Amended IN Assembly June 13, 2018 Amended IN Assembly September 06, 2017 Amended IN Assembly June 27, 2017 Amended IN Assembly June 12, 2017 Amended IN Senate April 17, 2017 Amended IN Senate April 17, 2017 Amended IN Senate March 27, 2017 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Senate Bill No. 551Introduced by Senator HuesoFebruary 16, 2017 An act to amend Section 63089.51 Sections 63089.1 and 63089.4 of, and to add Article Sections 63089.642, 63089.644, 63089.646 to, and to add Article 12 (commencing with Section 63090) to and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, and to add Section 44559.16 to the Health and Safety Code, relating to the Capital Access Loan Program. Program and making an appropriation therefor.LEGISLATIVE COUNSEL'S DIGESTSB 551, as amended, Hueso. Capital Access Loan Program for Small Businesses.Existing law establishes the Capital Access Loan Program for Small Businesses, which is administered by the California Pollution Control Financing Authority, to assist qualifying small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Under the program, the authority may enter into contracts with participating financial institutions and is required to establish a loss reserve account with participating financial institutions. Under existing law, Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program may to obtain reimbursement from the authority by submitting a claim for reimbursement for a specified amount of the loss covered by that loan, subject to certain procedures.Existing law also establishes other capital access loan programs that are administered by the authority, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program.Under the Small Business Financial Assistance Act of 2013, the California Infrastructure and Economic Development Bank, within the Governors Office of Business and Economic Development, administers specific programs relating to small business, either administered directly by the bank or under contract with small business financial development corporations. Existing law establishes within the bank the California Small Business Finance Center and authorizes the center to administer programs to assist businesses seeking new capital resources under the Small Business Financial Assistance Act of 2013, and establishes other related provisions.This bill would transfer the administration of specified loans to qualified small businesses under the Capital Access Loan Program for small businesses from the California Pollution Control Financing Authority to the California Small Business Finance Center, and would make conforming changes to that effect. This bill would provide that the authority will continue to administer other capital access loan programs that do not exclusively relate to loans given to qualified small businesses, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program. create the Capital Access Reserve Fund in the State Treasury to be under the administrative control of the California Small Business Finance Center within the bank. The bill would require that the fund be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or the provisions of services authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize funds to be held in financial institutions and companies that establish trust funds, as specified. The bill would specify the purposes for which funds may be used. The bill would prescribe a process for the transfer of specified moneys, including those from the General Fund, held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would provide that moneys in the fund are continuously appropriated. By creating a continuously appropriated fund and providing for its funding, this bill would make an appropriation. The bill would authorize the creation of holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. The bill would require the bank to provide reports in the Legislature in this regard.The bill would create the Capital Access Loan Program for Small Businesses, a loan loss reserve program, within the Small Business Financial Assistance Act of 2013. The bill would provide for the transfer of the loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would authorize the bank to contract with a financial company or financial institution to participate in the program and would state a specified priority for loans to be enrolled. The bill would require the bank to develop directives and requirements to implement the program. The bill would provide for the maintenance of regulations adopted by the California Pollution Control Financing Authority in connection with the management and control of loan loss reserve funds, as specified. The bill would prescribe a process pursuant to which a financial company or institution may withdraw from the program. The bill would also provide for the transfer of the collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would make conforming and technical changes. Digest Key Vote: MAJORITY2/3 Appropriation: NOYES Fiscal Committee: YES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. The Legislature finds and declares as follows:(a) In October 2010, Congress passed and the President signed the Small Business Jobs Act. Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures up to $1.5 billion for state sponsored small business finance programs. California utilized its federal small business grant money to capitalize the Small Business Loan Guarantee Program at the I-Bank's Small Business Finance Center, and the California Capital Access Program (CalCAP) loan loss reserve program and a collateral support program administered through the California Pollution Control Financing Authority (CPCFA).(b)In 2011, the California Pollution Control Financing Authority received a federal allocation from the State Small Business Credit Initiative (SSBCI) to expand and support its CalCAP for Small Business Program. That allocation, as amended from time to time, totaled approximately $19,900,000.(b) In February 2011, the California Pollution Control Financing Authority was awarded approximately eighty-four million dollars ($84,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) for use by the authority in its California Capital Access Program for Small Businesses and the California Capital Access Collateral Support program.(c) On April 25, 2017, the Treasurers office alerted the public and interested stakeholders that the federal moneys allocated to California to support the California Capital Access Loan Program (CalCAP) for Small Business were near exhaustion. In addition, the notice stated that when the federal moneys are exhausted, the authority will continue to review and approve pending loan applications. For those which are approved, CPCFA will make contributions from the balance remaining from the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session for deposit into each lenders CalCAP State Loan Loss Reserve Account.(d) Finally, the notice stated that the authority staff projects that the balance of the General Fund appropriation will support all current loan enrollment applications in the CPCFAs possession. However, we also anticipate that these State program funds will be exhausted in the Summer 2017, at which point the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(e) Although the authority has adopted regulations to recapture some funds it has previously contributed to CalCAP for use in the Small Business CalCAP, there remains a significant risk that the authority may elect to permanently modify the California Capital Access Loan Program for Small Businesses to focus more intently on lending programs for pollution control financing projects, a change in direction that would be more consistent with its namesake and its enabling statutes. Earlier in this session of the Legislature, the authority took action consistent with this apparent plan by amending Assembly Bill 964 (Calderon), a bill that is sponsored by the authority. On May 30, 2017, Assembly Bill 964 was amended in the Senate, to remove for Small Businesses from the title of the Capital Access Loan Program to read Capital Access Loan Program.(f) Without direction from the Legislature, a distinct possibility exists that federal funds that were allocated for the purpose of assisting small businesses might be redirected to support programs separate and apart from small business assistance, which runs counter to the intent set forth in the federal Small Business Jobs Act of 2010.(g) In 2013, years after funding was distributed in California from the State Small Business Credit Initiative, the Legislature enacted Assembly Bill 1247 (Medina and Bocanegra) of the 201314 Regular Session, which created the Small Business Finance Center (SBFC) at the California Infrastructure and Economic Development Bank. The SBFC helps businesses create and retain jobs, and encourages investment in low- to moderate-income communities. The finance center operates a Small Business Loan Guarantee Program, and provides technical assistance to small businesses and microbusinesses. In 2017, the SBFC created the Jump Start Loan Program which provides direct loans from $500 to $10,000 to small businesses in low-wealth communities.(h) The SBFC and the California Infrastructure and Economic Development Bank are organized within the Governors Office of Business and Economic Development (GO-Biz), which was created in 2012 to serve as Californias single point of contact for economic development and job creation efforts.(i)Therefore, the Legislature declares that it is appropriate, as program funding expires, that the Capital Access Loan Program for Small Businesses, now within the purview of the California Pollution Control Financing Authority, should be transferred to the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(i) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully disbursed, that the portfolio of the Capital Access Loan Program for Small Businesses and the portfolio of the Collateral Support program be transferred from the CPCFA to the California Small Business Finance Center within the California Infrastructure and Economic Development Bank.