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| 1 | + | CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION Assembly Bill No. 474Introduced by Assembly Member Reyes(Coauthors: Assembly Members Carrillo, Petrie-Norris, Luz Rivas, Smith, and Wicks)February 12, 2019 An act to amend Sections 63089.1, 63089.4, 63089.5, and 63089.98 of, to add Sections 63089.642 and 63089.644 to, and to add Article 12 (commencing with Section 63090) and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, relating to the Capital Access Loan Program, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGESTAB 474, as introduced, Reyes. 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. Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program 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. The act establishes the program manager as the manager of the California Small Business Finance Center, and requires each small business financial development corporation formed pursuant to the act to submit specified information to the program manager related to their activities. Existing law requires the program manager, no later than January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year ending June 30 containing the financial product activity of each small business financial development corporation formed. Existing law establishes the Small Business Expansion Fund in the State Treasury, and continuously appropriates specified moneys into the fund for purposes related to the Small Business Financial Assistance Act of 2013.This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used.The bill would create the California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement 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 California Small Business Finance Center for purposes of the California Loan Loss Reserve Program for Small Business, pursuant to a specified process. The bill would authorize the bank to contract with a qualified financial company or financial institution to participate as a lender 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 participating as a lender 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.The bill would modify the requirements of the annual report described above by requiring the program manager to include in its annual report the financial product activity of each financial institution or company that participates in the loan loss reserve program specified information, and would require the program manager, for one year following the creation of the loan loss reserve program, to prepare and submit to the Governor and the Legislature a semi-annual progress report relating to the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank.This bill would declare that it is to take effect immediately as an urgency statute.Digest Key Vote: 2/3 Appropriation: YES 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 to strengthen state programs that support financing of small businesses.(b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee 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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(d) 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.(e) 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.(f) 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.(g) 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.(h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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 for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter.SEC. 4. Section 63089.5 of the Government Code is amended to read:63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund.SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read:63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021.SEC. 6. Section 63089.644 is added to the Government Code, immediately following Section 63089.642, to read:63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. SEC. 7. Section 63089.98 of the Government Code is amended to read:63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website.SEC. 8. 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. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank.63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations.SEC. 9. Article 13 (commencing with Section 63095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021.SEC. 10. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:In order to provide the Small Business Finance Center at the California Infrastructure and Economic Development Bank with authority to develop directives and requirements at the earliest possible date for the efficient transfer and consolidation of responsibility for the management of funds allocated to California pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code), it is necessary that this act take effect immediately. | |
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| 3 | + | CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION Assembly Bill No. 474Introduced by Assembly Member Reyes(Coauthors: Assembly Members Carrillo, Petrie-Norris, Luz Rivas, Smith, and Wicks)February 12, 2019 An act to amend Sections 63089.1, 63089.4, 63089.5, and 63089.98 of, to add Sections 63089.642 and 63089.644 to, and to add Article 12 (commencing with Section 63090) and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, relating to the Capital Access Loan Program, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGESTAB 474, as introduced, Reyes. 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. Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program 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. The act establishes the program manager as the manager of the California Small Business Finance Center, and requires each small business financial development corporation formed pursuant to the act to submit specified information to the program manager related to their activities. Existing law requires the program manager, no later than January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year ending June 30 containing the financial product activity of each small business financial development corporation formed. Existing law establishes the Small Business Expansion Fund in the State Treasury, and continuously appropriates specified moneys into the fund for purposes related to the Small Business Financial Assistance Act of 2013.This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used.The bill would create the California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement 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 California Small Business Finance Center for purposes of the California Loan Loss Reserve Program for Small Business, pursuant to a specified process. The bill would authorize the bank to contract with a qualified financial company or financial institution to participate as a lender 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 participating as a lender 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.The bill would modify the requirements of the annual report described above by requiring the program manager to include in its annual report the financial product activity of each financial institution or company that participates in the loan loss reserve program specified information, and would require the program manager, for one year following the creation of the loan loss reserve program, to prepare and submit to the Governor and the Legislature a semi-annual progress report relating to the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank.This bill would declare that it is to take effect immediately as an urgency statute.Digest Key Vote: 2/3 Appropriation: YES Fiscal Committee: YES Local Program: NO | |
