in, or on, property, any pledge or other instrument relating to the possession of property, and any assignment or other instrument relating to establishing any right, title, or interest in, or related to, property, including the revenues therefrom, given by an authority to a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the state, or bondholder or agent, for the security of its bonds and the benefit of the bondholders.
(l) “Proceedings” means the actions taken by an authority in undertaking, carrying out, and completing a project, including, without limitation, the project agreements, indenture, bonds, and resolutions.
(m) “Project” means the acquisition, construction, improvement, repair, rehabilitation, and reconstruction of facilities and the acquisition and rehabilitation of machinery, equipment, and furnishings, and the acquisition of engineering and architectural surveys, plans, and specifications, and all other necessary and related capital expenditures by the issuance of bonds upon the application of and to be repaid by payments from a company for the purposes of this title.
(n) “Project agreements” means the agreements between an authority and a company respecting a project, and may include, without limitation, leases, subleases, options, and installment or other contracts of purchase or sale, loan, or guaranty agreements, notes, mortgages, deeds of trust, and security agreements.
(o) “Property” means any land, air rights, water rights, disposal rights, improvements, buildings or other structures, and any personal property, tangible or intangible, and includes, but is not limited to, machinery and equipment, whether or not in existence or under construction, and interests in any of the foregoing, or promissory notes or other obligations of any kind respecting such interests.
(p) “Public agency” means any county, city and county, city, or redevelopment agency.
(q) “Revenues” means all rents, purchase payments, and other income derived by an authority from, or with respect to, the sale, lease, or other voluntary or involuntary disposition of, or repayment of loans with respect to, property, bond proceeds, and any receipts derived from the deposit or investment of any such income or proceeds in any fund or account of an authority, but does not include receipts designated to cover administration expenses.
(r) “Tax-exempt” means, with respect to any bonds, that the interest on the bonds is excluded from gross income of the holders thereof for federal income tax purposes, or is otherwise entitled to any federal tax advantage.
(s) “Taxable” means, with respect to any bonds, that the bonds are not tax-exempt.

SEC. 2.

 Section 91529 of the Government Code is amended to read:

91529.
 Companies may apply for financing pursuant to this article by filing with an authority an application therefor which includes all of the following:
(a) Such financial, legal, and other information as is required by an authority.
(b) An estimate of the amount of bonds proposed to be issued, of the sources of amounts otherwise required for the project, and an itemization of the estimated cost and any other expenses which aggregate not less than the estimated amount of bonds.
(c) Sufficient other information as is necessary to the determinations required to be made by subdivision (c) of Section 91530.
An application may be amended, supplemented, or clarified from time to time, with any information that is required for the making of the determinations desired at the time, in accordance with procedures established by the authority.

SEC. 3.

 Section 91531 of the Government Code is repealed.

SEC. 4.

 Section 91532 of the Government Code is repealed.

SEC. 5.

 Article 3 (commencing with Section 91550) of Chapter 1 of Title 10 of the Government Code is repealed.

SEC. 6.

 The heading of Article 4 (commencing with Section 91560) of Chapter 1 of Title 10 of the Government Code is amended and renumbered to read:
Article  3. Small Business Financing

SEC. 7.

 Section 91560 of the Government Code is amended to read:

91560.
 (a) The Legislature finds and declares that small businesses may have difficulty establishing adequate security for bonds issued by an authority in their behalf; that establishing common reserve funds will help to provide reasonable security for these bonds and will help to make the authority’s services available to various small businesses that may be otherwise unable to use them.
(b) For the purpose of establishing and maintaining the common reserve funds it deems necessary or desirable to secure its bonds or any issuance thereof, an authority, pursuant to its project agreements with companies, may levy fees or other charges on, or require deposits from, companies receiving financing for projects under this title. Before levying any of these fees or charges or requiring deposits, an authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for the fees, charges, or deposits.
(c) Subject to any prior contractual obligations to any of its bondholders, an authority may establish one or more common reserve funds for any or all of its bonds. Each authority shall establish its liability limits of the common reserve fund with respect to any single issue of bonds issued by the authority.
(d) Each common reserve fund established pursuant to this section shall be deposited in a special account that shall be established by the Controller. Notwithstanding any other provision of law, all interest or other increment earned by investment or deposit of moneys in such an account pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 or pursuant to any other provision of law shall be credited to, and deposited in, the account.

