BILL NUMBER: AB 2670INTRODUCED BILL TEXT INTRODUCED BY Assembly Member Medina FEBRUARY 21, 2014 An act to amend Section 13997.6 of, and to add Chapter 7 (commencing with Section 63100) to Division 1 of Title 6.7 of, the Government Code, relating to economic development. LEGISLATIVE COUNSEL'S DIGEST AB 2670, as introduced, Medina. Small Business Technical Assistance Act of 2014. The Economic Revitalization Act establishes the Governor's Office of Business and Economic Development, also known as "GO-Biz," to serve the Governor as the lead entity for economic strategy and the marketing of California on issues relating to business development, private sector investment, and economic growth. Bergeson-Peace Infrastructure and Economic Development Bank Act establishes the California Infrastructure and Economic Development Bank within GO-Biz to, among other things, assist in the promotion of economic development throughout the state. This bill would enact the Small Business Technical Assistance Act of 2014, within the bank under the direction of GO-Biz to, among other things, serve as the lead state entity for overseeing the state' s participation with the federal California Small Business Development Center Program. This act would also recognize the federal program. This act would authorize GO-Biz or any other state entity to contract with an Administrative Lead Center established under the federal program. This act would require the State Chair of the California Small Business Development Center Leadership Council, established under the federal program, to report specific information to GO-Biz relating to any year that state funds are appropriated to support an Administrative Lead Center, and would, in turn, require the director of GO-Biz to provide that report to the Legislature and post the report on the GO-Biz's Internet Web site. This bill would also require the state chair, as a condition of accepting state funds, to allow access to other information about the program under certain conditions. This bill would make legislative findings and declarations in this regard. 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 13997.6 of the Government Code is amended to read: 13997.6. (a) The California Economic Development Fund is hereby created in the State Treasury for the purpose of receiving federal, state, local, and private economic development funds, and receiving repayment of loans or grant proceeds and interest on those loans or grants. (b) Upon appropriation by the Legislature, moneys in the fund may be expended by the Governor's Office of Business and Economic Development , without regard to fiscal year, to providematchingfunds for loans , matching funds, or grants to public agencies, nonprofit organizations, and private entities, and for other economic development purposes, consistent with the purposes for which the moneys were received. SEC. 2. Chapter 7 (commencing with Section 63100) is added to Division 1 of Title 6.7 of the Government Code, to read: CHAPTER 7. SMALL BUSINESS TECHNICAL ASSISTANCE ACT OF 2014 63100. This chapter shall be known, and may be cited, as the Small Business Technical Assistance Act of 2014. 63105. The Legislature finds and declares all of the following: (a) The California Small Business Development Center Program plays a significant role in expanding and supporting California small businesses. There are more than 1,000 Small Business Development Centers in the United States and its territories, and there are over 30 Small Business Development Centers located in regions throughout California. (b) The primary role of the California Small Business Development Center Program, a component of the federal Small Business Development Center Program, is to provide technical assistance to the state's small businesses, including tracking assistance and outcomes that result in a meaningful contribution to the California economy. (c) Within the state, the California Small Business Development Center Program is administered through six Regional Small Business Development Center Networks, as follows: Northern California; Northeastern California; Central California; Orange County/Inland Empire; Los Angeles; and San Diego. Each regional network is managed by an Administrative Lead Center, designated by the federal Small Business Administration through a cooperative agreement, and affiliated with one public institution of higher education. The centers are responsible for securing required one-to-one matching funds to draw down federal appropriations, according to a population-based formula determined by the United States Census, and the regional networks are held accountable for their productivity and required to submit regular performance reports to the Office of Small Business Development Centers, within the federal Small Business Administration. (d) Throughout the six regional networks there are more than 30 full-time Small Business Development Centers, with multiple additional outreach locations serving small businesses in this state. These centers provide assistance to existing businesses in the areas of financing, government contracting, business planning and management, marketing, international trade, energy efficiency and sustainability, and disaster preparedness. The centers also provide expert advice to technology companies in the areas of business and financial plan preparation, angel and venture capital presentation preparation, funding strategies, product positioning, market launch strategies, applications for federal grants, technology transfers with research universities, intellectual property issues, and strategic partnerships. The centers work in collaboration with various partners to provide these services, including, but not limited to, the federal Small Business Administration, the United States Department of Commerce, the United States Department of Agriculture, the Governor's Office of Business and Economic Development, the California Innovation Hub Program, the California Community Colleges, the California State University, the University of California, local workforce investment boards, economic developers, cities, counties, and chambers of commerce. 63110. The following definitions apply for the purposes of this chapter: (a) "Act of Congress" refers to the act of Congress signed into law on July 2, 1980, entitled "The Small Business Development Act of 1980" (Public Law 96-302) which authorized the Small Business Development Center program, operated by the Small Business Administration. (b) "Administrative Lead Center" means the entity with which the federal Small Business Administration contracts with to administer the Small Business Development Center Program within a state or district. The Administrative Lead Center is directly accountable to the Small Business Administration for all aspects of the Small Business Development Center, including staffing, program, outreach, and securing the required one-to-one match to draw down federal funds to operate the program in the Administrative Lead Center's area of responsibility. (c) The "California Small Business Development Center Program" is comprised of the six regional networks of Small Business Development Centers operating in the state pursuant to a cooperative agreement between the Administrative Lead Centers and the federal Small Business Administration. (d) "California Small Business Development Center Leadership Council" refers to the entity that is comprised of the directors of the Administrative Lead Centers that coordinate the regional networks of small business development centers. The council is the statewide entity tasked with negotiating partnerships on behalf of the California