California Senate Bill SB1128 Amended / Bill

 BILL NUMBER: SB 1128AMENDED BILL TEXT AMENDED IN ASSEMBLY JUNE 18, 2012 AMENDED IN SENATE MAY 29, 2012 AMENDED IN SENATE MAY 1, 2012 AMENDED IN SENATE APRIL 16, 2012 AMENDED IN SENATE APRIL 9, 2012 INTRODUCED BY Senator Padilla (Coauthor: Senator Rubio) FEBRUARY 21, 2012 An act to  amend Sections 26001, 26002, 26008, 26009, 26011, 26014, 26015, 26017, 26022, 26023, 26024, 26025, 26030, 26033, 26034, and 26035 of, to  amend, repeal, and add Sections 26003  , 26011,  and 26011.8 of  , to add Chapter 4 (commencing with Section 26050) to Division 16 of, to repeal Sections 26001.5, 26011.5, 26011.6, 26012, 26013, 26016, 26016.5, 26020, 26021, 26026, and 26027 of, and to repeal Division 16.2 (commencing with Section 26100) of,  the Public Resources Code,  and to amend, repeal, and add Section 6010.8 of the Revenue and Taxation Code,  relating to energy. LEGISLATIVE COUNSEL'S DIGEST SB 1128, as amended, Padilla. Energy: alternative energy financing.  Existing law establishes the California Alternative Energy and Advanced Transportation Financing Authority and requires the authority to establish programs to provide financial assistance to participating parties for projects related to alternative energy sources and advanced transportation projects. Existing law authorizes the authority to issue revenue bonds or other securities of up to $1 billion in total outstanding debt as a financing mechanism for providing financial assistance to those projects.   This bill would revise and recast those provisions to, among other things, require the authority to establish programs providing financial assistance to projects for renewable energy generation facilities, combined heat and power systems, facilities designed for the production of renewable fuels, and energy efficiency devices and technologies. The bill would eliminate the $1 billion limitation on the amount of outstanding indebtedness the authority may incur to provide the financial assistance.  Existing law authorizes the  California Alternative Energy and Advanced Transportation Financing Authority   authority  , until January 1, 2021, to provide financial assistance in the form of a sales and use tax exclusion for a project to promote California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or the reduction in air and water pollution or energy consumption. Existing law requires the authority,  upon granting   once the  sales and use tax  exemption   exemptions  for projects  that exceeds   exceed  $100,000,000 for a given year, to provide the Legislature with a 20-day notice prior to granting additional sales and use tax  exclusion   exemptions. The sales and use tax exemption applies to the transfer of title of tangible personal property constituting a project to the authority by a participating party, or a lease or transfer of title of tangible   personal property constituting a project by the authority to a participating party  . This bill would additionally authorize the authority, until July 1, 2016, to grant the above financial assistance to projects that promote the utilization of advanced manufacturing, as defined. The bill would require the authority, until July 1, 2016, to study the efficacy and cost benefit of the sales and use tax exemption for advanced manufacturing projects. The bill would require the authority, before January 1, 2017, to submit to the Legislature a report on the study. The bill would require the authority, before January 1, 2015, to submit to the Legislature an interim report on the efficacy of granting the sales and use tax exemption for  a  projects, and recommendations on changes that would increase the efficacy in creating jobs and whether the exemption should be expanded or narrowed. The bill would require the authority, until July 1, 2016, to work with the Legislative Analyst's Office to determine the most efficient and  cost effective   cost-effective  way for the state to create jobs in advanced manufacturing. The bill would require the authority, until January 1, 2021, to work with the University of California or the California State University to perform a peer review of the net benefits test used to evaluate applicants applying for the sales and use tax exemption, as specified. The bill would instead prohibit the authority from granting, on an annual basis, a sales and use tax  exclusion   exemption  for a project exceeding $100,000,000.  The bill would, instead, apply the sales and use tax exemption to the lease or transfer of title of tangible property constituting a project to any participating party.  Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   Section 26001 of the   Public Resources Code   is amended to read:  26001. The Legislature hereby finds and declares  all   both  of the following: (a) It is essential that the state, in cooperation with the federal government, use all practical and commercially feasible means to promote the prompt and efficient development of energy sources which are renewable or which more efficiently utilize and conserve scarce energy resources. (b) The promotion of  sustainable and renewable  energy sources  which   , implementation of measures that increase the efficiency of the use of energy, and advanced transportation technologies that  reduce the degradation of the environment and  which   lessen the state's dependence of fossil fuels, and  protect the health, welfare, and safety of the people of this state  is   are  in the public interest and  serves   serve  a public purpose.  (c) It is essential that the state, in cooperation with the federal government, use all practical and commercially feasible means to promote the development and commercialization of advanced transportation technologies to conserve energy, reduce air pollution, promote economic development and jobs, and protect the health, welfare, and safety of the people of the state.   SEC. 2.   Section 26001.5 of the  Public Resources Code   is repealed.   26001.5. (a) It is the intent of the Legislature, in enacting Senate Bill 1754 of the 2008-09 Regular Session, to only provide authority for the California Alternative Energy and Advanced Transportation Financing Authority to use bonds to finance power purchase agreement arrangements, and not to alter or supersede other provisions of law addressing criteria associated with energy generation or advanced transportation technologies, such as direct-access, the use, size, or statewide caps, or the net-metering or feed-in tariff provisions. (b) When the authority uses bonds to finance the power purchase agreements, the construction, alteration, demolition, installation, repair, and maintenance work on the projects financed by the arrangements are subject to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code and the authority shall incorporate reference to that provision in its agreements with participating parties.   SEC. 3.   Section 26002 of the   Public Resources Code   is amended to read:  26002.  (a)    It is the purpose of this division to  carry out and make effective the findings of the Legislature pursuant to Sections 25004, 25004.2, 25004.3, 25007, and 26001,   advance the state's goals of reducing the levels of greenhouse gas emissions, increasing the deployment of sustainable and renewable energy sources, implementing measures that increase the efficiency of the use of energy, creating high quality employment opportunities, and lessening the state's dependence   on fossil fuels  and to that end to provide  industry within this state with  an alternative method of financing in providing and promoting the establishment of both of the following:  (1)   (a)    Facilities utilizing alternative methods and sources of energy.  (2)   (b)    Facilities needed for the development and commercialization of advanced transportation technologies.  (b) The Legislature hereby finds and declares that the facilities specified in subdivision (a) are necessary to meet the energy and transportation needs of this state and to guarantee the health and welfare of the citizens of this state.   SECTION 1.   SEC. 4.  Section 26003 of the Public Resources Code is amended to read: 26003. (a) As used in this division, unless the context otherwise requires: (1) (A) "Advanced manufacturing" means manufacturing that improves existing, or creates entirely new, materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models in any of the following technology areas: (i) Micro- and nanoelectronics, including semiconductors. (ii) Advanced materials. (iii) Integrated computational materials engineering. (iv) Nanotechnology. (v) Additive manufacturing. (vi) Industrial biotechnology. (B) "Advanced manufacturing" includes all of the following: (i) A production system capable of furnishing a mix of products in small or large volumes, with both the efficiency of mass production and the flexibility of custom manufacturing, to respond rapidly to customer demand and desired quality. (ii) Systems that result from substantive advancement, whether incremental or breakthrough, over the current state of the art, in the production of materials and products. These advancements include improvements in manufacturing processes and systems that are often referred to as "smart" or "intelligent" manufacturing systems, which integrate computational predictability and operational efficiency. (iii) Systems that produce goods that minimize the use of resources while maintaining or improving cost and performance. (iv) (I) Systems and technologies that are sustainable. (II) Sustainable systems and technologies do not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents. The State Air Resources Board shall advise the authority to ensure that the requirements of this subclause are met. (2)  (A)    "Advanced transportation technologies" means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value added jobs for Californians while enhancing the state's commitment to energy conservation, pollution  and greenhouse gas emissions  reduction, and transportation efficiency.  Those technologies may include, but are not limited to, any of the following:   (A) Intelligent vehicle highway systems.   (B) Advanced telecommunications for transportation.   (C) Command, control, and communications for public transit vehicles and systems.   (D) Electric vehicles and ultralow-emission vehicles.   (E) High-speed rail and magnetic levitation passenger systems.   (F) Fuel cells.   (B) "Advanced transportation technologies" does not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents.   (C) The State Air Resources Board shall advise the authority to ensure that the requirements of this paragraph are met.  (3) (A) "Alternative sources" means  the application of cogeneration technology, as defined in Section 25134; the conservation of energy; or the use of solar, biomass, wind, geothermal, hydroelectricity under 30 megawatts, or any other source of energy, the efficient use of which will reduce the use of fossil and nuclear fuels   devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, or a facility designed for the production of renewable fuels, the efficient use of which reduce the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases . (B) "Alternative sources" does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits. (4) "Authority" means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given. (5) "Cost" as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; the cost of the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incident to determining the feasibility of constructing any project or incident to the construction, acquisition, or financing of a project. (6) "Financial assistance" includes, but is not limited to,  either, or any combination, of the following:   loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.   (A) Loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, insurance, guarantees or other credit enhancements or liquidity facilities, contributions of money, property, labor, or other items of value, or any combination thereof, as determined by, and approved by the resolution of, the board.   (B) Any other type of assistance the authority determines is appropriate.  (7)  (A)   "Participating party" means  either of the following:   a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public district,   school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.   (A) A person, or an entity or group of entities engaged in business or operations in the state, whether organized for profit or not for profit, that does either of the following:   (i) Applies for financial assistance from the authority for the purpose of implementing a project in a manner prescribed by the authority.   (ii) Participates in the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011.   (B) A public agency or nonprofit corporation that does either of the following:   (i) Applies for financial assistance from the authority for the purpose of implementing a project in a manner prescribed by the authority.   (ii) Participates in the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011.   (B) For the purposes of Section 6010.8 of the Revenue and Taxation Code, "participating party" means an entity specified in paragraph (1) that seeks financial assistance pursuant to Section 26011.8.  (8) (A) "Project" means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies, alternative source components, or an arrangement for the purchase, including prepayment, or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011. (B) "Project," for the purposes of Section 26011.8  and Section 6010.8 of the Revenue and Taxation Code  , means any tangible personal property that is utilized for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, or alternative source products, components, or systems.  (9) "Public agency" means a federal or state agency, department, board, authority, state or community college, university, or commission, or a county, city and county, city, regional agency, public district, school district, or other political entity.   (10) (A) "Renewable energy" means a device or technology that conserves or produces heat, processes heat, space heating, water heating, steam, space cooling, refrigeration, mechanical energy, electricity, or energy in any form convertible to these uses, that does not expend or use conventional energy fuels, and that uses any of the following electrical generation technologies:   (i) Biomass.  (ii) Solar thermal.   (iii) Photovoltaic.   (iv) Wind.   (v) Geothermal.   (B) For purposes of this subdivision, "conventional energy fuel" means any fuel derived from petroleum deposits, including, but not limited to, oil, heating oil, gasoline, fuel oil, or natural gas, including liquefied natural gas, or nuclear fissionable materials.   (C) Notwithstanding subparagraph (A), for the purposes of this section, "renewable energy" also means ultralow-emission equipment for energy generation based on thermal energy systems such as natural gas turbines; landfill gas turbines, engines, and microturbines; digester gas turbines, engines, and microturbines; and fuel cells.   (11)   (9)    "Revenue" means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority. (b) This section shall become inoperative on July 1, 2016, and, as of January 1, 2017, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2017, deletes or extends the dates on which it becomes inoperative and is repealed.  SEC. 2.   SEC. 5.  Section 26003 is added to the Public Resources Code, to read: 26003. (a) As used in this division, unless the context otherwise requires: (1)  (A)    "Advanced transportation technologies" means emerging commercially competitive transportation-related technologies identified by the authority as capable of creating long-term, high-value added jobs for Californians while enhancing the state's commitment to energy conservation, pollution  and greenhouse gas emissions  reduction, and transportation efficiency.  Those technologies may include, but are not limited to, any of the following:   (A) Intelligent vehicle highway systems.   (B) Advanced telecommunications for transportation.   (C) Command, control, and communications for public transit vehicles and systems.   (D) Electric vehicles and ultralow-emission vehicles.   (E) High-speed rail and magnetic levitation passenger systems.   (F) Fuel cells.   (B) "Advanced transportation technologies" does not include those required to be undertaken pursuant to state or federal law or regulations, air district rules or regulations, memoranda of understanding with a governmental entity, or legally binding agreements or documents.   (C) The State Air Resources Board shall advise the authority to ensure that the requirements of this paragraph are met.  (2) (A) "Alternative sources" means  the application of cogeneration technology, as defined in Section 25134; the conservation of energy; or the use of solar, biomass, wind, geothermal, hydroelectricity under 30 megawatts, or any other source of energy, the efficient use of which will reduce the use of fossil and nuclear fuels   devices or technologies used for a renewable electrical generation facility, as defined in paragraph (1) of subdivision (a) of Section 25741, a combined heat and power system, as defined in Section 2840.2 of the Public Utilities Code, or a facility designed for the production of renewable fuels, the efficient use of which reduce the use of fossil or nuclear fuels, and energy efficiency devices or technologies that reduce the need for new electric generation and reduce emissions of toxic and criteria pollutants and greenhouse gases  . (B) "Alternative sources" does not include a hydroelectric facility that does not meet state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits. (3) "Authority" means the California Alternative Energy and Advanced Transportation Financing Authority established pursuant to Section 26004, and any board, commission, department, or officer succeeding to the functions of the authority, or to which the powers conferred upon the authority by this division shall be given. (4) "Cost" as applied to a project or portion of the project financed under this division means all or part of the cost of construction and acquisition of all lands, structures, real or personal property or an interest in the real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project; the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which those buildings or structures may be moved; the cost of all machinery, equipment, and furnishings, financing charges, interest prior to, during, and for a period after, completion of construction as determined by the authority; the cost of the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011; provisions for working capital; reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations, and improvements; the cost of architectural, engineering, financial, accounting, auditing and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incident to determining the feasibility of constructing any project or incident to the construction, acquisition, or financing of a project. (5) "Financial assistance" includes, but is not limited to,  either, or any combination, of the following:   loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, bond insurance, loan guarantees or other credit enhancements or liquidity facilities, contributions of money, or a combination thereof, as determined by, and approved by the resolution of, the board.   (A) Loans, loan loss reserves, interest rate reductions, proceeds of bonds issued by the authority, insurance, guarantees or other credit enhancements or liquidity facilities, contributions of money, property, labor, or other items of value, or any combination thereof, as determined by, and approved by the resolution of, the board.   (B) Any other type of assistance the authority determines is appropriate.  (6)  (A)    "Participating party" means  either of the following:   a person, federal or state agency, department, board, authority, or commission, state or community college, or university, or a city or county, regional agency, public   district, school district, or other political entity engaged in the business or operations in the state, whether organized for profit or not for profit, that applies for financial assistance from the authority for the purpose of implementing a project.   (A) A person, or an entity or group of entities engaged in business or operations in the state, whether organized for profit or not for profit, that does either of the following:   (i) Applies for financial assistance from the authority for the purpose of implementing a project in a manner prescribed by the authority.   (ii) Participates in the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011.   (B) A public agency or nonprofit corporation that does either of the following:   (i) Applies for financial assistance from the authority for the purpose of implementing a project in a manner prescribed by the authority.   (ii) Participates in the purchase or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011.   (B) For the purposes of Section 6010.8 of the Revenue and Taxation Code, "participating party" means an entity specified in paragraph (1) that seeks financial assistance pursuant to Section 26011.8.  (7) (A) "Project" means a land, building, improvement to the land or building, rehabilitation, work, property, or structure, real or personal, stationary or mobile, including, but not limited to, machinery and equipment, whether or not in existence or under construction, that utilizes, or is designed to utilize, an alternative source, or that is utilized for the design, technology transfer, manufacture, production, assembly, distribution, or service of advanced transportation technologies, alternative source components, or an arrangement for the purchase, including prepayment, or sale of energy derived from an alternative source pursuant to paragraph (7) of subdivision (a) of Section 26011. (B) "Project," for the purposes of Section 26011.8  of this and Section 6010.8 of the Revenue and Taxation Code  , means any tangible personal property that is utilized for the design, manufacture, production, or assembly of advanced transportation technologies or alternative source products, components, or systems.  (8) "Public agency" means a federal or state agency, department, board, authority, state or community college, university, or commission, or a county, city and county, city, regional agency, public district, school district, or other political entity.   (9) (A) "Renewable energy" means a device or technology that conserves or produces heat, processes heat, space heating, water heating, steam, space cooling, refrigeration, mechanical energy, electricity, or energy in any form convertible to these uses, that does not expend or use conventional energy fuels, and that uses any of the following electrical generation technologies:   (i) Biomass.   (ii) Solar thermal.   (iii) Photovoltaic.   (iv) Wind.   (v) Geothermal.   (B) For purposes of this subdivision, "conventional energy fuel" means any fuel derived from petroleum deposits, including, but not limited to, oil, heating oil, gasoline, fuel oil, or natural gas, including liquefied natural gas, or nuclear fissionable materials.   (C) Notwithstanding subparagraph (A), for the purposes of this section, "renewable energy" also means ultralow-emission equipment for energy generation based on thermal energy systems such as natural gas turbines; landfill gas turbines, engines, and microturbines; digester gas turbines, engines, and microturbines; and fuel cells.   (10)   (8)    "Revenue" means all rents, receipts, purchase payments, loan repayments, and all other income or receipts derived by the authority from a project, or the sale, lease, or other disposition of alternative source or advanced transportation technology facilities, or the making of loans to finance alternative source or advanced transportation technology facilities, and any income or revenue derived from the investment of money in any fund or account of the authority. (b) This section shall become operative on July 1, 2016.  SEC. 6.   Section 26008 of the   Public Resources Code  is amended to read:  26008. The authority may employ an executive director and any other persons as are necessary to enable it properly to perform the duties imposed upon it by this division. The executive director shall serve at the pleasure of the authority and shall receive such compensation as shall be fixed by the authority. The authority may, by resolution, delegate to  one or more of its members,  its executive director, or any other  official or  employee of the authority  , or the Treasurer's designee  any powers and duties that it may deem proper, including, but not limited to, the power to enter into contracts on behalf of the authority.  SEC. 7.   Section 26009 of the   Public Resources Code   is amended to read:  26009.  (a)    The authority  shall, in accordance with Chapter   may adopt, amend, or repeal all rules and regulations necessary to carry out this division as emergency regulations in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter  3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government  Code   , adopt all necessary rules and regulations to carry out this division   Code). The adoption, amendment, or repeal of the regulations is conclusively presumed to be necessary for the immediate preservation of the public peace, health, safety, or general welfare within the meaning of Section 11346.1 of the Government Code  .  (b) The authority may call upon any board or department of the state government for aid and assistance in the preparation of plans and specifications and in the development of technology necessary to effectively promote the development and utilization of alternative energy sources and the development and commercialization of advanced transportation technologies.   SEC. 3.   SEC. 8.  Section 26011 of the Public Resources Code is amended to read: 26011.  (a)    The authority is authorized and empowered:  (1)   (a)    To adopt an official seal.  (2)   (b)    To sue and be sued in its own name.  (3)   (c)    To issue bonds, notes, bond anticipation notes, and other obligations of the authority, including, at the option of the authority, obligations bearing interest that is taxable for purposes of federal income taxation, for any of its purposes and to fund or refund the same, all as provided in this division.  (4)   (d)   To determine the location and character of a project to be financed under the provisions of this division, to  lend   provide  financial assistance to a participating party, to enter into loan agreements with a participating party for the financing of a project including creating a lien or security interest in the property, to construct, reconstruct, renovate, replace, lease, as lessor or lessee, and regulate the same, and to enter into contracts for the sale of a project, including installment sales or sales under conditional sales contracts.  (5)   (e)    To fix fees and charges for projects, and interest rates with respect to loans for projects  or for loan of moneys to finance projects  , and to revise from time to time the fees and charges and interest rates, and to collect rates, rents, fees,  loan repayments,  and charges for the use of, and for a facility or service furnished, or to be furnished, by a project or part of the project and to contract with a person, partnership, association, corporation, or public agency with respect to the project, and to fix the terms and conditions upon which a project may be sold or disposed of, whether upon installment sales contracts or otherwise.  (6)   (f)    To employ and fix the compensation of bond counsel, financial consultants, and advisers as may be necessary in its judgment in connection with the issuance and sale of any bonds, notes, bond anticipation notes, or other obligations of the authority; to contract for engineering, architectural, accounting, or other services of appropriate state agencies as may be necessary in the judgment of the authority for the successful development of a project; and to pay the reasonable costs of consulting engineers, architects, accountants, and construction experts employed by a participating party if, in the judgment of the authority, the services are necessary to the successful development of a project, and the services are not obtainable from a state agency     to advance the purposes of this division  .  (7) To purchase alternative source energy or projects from a person or entity for sale to a participating party, or to make a loan to a participating party to purchase alternative source energy or projects, or to purchase from a person or entity that has contracted to sell alternative source energy to a participating party the right to receive purchase payments and related rights under that contract or any related contracts. Notwithstanding any other applicable law, the authority and a public agency, for purposes of a program or financing, shall have the power to enter into contractual arrangements and related agreements or instruments, including, without limitation, a prepayment purchase contract, lease, loan, construction, security, operation and maintenance, or other agreement or instrument, with the authority or with a participating party, upon the terms and subject to the conditions that may be necessary or convenient to accomplish the purposes of this subdivision. The authority shall only enter into a prepayment contract with a participating party for energy derived from an alternative source to the extent the prepayment is for energy intended to primarily offset part or all of the authority's or a participating party's own electrical requirements.   (8)   (g)    To purchase, with proceeds of its bonds or its revenue, bonds issued by a public agency  described in clause (ii) of subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003  at a public or negotiated sale. Bonds purchased pursuant to this subdivision may be held by the authority or sold to public or private purchasers at public or negotiated sales, in whole or in part, separately or together with other bonds issued by the authority.  (9)   (h)    To do all things generally necessary or convenient to carry out the purposes of this division.  (b) This section shall become inoperative on July 1, 2016, and, as of January 1, 2017, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2017, deletes or extends the dates on which it becomes inoperative and is repealed.   SEC. 4.   Section 26011 is added to the Public Resources Code, to read: 26011. (a) The authority is authorized and empowered: (1) To adopt an official seal. (2) To sue and be sued in its own name. (3) To issue bonds, notes, bond anticipation notes, and other obligations of the authority, including, at the option of the authority, obligations bearing interest that is taxable for purposes of federal income taxation, for any of its purposes and to fund or refund the same, all as provided in this division. (4) To determine the location and character of a project to be financed under the provisions of this division, to lend financial assistance to a participating party, to enter into loan agreements with a participating party for the financing of a project including creating a lien or security interest in the property, to construct, reconstruct, renovate, replace, lease, as lessor or lessee, and regulate the same, and to enter into contracts for the sale of a project, including installment sales or sales under conditional sales contracts. (5) To fix fees and charges for projects, and interest rates with respect to loans for projects, and to revise from time to time the fees and charges and interest rates, and to collect rates, rents, fees, and charges for the use of, and for a facility or service furnished, or to be furnished, by a project or part of the project and to contract with a person, partnership, association, corporation, or public agency with respect to the project, and to fix the terms and conditions upon which a project may be sold or disposed of, whether upon installment sales contracts or otherwise. (6) To employ and fix the compensation of bond counsel, financial consultants, and advisers as may be necessary in its judgment in connection with the issuance and sale of any bonds, notes, bond anticipation notes, or other obligations of the authority; to contract for engineering, architectural, accounting, or other services of appropriate state agencies as may be necessary in the judgment of the authority for the successful development of a project; and to pay the reasonable costs of consulting engineers, architects, accountants, and construction experts employed by a participating party if, in the judgment of the authority, the services are necessary to the successful development of a project, and the services are not obtainable from a state agency. (7) To purchase alternative source energy or projects from a person or entity for sale to a participating party, or to make a loan to a participating party to purchase alternative source energy or projects, or to purchase from a person or entity that has contracted to sell alternative source energy to a participating party the right to receive purchase payments and related rights under that contract or any related contracts. Notwithstanding any other applicable law, the authority and a public agency, for purposes of a program or financing, shall have the power to enter into contractual arrangements and related agreements or instruments, including, without limitation, a prepayment purchase contract, lease, loan, construction, security, operation and maintenance, or other agreement or instrument, with the authority or with a participating party, upon the terms and subject to the conditions that may be necessary or convenient to accomplish the purposes of this subdivision. The authority shall only enter into a prepayment contract with a participating party for energy derived from an alternative source to the extent the prepayment is for energy intended to primarily offset part or all of the authority's or a participating party's own electrical requirements. (8) To purchase, with proceeds of its bonds or its revenue, bonds issued by a public agency described in clause (ii) of subparagraph (B) of paragraph (6) of subdivision (a) of Section 26003 at a public or negotiated sale. Bonds purchased pursuant to this subdivision may be held by the authority or sold to public or private purchasers at public or negotiated sales, in whole or in part, separately or together with other bonds issued by the authority. (9) To do all things generally necessary or convenient to carry out the purposes of this division. (b) This section shall become operative on July 1, 2016.   SEC. 9.   Section 26011.5 of the   Public Resources Code   is repealed.   