SEC. 8.

 Section 91561 of the Government Code is repealed.

SEC. 9.

 Section 91561.3 of the Government Code is amended to read:

91561.3.
 Each local authority may enter into joint powers agreements with other local authorities to issue pooled bonds in response to small business loan requests.

SEC. 10.

 Section 91561.5 of the Government Code is amended to read:

91561.5.
 For purposes of this article, “small business” means small business as defined in Section 14837.

SEC. 11.

 Section 91562.5 of the Government Code is repealed.

SEC. 12.

 Article 5 (commencing with Section 91570) of Chapter 1 of Title 10 of the Government Code is repealed.

SEC. 13.

 Section 44559.13 of the Health and Safety Code, as amended by Section 2 of Chapter 644 of the Statutes of 2017, is amended to read:

44559.13.
 (a) It is the intent of the Legislature in this act to create and fund the California Americans with Disabilities Act Small Business Capital Access Loan Program to assist small businesses in complying with the Americans with Disabilities Act. It is not the intent of the Legislature to assist the physical expansion of small businesses that includes modifications that comply with the Americans with Disabilities Act. 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 with the additional program requirements specified under this section.
(b) For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1) “Americans with Disabilities Act” means the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) and amendments thereto.
(2) “California Americans with Disabilities Act Small Business Capital Access Loan Program Fund” or “fund” means a fund established and administered by the authority pursuant to Sections 44548 and 44549 to be used for purposes of this program.
(3) (A) “Eligible cost” means and includes all or any part of the price of construction, purchase price of real or personal property, the price of demolishing or removing any buildings or structures, the price of all machinery and equipment, the amount of financing charges and interest before, during, and for a period not to exceed the later of one year or one year following completion of construction, as determined by the authority, the price of insurance during construction, the amount of funding or financing noncapital expenses, the amount of reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements, the price of engineering, financial, and legal services and other service contracts, the price of plans, specifications, studies, surveys, estimates, administrative expenses, and any other expenses of funding or financing, that are necessary and allocable to the eligible project.
(B) “Eligible cost” shall not include costs not directly related to physical alterations necessary for compliance with the Americans with Disabilities Act.
(4) “Eligible project” means the physical alterations or retrofits to an existing small business facility of less than 10,000 square feet necessary to ensure that facility is in compliance with the Americans with Disabilities Act, and the financing necessary to pay eligible costs of the project.
(5) “Qualified loan” means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed fifty thousand dollars ($50,000).
(6) “Small business” or “qualified business” means a business that is independently owned and operated and not dominant in its field that meets both of the following additional criteria:
(A) It has 30 or fewer full-time equivalent employees, or it has less than five million dollars ($5,000,000) in total gross annual income from all sources.
(B) It does not provide overnight accommodations.
(c) (1) The California Americans with Disabilities Act Small Business Capital Access Loan Program Fund is established in the State Treasury for, and shall be administered by the authority pursuant to Sections 44548 and 44549 for, this program. Notwithstanding Section 13340 of the Government Code, all money in the fund is 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.
(2) All moneys in the fund derived from any source shall be held in trust for the life of this program, subject to the program expenditures and costs of administering this section, as follows:
(A) Program expenditures shall include all of the following:
(i) Contributions paid by the authority in support of qualified loans.
(ii) Payments made to borrowers enrolling loans to participate in the program, to the extent that moneys other than the initial appropriation are deposited into the fund by the authority and are authorized for that use pursuant to paragraph (3) of subdivision (d).
(iii) Reasonable costs to educate the small business community and participating lenders about the program, including travel within the state.
(B) 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:
(i) Personnel costs.
(ii) Service and vending contracts necessary to carry out the program.
(iii) Other reasonable direct and indirect administrative costs.
(3) The authority may direct the 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. The authority may alternatively 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 Title 2 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 Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d) The authority shall adopt regulations 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:
(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 small business upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3) Contribute an additional incentive from the fund for each loan enrolled for a qualified business located in a severely affected community, or make nonreimbursable payments from other moneys to participating borrowers to offset all or a portion of the reasonable costs of architectural inspections obtained from a person who is certified as an access specialist pursuant to the program described in Section 4459.5 of the Government Code.
(4) Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for small business offered by the authority as long as funds are available for this program.
(5) Limit the term of loss coverage for each qualified loan to no more than five years.
(6) 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.