Small Business Development Center Program, leveraging operational and technical assistance for best practices across the six regions, and working with the state government to maximize the economic impact of the federal Small Business Development Center Program within the state. (e) "Director" means the Director of the Governor's Office of Business and Economic Development. (f) "Federal match" means the money committed to the operations of the regional network of Small Business Development Centers by an Administrative Lead Center, which have come from a nonfederal government source of moneys. The federal match is used to draw down moneys from the federal Small Business Administration. (g) "Office" means the Governor's Office of Business and Economic Development. (h) "Regional Directors" refers to the highest level personnel charged with management and oversight of a regional network of Small Business Development Center Networks, and who are employed by the Administrative Lead Centers pursuant to guidelines from the federal Small Business Development Center. There are six Regional Director positions in California. (i) "Regional network of Small Business Development Centers" refers to the Small Business Development Centers which are administered under a single Administrative Lead Center. There are six California Regional Small Business Development Center Networks: Northern California, Northeastern California, Central California, Orange County/Inland Empire, Los Angeles, and San Diego. (j) "Small Business Development Center" refers to an individual physical location, recognized by the federal Small Business Administration and overseen by the Administrative Lead Center, where a small business owner or an aspiring entrepreneur can receive free one-on-one consulting and low at-cost training on a variety of topics including starting, operating, and expanding a small business. 63115. (a) The office shall serve as the lead state entity for overseeing the state's participation with the California Small Business Development Center Program. The office may collaborate and support the Administrative Lead Centers in the provision of technical assistance and other related services to small businesses through their regional networks of Small Business Development Centers. (b) The office or any other state entity may contract with an Administrative Lead Center. If a contract is entered into and money is exchanged for services, the Administrative Lead Center or centers shall report on those activities as specified in Section 63125. (c) Any public or private corporation authorized to establish, operate, and maintain a small business development regional center whose application is granted pursuant to the terms of the Act of Congress may establish, operate, and maintain the center subject to the conditions and restrictions of the Act of Congress, and any amendments thereto. 63120. (a) The state recognizes that the Small Business Development Center may, pursuant to the Act of Congress, on January 1, 2014, offer a range of services, including, but not limited to: (1) Providing specialized one-on-one counseling and technical assistance in the areas of financing, government contracting, business planning and management, marketing, international trade, energy efficiency, sustainability, and disaster preparedness for small businesses with the greatest potential for job retention and creation. (2) Providing expert business startup advising, including legal requirements for starting a business and access to capital for small businesses and entrepreneurs with the greatest potential to start companies and provide jobs within California. (3) Providing commercialization assistance to new and emerging technology companies in the areas of business and financial plan preparation, angel and venture capital presentation preparation, funding strategies, product positioning, market launch strategies, application for Small Business Innovation Research and Small Business Technology Transfer federal grants, technology transfer to and from research universities, intellectual property issues, and strategic partnerships. (4) Conducting regional and local workshops, seminars, and conferences with local partners to meet the needs of small business clients. (5) Providing services to link small businesses to research and development institutions for the purposes of transferring new technology to a new or an expanding small business. (6) Assisting with the commercialization of technology products or services and with the preparation of raising funds. (7) Providing assistance to high growth and highly scalable businesses and entrepreneurs seeking angel and venture capital by preparing and positioning them for funding. (8) Coordinating with employee training and placement programs. (9) Providing market research and planning assistance to local, regional, and statewide economic development partners, projects, and collaborations. (10) Gathering, analyzing, and maintaining information on the economic impact of business assistance provided by the Small Business Development Center and other organizations. (b) The Administrative Lead Center is responsible for oversight, management, and compliance of the Small Business Development Centers in its geographic region, in accordance with state law and the Act of Congress. (c) In accordance with the Act of Congress, the California Small Business Development Center program is required to provide a federal match of at least one-to-one with nonfederal funds, and is thus authorized to receive grants, gifts, and other sources of funds to support its mission. 63125. (a) On or before August 30 following any year that state funds are appropriated to an Administrative Lead Center for the support of the California Small Business Development Center Program, the State Chair of the California Small Business Development Center Leadership Council shall provide a written report to the office consistent with the requirements of this section. (b) Each Administrative Lead Center shall agree to the reporting requirement in this section as a condition of receiving state funds. As a further condition for receiving state funds, the State Chair of the California Small Business Development Center Leadership Council shall arrange to provide the office with access to similar information, in both a similar timeframe and format, that an Administrative Lead Center may provide to the federal Small Business Administration on client services and the economic impact of the California Small Business Development Center Program. Information provided to the office shall meet applicable privacy standards and shall not disclose the name of an individual business. (c) A report prepared pursuant to subdivision (a) shall include, but not be limited to, all of the following data: (1) Number of businesses assisted. (2) Number of employees employed by those businesses at the time those businesses were assisted. (3) Number of jobs created. (4) Number of jobs retained. (5) Estimated amount of state tax dollars generated from those businesses. (6) Industry sectors of the businesses assisted, as reported by the assisted businesses. (7) Increase in sales reported by businesses assisted as a result of the program. (8) The amount of capital infusion, in both debt and equity, obtained by assisted businesses. (9) Total amount of federal funds allocated to the region during the reporting period. (d) The director shall submit a copy of the report required pursuant to subdivision (a) to the Legislature in compliance with Section 9795 and post the report on the office's Internet Web site no later than 30 days after the office receives the report.