(2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(3) It is intent the Legislature that nothing in this act impede the ability of the CPCFA to operate the California Capital Access Program with other program funds, as well as administering the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 of the Health and Safety Code and the California Seismic Safety Capital Access Loan Program established in Section 44559.14 of the Health and Safety Code.SEC. 2.Section 63089.51 of the Government Code is amended to read:63089.51.(a)All money deposited in the expansion fund is hereby continuously appropriated, without regard to fiscal years, for the purposes of this chapter, except for Article 12 (commencing with Section 63090).(b)Except as specified in subdivision (b) of Section 63089.54, the state or the bank shall not be liable or obligated in any way beyond the state money that is allocated in the expansion fund from moneys from the General Fund appropriated for those purposes.SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.SEC. 3. Section 63089.4 of the Government Code is amended to read:63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.SEC. 4. Section 63089.642 is added to the Government Code, to read:63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes. SEC. 5. Section 63089.644 is added to the Government Code, to read:63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter. SEC. 6. Section 63089.646 is added to the Government Code, to read:63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.SEC. 3.SEC. 7. Article 12 (commencing with Section 63090) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank. 63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.SEC. 8. Article 13 (commencing with Section 69095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.SEC. 4.Section 44559.16 is added to the Health and Safety Code, to read:44559.16.(a)The Capital Access Loan Program for Small Businesses established pursuant to this article is hereby transferred to the California Small Business Finance Center.(b)Unless the context clearly requires otherwise, the California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the authority pursuant to this article, relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business for which contributions by the authority were made with funds received under the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) or with the six million dollars ($6,000,000) appropriated to the authority for this purpose in subdivision (b) of Section 2 of Chapter 731 of the Statutes of 2010. All unexpended funds appropriated to or received by the authority for these purposes shall also be transferred to the California Small Business Finance Center except that, notwithstanding any other law including Sections 44548, 44549, 44559.13, and 44559.14, any funds so transferred shall only be available to the California Small Business Finance Center upon appropriation by the Legislature. However, the authority shall continue to administer any other capital access loan program that does not exclusively relate to loans given to qualified small businesses, including, among others, the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 and the California Seismic Safety Capital Access Loan Program established in Section 44559.14.(c)Unless the context clearly requires otherwise, whenever the term authority or California Pollution Control Financing Authority appears in any statute in this article, or in other statutes, regulations, or contracts directly related to the Capital Access Loan Program for Small Businesses, it shall be deemed to also refer to the California Small Business Finance Center. Unless the context clearly requires otherwise, any reference to the executive director in this article shall be deemed to also refer to the program manager of the California Small Business Finance Center.
Amended IN Assembly June 13, 2018 Amended IN Assembly September 06, 2017 Amended IN Assembly June 27, 2017 Amended IN Assembly June 12, 2017 Amended IN Senate April 17, 2017 Amended IN Senate April 17, 2017 Amended IN Senate March 27, 2017 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Senate Bill No. 551Introduced by Senator HuesoFebruary 16, 2017 An act to amend Section 63089.51 Sections 63089.1 and 63089.4 of, and to add Article Sections 63089.642, 63089.644, 63089.646 to, and to add Article 12 (commencing with Section 63090) to and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, and to add Section 44559.16 to the Health and Safety Code, relating to the Capital Access Loan Program. Program and making an appropriation therefor.LEGISLATIVE COUNSEL'S DIGESTSB 551, as amended, Hueso. Capital Access Loan Program for Small Businesses.Existing law establishes the Capital Access Loan Program for Small Businesses, which is administered by the California Pollution Control Financing Authority, to assist qualifying small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Under the program, the authority may enter into contracts with participating financial institutions and is required to establish a loss reserve account with participating financial institutions. Under existing law, Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program may to obtain reimbursement from the authority by submitting a claim for reimbursement for a specified amount of the loss covered by that loan, subject to certain procedures.Existing law also establishes other capital access loan programs that are administered by the authority, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program.Under the Small Business Financial Assistance Act of 2013, the California Infrastructure and Economic Development Bank, within the Governors Office of Business and Economic Development, administers specific programs relating to small business, either administered directly by the bank or under contract with small business financial development corporations. Existing law establishes within the bank the California Small Business Finance Center and authorizes the center to administer programs to assist businesses seeking new capital resources under the Small Business Financial Assistance Act of 2013, and establishes other related provisions.This bill would transfer the administration of specified loans to qualified small businesses under the Capital Access Loan Program for small businesses from the California Pollution Control Financing Authority to the California Small Business Finance Center, and would make conforming changes to that effect. This bill would provide that the authority will continue to administer other capital access loan programs that do not exclusively relate to loans given to qualified small businesses, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program. create the Capital Access Reserve Fund in the State Treasury to be under the administrative control of the California Small Business Finance Center within the bank. The bill would require that the fund be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or the provisions of services authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize funds to be held in financial institutions and companies that establish trust funds, as specified. The bill would specify the purposes for which funds may be used. The bill would prescribe a process for the transfer of specified moneys, including those from the General Fund, held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would provide that moneys in the fund are continuously appropriated. By creating a continuously appropriated fund and providing for its funding, this bill would make an appropriation. The bill would authorize the creation of holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. The bill would require the bank to provide reports in the Legislature in this regard.The bill would create the Capital Access Loan Program for Small Businesses, a loan loss reserve program, within the Small Business Financial Assistance Act of 2013. The bill would provide for the transfer of the loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would authorize the bank to contract with a financial company or financial institution to participate in the program and would state a specified priority for loans to be enrolled. The bill would require the bank to develop directives and requirements to implement the program. The bill would provide for the maintenance of regulations adopted by the California Pollution Control Financing Authority in connection with the management and control of loan loss reserve funds, as specified. The bill would prescribe a process pursuant to which a financial company or institution may withdraw from the program. The bill would also provide for the transfer of the collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would make conforming and technical changes. Digest Key Vote: MAJORITY2/3 Appropriation: NOYES Fiscal Committee: YES Local Program: NO
Amended IN Assembly June 13, 2018 Amended IN Assembly September 06, 2017 Amended IN Assembly June 27, 2017 Amended IN Assembly June 12, 2017 Amended IN Senate April 17, 2017 Amended IN Senate April 17, 2017 Amended IN Senate March 27, 2017
Amended IN Assembly June 13, 2018
Amended IN Assembly September 06, 2017
Amended IN Assembly June 27, 2017
Amended IN Assembly June 12, 2017
Amended IN Senate April 17, 2017
Amended IN Senate April 17, 2017
Amended IN Senate March 27, 2017
CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION
Senate Bill No. 551
Introduced by Senator HuesoFebruary 16, 2017
Introduced by Senator Hueso
February 16, 2017
An act to amend Section 63089.51 Sections 63089.1 and 63089.4 of, and to add Article Sections 63089.642, 63089.644, 63089.646 to, and to add Article 12 (commencing with Section 63090) to and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, and to add Section 44559.16 to the Health and Safety Code, relating to the Capital Access Loan Program. Program and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 551, as amended, Hueso. Capital Access Loan Program for Small Businesses.