SEC. 14.

 Section 44559.14 of the Health and Safety Code is amended to read:

44559.14.
 (a) (1) It is the intent of the Legislature in enacting the act adding this section to create and fund a program to assist residential property owners and small business owners in seismically retrofitting residences and small businesses with a priority on soft-story buildings and unreinforced brick and concrete buildings. It is not the intent of the Legislature to assist the physical expansion of small businesses and residences.
(2) The Legislature hereby establishes the California Seismic Safety Capital Access Loan Program. The program shall cover losses on qualified loans by participating lenders to qualified residential property owners or qualified small businesses for eligible projects, as specified under this section. The program shall be administered by the California Pollution Control Financing Authority and follow the terms and conditions for the Capital Access Loan Program in this article with the additional program requirements specified under this section.
(b) For purposes of this section, unless the context requires otherwise, the following words and terms shall have the following meanings:
(1) “Seismic retrofit construction” means alteration performed on or after January 1, 2017, of a qualified building or its components to substantially mitigate seismic damage. “Seismic retrofit construction” includes, but is not limited to, all of the following:
(A) Anchoring the structure to the foundation.
(B) Bracing cripple walls.
(C) Bracing hot water heaters.
(D) Installing automatic gas shutoff valves.
(E) Repairing or reinforcing the foundation to improve the integrity of the foundation against seismic damage.
(F) Anchoring fuel storage.
(G) Installing an earthquake-resistant bracing system for mobilehomes that are registered with the Department of Housing and Community Development.
(H) Strengthening a building’s lateral load resisting system.
(2) “Eligible costs” means the costs paid or incurred on or after January 1, 2017, for an eligible project, including any engineering or architectural design work necessary to permit or complete the eligible project less the amount of any grant provided by a public entity for the eligible project. “Eligible costs” do not include costs paid or incurred for any of the following:
(A) Maintenance, including abatement of deferred or inadequate maintenance, and correction of violations unrelated to the seismic retrofit construction.
(B) Repair, including repair of earthquake damage.
(C) Seismic retrofit construction required by local building codes as a result of addition, repair, building relocation, or change of use or occupancy.
(D) Other work or improvement required by local building or planning codes as a result of the intended seismic retrofit construction.
(E) Rent reductions or other associated compensation, compliance actions, or other related coordination involving the qualified residential property owner or qualified small business and any other party, including a tenant, insurer, or lender.
(F) Replacement of existing building components, including equipment, except as needed to complete the seismic retrofit construction.
(G) Bracing or securing nonpermanent building contents.
(H) The offset of costs, reimbursements, or other costs transferred from the qualified residential property owner or qualified small business to others.
(3) “Eligible project” means seismic retrofit construction that is necessary to ensure that the qualified building is capable of substantially mitigating seismic damage, and the financing necessary to pay eligible costs of the project.
(4) “Qualified building” means a residential or commercial building that is identified by the local building code official for the jurisdiction in which the building is located as a building in need of seismic retrofitting and is either a building of a type that is potentially vulnerable in the event of a catastrophic earthquake or a building constructed before 1981.
(5) “Qualified loan” means a loan or portion of a loan as defined in subdivision (j) of Section 44559.1, where the proceeds of the loan or portion of the loan are limited to the eligible costs for an eligible project under this program, and where the loan or portion of the loan does not exceed two hundred fifty thousand dollars ($250,000).
(6) “Qualified small business” means a business referred to in subdivisions (i) and (m) of Section 44559.1 that owns a qualified building regardless of owner occupancy, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(7) “Qualified residential property owner” means either an owner of a residential building that is a qualified building or a qualified small business that owns one or more residential buildings, including a multiunit housing building, that is a qualified building, notwithstanding the restriction on passive real estate ownership in subparagraph (B) of paragraph (2) of subdivision (j) of Section 44559.1.
(c) (1) The California Seismic Safety Capital Access Loan Program Fund is established in the State Treasury and shall be administered by the authority pursuant to Sections 44548 and 44549 for this program. For purposes of this section, the references in Sections 44548 and 44549 to “small business” shall include “qualified residential property owner,” as defined in this section. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority for carrying out 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.
(2) All moneys in the fund derived from any source shall be held in trust for the life of this program, for program expenditures and costs of administering this section, as follows:
(A) Program expenditures shall include both of the following:
(i) Contributions paid by the authority in support of qualified loans.
(ii) Costs for a qualified expert to validate that the proceeds of the loans are eligible costs, as defined under this section.
(iii) Reasonable costs to educate the small business community, residential property owners, and participating lenders about the program, including travel within the state.
(B) 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:
(i) Personnel costs.
(ii) Service and vending contracts, other than program expenditures described in subparagraph (A), that are necessary to carry out the program.
(iii) Other reasonable direct and indirect administrative costs.
(3) The authority may direct the 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. The authority may alternatively 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 Title 2 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 Title 2 of the Government Code, excepting the Surplus Money Investment Fund.
(d) The authority shall adopt regulations pursuant to Section 44520 to implement the program, including, but not limited to, provisions to:
(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 qualified small business or qualified residential property owner upon enrollment of a qualified loan that the proceeds of the loan will be used for the eligible costs of an eligible project.
(3) Contribute an additional incentive from the fund for each loan enrolled for a qualified small business or qualified residential property owner located in a severely affected community.
(4) Restrict the enrollment of a qualified loan in any other Capital Access Loan Program for a qualified small business or qualified residential property owner offered by the authority as long as funds are available for this program.
(5) Limit the term of loss coverage for each qualified loan to no more than 10 years.
(6) Recapture from the loss reserve account the authority’s contribution for each enrolled loan upon the maturation of that loan or after 10 years from the date of enrollment, whichever happens first, to be deposited in the fund and applied to future program and administrative expenditures.
(e) The authority may adopt regulations relating to residential property owner or small business financing as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. For purposes of that Chapter 3.5, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. The regulations shall be repealed 180 days after their effective date, unless the adopting authority or agency complies with that Chapter 3.5.