26011.5. The authority, in consultation with the State Energy Resources Conservation and Development Commission, shall establish criteria for the selection of projects to receive financing assistance from the authority. In the selection of projects, the authority shall, in accordance with the legislative intent, provide financial assistance under this division in a manner consistent with sound financial practice. In developing project selection criteria, the authority shall consider, but not be limited to, all of the following: (a) The technological feasibility of the projects. (b) The economic soundness of the projects and a realistic expectation that all financial obligations can and will be met by the participating parties. (c) The contribution that the projects can make to a reduction or more efficient use of fossil fuels. (d) The contribution that the project can make toward diversifying California's energy resources by fostering renewable energy systems that can substitute, or preferably eliminate, the demand for conventional energy fuels. (e) Any other such factors that the authority finds significant in achieving the purposes and objectives of this division.   SEC. 10.   Section 26011.6 of the   Public Resources Code   is repealed.   26011.6. (a) The authority shall establish a renewable energy program to provide financial assistance to public power entities, independent generators, utilities, or businesses manufacturing components or systems, or both, to generate new and renewable energy sources, develop clean and efficient distributed generation, and demonstrate the economic feasibility of new technologies, such as solar, photovoltaic, wind, and ultralow-emission equipment. The authority shall give preference to utility-scale projects that can be rapidly deployed to provide a significant contribution as a renewable energy supply. The program established pursuant to this subdivision shall include financial assistance provided pursuant to subdivision (g) of Section 26011. (b) The authority shall make every effort to expedite the operation of renewable energy systems, and shall adopt regulations for purposes of this section and Section 26011.5 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. Notwithstanding the 120-day limitation specified in subdivision (e) of Section 11346.1 of the Government Code, the regulations shall be repealed 180 days after their effective date, unless the authority complies with Sections 11346.2 to 11347.3, inclusive, as provided in subdivision (e) of Section 11346.1 of the Government Code. (c) The authority shall consult with the State Energy Resources Conservation and Development Commission regarding the financing of projects to avoid duplication of other renewable energy projects. (d) The authority shall ensure that any financed project shall offer its power within California on a long-term contract basis. (e) The authority shall ensure that a financed project is limited to resources that the authority determines support the state's goals for the reduction of emissions of greenhouse gases pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).   SEC. 5.   SEC. 11.  Section 26011.8 of the Public Resources Code is amended to read: 26011.8. (a) The purpose of this section is to promote the creation of California-based manufacturing, California-based jobs, advanced manufacturing, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption. In furtherance of this purpose, the authority may approve a project for financial assistance in the form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code. (b) For purposes of this section, the following terms have the following meanings: (1) "Alternative source," in addition to as provided pursuant to subdivision (c) of Section 26003, includes advanced electric distributive generation technology as defined in Section 379.8 of the Public Utilities Code or energy storage technologies and their component materials. (2) "Project" means a project as defined in subparagraph (B) of paragraph (8) of subdivision (a) of Section 26003. (c) The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority. (d) The authority shall evaluate project applications based upon all of the following criteria: (1) The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California. (2) The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion. (3) The extent to which the project will create new, permanent jobs in California. (4) To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by any federal or state law or regulation. (5) The extent of unemployment in the area in which the project is proposed to be located. (6) Any other factors the authority deems appropriate in accordance with this section. (e) At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance. (f) Notwithstanding subdivision  (j)   (k)  , and without regard to the actual date of any transaction between a participating party and the authority, any project approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code prior to March 24, 2010, shall not be subject to this section. (g) The Legislative Analyst's Office shall report to the Joint Legislative Budget Committee on the effectiveness of this program, on or before January 1, 2019, by evaluating factors, including, but not limited to, the following: (1) The number of jobs created by the program in California. (2) The number of businesses that have remained in California or relocated to California as a result of this program. (3) The amount of state and local revenue and economic activity generated by the program. (4) The types of advanced manufacturing, as defined in paragraph (1) of subdivision (a) of Section 26003, utilized. (5) The amount of reduction in greenhouse gases, air pollution, water pollution, or energy consumption. (h) The exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year. (i) The authority shall make every effort to expedite the operation of this section, and shall adopt regulations for purposes of implementing the section 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. (j) (1) The authority shall study the efficacy and cost benefit of the sales and use tax exemption as it relates to advanced manufacturing projects. The study shall include the number of jobs created, the costs of each job, and the annual salary of each job. The study shall also consider a dynamic analysis of the economic output to the state that would occur without the sales and use tax exemption. The authority shall work with the Legislative Analyst's Office to determine the most efficient and cost-effective way for the state to create jobs in advanced manufacturing. Before January 1, 2017, the authority shall submit to the Legislature, consistent with Section 9795 of the Government Code, the result of the study. (2) Before January 1, 2014, and within six months of any significant change to the net benefits test, the authority shall work with the University of California or the California State University to perform a peer review of the net benefits test currently used to evaluate applicants applying pursuant to this section. (3) Before January 1, 2015, the authority shall, consistent with Section 9795 of the Government Code, submit to the Legislature an interim report on the efficacy of the program conducted pursuant to this section. The study shall include recommendations on program changes that would increase the program's efficacy in creating permanent and temporary jobs, and whether eligibility for the program should be extended or narrowed to other manufacturing types. The authority may work with the Legislative Analyst's Office in preparing the report and its recommendations. (k) (1) Except as provided in paragraph (2), this section shall become inoperative on July 1, 2016, and, as of January 1, 2017, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2017, deletes or extends the dates on which it becomes inoperative and is repealed. The sale or purchase of tangible personal property of a project approved prior to June 30, 2016, shall continue to be excluded from sales and use taxes pursuant to Section 6010.8 of the Revenue and Taxation Code for the period of time set forth in the authority's resolution approving the project pursuant to this section. (2) Notwithstanding paragraph (1), the authority's obligation to submit to the Legislature a report pursuant to paragraph (3) of subdivision (j) shall remain operative until the submission of the report.  SEC. 6.   SEC. 12.  Section 26011.8 is added to the Public Resources Code, to read: 26011.8. (a) The purpose of this section is to promote the creation of California-based manufacturing, California-based jobs, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption. In furtherance of this purpose, the authority may approve a project for financial assistance in the form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code. (b) (1) For purposes of this section, "project" means a project as defined in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003. (2) For purposes of this section, "alternative sources" also includes advanced electric distributive generation technology as defined in Section 379.8 of the Public Utilities Code or energy storage technologies and their component materials. (c) The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority. (d) The authority shall evaluate project applications based upon all of the following criteria: (1) The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California. (2) The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion. (3) The extent to which the project will create new, permanent jobs in California. (4) To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by any federal or state law or regulation. (5) The extent of unemployment in the area in which the project is proposed to be located. (6) Any other factors the authority deems appropriate in accordance with this section. (e) At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance. (f) Notwithstanding subdivision  (j)   (k)  , and without regard to the actual date of any transaction between a participating party and the authority, any project as defined in paragraph (7) of subdivision (a) of Section 26003 approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code prior to March 24, 2010, shall not be subject to this section. (g) The Legislative Analyst's Office shall report to the Joint Legislative Budget Committee on the effectiveness of this program, on or before January 1, 2019, by evaluating factors, including, but not limited to, the following: (1) The number of jobs created by the program in California. (2) The number of businesses that have remained in California or relocated to California as a result of this program. (3) The amount of state and local revenue and economic activity generated by the program. (4) The amount of reduction in greenhouse gases, air pollution, water pollution, or energy consumption. (h) The exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year. (i) The authority shall make every effort to expedite the operation of this section, and shall adopt regulations for purposes of implementing the section 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. (j) If any significant changes are made to the net benefits test, the authority shall work with the University of California or the California State University to perform a peer review of the net benefits test currently used to evaluate applicants applying pursuant to this section. (k) This section shall become operative on July 1, 2016, and shall remain in effect only until January 1, 2021, and as of that date is repealed. The sale or purchase of tangible personal property of a project approved prior to January 1, 2021, shall continue to be excluded from sales and use taxes pursuant to Section 6010.8 of the Revenue and Taxation Code for the period of time set forth in the authority's resolution approving the project pursuant to this section.  