Existing law establishes the Capital Access Loan Program for Small Businesses, which is administered by the California Pollution Control Financing Authority, to assist qualifying small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Under the program, the authority may enter into contracts with participating financial institutions and is required to establish a loss reserve account with participating financial institutions. Under existing law, Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program may to obtain reimbursement from the authority by submitting a claim for reimbursement for a specified amount of the loss covered by that loan, subject to certain procedures.Existing law also establishes other capital access loan programs that are administered by the authority, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program.Under the Small Business Financial Assistance Act of 2013, the California Infrastructure and Economic Development Bank, within the Governors Office of Business and Economic Development, administers specific programs relating to small business, either administered directly by the bank or under contract with small business financial development corporations. Existing law establishes within the bank the California Small Business Finance Center and authorizes the center to administer programs to assist businesses seeking new capital resources under the Small Business Financial Assistance Act of 2013, and establishes other related provisions.This bill would transfer the administration of specified loans to qualified small businesses under the Capital Access Loan Program for small businesses from the California Pollution Control Financing Authority to the California Small Business Finance Center, and would make conforming changes to that effect. This bill would provide that the authority will continue to administer other capital access loan programs that do not exclusively relate to loans given to qualified small businesses, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program. create the Capital Access Reserve Fund in the State Treasury to be under the administrative control of the California Small Business Finance Center within the bank. The bill would require that the fund be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or the provisions of services authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize funds to be held in financial institutions and companies that establish trust funds, as specified. The bill would specify the purposes for which funds may be used. The bill would prescribe a process for the transfer of specified moneys, including those from the General Fund, held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would provide that moneys in the fund are continuously appropriated. By creating a continuously appropriated fund and providing for its funding, this bill would make an appropriation. The bill would authorize the creation of holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. The bill would require the bank to provide reports in the Legislature in this regard.The bill would create the Capital Access Loan Program for Small Businesses, a loan loss reserve program, within the Small Business Financial Assistance Act of 2013. The bill would provide for the transfer of the loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would authorize the bank to contract with a financial company or financial institution to participate in the program and would state a specified priority for loans to be enrolled. The bill would require the bank to develop directives and requirements to implement the program. The bill would provide for the maintenance of regulations adopted by the California Pollution Control Financing Authority in connection with the management and control of loan loss reserve funds, as specified. The bill would prescribe a process pursuant to which a financial company or institution may withdraw from the program. The bill would also provide for the transfer of the collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would make conforming and technical changes.
Existing law establishes the Capital Access Loan Program for Small Businesses, which is administered by the California Pollution Control Financing Authority, to assist qualifying small businesses in financing the costs of complying with environmental mandates and the remediation of contamination on their properties. Under the program, the authority may enter into contracts with participating financial institutions and is required to establish a loss reserve account with participating financial institutions. Under existing law, Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program may to obtain reimbursement from the authority by submitting a claim for reimbursement for a specified amount of the loss covered by that loan, subject to certain procedures.
Existing law also establishes other capital access loan programs that are administered by the authority, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program.
Under the Small Business Financial Assistance Act of 2013, the California Infrastructure and Economic Development Bank, within the Governors Office of Business and Economic Development, administers specific programs relating to small business, either administered directly by the bank or under contract with small business financial development corporations. Existing law establishes within the bank the California Small Business Finance Center and authorizes the center to administer programs to assist businesses seeking new capital resources under the Small Business Financial Assistance Act of 2013, and establishes other related provisions.
This bill would transfer the administration of specified loans to qualified small businesses under the Capital Access Loan Program for small businesses from the California Pollution Control Financing Authority to the California Small Business Finance Center, and would make conforming changes to that effect. This bill would provide that the authority will continue to administer other capital access loan programs that do not exclusively relate to loans given to qualified small businesses, including the California Americans with Disabilities Small Business Capital Access Loan Program and the California Seismic Safety Capital Access Loan Program. create the Capital Access Reserve Fund in the State Treasury to be under the administrative control of the California Small Business Finance Center within the bank. The bill would require that the fund be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or the provisions of services authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize funds to be held in financial institutions and companies that establish trust funds, as specified. The bill would specify the purposes for which funds may be used. The bill would prescribe a process for the transfer of specified moneys, including those from the General Fund, held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would provide that moneys in the fund are continuously appropriated. By creating a continuously appropriated fund and providing for its funding, this bill would make an appropriation. The bill would authorize the creation of holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. The bill would require the bank to provide reports in the Legislature in this regard.
