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SB-1293 California Infrastructure and Economic Development Bank: Sea Level Rise Revolving Loan Program.(2019-2020)

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Date Published: 03/30/2020 09:00 PM
SB1293:v98#DOCUMENT

Amended  IN  Senate  March 30, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill
No. 1293


Introduced by Senator Allen

February 21, 2020


An act relating to coastal resources. An act to amend Section 63050 of, and to add Article 5.5 (commencing with Section 63047.5) to Chapter 2 of Division 1 of Title 6.7 of, the Government Code, relating to coastal resources, and making an appropriation therefor.


LEGISLATIVE COUNSEL'S DIGEST


SB 1293, as amended, Allen. Coastal resources: climate change: sea level rise. California Infrastructure and Economic Development Bank: Sea Level Rise Revolving Loan Program.
The Bergeson-Peace Infrastructure and Economic Development Bank Act establishes the California Infrastructure and Economic Development Bank (I-Bank) in the Governor’s Office of Business and Economic Development. Existing law, among other things, authorizes the I-Bank to make loans, issue bonds, and provide financial assistance for various types of projects that qualify as economic development or public development facilities. The act defines, among other things, the term “public development facilities” for these purposes to mean real and personal property, structures, conveyances, equipment, thoroughfares, buildings, and supporting components thereof, excluding any housing, that are directly related to providing, among other things, housing-related infrastructure, as specified. The act establishes the California Infrastructure and Economic Development Bank Fund, a continuously appropriated fund, for support of the bank.
This bill would create the Sea Level Rise Revolving Loan Program within the I-Bank to provide low-interest loans to local jurisdictions for the purchase of coastal properties in their jurisdictions identified as vulnerable coastal property. The bill would require the California Coastal Commission, before January 1, 2022, in consultation with the California Coastal Commission, the State Lands Commission, and any other applicable state, federal, and local entities with relevant jurisdiction and expertise, to determine criteria and guidelines for the identification of vulnerable coastal properties eligible for participation in the program. The bill would authorize specified cities and counties to apply for, and be awarded, a low-interest loan under the program if the city or county develops and submits to the bank a vulnerable coastal property plan. The bill would require the California Coastal Conservancy to review the plans to determine whether they meet the required criteria for vulnerable coastal properties to be eligible for participation in the program.
The bill would establish the Sea Level Rise Revolving Loan Account within the California Infrastructure and Economic Development Bank Fund, which, as described above, is a continuously appropriated fund. The bill would authorize the I-Bank to issue bonds and require the bond revenues be deposited in the Sea Level Rise Revolving Loan Account to be used for purposes of the Seal Level Rise Revolving Loan Program. The bill would also require that loan repayments, fees, and penalties be deposited in the revolving account. By increasing the amount of money in a continuously appropriated fund, the bill would make an appropriation.

Existing law establishes the Integrated Climate Adaptation and Resiliency Program, administered by the Office of Planning and Research, to coordinate regional and local efforts with state climate adaptation strategies to adapt to the impacts of climate change, as specified.

This bill would state the intent of the Legislature to enact legislation that would protect the public and coastal resources from the threat of sea level rise and increased storm surge brought forth by climate change and that would create a revolving loan fund to allow local governments to purchase threatened coastal properties for leasing purposes.

Vote: MAJORITY2/3   Appropriation: NOYES   Fiscal Committee: NOYES   Local Program: NO  

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


SECTION 1.

 Article 5.5 (commencing with Section 63047.5) is added to Chapter 2 of Division 1 of Title 6.7 of the Government Code, to read:
Article  5.5. Sea Level Rise Revolving Loan Program