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| 5 | - | Amended IN Assembly April 29, 2019 | |
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| 7 | - | Amended IN Assembly April 29, 2019 | |
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| 9 | 9 | CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION | |
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| 11 | 11 | Assembly Bill No. 474 | |
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| 13 | 13 | Introduced by Assembly Member Reyes(Coauthors: Assembly Members Carrillo, Petrie-Norris, Luz Rivas, Smith, and Wicks)February 12, 2019 | |
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| 15 | 15 | Introduced by Assembly Member Reyes(Coauthors: Assembly Members Carrillo, Petrie-Norris, Luz Rivas, Smith, and Wicks) | |
| 16 | 16 | February 12, 2019 | |
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| 18 | 18 | An act to amend Sections 63089.1, 63089.4, 63089.5, and 63089.98 of, to add Sections 63089.642 and 63089.644 to, and to add Article 12 (commencing with Section 63090) and Article 13 (commencing with Section 63095) to, Chapter 6 of Division 1 of Title 6.7 of, the Government Code, relating to the Capital Access Loan Program, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately. | |
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| 20 | 20 | LEGISLATIVE COUNSEL'S DIGEST | |
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| 22 | 22 | ## LEGISLATIVE COUNSEL'S DIGEST | |
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| 24 | - | AB 474, as | |
| 24 | + | AB 474, as introduced, Reyes. Capital Access Loan Program for Small Businesses. | |
| 25 | 25 | ||
| 26 | - | 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. Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program 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. The act establishes the program manager as the manager of the California Small Business Finance Center, and requires each small business financial development corporation formed pursuant to the act to submit specified information to the program manager related to their activities. Existing law requires the program manager, no later than January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year ending June 30 containing the financial product activity of each small business financial development corporation formed. Existing law establishes the Small Business Expansion Fund in the State Treasury, and continuously appropriates specified moneys into the fund for purposes related to the Small Business Financial Assistance Act of 2013.This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. | |
| 26 | + | 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. Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program 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. The act establishes the program manager as the manager of the California Small Business Finance Center, and requires each small business financial development corporation formed pursuant to the act to submit specified information to the program manager related to their activities. Existing law requires the program manager, no later than January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year ending June 30 containing the financial product activity of each small business financial development corporation formed. Existing law establishes the Small Business Expansion Fund in the State Treasury, and continuously appropriates specified moneys into the fund for purposes related to the Small Business Financial Assistance Act of 2013.This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used.The bill would create the California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement 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 California Small Business Finance Center for purposes of the California Loan Loss Reserve Program for Small Business, pursuant to a specified process. The bill would authorize the bank to contract with a qualified financial company or financial institution to participate as a lender 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 participating as a lender 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.The bill would modify the requirements of the annual report described above by requiring the program manager to include in its annual report the financial product activity of each financial institution or company that participates in the loan loss reserve program specified information, and would require the program manager, for one year following the creation of the loan loss reserve program, to prepare and submit to the Governor and the Legislature a semi-annual progress report relating to the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank.This bill would declare that it is to take effect immediately as an urgency statute. | |
| 27 | 27 | ||
| 28 | 28 | 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. Existing law authorizes a participating financial institution that experiences a default on a qualified loan enrolled in the Capital Access Loan Program 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. | |
| 29 | 29 | ||
| 30 | 30 | 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. | |
| 31 | 31 | ||
| 32 | 32 | 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. The act establishes the program manager as the manager of the California Small Business Finance Center, and requires each small business financial development corporation formed pursuant to the act to submit specified information to the program manager related to their activities. Existing law requires the program manager, no later than January 1 of each year, to prepare and submit to the Governor and the Legislature a report for the preceding fiscal year ending June 30 containing the financial product activity of each small business financial development corporation formed. Existing law establishes the Small Business Expansion Fund in the State Treasury, and continuously appropriates specified moneys into the fund for purposes related to the Small Business Financial Assistance Act of 2013. | |