The bill would create the Capital Access Loan Program for Small Businesses, a loan loss reserve program, within the Small Business Financial Assistance Act of 2013. The bill would provide for the transfer of the loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would authorize the bank to contract with a financial company or financial institution to participate in the program and would state a specified priority for loans to be enrolled. The bill would require the bank to develop directives and requirements to implement the program. The bill would provide for the maintenance of regulations adopted by the California Pollution Control Financing Authority in connection with the management and control of loan loss reserve funds, as specified. The bill would prescribe a process pursuant to which a financial company or institution may withdraw from the program. The bill would also provide for the transfer of the collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority, to the bank pursuant to a specified process. The bill would make conforming and technical changes.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. The Legislature finds and declares as follows:(a) In October 2010, Congress passed and the President signed the Small Business Jobs Act. Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures up to $1.5 billion for state sponsored small business finance programs. California utilized its federal small business grant money to capitalize the Small Business Loan Guarantee Program at the I-Bank's Small Business Finance Center, and the California Capital Access Program (CalCAP) loan loss reserve program and a collateral support program administered through the California Pollution Control Financing Authority (CPCFA).(b)In 2011, the California Pollution Control Financing Authority received a federal allocation from the State Small Business Credit Initiative (SSBCI) to expand and support its CalCAP for Small Business Program. That allocation, as amended from time to time, totaled approximately $19,900,000.(b) In February 2011, the California Pollution Control Financing Authority was awarded approximately eighty-four million dollars ($84,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) for use by the authority in its California Capital Access Program for Small Businesses and the California Capital Access Collateral Support program.(c) On April 25, 2017, the Treasurers office alerted the public and interested stakeholders that the federal moneys allocated to California to support the California Capital Access Loan Program (CalCAP) for Small Business were near exhaustion. In addition, the notice stated that when the federal moneys are exhausted, the authority will continue to review and approve pending loan applications. For those which are approved, CPCFA will make contributions from the balance remaining from the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session for deposit into each lenders CalCAP State Loan Loss Reserve Account.(d) Finally, the notice stated that the authority staff projects that the balance of the General Fund appropriation will support all current loan enrollment applications in the CPCFAs possession. However, we also anticipate that these State program funds will be exhausted in the Summer 2017, at which point the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(e) Although the authority has adopted regulations to recapture some funds it has previously contributed to CalCAP for use in the Small Business CalCAP, there remains a significant risk that the authority may elect to permanently modify the California Capital Access Loan Program for Small Businesses to focus more intently on lending programs for pollution control financing projects, a change in direction that would be more consistent with its namesake and its enabling statutes. Earlier in this session of the Legislature, the authority took action consistent with this apparent plan by amending Assembly Bill 964 (Calderon), a bill that is sponsored by the authority. On May 30, 2017, Assembly Bill 964 was amended in the Senate, to remove for Small Businesses from the title of the Capital Access Loan Program to read Capital Access Loan Program.(f) Without direction from the Legislature, a distinct possibility exists that federal funds that were allocated for the purpose of assisting small businesses might be redirected to support programs separate and apart from small business assistance, which runs counter to the intent set forth in the federal Small Business Jobs Act of 2010.(g) In 2013, years after funding was distributed in California from the State Small Business Credit Initiative, the Legislature enacted Assembly Bill 1247 (Medina and Bocanegra) of the 201314 Regular Session, which created the Small Business Finance Center (SBFC) at the California Infrastructure and Economic Development Bank. The SBFC helps businesses create and retain jobs, and encourages investment in low- to moderate-income communities. The finance center operates a Small Business Loan Guarantee Program, and provides technical assistance to small businesses and microbusinesses. In 2017, the SBFC created the Jump Start Loan Program which provides direct loans from $500 to $10,000 to small businesses in low-wealth communities.(h) The SBFC and the California Infrastructure and Economic Development Bank are organized within the Governors Office of Business and Economic Development (GO-Biz), which was created in 2012 to serve as Californias single point of contact for economic development and job creation efforts.(i)Therefore, the Legislature declares that it is appropriate, as program funding expires, that the Capital Access Loan Program for Small Businesses, now within the purview of the California Pollution Control Financing Authority, should be transferred to the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(i) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully disbursed, that the portfolio of the Capital Access Loan Program for Small Businesses and the portfolio of the Collateral Support program be transferred from the CPCFA to the California Small Business Finance Center within the California Infrastructure and Economic Development Bank.(2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(3) It is intent the Legislature that nothing in this act impede the ability of the CPCFA to operate the California Capital Access Program with other program funds, as well as administering the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 of the Health and Safety Code and the California Seismic Safety Capital Access Loan Program established in Section 44559.14 of the Health and Safety Code.SEC. 2.Section 63089.51 of the Government Code is amended to read:63089.51.(a)All money deposited in the expansion fund is hereby continuously appropriated, without regard to fiscal years, for the purposes of this chapter, except for Article 12 (commencing with Section 63090).(b)Except as specified in subdivision (b) of Section 63089.54, the state or the bank shall not be liable or obligated in any way beyond the state money that is allocated in the expansion fund from moneys from the General Fund appropriated for those purposes.SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.SEC. 3. Section 63089.4 of the Government Code is amended to read:63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.SEC. 4. Section 63089.642 is added to the Government Code, to read:63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes. SEC. 5. Section 63089.644 is added to the Government Code, to read:63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter. SEC. 6. Section 63089.646 is added to the Government Code, to read:63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.SEC. 3.SEC. 7. Article 12 (commencing with Section 63090) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank. 63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.SEC. 8. Article 13 (commencing with Section 69095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.SEC. 4.Section 44559.16 is added to the Health and Safety Code, to read:44559.16.(a)The Capital Access Loan Program for Small Businesses established pursuant to this article is hereby transferred to the California Small Business Finance Center.(b)Unless the context clearly requires otherwise, the California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the authority pursuant to this article, relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business for which contributions by the authority were made with funds received under the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) or with the six million dollars ($6,000,000) appropriated to the authority for this purpose in subdivision (b) of Section 2 of Chapter 731 of the Statutes of 2010. All unexpended funds appropriated to or received by the authority for these purposes shall also be transferred to the California Small Business Finance Center except that, notwithstanding any other law including Sections 44548, 44549, 44559.13, and 44559.14, any funds so transferred shall only be available to the California Small Business Finance Center upon appropriation by the Legislature. However, the authority shall continue to administer any other capital access loan program that does not exclusively relate to loans given to qualified small businesses, including, among others, the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 and the California Seismic Safety Capital Access Loan Program established in Section 44559.14.(c)Unless the context clearly requires otherwise, whenever the term authority or California Pollution Control Financing Authority appears in any statute in this article, or in other statutes, regulations, or contracts directly related to the Capital Access Loan Program for Small Businesses, it shall be deemed to also refer to the California Small Business Finance Center. Unless the context clearly requires otherwise, any reference to the executive director in this article shall be deemed to also refer to the program manager of the California Small Business Finance Center.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. The Legislature finds and declares as follows:(a) In October 2010, Congress passed and the President signed the Small Business Jobs Act. Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures up to $1.5 billion for state sponsored small business finance programs. California utilized its federal small business grant money to capitalize the Small Business Loan Guarantee Program at the I-Bank's Small Business Finance Center, and the California Capital Access Program (CalCAP) loan loss reserve program and a collateral support program administered through the California Pollution Control Financing Authority (CPCFA).