63047.5.
 This article shall be known, and may be cited, as the Sea Level Rise Revolving Loan Program.

63047.51.
 The Legislature finds and declares all of the following:
(a) Anthropogenic Climate Change has been, and will continue to be, a very serious threat to the future of California. Rising global temperatures, and the subsequent melting of polar ice caps, has resulted in an increased rise in Sea levels worldwide with significant ramifications for coastal communities.
(b) Current projections indicate California’s coast will experience a sea level rise of one-half of one foot by 2030, two feet by 2050, and seven feet by 2100. A higher sea level exacerbates the threats of coastal erosion, storm surge, and flood damage along California’s coastline and will very likely result in saltwater intrusion that will threaten drinking water supplies.
(c) Currently, the California coastline is home to 68 percent of the state’s population and is responsible for 80 percent of its gross domestic product. California’s ocean-based economy employs over 500,000 people and is valued at approximately forty-five billion dollars ($45,000,000,000) annually.
(d) Any attempt to properly address the threat of sea level rise must include a broad range of creative climate change mitigation strategies to limit greenhouse gas emissions and the worst impacts of climate change, and must include adaption and resiliency efforts designed to prepare communities for the impacts we cannot avoid.

63047.52.
 The following definitions, in addition to the definitions contained in Section 63010, shall apply for purposes of this article:
(a) “Local jurisdiction” means a city or county, or its governing body, in which a vulnerable coastal property is located. A county may act as the local jurisdiction for a city within the county’s jurisdiction upon implementation of a memorandum of understanding between the two jurisdictions.
(b) “Vulnerable Coastal Property” means any coastal property, building, or structure, identified by a local jurisdiction that is vulnerable to sea level rise, as determined in accordance with the criteria developed by the California Coastal Conservancy pursuant to Section 63047.53.

63047.53.
 (a) The bank, in consultation with the California Coastal Conservancy and the California Coastal Commission, shall develop and administer the Sea Level Rise Revolving Loan Program for the purposes of administering the Sea Level Rise Revolving Loan Account. The program shall provide low-interest loans to local jurisdictions for the purchase of coastal properties in their jurisdictions identified as vulnerable coastal property.
(b) Before January 1, 2022, the California Coastal Conservancy, in consultation with the California Coastal Commission, the State Lands Commission, and any other applicable state, federal, and local entities with relevant jurisdiction and expertise, shall do the following:
(1) Determine criteria and guidelines for the identification of vulnerable coastal properties eligible for participation in the Sea Level Rise Revolving Loan Program, including, but not limited to:
(A) Required conditions for coastal properties to be identified as vulnerable coastal properties.
(B) Specific information required to be included in a vulnerable coastal property plan created by a city or county in order to determine the risks of sea level rise and related risks to that community, including, but not limited to, flooding and erosion.
(C) Criteria, including existing applicable laws and other standards, to identify when a vulnerable coastal property is lost to the sea.
(2) Provide all criteria and guidelines to the bank for adoption under the Sea Level Rise Revolving Loan Program, and post all criteria and guidelines on the California Coastal Conservancy’s internet website.
(3) Review vulnerable coastal property plans submitted by local jurisdictions to determine whether a plan meets the criteria established under this section.
(c) The bank and the California Coastal Conservancy may adopt regulations, rules, guidelines, or other criteria to implement this article. The adoption, amendment, or repeal of a regulation, rule, guideline, or other criteria authorized by this article is hereby exempted from the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2).

63047.54.
 (a) A local jurisdiction may apply for, and be awarded, a low-interest loan through the Sea Level Rise Loan Program only if the local jurisdiction completes both of the following:
(1) Develops and submits to the bank a vulnerable coastal property plan for the jurisdiction that is approved by the California Coastal Conservancy. The vulnerable coastal property plan shall include all of the following:
(A) An explanation of how the vulnerable coastal property or properties included in the plan meet the criteria developed by the California Coastal Conservancy.
(B) The acquisition process for any vulnerable coastal property included in the plan.
(C) The lease agreement for any vulnerable coastal property included in the plan.
(D) The management plan for any vulnerable coastal property included in the plan.
(E) The expected time period for acquisition of any vulnerable coastal property included in the plan.
(2) All other requirements imposed by the bank under this article.
(b) (1) If awarded a loan under this article, a local jurisdiction shall use the moneys to purchase the vulnerable coastal property or properties included in the vulnerable coastal property plan through a fair and transparent purchase process.
(2) The local jurisdiction shall not use eminent domain for vulnerable coastal properties included in this program.