| 33 | 33 | ||
| 34 | - | This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. | |
| 34 | + | This bill would create the Loan Loss Reserve Account in the California Small Business Expansion Fund to be under the administrative and management control of the California Small Business Finance Center within the bank, and would continuously appropriate all moneys deposited into the account to the center for purposes of the Small Business Financial Assistance Act of 2013. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require that the account be established and maintained by the bank for the benefit of qualified financial companies or financial institutions participating as a lender in the loan loss reserve program or another program authorized pursuant to Small Business Financial Assistance Act of 2013. The bill would authorize the program to hold funds in the loan loss reserve account in a financial institution or company that establishes a trust fund, as specified. The bill would prescribe a process for the transfer of specified moneys held by the California Pollution Control Financing Authority to the Capital Access Reserve Fund. The bill would require the bank to create holding accounts and loss reserve accounts and would prescribe the purposes for which they may be used. | |
| 35 | 35 | ||
| 36 | 36 | The bill would create the California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement 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 California Small Business Finance Center for purposes of the California Loan Loss Reserve Program for Small Business, pursuant to a specified process. The bill would authorize the bank to contract with a qualified financial company or financial institution to participate as a lender 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 participating as a lender 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. | |
| 37 | 37 | ||
| 38 | 38 | The bill would modify the requirements of the annual report described above by requiring the program manager to include in its annual report the financial product activity of each financial institution or company that participates in the loan loss reserve program specified information, and would require the program manager, for one year following the creation of the loan loss reserve program, to prepare and submit to the Governor and the Legislature a semi-annual progress report relating to the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. | |
| 39 | 39 | ||
| 40 | 40 | This bill would declare that it is to take effect immediately as an urgency statute. | |
| 41 | 41 | ||
| 42 | 42 | ## Digest Key | |
| 43 | 43 | ||
| 44 | 44 | ## Bill Text | |
| 45 | 45 | ||
| 46 | - | 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 to strengthen state programs that support financing of small businesses.(b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee 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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(d) 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.(e) 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.(f) 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.(g) 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.(h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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 for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(e) Invest expansion fund and trust fund moneys as specified in this chapter.(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(g) Adopt directives and requirements as specified in this chapter.(h) Authorize new financial product programs and activities pursuant to this chapter.SEC. 4. Section 63089.5 of the Government Code is amended to read:63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund.SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read:63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter. | |
| 46 | + | 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 to strengthen state programs that support financing of small businesses.(b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee 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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(d) 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.(e) 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.(f) 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.(g) 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.(h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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 for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter.SEC. 4. Section 63089.5 of the Government Code is amended to read:63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund.SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read:63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021.SEC. 6. Section 63089.644 is added to the Government Code, immediately following Section 63089.642, to read:63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. SEC. 7. Section 63089.98 of the Government Code is amended to read:63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website.SEC. 8. 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. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank.63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations.SEC. 9. Article 13 (commencing with Section 63095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021.SEC. 10. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:In order to provide the Small Business Finance Center at the California Infrastructure and Economic Development Bank with authority to develop directives and requirements at the earliest possible date for the efficient transfer and consolidation of responsibility for the management of funds allocated to California pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code), it is necessary that this act take effect immediately. | |
| 47 | 47 | ||
| 48 | 48 | The people of the State of California do enact as follows: | |
| 49 | 49 | ||
| 50 | 50 | ## The people of the State of California do enact as follows: | |
| 51 | 51 | ||
| 52 | 52 | 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 to strengthen state programs that support financing of small businesses.(b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee 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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(d) 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.(e) 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.(f) 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.(g) 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.(h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. | |