(b)In 2011, the California Pollution Control Financing Authority received a federal allocation from the State Small Business Credit Initiative (SSBCI) to expand and support its CalCAP for Small Business Program. That allocation, as amended from time to time, totaled approximately $19,900,000.(b) In February 2011, the California Pollution Control Financing Authority was awarded approximately eighty-four million dollars ($84,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) for use by the authority in its California Capital Access Program for Small Businesses and the California Capital Access Collateral Support program.(c) On April 25, 2017, the Treasurers office alerted the public and interested stakeholders that the federal moneys allocated to California to support the California Capital Access Loan Program (CalCAP) for Small Business were near exhaustion. In addition, the notice stated that when the federal moneys are exhausted, the authority will continue to review and approve pending loan applications. For those which are approved, CPCFA will make contributions from the balance remaining from the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session for deposit into each lenders CalCAP State Loan Loss Reserve Account.(d) Finally, the notice stated that the authority staff projects that the balance of the General Fund appropriation will support all current loan enrollment applications in the CPCFAs possession. However, we also anticipate that these State program funds will be exhausted in the Summer 2017, at which point the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(e) Although the authority has adopted regulations to recapture some funds it has previously contributed to CalCAP for use in the Small Business CalCAP, there remains a significant risk that the authority may elect to permanently modify the California Capital Access Loan Program for Small Businesses to focus more intently on lending programs for pollution control financing projects, a change in direction that would be more consistent with its namesake and its enabling statutes. Earlier in this session of the Legislature, the authority took action consistent with this apparent plan by amending Assembly Bill 964 (Calderon), a bill that is sponsored by the authority. On May 30, 2017, Assembly Bill 964 was amended in the Senate, to remove for Small Businesses from the title of the Capital Access Loan Program to read Capital Access Loan Program.(f) Without direction from the Legislature, a distinct possibility exists that federal funds that were allocated for the purpose of assisting small businesses might be redirected to support programs separate and apart from small business assistance, which runs counter to the intent set forth in the federal Small Business Jobs Act of 2010.(g) In 2013, years after funding was distributed in California from the State Small Business Credit Initiative, the Legislature enacted Assembly Bill 1247 (Medina and Bocanegra) of the 201314 Regular Session, which created the Small Business Finance Center (SBFC) at the California Infrastructure and Economic Development Bank. The SBFC helps businesses create and retain jobs, and encourages investment in low- to moderate-income communities. The finance center operates a Small Business Loan Guarantee Program, and provides technical assistance to small businesses and microbusinesses. In 2017, the SBFC created the Jump Start Loan Program which provides direct loans from $500 to $10,000 to small businesses in low-wealth communities.(h) The SBFC and the California Infrastructure and Economic Development Bank are organized within the Governors Office of Business and Economic Development (GO-Biz), which was created in 2012 to serve as Californias single point of contact for economic development and job creation efforts.(i)Therefore, the Legislature declares that it is appropriate, as program funding expires, that the Capital Access Loan Program for Small Businesses, now within the purview of the California Pollution Control Financing Authority, should be transferred to the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(i) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully disbursed, that the portfolio of the Capital Access Loan Program for Small Businesses and the portfolio of the Collateral Support program be transferred from the CPCFA to the California Small Business Finance Center within the California Infrastructure and Economic Development Bank.(2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(3) It is intent the Legislature that nothing in this act impede the ability of the CPCFA to operate the California Capital Access Program with other program funds, as well as administering the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 of the Health and Safety Code and the California Seismic Safety Capital Access Loan Program established in Section 44559.14 of the Health and Safety Code.
SECTION 1. The Legislature finds and declares as follows:(a) In October 2010, Congress passed and the President signed the Small Business Jobs Act. Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures up to $1.5 billion for state sponsored small business finance programs. California utilized its federal small business grant money to capitalize the Small Business Loan Guarantee Program at the I-Bank's Small Business Finance Center, and the California Capital Access Program (CalCAP) loan loss reserve program and a collateral support program administered through the California Pollution Control Financing Authority (CPCFA).(b)In 2011, the California Pollution Control Financing Authority received a federal allocation from the State Small Business Credit Initiative (SSBCI) to expand and support its CalCAP for Small Business Program. That allocation, as amended from time to time, totaled approximately $19,900,000.(b) In February 2011, the California Pollution Control Financing Authority was awarded approximately eighty-four million dollars ($84,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) for use by the authority in its California Capital Access Program for Small Businesses and the California Capital Access Collateral Support program.(c) On April 25, 2017, the Treasurers office alerted the public and interested stakeholders that the federal moneys allocated to California to support the California Capital Access Loan Program (CalCAP) for Small Business were near exhaustion. In addition, the notice stated that when the federal moneys are exhausted, the authority will continue to review and approve pending loan applications. For those which are approved, CPCFA will make contributions from the balance remaining from the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session for deposit into each lenders CalCAP State Loan Loss Reserve Account.(d) Finally, the notice stated that the authority staff projects that the balance of the General Fund appropriation will support all current loan enrollment applications in the CPCFAs possession. However, we also anticipate that these State program funds will be exhausted in the Summer 2017, at which point the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(e) Although the authority has adopted regulations to recapture some funds it has previously contributed to CalCAP for use in the Small Business CalCAP, there remains a significant risk that the authority may elect to permanently modify the California Capital Access Loan Program for Small Businesses to focus more intently on lending programs for pollution control financing projects, a change in direction that would be more consistent with its namesake and its enabling statutes. Earlier in this session of the Legislature, the authority took action consistent with this apparent plan by amending Assembly Bill 964 (Calderon), a bill that is sponsored by the authority. On May 30, 2017, Assembly Bill 964 was amended in the Senate, to remove for Small Businesses from the title of the Capital Access Loan Program to read Capital Access Loan Program.(f) Without direction from the Legislature, a distinct possibility exists that federal funds that were allocated for the purpose of assisting small businesses might be redirected to support programs separate and apart from small business assistance, which runs counter to the intent set forth in the federal Small Business Jobs Act of 2010.(g) In 2013, years after funding was distributed in California from the State Small Business Credit Initiative, the Legislature enacted Assembly Bill 1247 (Medina and Bocanegra) of the 201314 Regular Session, which created the Small Business Finance Center (SBFC) at the California Infrastructure and Economic Development Bank. The SBFC helps businesses create and retain jobs, and encourages investment in low- to moderate-income communities. The finance center operates a Small Business Loan Guarantee Program, and provides technical assistance to small businesses and microbusinesses. In 2017, the SBFC created the Jump Start Loan Program which provides direct loans from $500 to $10,000 to small businesses in low-wealth communities.(h) The SBFC and the California Infrastructure and Economic Development Bank are organized within the Governors Office of Business and Economic Development (GO-Biz), which was created in 2012 to serve as Californias single point of contact for economic development and job creation efforts.(i)Therefore, the Legislature declares that it is appropriate, as program funding expires, that the Capital Access Loan Program for Small Businesses, now within the purview of the California Pollution Control Financing Authority, should be transferred to the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(i) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully disbursed, that the portfolio of the Capital Access Loan Program for Small Businesses and the portfolio of the Collateral Support program be transferred from the CPCFA to the California Small Business Finance Center within the California Infrastructure and Economic Development Bank.(2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.(3) It is intent the Legislature that nothing in this act impede the ability of the CPCFA to operate the California Capital Access Program with other program funds, as well as administering the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 of the Health and Safety Code and the California Seismic Safety Capital Access Loan Program established in Section 44559.14 of the Health and Safety Code.