63047.55.
 (a) There is hereby created in the State Treasury in the California Infrastructure and Economic Development Bank Fund, a Sea Level Rise Revolving Loan Account for the purpose of providing low-interest loans to eligible local jurisdictions in accordance with the Sea Level Rise Revolving Loan Program established under this article.
(b) (1) The bank may issue taxable or tax-exempt revenue bonds pursuant to Chapter 5 (commencing with Section 63070) and deposit the proceeds from the bonds into the revolving account or use the proceeds to refund bonds previously issued under this article. Bond proceeds may also be used to fund necessary reserves, capitalized interest, or costs of issuance.
(2) Except as may be provided in the governing documents with respect to bond anticipation notes, each of the bonds issued under this article shall, to the extent provided in the governing documents, be payable from, and secured by, all or a portion of the revenues in the revolving account and the assets of the revolving account, to the extent the revenues and assets are pledged by the board for those purposes.
(3) Bonds issued under this article shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, other than the bank, or a pledge of the faith and credit of the state or of any political subdivision, but shall be payable solely from the revolving account and the assets of the revolving account, and the security provided by the revolving account. All bonds issued under this article shall contain on the face of the bonds a statement to the same effect.
(c) In addition to any other financing provided pursuant to this division, the bank may provide low-interest loans from the Sea Level Rise Revolving Loan Account for purposes of the Sea Level Rise Revolving Loan Program to any local jurisdiction that meets the requirements of Section 63047.53, in connection with the financing or refinancing of a vulnerable coastal property in accordance with an agreement, or agreements, between the bank and the local jurisdiction, either as a sole lender or in participation or syndication with other lenders. The financing shall not exceed the total value of the vulnerable coastal property being financed.
(d) All moneys received for repayment of a loan, and any penalties, interest, and fees in connection with a loan, provided for purposes of the Sea Level Rise Revolving Loan Program shall be deposited in the Sea Level Rise Revolving Loan Account.
(e) The bank may use moneys in the Sea Level Rise Revolving Loan Account for administrative costs incurred in implementing the Sea Level Rise Revolving Loan Program in an amount determined by the bank and approved by the Department of Finance.

SEC. 2.

 Section 63050 of the Government Code is amended to read:

63050.
 (a) There is hereby created in the State Treasury the California Infrastructure and Economic Development Bank Fund for the purpose of implementing the objectives and provisions of this division. Within the fund there shall also be established a Sponsor Revenue Bond Account, a Participating Party Revenue Bond Account, a State Infrastructure Revolving Account, a Sea Level Rise Revolving Loan Account, and additional accounts and subaccounts that the bank may establish from time to time.
(b) Notwithstanding Section 13340 and except as provided in subdivision (c), all moneys in the infrastructure bank fund are continuously appropriated without regard to fiscal years for the support of the bank and shall be available for expenditure for the purposes stated in this division.
(c) Moneys in the infrastructure bank fund shall be available for expenditure for general administration only upon appropriation by the Legislature. This subdivision shall not limit the authority of the bank to expend funds directly related to the servicing of approved debt. Moneys in the fund shall be available for the purpose of general administration of the authority only upon appropriation by the Legislature, but not more than 5 percent of any bond proceeds administered by the authority may be expended to cover the costs of issuance, as that terminology is defined under Section 147 (G) of the Internal Revenue Code.
(d) Notwithstanding any other provision of this division, not more than 15 percent of the financing annually approved by the executive director that utilizes state funds from the infrastructure bank fund may be expended upon educational facilities, environmental mitigation measures, and parks and recreational facilities.
(e) The executive director may transfer funds between the infrastructure bank fund and the guarantee trust fund when appropriate to accomplish the financing objectives of this division.

SECTION 1.

It is the intent of the Legislature to enact legislation that would protect the public and coastal resources from the threat of sea level rise and increased storm surge brought forth by climate change and that would create a revolving loan fund to allow local governments to purchase threatened coastal properties for leasing purposes.