| 53 | 53 | ||
| 54 | 54 | 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 to strengthen state programs that support financing of small businesses.(b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee 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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program.(d) 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.(e) 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.(f) 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.(g) 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.(h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. | |
| 55 | 55 | ||
| 56 | 56 | SECTION 1. The Legislature finds and declares as follows: | |
| 57 | 57 | ||
| 58 | 58 | ### SECTION 1. | |
| 59 | 59 | ||
| 60 | 60 | (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 to strengthen state programs that support financing of small businesses. | |
| 61 | 61 | ||
| 62 | 62 | (b) In April 2011, California entered into an allocation agreement with the United States Treasury for approximately one hundred and sixty-eight million dollars ($168,000,000) pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code). The federal funds were divided evenly between the administering entities for two state credit enhancement programs with eighty-four million dollars ($84,000,000) being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee Program. | |
| 63 | 63 | ||
| 64 | 64 | (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, and that by Summer 2017 the CPCFA will no longer be able to enroll loans in the CalCAP for Small Business Program. | |
| 65 | 65 | ||
| 66 | 66 | (d) 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. | |
| 67 | 67 | ||
| 68 | 68 | (e) 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. | |
| 69 | 69 | ||
| 70 | 70 | (f) 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. | |
| 71 | 71 | ||
| 72 | 72 | (g) 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. | |
| 73 | 73 | ||
| 74 | 74 | (h) (1) The Legislature declares that it is appropriate, as program funding expires, or that the funds have been fully expended or allocated, 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. | |
| 75 | 75 | ||
| 76 | 76 | (2) The Legislature declares that all federal and state funds, the source of which was the federal Small Business Jobs Act, including funds that have been returned to or recaptured by the CPCFA and currently under its control, be transferred to the California Small Business Expansion Fund and be under the administrative control of the California Small Business Finance Center at the California Infrastructure and Economic Development Bank. | |
| 77 | 77 | ||
| 78 | - | SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 78 | + | SEC. 2. Section 63089.1 of the Government Code is amended to read:63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 79 | 79 | ||
| 80 | 80 | SEC. 2. Section 63089.1 of the Government Code is amended to read: | |
| 81 | 81 | ||
| 82 | 82 | ### SEC. 2. | |
| 83 | 83 | ||
| 84 | - | 63089.1. (a) The program manager acting under the direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 84 | + | 63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 85 | 85 | ||
| 86 | - | 63089.1. (a) The program manager acting under the direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 86 | + | 63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 87 | 87 | ||
| 88 | - | 63089.1. (a) The program manager acting under the direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 88 | + | 63089.1. (a) The program manager acting under the guidance direction 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 qualified financial institution or financial company participating as lender in the loan loss reserve program 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 the program managers 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 the program managers 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. | |
| 89 | 89 | ||
| 90 | 90 | ||
| 91 | 91 | ||
| 92 | - | 63089.1. (a) The program manager acting under the direction of the executive director shall do all of the following: | |
| 92 | + | 63089.1. (a) The program manager acting under the guidance direction of the executive director shall do all of the following: | |
| 93 | 93 | ||
| 94 | 94 | (1) Administer this chapter. | |
| 95 | 95 | ||
| 96 | 96 | (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. | |
| 97 | 97 | ||
| 98 | 98 | (B) Enter into a contract between the bank and any qualified financial institution or financial company participating as lender in the loan loss reserve program under this chapter. | |
| 99 | 99 | ||
| 100 | 100 | (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. | |
| 101 | 101 | ||
| 102 | 102 | (4) Require each corporation to submit an annual written plan of operation. | |
| 103 | 103 | ||
| 104 | 104 | (5) Authorize the distribution, transfer, leverage, and withholding of moneys in the expansion fund and trust funds. | |
| 105 | 105 | ||
| 106 | 106 | (6) Authorize the investment of expansion and trust fund moneys. | |
| 107 | 107 | ||
| 108 | 108 | (7) Oversee the operations of one or more programs authorized pursuant to this chapter and by Section 8684.2. | |
| 109 | 109 | ||
| 110 | 110 | (8) Act as liaison between corporations, other state and federal agencies, lenders, and the Legislature. | |
| 111 | 111 | ||
| 112 | 112 | (9) Act as secretary to the California Small Business Board, and attend meetings of the California Small Business Board and the bank board. | |
| 113 | 113 | ||
| 114 | - | (b) The program manager may attend and participate at corporation meetings. The program manager or the program managers 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 the program managers duties, but in no case shall the program manager confer less than once each fiscal year. | |
| 114 | + | (b) The program manager may attend and participate at corporation meetings. The program manager or his or her the program managers 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 the program managers duties, but in no case shall the program manager confer less than once each fiscal year. | |
| 115 | 115 | ||
| 116 | 116 | (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. | |
| 117 | 117 | ||
| 118 | - | 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 for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(e) Invest expansion fund and trust fund moneys as specified in this chapter.(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(g) Adopt directives and requirements as specified in this chapter.(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 118 | + | 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 for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 119 | 119 | ||