SECTION 1. The Legislature finds and declares as follows:
### SECTION 1.
(a) In October 2010, Congress passed and the President signed the Small Business Jobs Act. Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures up to $1.5 billion for state sponsored small business finance programs. California utilized its federal small business grant money to capitalize the Small Business Loan Guarantee Program at the I-Bank's Small Business Finance Center, and the California Capital Access Program (CalCAP) loan loss reserve program and a collateral support program administered through the California Pollution Control Financing Authority (CPCFA).
(b)In 2011, the California Pollution Control Financing Authority received a federal allocation from the State Small Business Credit Initiative (SSBCI) to expand and support its CalCAP for Small Business Program. That allocation, as amended from time to time, totaled approximately $19,900,000.
(b) In February 2011, the California Pollution Control Financing Authority was awarded approximately eighty-four million dollars ($84,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) for use by the authority in its California Capital Access Program for Small Businesses and the California Capital Access Collateral Support program.
(c) On April 25, 2017, the Treasurers office alerted the public and interested stakeholders that the federal moneys allocated to California to support the California Capital Access Loan Program (CalCAP) for Small Business were near exhaustion. In addition, the notice stated that when the federal moneys are exhausted, the authority will continue to review and approve pending loan applications. For those which are approved, CPCFA will make contributions from the balance remaining from the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session for deposit into each lenders CalCAP State Loan Loss Reserve Account.
(d) Finally, the notice stated that the authority staff projects that the balance of the General Fund appropriation will support all current loan enrollment applications in the CPCFAs possession. However, we also anticipate that these State program funds will be exhausted in the Summer 2017, at which point the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.
(e) Although the authority has adopted regulations to recapture some funds it has previously contributed to CalCAP for use in the Small Business CalCAP, there remains a significant risk that the authority may elect to permanently modify the California Capital Access Loan Program for Small Businesses to focus more intently on lending programs for pollution control financing projects, a change in direction that would be more consistent with its namesake and its enabling statutes. Earlier in this session of the Legislature, the authority took action consistent with this apparent plan by amending Assembly Bill 964 (Calderon), a bill that is sponsored by the authority. On May 30, 2017, Assembly Bill 964 was amended in the Senate, to remove for Small Businesses from the title of the Capital Access Loan Program to read Capital Access Loan Program.
(f) Without direction from the Legislature, a distinct possibility exists that federal funds that were allocated for the purpose of assisting small businesses might be redirected to support programs separate and apart from small business assistance, which runs counter to the intent set forth in the federal Small Business Jobs Act of 2010.
(g) In 2013, years after funding was distributed in California from the State Small Business Credit Initiative, the Legislature enacted Assembly Bill 1247 (Medina and Bocanegra) of the 201314 Regular Session, which created the Small Business Finance Center (SBFC) at the California Infrastructure and Economic Development Bank. The SBFC helps businesses create and retain jobs, and encourages investment in low- to moderate-income communities. The finance center operates a Small Business Loan Guarantee Program, and provides technical assistance to small businesses and microbusinesses. In 2017, the SBFC created the Jump Start Loan Program which provides direct loans from $500 to $10,000 to small businesses in low-wealth communities.
(h) The SBFC and the California Infrastructure and Economic Development Bank are organized within the Governors Office of Business and Economic Development (GO-Biz), which was created in 2012 to serve as Californias single point of contact for economic development and job creation efforts.
(i)Therefore, the Legislature declares that it is appropriate, as program funding expires, that the Capital Access Loan Program for Small Businesses, now within the purview of the California Pollution Control Financing Authority, should be transferred to the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.
(i) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully disbursed, that the portfolio of the Capital Access Loan Program for Small Businesses and the portfolio of the Collateral Support program be transferred from the CPCFA to the California Small Business Finance Center within the California Infrastructure and Economic Development Bank.
(2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank.
(3) It is intent the Legislature that nothing in this act impede the ability of the CPCFA to operate the California Capital Access Program with other program funds, as well as administering the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 of the Health and Safety Code and the California Seismic Safety Capital Access Loan Program established in Section 44559.14 of the Health and Safety Code.
(a)All money deposited in the expansion fund is hereby continuously appropriated, without regard to fiscal years, for the purposes of this chapter, except for Article 12 (commencing with Section 63090).
(b)Except as specified in subdivision (b) of Section 63089.54, the state or the bank shall not be liable or obligated in any way beyond the state money that is allocated in the expansion fund from moneys from the General Fund appropriated for those purposes.
SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.
SEC. 2. Section 63089.1 of the Government Code is amended to read:
### SEC. 2.
63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.
63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.
63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:(1) Administer this chapter.(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter. (3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.(4) Require each corporation to submit an annual written plan of operation.(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.(6) Authorize the investment of expansion and trust fund moneys.(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.
63089.1. (a) The program manager acting under the guidance of the executive director shall do all of the following:
(1) Administer this chapter.
(2) (A) Enter into a contract between the bank and each corporation for services to be provided by the corporations for one or more programs or financial products under this chapter and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.
(B) Enter into a contract between the bank and any financial institution or financial company in connection with one or more programs or financial products under this chapter.
(3) In accordance with available resources, allow the use of branch offices for the purposes of making these programs under this chapter accessible to all areas of the state.
(4) Require each corporation to submit an annual written plan of operation.
(5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds.
(6) Authorize the investment of expansion and trust fund moneys.
(7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2.
(8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature.
(9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board.