SEC. 13.   Section 26012 of the   Public Resources Code   is repealed.   26012. All expenses incurred in carrying out the provisions of this division shall be payable solely from funds provided under the authority of this division and no liability or obligation shall be imposed upon the State of California and, except as provided in Section 26027, none shall be incurred by the authority beyond the extent to which moneys shall have been provided under the provisions of this division. Under no circumstances shall the authority create any debt, liability, or obligation on the part of the State of California payable from any source whatsoever other than the moneys provided under the provisions of this division.   SEC. 14.  Section 26013 of the   Public Resources Code   is repealed.   26013. (a) All projects shall be constructed or completed subject to the rules and regulations of the authority. (b) In addition to the requirements of subdivision (a), all projects involving construction or completion of hydroelectric facilities shall comply with all state laws pertaining to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits, as a condition of receiving any financing under this division. For these purposes, no financial assistance shall be provided by the authority for construction or completion of hydroelectric facilities unless the participating party provides proof of either of the following: (1) Certification from the State Water Resources Control Board that a water right permit has been issued for the operation of the hydroelectric facility. No certification shall be issued unless, in applying for the certification, the applicant agrees in writing to comply with all terms and conditions of the permit. (2) Certification from the State Water Resources Control Board that, in the opinion of the board, the private energy producer possesses riparian rights or other water rights which authorize the operation of the hydroelectric facility. (c) The authority may acquire, by deed, purchase, lease, contract, gift, devise, or otherwise, any real or personal property, structures, rights, rights-of-way, franchises, easements, and other interests in lands located within this state necessary or convenient for the construction or operation of a project, upon terms and conditions it deems advisable, and to lease, sell, or dispose of any property or interest in any manner necessary or desirable to carry out this division. The authority may not exercise the power of eminent domain under this division or any other provision of law.   SEC. 15.   Section 26014 of the   Public Resources Code   is amended to read:  26014. When the principal of and interest on bonds of the authority issued to finance  or refund  the cost of a particular project for a participating party  , including any refunding bonds issued to refund and refinance such bonds,  shall have been fully paid and retired or when adequate provision shall have been made for the payment and retirement of the same, and all other conditions of the resolution, indenture, or agreement authorizing and securing the same shall have been satisfied and the lien of such resolution, indenture, or agreement shall have been released in accordance with the provisions thereof, the authority is authorized, upon such terms and conditions as may be prescribed by the authority, to execute such deeds and conveyances as are necessary or required to convey title to such project to such participating party.  SEC. 16.   Section 26015 of the   Public Resources Code   is amended to read:  26015. (a) The authority, or the executive  secretary   director  of the authority, if authorized to do so by resolution of the authority, shall take official action towards the issuance of bonds with respect to any participating party at the next meeting of the authority occurring more than 30 days following receipt of such application or if by the executive  secretary   director  within 45 days of such receipt. The executive  secretary   director  may be authorized to take such action in a resolution of general authority. Official action towards the issuance of bonds may reserve the right of the authority to further review an application for financing and to consider the terms thereof prior to the issuance of bonds therefor. (b) The authority shall take final action to approve or disapprove of the issuance of bonds or notes to lend financial assistance to participating parties within 60 days of the receipt by the authority of a request from such participating party for such action. Any such request by a participating party for such final action shall be accompanied by evidence of fulfillment of any and all conditions to the issuance of such bonds or notes imposed at the time the first action towards the issuance thereof was taken by the authority and by copies of forms of all principal legal documents to be approved by the authority. (c) The authority may give final approval for the issuance of such bonds or notes upon such terms as it reasonably deems necessary or desirable. (d) Any action under this section shall be at the sole discretion of the authority.  SEC. 17.   Section 26016 of the   Public Resources Code   is repealed.   26016. The authority shall provide maximum opportunity for use of its financing by individuals and small businesses or corporations by providing information, assistance, and coordination to facilitate financing for small projects. Small projects under one million dollars ($1,000,000) cost or one megawatt size or both such cost and size may be grouped together and qualify as one bond sale. In the event that a small business entity applying for funding under this section is not approved by the authority, the authority shall assist the small business entity to locate a favorable funding source through a corporation qualified under the Business and Industrial Development Corporations Law (commencing with Section 31000 of the Financial Code), or through any federal, state, or private funding source.   SEC. 18.   Section 26016.5 of the   Public Resources Code   is repealed.   26016.5. (a) The Legislature finds and declares that small businesses have had difficulty establishing adequate security for bonds issued by the authority in their behalf, and that establishing common reserve funds will help to provide reasonable security for such bonds and will help to make the authority's services available to various small businesses which are presently unable to use them. (b) For the purpose of establishing and maintaining such common reserve funds as it deems necessary or desirable to secure its bonds or any issuance thereof, the authority, pursuant to its contracts with participating parties, may levy fees or other charges on, or require deposits from, participating parties receiving financing for projects under this division. Prior to levying any such fees or charges or requiring such deposits, the authority shall adopt regulations for the operation of the common reserve funds and governing the amounts and any payment schedule for such fees, charges, or deposits. (c) Subject to any prior contractual obligations to any of its bondholders, the authority may establish one or more common reserve funds for any or all of its bonds. The liability of any such common reserve fund, with respect to any single issue of bonds of the authority, may not exceed 25 percent of the sum of the bonds of such issue. (d) Each common reserve fund established pursuant to this section shall be deposited in a special account which 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 of the Government Code or pursuant to any other provision of law shall be credited to, and deposited in, the account.   SEC. 19.   Section 26017 of the   Public Resources Code   is amended to read:  26017. The authority, no later than March  1   31  of each year, shall submit to the Legislature a report of its activities for the preceding calendar year ended December 31. Such report shall include (1) a listing of the applications received, (2) a listing of the applications accepted for financing, (3) a specification of bonds sold, interest rates thereon, and whether bond sales were pursuant to public bid or were negotiated, (4) a specification of the amount of bonds authorized but currently unsold, (5) a projection of the authority's needs and requirements for the coming year, and (6) a report of revenues and expenditures for the preceding fiscal year.  SEC. 20.   Section 26020 of the   Public Resources Code   is repealed.   26020. (a) The authority may incur indebtedness and issue and renew negotiable bonds, notes, debentures, or other securities of any kind or class. All indebtedness, however evidenced, shall be payable solely from revenues of the authority and the proceeds of its negotiable bonds, notes, debentures, or other securities, and shall not exceed the sum of one billion dollars ($1,000,000,000) of total debt outstanding. (b) As used in this section, "total debt outstanding" does not include either of the following: (1) A bond for which provisions have been made for prepayment through irrevocable escrow or other means, so that the bond is not considered outstanding under its authorizing document. (2) Indebtedness that is incurred to refund existing debts, except to the extent that the indebtedness exceeds the amount of those debts.   SEC. 21.   Section 26021 of the   Public Resources Code   is repealed.   26021. The Legislature may, by statute, authorize the authority to issue bonds, as defined in Section 26022, in excess of the amount provided in Section 26020.   SEC. 22.   Section 26022 of the   Public Resources Code   is amended to read:  26022. (a) The authority is authorized from time to time to issue its negotiable bonds, notes, debentures, or other securities (hereinafter collectively called "bonds") for any of its purposes. The bonds may be authorized, without limiting the generality of the foregoing, to finance a single project for a single participating party, a series of projects for a single participating party, a single project for several participating parties, or several projects for several participating parties, or the purchase and sale of alternative source energy or projects pursuant to subdivision (g) of Section 26011.  