SEC. 15.

 Section 6010.8 of the Revenue and Taxation Code, as amended by Section 5 of Chapter 788 of the Statutes of 2015, is amended to read:

6010.8.
 (a) (1) “Sale” and “purchase” do not include any lease or transfer of title of tangible personal property constituting any project to any participating party.
(2) On and after the operative date of the act adding this paragraph, “sale” and “purchase” do not include any lease or transfer of title of tangible personal property constituting any project to any contractor for use in the performance of a construction contract for the participating party that will use that property as an integral part of the approved project.
(b) As used in this section, “project” has the meaning specified in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003 of the Public Resources Code and “participating party” has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code.
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 16.

 Any moneys, including interest earned, in the Industrial Development Fund established pursuant to Section 91553 of the Government and repealed by the act adding this section are hereby transferred to the California Debt Limit Allocation Committee Fund established pursuant to Section 8869.90 of the Government Code and are hereby appropriated to the California Pollution Control Financing Authority to reimburse this authority for its administrative costs related to the elimination of the California Industrial Development Financing Advisory Commission, as described in the interagency agreement entered into between the authority and the commission for this purpose. Any remaining moneys subject to this transfer from the Industrial Development Fund are hereby appropriated to the California Debt Limit Allocation Committee for purposes described in Section 8869.90 of the Government Code.

SEC. 17.

 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to assist businesses in making Americans with Disabilities Act, water efficiency, and earthquake- related building changes as soon as possible, it is necessary for this act to take effect immediately as an urgency statute.