(b) The program manager may attend and participate at corporation meetings. The program manager or his or her designee shall be an ex officio, nonvoting representative on the board of directors and loan committees of each corporation. The program manager shall confer with the board of directors of each corporation as appropriate and necessary to carry out his or her duties, but in no case shall the program manager confer less than once each fiscal year.
(c) In accordance with available resources, assist corporations in applying for public and private funding opportunities, and in obtaining program support from the business community.
SEC. 3. Section 63089.4 of the Government Code is amended to read:63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.
SEC. 3. Section 63089.4 of the Government Code is amended to read:
### SEC. 3.
63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.
63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.
63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f) Adopt directives and requirements as specified in this chapter.(g) Authorize new financial product programs and activities pursuant to this chapter.
63089.4. The bank is authorized to:
(a) Approve new corporations recommended by the program manager.
(b) Enter into contracts with corporations corporations, financial institutions, or financial companies for program management and other financial product-related services.
(c) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.
(d) Invest expansion fund fund, capital access reserve fund, and trust fund moneys as specified in this chapter.
(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.
(f) Adopt directives and requirements as specified in this chapter.
(g) Authorize new financial product programs and activities pursuant to this chapter.
SEC. 4. Section 63089.642 is added to the Government Code, to read:63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes.
SEC. 4. Section 63089.642 is added to the Government Code, to read:
### SEC. 4.
63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes.
63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes.
63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter. (2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.(b) Capital Access Reserve Fund shall be used for the following purposes:(1) To fund financial products authorized pursuant to this chapter.(2) To pay defaults directly related to financial products authorized pursuant to this chapter.(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. (3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys. (4) The final transfer of the funds shall occur no later than January 1, 2020. (d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter. (e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee. (2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes.
63089.642. (a) (1) There is hereby created in the State Treasury the Capital Access Reserve Fund under the administrative control of the California Small Business Finance Center within the bank. The fund shall be established and maintained by the bank for the benefit of financial companies or financial institutions participating in one or more programs or providing services authorized pursuant to this chapter.
(2) The bank board may elect to hold all or a portion of the fund in a financial institution or financial company that establishes a trust fund and acts as trustee for the funds. The financial institution or financial company so designated shall be approved by the Treasurer for the receipt of state funds. Interest earned on a trust fund in financial institutions and financial companies may be utilized by the financial institution, financial company, and the bank pursuant to the purposes of this chapter and subject to the requirements and directives adopted by the bank board.
(3) The funds in the Capital Access Reserve Fund shall be paid out to a trust fund by the Treasurer on funds drawn by the Controller and requisitioned by the bank.
(b) Capital Access Reserve Fund shall be used for the following purposes:
(1) To fund financial products authorized pursuant to this chapter.
(2) To pay defaults directly related to financial products authorized pursuant to this chapter.
(3) To pay administrative costs of financial institutions and financial companies, pursuant to the directives and requirements adopted by the bank board.
(4) To pay state support, information technology, and administrative costs related to programs and services authorized pursuant to this chapter.
(5) To pay those costs necessary to protect a real property interest in a financial product default.
(c) (1) The Capital Access Reserve Fund is created for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, credit enhancements, and other financial products that the California Small Business Finance Center is authorized to provide or manage pursuant to this chapter.
(2) The bank shall provide written notice to the Joint Legislative Budget Committee, the Chief Clerk of the Assembly, and the Secretary of the Senate, who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the Capital Access Reserve fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.
(3) (A) All federal and state funds, the source of which was the federal Small Business Jobs Act or the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, including funds that have been returned to or recaptured by the CPCFA and currently under its control, in the Pollution Control Financing Authority Fund shall be transferred to the Capital Access Reserve Fund and be under the administrative control of the California Small Business Finance Center.
(B) To initiate the transfer of the funds, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon adoption of the resolution by the bank board, the California Pollution Control Financing Authority shall transfer the moneys.
(4) The final transfer of the funds shall occur no later than January 1, 2020.
(d) The Small Business Finance Center shall manage all moneys in Capital Access Reserve Fund. Interest or income earned on moneys shall be deemed to be part of the fund and used solely for programs, services, and actions authorized pursuant to this chapter.
(e) (1) Pursuant to the directives and requirements adopted in this chapter, the state has a residual interest in the funds deposited in the trust fund, including any individual accounts, and to the return on these funds from investment. On dissolution, suspension, or termination of an agreement related to a program or service authorized pursuant to this chapter, these funds shall be withdrawn from the applicable account and returned to the Capitol Access Reserve Fund or temporarily transferred to another trust fund account. This provision shall be contained in relevant trust instructions to a trustee.
(2) For the purposes of paragraph (1), the bank may create one or more holding accounts in the Capital Access Reserve Fund, to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
(f) All money in the Capital Access Reserve Fund is hereby continuously appropriated without regard to fiscal years, for the purposes of this chapter.
(g) The state or the bank shall not be liable or obligated in any way beyond the money that is allocated in the Capital Access Reserve Fund for these purposes.
SEC. 5. Section 63089.644 is added to the Government Code, to read:63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
SEC. 5. Section 63089.644 is added to the Government Code, to read:
### SEC. 5.
63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses. Funding in the account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all required fees paid by the financial company or financial institution, and the small business.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account. (b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account. (c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
63089.644. (a) The bank may create one or more loss reserve accounts in the Capital Access Reserve Fund or a trust fund for a financial institution and financial company participating in the Capital Access Loan Program for Small Businesses.
Funding in the account established for the purposes of this section shall be used for the purposes of the following:
(1) Depositing all required fees paid by the financial company or financial institution, and the small business.
(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.
(3) Covering losses on enrolled loans sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account.
(b) The bank shall manage all moneys in a loss reserve account established pursuant to this section. Interest or income earned on money credited to the loss reserve account shall be deemed to be part of the loss reserve account. The bank may withdraw from the loss reserve account all, or a portion, of the interest or other income that has been credited to the account.
(c) For purposes of this section, the bank may create one or more holding accounts in the Capital Access Reserve Fund to accommodate the temporary or permanent transfer of funds pursuant to requirements and directives adopted by the bank board relating to the suspension and termination of a financial institution or financial companys participation in a program or offering a service authorized under this chapter.
SEC. 6. Section 63089.646 is added to the Government Code, to read:63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.
SEC. 6. Section 63089.646 is added to the Government Code, to read:
### SEC. 6.
63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.
63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.
63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020. (c) The report required by this section shall be submitted in compliance with Section 9795.