In anticipation of the sale of bonds as authorized by Section 26020, or as may be authorized pursuant to Section 26021, the  The  authority may issue negotiable bond anticipation notes and may renew the notes from time to time. The bond anticipation notes may be paid from the proceeds of sale of the bonds of the authority in anticipation of which they were issued. Notes and agreements relating to the notes and bond anticipation notes, collectively called notes, and the resolution or resolutions authorizing the notes may contain any provisions, conditions or limitations that a bond, agreement relating to the bond, and bond resolution of the authority may contain. However, a note or renewal of the note shall mature at a time not exceeding  two   three  years from the date of issue of the original note. (b) Except as may otherwise be expressly provided by the authority, every issue of its bonds, notes, or other obligations shall be general obligations of the authority payable from any revenues or moneys of the authority available for these purposes and not otherwise pledged, subject only to any agreements with the holders of particular bonds, notes, or other obligations pledging any particular revenues or moneys and subject to any agreements with any participating party. Notwithstanding that the bonds, notes, or other obligations may be payable from a special fund, they are for all purposes negotiable instruments, subject only to the provisions of the bonds, notes, or other obligations for registration. (c)  Subject to the limitations in Sections 26020 and 26021, the   The  bonds may be issued as serial bonds or as term bonds, or the authority, in its discretion, may issue bonds of both types. The bonds shall be authorized by resolution of the authority and shall bear the date or dates, mature at the time or times, not exceeding 50 years from their respective dates, bear interest at the  fixed  rate or rates,  or at the variable rates, including multiple methods of setting rates from time to time while the bonds are outstanding,  be payable at the time or times, be in the denominations,  be in the form, either coupon or registered, carry the registration privileges,  be executed in a manner, be payable in lawful money of the United States of America at a place or places, and be subject to terms of redemption  or tender  , as the resolution or resolutions may provide. The bonds or notes shall be sold by the Treasurer  within 60 days of receipt of a certified copy of the authority's resolution authorizing the sale of the bonds. However, the authority, at its discretion, may adopt a resolution extending the 60-day period   as agent for sale  . The sales may be a public or private sale, and for the price or prices and on the terms and conditions, as the authority shall determine after giving due consideration to the recommendations of any participating party to be assisted from the proceeds of the bonds or notes. Pending preparation of the definitive bonds, the Treasurer may issue interim receipts, certificates, or temporary bonds that shall be exchanged for the definitive bonds. The Treasurer may sell bonds, notes, or other evidence of indebtedness at a price below their par value. However, the discount on a security sold pursuant to this section shall not exceed 6 percent of the par value. (d) A resolution or resolutions authorizing bonds or an issue of bonds may contain provisions that shall be a part of the contract with the holders of the bonds  or any credit provider  to be authorized, as to all of the following: (1) Pledging the full faith and credit of the authority or pledging all or part of the revenues of a project or a revenue-producing contract or contracts made by the authority with an individual, partnership, corporation, or association or other body, public or private, or other moneys of the authority, to secure the payment of the bonds or of any particular issue of bonds, subject to the agreements with bondholders as may then exist. (2) The rentals, fees, purchase payments, loan repayments, and other charges to be charged, and the amounts to be raised in each year by the charges, and the use and disposition of the revenues. (3) The setting aside of reserves or sinking funds, and the regulation and disposition of the reserves or sinking funds. (4) Limitations on the right of the authority or its agent to restrict and regulate the use of the project or projects to be financed out of the proceeds of the bonds or any particular issue of bonds. (5) Limitations on the purpose to which the proceeds of sale of an issue of bonds then or thereafter to be issued may be applied and pledging those proceeds to secure the payment of the bonds or the issue of the bonds. (6) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds. (7) The procedure, if any, by which the terms of a contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to the amendment or abrogation, and the manner in which that consent may be given. (8) Limitations on expenditures for operating, administrative, or other expenses of the authority. (9) Defining the acts or omissions to act that constitute a default in the duties of the authority to holders of its obligations and providing the rights and remedies of the holders in the event of a default. (10) The mortgaging of a project and the site of the project for the purpose of securing the bondholders. (11) The mortgaging of land, improvements, or other assets owned by a participating party for the purpose of securing the bondholders.  (12) Procedures for the selection of projects to be financed with the proceeds of the bonds authorized by the resolution, if the bonds are to be sold in advance of the designation of the projects and participating parties to receive the financing.   (12) Provisions for the security of any provider of credit enhancement supporting payment on the bonds, but only in a manner subordinate to the right of bondholders.  (e) Neither the members of the authority nor a person executing the bonds or notes shall be liable personally on the bonds or notes or be subject to personal liability or accountability by reason of the issuance of the bond or note. (f) The authority shall have power out of any funds available for these purposes to purchase its bonds or notes  without the cancellation thereof  . The authority may hold, pledge, cancel, or resell those bonds, subject to and in accordance with agreements with bondholders.  SEC. 23.   Section 26023 of the   Public Resources Code   is amended to read:  26023. In the discretion of the authority, any bonds issued under the provisions of this division may be secured by a trust agreement by and between the authority and a corporate trustee or trustees, which may be the State Treasurer or any trust company or bank having the powers of a trust company within or without the state. Such trust agreement or the resolution providing for the issuance of such bonds may pledge or assign the revenues to be received or proceeds of any contract or contracts pledged and may convey or mortgage the project or projects, or any portion thereof, to be financed out of the proceeds of such bonds. Such trust agreement or resolution providing for the issuance of such bonds may contain such provisions for protecting and enforcing the rights and remedies of the bondholders  or any credit provider  as may be reasonable and proper and not in violation of law, including particularly such provisions as have hereinabove been specifically authorized to be included in any resolution or resolutions of the authority authorizing bonds thereof. Any bank or trust company doing business under the laws of this state which may act as depositary of the proceeds of bonds or of revenues or other moneys may furnish such indemnifying bonds or pledge such securities as may be required by the authority. Any such trust agreement may set forth the rights and remedies of the bondholders and of the trustee or trustees, and may restrict the individual right of action by bondholders  or any credit provider  . In addition to the foregoing, any such trust agreement or resolution may contain such other provisions as the authority may deem reasonable and proper for the security of the bondholders  or any credit provider  . Notwithstanding any other provision of law, the State Treasurer shall not be deemed to have a conflict of interest by reason of acting as trustee pursuant to this division. All expenses incurred in carrying out the provisions of such trust agreement or resolution may be treated as a part of the cost of the operation of a project.  SEC. 24.   Section 26024 of the   Public Resources Code   is amended to read:  26024. Bonds issued under the provisions of this division shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, other than the authority, or a pledge of the faith and credit of the state or of any such political subdivision, other than the authority, but shall be payable solely from the funds herein provided therefor. All such bonds shall contain on the face thereof a statement to the following effect: "Neither the faith and credit nor the taxing power of the State of California  or any local agency  is pledged to the payment of the principal of or interest on this bond." The issuance of bonds under the provisions of this division shall not directly or indirectly or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation whatever therefor or to make any appropriation for their payment. Nothing contained in this section shall prevent nor be construed to prevent the authority from pledging its full faith and credit to the payment of bonds or issue of bonds authorized pursuant to this division.  SEC. 25.   Section 26025 of the   Public Resources Code   is amended to read:  26025. (a) The authority is hereby authorized to provide for the issuance of bonds of the authority for the purpose of refunding  , directly or indirectly,  any bonds, notes, or other  securities   evidence of indebtedness of the authority  or any public agency  then outstanding, including the payment of any redemption premium thereon and any interest accrued or to accrue to the earliest or subsequent date of redemption, purchase, or maturity of such bonds, and, if deemed advisable by the authority, for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a project or any portion thereof. (b) The proceeds of any such bonds issued for the purpose of refunding outstanding bonds, notes, or other securities may, in the discretion of the authority, be applied to the purchase or retirement at maturity or redemption of such outstanding bonds either on their earliest or any subsequent redemption date or upon the purchase or retirement at the maturity thereof and may, pending such application, be placed in escrow to be applied to such purchase or retirement at maturity or redemption on such date as may be determined by the authority. (c) Pending such use, any such escrowed proceeds may be invested and reinvested by the State Treasurer  or any trustee  in  obligations of, or guaranteed by, the United States of America, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States of America   instruments as may be specified in the resolution or indenture governing the bonds to be refunded  , maturing at such time or times as shall be appropriate to assure the prompt payment, as to principal, interest, and redemption premium, if any, of the outstanding bonds to be so refunded. The interest, income, and profits, if any, earned or realized on any such investment may also be applied to the payment of the outstanding bonds to be so refunded. After the terms of the escrow have been fully satisfied and carried out, any balance of such proceeds and interest, income, and profits, if any, earned or realized on the investments thereof may be returned to the authority for use by it in any lawful manner.  (d) The portion of the proceeds of any such bonds issued for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a project may be invested and reinvested by the State Treasurer in obligations of, or guaranteed by, the United States of America, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States of America, maturing not later than the time or times when such proceeds will be needed for the purpose of paying all or any part of such cost. The interest, income and profits, if any, earned or realized on such investment may be applied to the payment of all or any part of such cost or may be used by the authority in any lawful manner.   (e)   (d)    All such bonds shall be subject to the provisions of this division in the same manner and to the same extent as other bonds issued pursuant to this division.  If the authority refunds bonds or evidence of indebtedness not originally issued by the authority, the authority shall make findings that the project being refinanced qualifies as a project under this division.   