| 120 | 120 | SEC. 3. Section 63089.4 of the Government Code is amended to read: | |
| 121 | 121 | ||
| 122 | 122 | ### SEC. 3. | |
| 123 | 123 | ||
| 124 | - | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(e) Invest expansion fund and trust fund moneys as specified in this chapter.(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(g) Adopt directives and requirements as specified in this chapter.(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 124 | + | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 125 | 125 | ||
| 126 | - | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(e) Invest expansion fund and trust fund moneys as specified in this chapter.(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(g) Adopt directives and requirements as specified in this chapter.(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 126 | + | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 127 | 127 | ||
| 128 | - | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(e) Invest expansion fund and trust fund moneys as specified in this chapter.(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(g) Adopt directives and requirements as specified in this chapter.(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 128 | + | 63089.4. The bank is authorized to:(a) Approve new corporations recommended by the program manager.(b) Enter into contracts with corporations for program management and other financial product-related services.(c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. (c)(d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.(d)(e) Invest expansion fund and trust fund moneys as specified in this chapter.(e)(f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.(f)(g) Adopt directives and requirements as specified in this chapter.(g)(h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 129 | 129 | ||
| 130 | 130 | ||
| 131 | 131 | ||
| 132 | 132 | 63089.4. The bank is authorized to: | |
| 133 | 133 | ||
| 134 | 134 | (a) Approve new corporations recommended by the program manager. | |
| 135 | 135 | ||
| 136 | 136 | (b) Enter into contracts with corporations for program management and other financial product-related services. | |
| 137 | 137 | ||
| 138 | 138 | (c) Enter into contracts with any financial institution or financial company for the purpose of participating as a lender in a loss reserve program or another program authorized under this chapter. | |
| 139 | 139 | ||
| 140 | + | (c) | |
| 141 | + | ||
| 142 | + | ||
| 143 | + | ||
| 140 | 144 | (d) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter. | |
| 145 | + | ||
| 146 | + | (d) | |
| 147 | + | ||
| 148 | + | ||
| 141 | 149 | ||
| 142 | 150 | (e) Invest expansion fund and trust fund moneys as specified in this chapter. | |
| 143 | 151 | ||
| 152 | + | (e) | |
| 153 | + | ||
| 154 | + | ||
| 155 | + | ||
| 144 | 156 | (f) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter. | |
| 157 | + | ||
| 158 | + | (f) | |
| 159 | + | ||
| 160 | + | ||
| 145 | 161 | ||
| 146 | 162 | (g) Adopt directives and requirements as specified in this chapter. | |
| 147 | 163 | ||
| 164 | + | (g) | |
| 165 | + | ||
| 166 | + | ||
| 167 | + | ||
| 148 | 168 | (h) Authorize new financial product programs and activities pursuant to this chapter. | |
| 149 | 169 | ||
| 150 | - | SEC. 4. Section 63089.5 of the Government Code is amended to read:63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 170 | + | SEC. 4. Section 63089.5 of the Government Code is amended to read:63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 151 | 171 | ||
| 152 | 172 | SEC. 4. Section 63089.5 of the Government Code is amended to read: | |
| 153 | 173 | ||
| 154 | 174 | ### SEC. 4. | |
| 155 | 175 | ||
| 156 | - | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 176 | + | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 157 | 177 | ||
| 158 | - | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 178 | + | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 159 | 179 | ||
| 160 | - | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 180 | + | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.(b) The expansion fund and the trust fund shall be used for the following purposes:(1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses.(2) To fund direct loans loans, loan loss reserves, and other debt instruments.(3) To pay administrative costs of corporations.(4) To pay state support and administrative costs.(5) To pay those costs necessary to protect a real property interest in a financial product default.(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 161 | 181 | ||
| 162 | 182 | ||
| 163 | 183 | ||
| 164 | 184 | 63089.5. (a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds. | |
| 165 | 185 | ||
| 166 | 186 | (b) The expansion fund and the trust fund shall be used for the following purposes: | |
| 167 | 187 | ||
| 168 | 188 | (1) To pay defaulted loan guarantee or surety bond losses, loan loss reserves, or other financial product defaults or losses. | |
| 169 | 189 | ||
| 170 | - | (2) To fund direct loans, loan loss reserves, and other debt instruments. | |
| 190 | + | (2) To fund direct loans loans, loan loss reserves, and other debt instruments. | |
| 171 | 191 | ||
| 172 | 192 | (3) To pay administrative costs of corporations. | |
| 173 | 193 | ||
| 174 | 194 | (4) To pay state support and administrative costs. | |
| 175 | 195 | ||
| 176 | 196 | (5) To pay those costs necessary to protect a real property interest in a financial product default. | |
| 177 | 197 | ||
| 178 | 198 | (c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide. The program manager shall provide written notice to the Joint Legislative Budget Committee and to 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 expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board. | |
| 179 | 199 | ||
| 180 | 200 | (d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations. | |
| 181 | 201 | ||
| 182 | 202 | (2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3. | |
| 183 | 203 | ||
| 184 | 204 | (e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund. | |
| 185 | 205 | ||
| 186 | - | SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read:63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter. | |
| 206 | + | SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read:63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021. | |
| 187 | 207 | ||
| 188 | 208 | SEC. 5. Section 63089.642 is added to the Government Code, immediately following Section 63089.62, to read: | |
| 189 | 209 | ||
| 190 | 210 | ### SEC. 5. | |
| 191 | 211 | ||
| 192 | - | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter | |
| 212 | + | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021. | |
| 193 | 213 | ||
| 194 | - | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter | |
| 214 | + | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021. | |
| 195 | 215 | ||
| 196 | - | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter | |
| 216 | + | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter.(2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board.(b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center.(2) 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 shall 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. (c) The final transfer of the funds shall occur no later than January 1, 2021. | |
| 197 | 217 | ||
| 198 | 218 | ||
| 199 | 219 | ||
| 200 | - | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter. | |
| 220 | + | 63089.642. (a) (1) There is hereby created in the expansion fund the Loan Loss Reserve Account under the administrative and management control of the California Small Business Finance Center within the bank. Notwithstanding Section 13340 of the Government Code, all moneys in the account are hereby continuously appropriated, without regard to fiscal years, for purposes of this chapter. The Loan Loss Reserve Account shall be established and maintained by the bank for the benefit of any qualified financial company or financial institution participating as a lender in the loan loss reserve program or another program authorized pursuant to this chapter. | |
| 201 | 221 | ||
| 202 | - | (2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board. | |
| 222 | + | (2) The program manager, under the direction of the executive director, may elect to hold all or a portion of the Loan Loss Reserve Account 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 directives and requirements adopted by the bank board. | |
| 203 | 223 | ||
| 204 | 224 | (b) (1) All federal and state funds, the source of which was the federal Small Business Jobs Act, 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 Loan Loss Reserve Account and be under the administrative control of the California Small Business Finance Center. | |
| 205 | 225 | ||
| 206 | 226 | (2) 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 shall 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. | |
| 207 | 227 | ||
| 208 | 228 | (c) The final transfer of the funds shall occur no later than January 1, 2021. | |
| 209 | 229 | ||
| 210 | 230 | SEC. 6. Section 63089.644 is added to the Government Code, immediately following Section 63089.642, to read:63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. | |
| 211 | 231 | ||
| 212 | 232 | SEC. 6. Section 63089.644 is added to the Government Code, immediately following Section 63089.642, to read: | |
| 213 | 233 | ||
| 214 | 234 | ### SEC. 6. | |
| 215 | 235 | ||
| 216 | 236 | 63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. | |
| 217 | 237 | ||
| 218 | 238 | 63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. | |
| 219 | 239 | ||
| 220 | 240 | 63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program.(b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following:(1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source.(2) Depositing contributions made by the state and, if applicable, the federal government or other sources.(3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements.(c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account.(2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions.(d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. | |
| 221 | 241 | ||
| 222 | 242 | ||
| 223 | 243 | ||
| 224 | 244 | 63089.644. (a) The program manager, under the direction of the executive director, shall create one or more loan loss reserve accounts in the trust fund for a financial institution or financial company participating as a lender in the loan loss reserve program. | |
| 225 | 245 | ||
| 226 | 246 | (b) The loan loss reserve account established for the purposes of this section shall be used for the purposes of the following: | |
| 227 | 247 | ||
| 228 | 248 | (1) Depositing all fees paid by the financial company or financial institution participating as a lender in the loan loss reserve fund, the small business, and any other moneys provided by the bank or other source. | |
| 229 | 249 | ||
| 230 | 250 | (2) Depositing contributions made by the state and, if applicable, the federal government or other sources. | |
| 231 | 251 | ||
| 232 | 252 | (3) Covering losses on enrolled loans under the loan loss reserve program, sustained by a financial company or financial institution by disbursing funds accumulated in the loss reserve account in accordance with directives and requirements. | |
| 233 | 253 | ||
| 234 | 254 | (c) (1) All moneys in a loan loss reserve account established pursuant to this section are the exclusive property of, and solely controlled by, the bank. The bank program manager, under the direction of the executive director, shall manage all moneys in a loan loss reserve account established pursuant to this section. Interest or income earned on money credited to the loan loss reserve account shall be deemed to be part of the loan loss reserve account. The program manager, under the direction of the executive director, may withdraw from the loan loss reserve account all, or a portion, of the interest or other income that has been credited to the account. | |
| 235 | 255 | ||
| 236 | 256 | (2) Any withdrawal made pursuant to this subdivision may be made before paying any claim and shall be used for the sole purpose of offsetting costs associated with carrying out the program, including administrative costs and loss reserve account contributions. | |
| 237 | 257 | ||
| 238 | 258 | (d) For purposes of this section, the program manager, under the direction of the executive director, may create one or more holding accounts in the loan loss reserve account or trust account to accommodate the temporary or permanent transfer of funds pursuant to directives and requirements adopted by the bank board relating to the suspension and termination of a financial institutions or financial companys participation as a lender in the loan loss reserve program or offering of a financial product authorized under this chapter. | |
| 239 | 259 | ||
| 240 | - | SEC. 7. Section 63089.98 of the Government Code is amended to read:63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually | |
| 260 | + | SEC. 7. Section 63089.98 of the Government Code is amended to read:63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website. | |
| 241 | 261 | ||
| 242 | 262 | SEC. 7. Section 63089.98 of the Government Code is amended to read: | |
| 243 | 263 | ||
| 244 | 264 | ### SEC. 7. | |
| 245 | 265 | ||
| 246 | - | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually | |
| 266 | + | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website. | |
| 247 | 267 | ||
| 248 | - | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually | |
| 268 | + | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website. | |
| 249 | 269 | ||
| 250 | - | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually | |
| 270 | + | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following:(1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances.(2) Default and loss statistics.(3) Employment data.(4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program.(5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year.(6) Significant events.(7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a).(b) The program manager shall post the report on the banks Internet Web site. internet website. | |
| 251 | 271 | ||
| 252 | 272 | ||
| 253 | 273 | ||
| 254 | - | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following: | |
| 274 | + | 63089.98. (a) Annually, not later than January 1 of each year commencing January 1, 2014, and notwithstanding Section 10231.5, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a report for the preceding fiscal year ending June 30, containing the expansion fund and trust fund financial product activity of each corporation, corporation administering any direct loans, guarantee, or other financial product and each financial institution and financial company participating as a lender in the loan loss reserve program or another financial product, including all of the following: | |
| 255 | 275 | ||
| 256 | 276 | (1) Direct loans, guarantees, loss reserves, and other financial products awarded and outstanding balances. | |
| 257 | 277 | ||
| 258 | 278 | (2) Default and loss statistics. | |
| 259 | 279 | ||
| 260 | 280 | (3) Employment data. | |
| 261 | 281 | ||
| 262 | 282 | (4) Ethnicity and gender data of participating contractors and other entities, and experience of surety insurer participants in the bond guarantee program. | |
| 263 | 283 | ||
| 264 | 284 | (5) Geographic distribution by city and county of the direct loans, guarantees, and other financial products awarded and outstanding at the close of the fiscal year. | |
| 265 | 285 | ||
| 266 | 286 | (6) Significant events. | |
| 267 | 287 | ||
| 268 | - | (7) Semi-annually | |
| 288 | + | (7) Semi-annually, the program manager shall prepare and submit to the Governor and the Legislature, pursuant to Section 9795, a progress report for the preceding six months, commencing with the first six months after the transfer of the loan loss reserve program from the California Pollution Control Financing Authority to the California Small Business Finance Center at the bank. The program manager shall submit the progress report within 90 days of each six month anniversary. No progress report shall be required after the first year following the creation of the loan loss reserve program under the California Small Business Finance Center, and the program manager shall include the loan loss reserve program in the annual report pursuant to subdivision (a). | |
| 269 | 289 | ||
| 270 | - | (b) The program manager shall post the report on the banks internet website. | |
| 290 | + | (b) The program manager shall post the report on the banks Internet Web site. internet website. | |
| 271 | 291 | ||
| 272 | - | SEC. 8. 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. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans | |
| 292 | + | SEC. 8. 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. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank.63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations. | |
| 273 | 293 | ||
| 274 | 294 | SEC. 8. Article 12 (commencing with Section 63090) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: | |
| 275 | 295 | ||
| 276 | 296 | ### SEC. 8. | |
| 277 | 297 | ||
| 278 | - | Article 12. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans | |
| 298 | + | Article 12. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank.63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations. | |
| 279 | 299 | ||
| 280 | - | Article 12. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans | |
| 300 | + | Article 12. Loan Loss Reserves63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank.63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations. | |
| 281 | 301 | ||
| 282 | 302 | Article 12. Loan Loss Reserves | |
| 283 | 303 | ||
| 284 | 304 | Article 12. Loan Loss Reserves | |
| 285 | 305 | ||
| 286 | - | 63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans | |
| 306 | + | 63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center.(b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business.(2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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, 2021.(c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business.(d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state.(e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to:(1) The initiation of new and extension of existing contracts 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 securitized 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 participating in the loan loss reserve program for cause, including provisions for appeals.(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 loan loss reserve account of the financial institution and financial company under contract. | |
| 287 | 307 | ||
| 288 | 308 | ||
| 289 | 309 | ||
| 290 | 310 | 63090. (a) The California Loan Loss Reserve Program for Small Business, a loan loss reserve and credit enhancement program, is hereby established under the administrative and management control of the California Small Business Finance Center. | |
| 291 | 311 | ||
| 292 | 312 | (b) (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 using, directly or indirectly, 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 the California Small Business Finance Center in the Bank for the California Loan Loss Reserve Program for Small Business. | |
| 293 | 313 | ||
| 294 | 314 | (2) To initiate the transfer of the portfolio, the bank board shall adopt a resolution that provides for the terms and conditions of the transfer. The bank shall 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. | |
| 295 | 315 | ||
| 296 | 316 | (3) The transfer of the portfolio shall occur no later than January 1, 2021. | |
| 297 | 317 | ||
| 298 | 318 | (c) The program may contract with any qualified financial company or financial institution for the purpose of allowing the financial company or institution to participate as a lender in the California Loan Loss Reserve Program for Small Business. | |
| 299 | 319 | ||
| 300 | - | (d) The priority for loans enrolled in this program shall be for loans and micro loans | |
| 320 | + | (d) The priority for loans enrolled in this program shall be for loans and micro loans that benefit low-income areas of the state, based on census tracts, and underserved business ownership groups, including minority-owned businesses and women-owned businesses in the state. | |