63089.646. (a) The bank shall provide the a progress report to the Legislature on the implementation of the transfer of funds and loan portfolios pursuant to Sections 63089.642, 63090, and 63091.
(b) The progress report shall be in the form of a letter submitted to the relevant policy and fiscal committees every six months, and the first letter shall be submitted no later than July 1, 2019, and the last letter shall be submitted and received no later than July 1, 2020.
(c) The report required by this section shall be submitted in compliance with Section 9795.
SEC. 3.SEC. 7. Article 12 (commencing with Section 63090) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank. 63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.
SEC. 3.SEC. 7. Article 12 (commencing with Section 63090) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read:
### SEC. 3.SEC. 7.
Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank. 63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.
Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank. 63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.
Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves
Article 12. Capital Access Loan Program for Small BusinessesLoan Loss Reserves
63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio. (3) The transfer of the portfolio shall occur no later than January 1, 2020.(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:(1) The initiation of new and extension of existing agreements to participate in the program.(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.(5) Annual reporting requirements on the use and outcomes of the program.(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.
63090. (a) The California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code.The Capital Access Loan Program for Small Businesses, a loan loss reserve program, is hereby established under the administrative control of the California Small Business Finance Center.
(b) The California Small Business Finance Center shall not deposit any money received pursuant to the Capital Access Loan Program for Small Businesses into the California Small Business Expansion Fund established pursuant to Section 63089.5. Notwithstanding Section 63089.51, no money in the California Small Business Expansion Fund, or any account within that fund, is available for purposes of this article. (1) The loss reserve loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under the Assembly Bill 1632 of the 200910 Regular Session, Chapter 731 of the Statutes of 2010, or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) shall be transferred to bank.
(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.
(3) The transfer of the portfolio shall occur no later than January 1, 2020.
(c) The bank may contract with any financial company or financial institution for the purpose of allowing the financial company or institution to participate in the Capital Access Loan Program for Small Businesses.
(d) The priority for loans enrolled in this program shall be for loans and microloans that benefit low-income, minority, and women-owned businesses in the state.
(e) The bank shall develop directives and requirements to implement the Capital Access Loan Program for Small Businesses established by this article, including, but not limited to:
(1) The initiation of new and extension of existing agreements to participate in the program.
(2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults.
(3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitize all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank.
(4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company for cause, including provisions for appeals.
(5) Annual reporting requirements on the use and outcomes of the program.
(f) The liability of the state and the bank to the financial institution and financial company under contract is limited to the amount of money credited to the loss reserve account of the financial institution and financial company under contract.
63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank.
63091. Regulations adopted by the California Pollution Control Financing Authority, pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business, as described in Section 44559.16 of the Health and Safety Code and the regulations dated May 15, 2012, approving the development and implementation of a collateral support program, and all subsequent resolutions and regulations adopted by the authority updating or modifying the program shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond September 1, 2019. Until the bank adopts its regulations, where an action is required subsequent to October 1, 2018, references to the California Pollution Control Financing Authority are deemed to reference the bank.
63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable: (1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.
63092. (a) Upon written notice to the bank, a financial company or financial institution may withdraw from the program. The notice shall state one of the following, as may be applicable:
(1) All loans secured by its loss reserve account have been repaid, and there are no pending claims for reimbursement for losses incurred as a result of loan defaults.
(2) The financial company or financial institution waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs or loan defaults with respect to all loans that are enrolled in its loss reserve account that have not been fully repaid as of the date the notice of withdrawal is filed with the bank.
(b) The bank shall establish the process for distribution of contributions back to a financial company or financial institution that has withdrawn from the program in directives and regulations.
SEC. 8. Article 13 (commencing with Section 69095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.
SEC. 8. Article 13 (commencing with Section 69095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read:
### SEC. 8.
Article 13. Miscellaneous Credit Enhancements69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.
Article 13. Miscellaneous Credit Enhancements69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.
Article 13. Miscellaneous Credit Enhancements
Article 13. Miscellaneous Credit Enhancements
69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.(c) The transfer of the portfolio shall occur no later than January 1, 2020.
69095. (a) The collateral support loan portfolio of the California Capital Access Loan Program, administered by the California Pollution Control Financing Authority pursuant to Article 8 (commencing with Section 44559) of Chapter 1 of Division 27 of the Health and Safety Code, comprised of enrolled loans for which the state contributed funding pursuant to the 2010 General Fund appropriation under Assembly Bill 1632 of the 200910 Regular Session (Chapter 731 of the Statutes of 2010) or federal funds awarded to the state pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) is transferred to the bank.
(b) To initiate the transfer of the portfolio, the bank board shall adopt a resolution which provides for the terms and conditions of the transfer. The bank may confer with the California Pollution Control Financing Authority on the terms and conditions of the resolution. The California Pollution Control Financing Authority shall provide requested information in a timely manner. Upon the adoption of the resolution, the California Pollution Control Financing Authority shall transfer the portfolio.
(c) The transfer of the portfolio shall occur no later than January 1, 2020.
(a)The Capital Access Loan Program for Small Businesses established pursuant to this article is hereby transferred to the California Small Business Finance Center.
(b)Unless the context clearly requires otherwise, the California Small Business Finance Center is hereby vested with all the duties, powers, purposes, responsibilities, and jurisdiction granted to the authority pursuant to this article, relating to the management and control of loan loss reserve funds and claims processing on all loans granted to a qualified small business for which contributions by the authority were made with funds received under the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code) or with the six million dollars ($6,000,000) appropriated to the authority for this purpose in subdivision (b) of Section 2 of Chapter 731 of the Statutes of 2010. All unexpended funds appropriated to or received by the authority for these purposes shall also be transferred to the California Small Business Finance Center except that, notwithstanding any other law including Sections 44548, 44549, 44559.13, and 44559.14, any funds so transferred shall only be available to the California Small Business Finance Center upon appropriation by the Legislature. However, the authority shall continue to administer any other capital access loan program that does not exclusively relate to loans given to qualified small businesses, including, among others, the California Americans with Disabilities Small Business Capital Access Loan Program established in Section 44559.13 and the California Seismic Safety Capital Access Loan Program established in Section 44559.14.
(c)Unless the context clearly requires otherwise, whenever the term authority or California Pollution Control Financing Authority appears in any statute in this article, or in other statutes, regulations, or contracts directly related to the Capital Access Loan Program for Small Businesses, it shall be deemed to also refer to the California Small Business Finance Center. Unless the context clearly requires otherwise, any reference to the executive director in this article shall be deemed to also refer to the program manager of the California Small Business Finance Center.