SEC. 26.   Section 26026 of the   Public Resources Code   is repealed.   26026. Bonds issued by the authority are legal investments for all trust funds, the funds of all insurance companies, banks, both commercial and savings, trust companies, savings and loan associations, and investment companies, for executors, administrators, trustees, and other fiduciaries, for state school funds, and for any funds which may be invested in county, municipal, or school district bonds, and such bonds are securities which may properly and legally be deposited with, and received by, any state or municipal officer or agency or political subdivision of the state for any purpose for which the deposit of bonds or obligations of the state, is now, or may hereafter be, authorized by law, including deposits to secure public funds if, and only to the extent that, evidence of indebtedness or debt securities of the participating party receiving financing through the issuance of such bonds qualify or are eligible for such purposes and uses.   SEC. 27.  Section 26027 of the   Public Resources Code   is repealed.   26027. No liability shall be incurred by the authority beyond the extent to which moneys have been provided under this division; except that for the purposes of meeting the necessary expenses of initial organization and operation until such date as the authority derives revenues or proceeds from bonds or notes as provided under this division, the authority may borrow money as needed for such expenses from the State Energy Resources Conservation and Development Special Account in the General Fund in the State Treasury. Such borrowed moneys shall be repaid with interest within a reasonable time after the authority receives revenues or proceeds from bonds or notes as provided under this division.   SEC. 28.   Section 26030 of the   Public Resources Code  is amended to read:  26030. The authority may contract with any participating party for the construction  or acquisition  of a project by such participating party. All such contracts for the construction  or acquisition  of a project by a participating party shall provide that the participating party shall be responsible for the architectural and engineering design and for the construction and completion thereof, subject to such standards for architectural and engineering design as may be established, and subject to such supervision as the authority deems necessary. The authority may agree to pay the cost of such project constructed  or acquired  by any participating party and to advance such costs from time to time in installments or otherwise as required by the contract for the construction  or acquisition  thereof. Title to all such projects  shall   may  be vested in the authority subject to the terms of any lease thereof to the participating party or the rights of a participating party under any contract for the purchase  or acquisition  of such project including the payment of the purchase price under installment sales contracts.  SEC. 29.   Section 26033 of the   Public Resources Code   is amended to read:  26033. All moneys received pursuant to the provisions of this division, whether as proceeds from the sale of bonds, notes, or other evidences of indebtedness or as revenues,  or as fees received by the authority,  shall be deemed to be trust funds to be held and applied solely as provided in this division. Any bank or trust company with which such moneys shall be deposited shall act as trustee of such moneys and shall hold and apply the same for the purposes hereof, subject to such regulations as the resolution authorizing the bonds of any issue or the trust agreements securing such bonds may provide.  SEC. 30.   Section 26034 of the   Public Resources Code   is amended to read:  26034. Any holder of bonds, notes, or other obligations issued under the provisions of this division  or any of the coupons appertaining thereto  , and the trustee or trustees under any trust agreement, except to the extent the rights herein given may be restricted by any resolution authorizing the issuance of, or any such trust agreement securing, such bonds, notes, or other obligations, may, either at law or in equity, by suit, action, mandamus, or other proceedings, protect and enforce any and all rights under the laws of the state or granted hereunder or under such resolution or trust agreements, and may enforce and compel the performance of all duties required by this division or by such resolution or trust agreement to be performed by the authority or by any officer, employee, or agent thereof, including the fixing, charging, and collecting of the rates, rents, fees, and charges herein authorized and required by the provisions of such resolution or trust agreement to be fixed, established, and collected.  SEC. 31.   Section 26035 of the   Public Resources Code   is amended to read:  26035. The exercise of the powers granted by this division shall be in all respects for the benefit of the people of this state, for their health and welfare, and protection of the state's environment. Any bonds, notes, or other obligations issued under the provisions of this division, their transfer and the income therefrom, shall at all times be free from taxation of every kind by the state and by municipalities and other political subdivisions of the state.  However, the preceding sentence shall not apply with respect to any bonds, notes, or other obligations, or the income therefrom, for any period during which such bonds, notes, or other obligations are held by (a) any participating party, (b) persons, organizations, trades, or businesses (whether or not incorporated, organized in this state, or affiliated with such participating party) owned or controlled, directly or indirectly, by such participating party, or (c) persons, organizations, trades or businesses (whether or not incorporated, organized in this state, or affiliated with such participating party) which own or control, directly or indirectly, such participating party.   SEC. 32.   Chapter 4 (commencing with Section 26050) is added to Division 16 of the  Public Resources Code   , to read:   CHAPTER 4. PROPERTY ASSESSED CLEAN ENERGY (PACE) AND CLEAN ENERGY FINANCING PROGRAM Article 1. General Provisions and Definitions 26050. (a) The Legislature finds and declares all of the following: (1) Property Assessed Clean Energy (PACE) financing has been pioneered by municipalities and counties in California as a way for home and small business owners to finance voluntary energy and water efficiency and clean energy improvements. (2) PACE financing was pioneered in the City of Berkeley, while the City and County of San Francisco, City of San Diego, City of Palm Desert, Sonoma County, and the California Statewide Communities Development Authority (CSCDA) have already initiated or are working to launch additional programs. (3) Seventeen other states, including Colorado and New York, have also enacted enabling PACE legislation. (4) The public subsidy provided by the PACE financing is justified by the benefits received in job creation, lower energy demand, and spurring new clean industries that will grow the economy. (b) It is the intent of the Legislature to assist local jurisdictions in financing the installation of distributed generation renewable energy sources, electric vehicle charging infrastructure, or energy or water efficiency improvements that are permanently fixed to real property through the use of voluntary contractual assessments. (c) It is not the intent of the Legislature to create any debt, liability, or obligation on the part of the state in assisting local jurisdictions pursuant to this division. 26050.5. The Legislature further finds and declares both of the following: (a) Actions by federally chartered home loan entities have frustrated efforts to accelerate the implementation of the PACE financing program, creating a need to establish effective alternative approaches that can be rapidly deployed to advance the purposes of this division. (b) Among the most promising alternatives that can be implemented rapidly are those intended to increase access to capital for projects that advance the purposes of this division. 26051. Unless the context otherwise requires, the definitions in this article govern the construction of this chapter. 26052. "Applicant" means, for the purposes of Article 2 (commencing with Section 26060), a public agency as defined in paragraph (3) of subdivision (c) of Section 5898.20 of the Streets and Highways Code and, for the purposes of Article 3 (commencing with Section 26070), a financial institution providing a loan pursuant to that chapter to finance the installation of distributed generation renewable energy sources, electric vehicle charging infrastructure, or energy or water efficiency improvements. 26053. "Clean Energy Upgrade Program" means a statewide energy and water efficiency and renewable energy generation building retrofit financing program developed by the State Energy Resources Conservation and Development Commission and the authority pursuant to Section 26070. 26054. "Property Assessed Clean Energy bond" or "PACE bond" means a bond that is secured by any of the following: (a) A voluntary contractual assessment on property authorized pursuant to paragraph (2) of subdivision (a) of Section 5898.20 of the Streets and Highways Code. (b) A voluntary contractual assessment or a voluntary special tax on property to finance the installation of distributed generation renewable energy sources, electric vehicle charging infrastructure, or energy or water efficiency improvements that is levied pursuant to a chartered city's constitutional authority under Section 5 of Article XI of the California Constitution. (c) A special tax on property authorized pursuant to subdivision (b) of Section 53328.1 of the Government Code. 26055. "PACE program" means a program established by an applicant that is financed by the PACE bond. 26056. This chapter does not create any liability or obligation upon the State of California and none shall be incurred by the authority beyond the extent to which moneys shall have been provided under this division. The authority shall not create any debt, liability, or obligation on the part of the State of California payable from any source whatsoever other than the moneys provided under this chapter. Article 2. PACE Reserve Program 26060. The authority shall develop and administer a PACE Reserve program to reduce overall costs to the property owners of PACE bonds issued by an applicant by providing a reserve of no more than 10 percent of the initial principal amount of the PACE bond. 26061. To qualify for assistance pursuant to this chapter, the PACE program shall require all of the following: (a) The interest rate on the PACE bond does not exceed a percentage as determined by the authority to be appropriate. (b) Minimum legal loan structure and credit underwriting criteria as determined by the authority are met. (c) Proceeds of the PACE bonds are used to finance qualified energy and water efficiency, electric vehicle charging infrastructure, and clean energy improvements. (d) The improvement financed is for a residential project of three units or fewer, or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total. 26062. An applicant shall submit to the authority an application providing a detailed description of the PACE program, a detailed description of the transactional activities associated with the PACE bond issuance, including all transactional costs, and other information deemed necessary by the authority. 