| 301 | 321 | ||
| 302 | 322 | (e) The bank shall develop directives and requirements to implement the California Loan Loss Reserve Program for Small Business established by this article, including, but not limited to: | |
| 303 | 323 | ||
| 304 | 324 | (1) The initiation of new and extension of existing contracts to participate in the program. | |
| 305 | 325 | ||
| 306 | 326 | (2) The filing of claims for reimbursement for losses incurred as a result of qualified loan defaults. | |
| 307 | 327 | ||
| 308 | - | (3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitized | |
| 328 | + | (3) The terms and conditions for a financial company or financial institution to assign, transfer, pledge or securitized all or a portion of any enrolled loan or loss reserve account, pursuant to directives and requirements developed by the bank. | |
| 309 | 329 | ||
| 310 | - | (4) The terms and conditions by which the program manger | |
| 330 | + | (4) The terms and conditions by which the program manger may temporarily suspend and terminate a contract with a financial institution or financial company participating in the loan loss reserve program for cause, including provisions for appeals. | |
| 311 | 331 | ||
| 312 | 332 | (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 loan loss reserve account of the financial institution and financial company under contract. | |
| 313 | 333 | ||
| 314 | 334 | 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank. | |
| 315 | 335 | ||
| 316 | 336 | ||
| 317 | 337 | ||
| 318 | 338 | 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 one year following the transfer of the portfolio and funds, pursuant to Section 63090 and 63095. Until the bank adopts its regulations, if an action is required subsequent to October 1, 2020, references to the California Pollution Control Financing Authority are deemed to reference the bank. | |
| 319 | 339 | ||
| 320 | - | 63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender waives all rights to submit claims for reimbursement for losses incurred as a result of charge-offs | |
| 340 | + | 63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender 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 participating as a lender 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 program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations. | |
| 321 | 341 | ||
| 322 | 342 | ||
| 323 | 343 | ||
| 324 | 344 | 63092. (a) Upon written notice to the program manager, a financial company or financial institution participating as a lender may withdraw from the program. The notice shall state one of the following, as may be applicable: | |
| 325 | 345 | ||
| 326 | 346 | (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. | |
| 327 | 347 | ||
| 328 | - | (2) The financial company or financial institution participating as a lender waives all rights to submit claims for reimbursement for losses incurred as a result of charge- | |
| 348 | + | (2) The financial company or financial institution participating as a lender 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. | |
| 329 | 349 | ||
| 330 | 350 | (b) The program manager shall establish the process in accordance with directives and requirements for the distribution of contributions back to a financial company or financial institution that has withdrawn from the loan loss reserve program in directives and regulations. | |
| 331 | 351 | ||
| 332 | 352 | SEC. 9. Article 13 (commencing with Section 63095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: Article 13. Miscellaneous Credit Enhancements63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021. | |
| 333 | 353 | ||
| 334 | 354 | SEC. 9. Article 13 (commencing with Section 63095) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read: | |
| 335 | 355 | ||
| 336 | 356 | ### SEC. 9. | |
| 337 | 357 | ||
| 338 | 358 | Article 13. Miscellaneous Credit Enhancements63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021. | |
| 339 | 359 | ||
| 340 | 360 | Article 13. Miscellaneous Credit Enhancements63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021. | |
| 341 | 361 | ||
| 342 | 362 | Article 13. Miscellaneous Credit Enhancements | |
| 343 | 363 | ||
| 344 | 364 | Article 13. Miscellaneous Credit Enhancements | |
| 345 | 365 | ||
| 346 | 366 | 63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center.(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 collateral support loan portfolio shall occur no later than January 1, 2021. | |
| 347 | 367 | ||
| 348 | 368 | ||
| 349 | 369 | ||
| 350 | 370 | 63095. (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 using, directly or indirectly, 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 hereby transferred to the California Small Business Finance Center. | |
| 351 | 371 | ||
| 352 | 372 | (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. | |
| 353 | 373 | ||
| 354 | 374 | (c) The transfer of the collateral support loan portfolio shall occur no later than January 1, 2021. | |
| 355 | 375 | ||
| 356 | 376 | SEC. 10. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:In order to provide the Small Business Finance Center at the California Infrastructure and Economic Development Bank with authority to develop directives and requirements at the earliest possible date for the efficient transfer and consolidation of responsibility for the management of funds allocated to California pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code), it is necessary that this act take effect immediately. | |
| 357 | 377 | ||
| 358 | 378 | SEC. 10. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:In order to provide the Small Business Finance Center at the California Infrastructure and Economic Development Bank with authority to develop directives and requirements at the earliest possible date for the efficient transfer and consolidation of responsibility for the management of funds allocated to California pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code), it is necessary that this act take effect immediately. | |
| 359 | 379 | ||
| 360 | 380 | SEC. 10. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are: | |
| 361 | 381 | ||
| 362 | 382 | ### SEC. 10. | |
| 363 | 383 | ||
| 364 | 384 | In order to provide the Small Business Finance Center at the California Infrastructure and Economic Development Bank with authority to develop directives and requirements at the earliest possible date for the efficient transfer and consolidation of responsibility for the management of funds allocated to California pursuant to the State Small Business Credit Initiative (Chapter 54 (commencing with Section 5701) of Title 12 of the United States Code), it is necessary that this act take effect immediately. |