26063. (a) In evaluating eligibility, the authority shall consider whether the applicant's PACE program includes the following conditions: (1) Loan recipients are legal owners of underlying property. (2) Loan recipients are current on mortgage and property tax payments. (3) Loan recipients are not in default or in bankruptcy proceedings. (4) Loans are for less than 10 percent of the value of the property. (5) The property is within the geographical boundaries of the PACE program. (6) The program offers financing for energy efficiency improvements or electric vehicle charging infrastructure. (7) Improvements financed by the program follow applicable standards of energy efficiency retrofit work, including any guidelines adopted by the State Resources Conservation and Development Commission. (b) In evaluating an application, the authority shall consider all of the following factors: (1) The use by the PACE program of best practices, adopted by the authority, to qualify eligible properties for participation in underwriting the PACE program. (2) The cost efficiency of the applicant's PACE program, including bond issuance. (3) The projected number of jobs created by the PACE program. (4) The applicant's PACE program requirements for quality assurance and consumer protection as related to achieving efficiency and clean energy production. (5) The mechanisms by which savings produced by this program are passed on to the property owners. (6) Any other factors deemed appropriate by the authority. 26064. The authority shall review the applicant's PACE bond issuance, including, but not limited to, indenture, trust agreement, and fiscal agent agreement ("the bond documents") and, when the authority is satisfied that the bond documents are consistent with the requirements of the PACE Reserve program established pursuant to this chapter, the authority shall advance to the applicant or the applicant's bond trustee, at the closing of the applicant's PACE bonds, the amount made available from the Renewable Resource Trust Fund and approved by the authority for use in the PACE bond's reserve fund under the bond documents. Prior to the disbursement of moneys pursuant to this section into a reserve fund, the authority shall enter into an agreement with the applicant regarding the creation and operation of the reserve fund, including the manner in which the authority will be repaid for any moneys disbursed to the reserve fund. Article 3. Clean Energy Upgrade Program 26070. The authority shall administer a Clean Energy Upgrade Program to reduce overall costs to the property owners of a loan provided by an applicant to finance the installation of distributed generation renewable energy sources, electric vehicle charging infrastructure, or energy or water efficiency improvements that are permanently fixed to real property by providing a reserve or other financial assistance at a level to be determined by the State Energy Resources Conservation and Development Commission and the authority. Improvements financed pursuant to this program shall be for a residential project of three units or fewer or a commercial project that costs less than twenty-five thousand dollars ($25,000) in total. 26071. (a) The authority shall adopt regulations governing the implementation of this chapter, including quality assurance pursuant to subdivision (b) of Section 26072, at a publicly noticed meeting. Notwithstanding any other law, regulations adopted pursuant to this section may be adopted as emergency regulations pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (b) For the purposes of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, including Section 11349.6 of that code, the Office of Administrative Law shall consider the adoption of the regulations pursuant to subdivision (a) to be necessary for the immediate preservation of the public peace, health and safety, and general welfare. 26072. (a) An applicant shall submit to the authority an application providing a detailed description of the loan program to finance the installation of distributed generation renewable energy sources, electric vehicle charging infrastructure, or energy or water efficiency improvements on real property, a detailed description of the transactional activities associated with the loan issuance, including all transactional costs, and other information deemed necessary by the authority. (b) The authority shall ensure that all improvements financed by the program meet quality assurance standards developed by the authority in consultation with the State Energy Resources Conservation and Development Commission. The standards shall include contractor certification and third-party inspection of an appropriate portion of completed projects to ensure project performance and consumer protection. 26073. (a) In evaluating eligibility, the authority shall consider whether the applicant's loan program includes the following conditions: (1) Loan recipients are legal owners of underlying property. (2) Loan recipients are current on mortgage and property tax payments. (3) Loan recipients are not in default or in bankruptcy proceedings. (4) Loans are for less than 10 percent of the value of the property. (5) The program offers financing for energy and water efficiency improvements. (6) Improvements financed by the program follow applicable standards of energy efficiency retrofit work, including any guidelines adopted by the State Energy Resources Conservation and Development Commission. (b) In evaluating an application, the authority shall consider all of the following factors: (1) The use by the loan program of best practices, adopted by the authority, to qualify eligible properties for participation in underwriting the loan program. (2) The cost efficiency of the applicant's loan program. (3) The projected number of jobs created by the loan program. (4) The applicant's loan program requirements for quality assurance and consumer protection, as related to achieving efficiency and clean energy production, in accordance with the standards developed pursuant to subdivision (b) of Section 26072. (5) The mechanisms by which savings produced by this program are passed on to the property owners. (6) Any other factors deemed appropriate by the authority. (c) The authority may approve a loan program that offers financing for electric vehicle charging infrastructure if the electric vehicle charging infrastructure is part of a project to install energy efficiency improvements and distributed generation renewable energy resources and is designed so that the project does not increase peak energy demand. 26074. (a) The authority shall require certification from a loan applicant that each loan offered pursuant to the applicant's loan program is consistent with the requirements of the Clean Energy Upgrade Program administered pursuant to this chapter. (b) If the conditions of subdivision (a) are satisfied, the authority shall allocate to the applicant, at the closing of the loan, the amount made available from the Renewable Resource Trust Fund in the form of financial assistance as approved by the State Energy Resources Conservation and Development Commission and the authority. Prior to providing financial assistance pursuant to this section, the authority shall enter into an agreement with the applicant regarding the financial assistance, including the process for the possible return of moneys disbursed to or on behalf of the applicant. Article 4. Appropriation and Reporting 26080. (a) Until January 1, 2015, an amount of up to fifty million dollars ($50,000,000) from the Renewable Resource Trust Fund, established pursuant to Section 25751, is hereby appropriated to the authority for the purposes of this chapter. The moneys appropriated shall remain in the Renewable Resource Trust Fund until the funds are needed by the authority pursuant to this chapter. (b) Of the moneys appropriated in subdivision (a), up to five hundred fifty thousand dollars ($550,000) may be expended by the authority for the initial administrative costs in implementing this chapter. (c) All repayments of moneys disbursed pursuant to this chapter shall be deposited into the Renewable Resource Trust Fund. 26081. (a) On March 31, 2011, and annually thereafter, the authority shall submit to the Legislature a report pursuant to Section 9795 of the Government Code on all of the following: (1) The status of the account. (2) A summary of the PACE bonds that received assistance pursuant to Article 2 (commencing with Section 26060) and a summary of the loans that received assistance pursuant to Article 3 (commencing with Section 26070). (3) A summary of the benefits provided by this division, including reduced interest rates on the PACE bonds or on loans receiving assistance pursuant to this division. (4) The number of jobs created by the PACE programs or loans that received assistance pursuant to this chapter. (5) Information on energy and water savings resulting from the PACE programs or loans that received assistance pursuant to this chapter. (6) Other information deemed appropriate by the authority. (b) This section shall remain in effect only until January 1, 2015, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2015, deletes or extends that date. 26082. (a) Notwithstanding Section 26080, twenty-five million dollars ($25,000,000) of the unencumbered balance of the fifty million dollars ($50,000,000) that was appropriated to the authority pursuant to Section 26080 and is in the Renewable Resource Trust Fund is hereby appropriated to the Energy Conservation Assistance Account established pursuant to Section 25416. (b) Notwithstanding Section 25421, any unexpended funds appropriated pursuant to subdivision (a) remaining in the Energy Conservation Assistance Account on and after January 1, 2013, except to the extent those funds are encumbered pursuant to Section 25417.5, shall revert to the Renewable Resource Trust Fund and be available to the authority for the purposes of this chapter.   SEC. 33.   Division 16.2 (commencing with Section 26100) of the   Public Resources Code   is repealed.   SEC. 34.   Section 6010.8 of the   Revenue and Taxation Code   is amended to read:  6010.8.  (a)    "Sale" and "purchase" do not include any  lease or  transfer of title of tangible personal property constituting any project to  the California Alternative Energy and Advanced Transportation Financing Authority by any participating party, nor any lease or transfer of title of tangible personal property constituting any project by the authority to  any participating party  , when the transfer or lease is made pursuant to Division 16 (commencing with Section 26000) of the Public Resources Code  .  The terms "project" and "participating party" as   As  used in this section  have the same meanings as   "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  .  (b) This section shall become inoperative on July 1, 2016, and, as of January 1, 2017, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2017, deletes or extends the dates on which it becomes inoperative and is repealed.   SEC. 35.   Section 6010.8 is added to the   Revenue and Taxation Code   , to read:   6010.8. (a) "Sale" and "purchase" do not include any lease or transfer of title of tangible personal property constituting any project to any participating party. As used in this section "project" has the meaning specified in subparagraph (B) of paragraph (7) of subdivision (a) of Section 26003 of the Public Resources Code and "participating party" has the meaning specified in subparagraph (B) of paragraph (6) of subdivision (a) of Section 26003 of the Public Resources Code. (b) This section shall become operative on July 1, 2016.