Marks-Roos Local Bond Pooling Act of 1985: rate reduction bonds: review.
The passage of AB 1765 is expected to have significant implications for state laws surrounding utility financing. By expanding the exemptions for bond issuances from authority reviews, local agencies may find it easier and more efficient to obtain financing for utility projects. This could lead to an increase in the number of projects being financed through these bonds, ultimately enhancing the provision of utility services. However, the bill may also raise concerns regarding oversight and consumer protection, as reduced reviews could allow for potentially unfavorable terms in bond issuances that may affect ratepayers.
Assembly Bill 1765 amends Section 6588.7 of the Government Code as it pertains to the Marks-Roos Local Bond Pooling Act of 1985. This legislation enables certain joint powers authorities to issue rate reduction bonds to finance utility projects. It also specifies that certain bond issuances are exempt from review by the California Pollution Control Financing Authority when such reviews are conducted by a ratepayer advocate regarding electric utility rates. Furthermore, the bill allows the authority to impose additional nonrefundable fees to offset the costs of an independent financial advisor for reviewing application requirements. This change aims to streamline the process for financing utility projects and reduce regulatory burdens for local agencies seeking to fund such projects.
The sentiment surrounding AB 1765 seems to be cautiously optimistic among proponents, who argue that it fosters quicker funding and reduced administrative burdens for local authorities. Supporters believe that this legislative change will encourage investment in public utility projects that can lead to improvements in service reliability and infrastructure. Conversely, some detractors express concerns about the implications of less stringent oversight, suggesting that it could lead to abuses or failures in accountability in managing public funds, potentially impacting consumer prices in the long run.
Notably, a point of contention arises from the reduced level of review by the California Pollution Control Financing Authority. Critics argue that by allowing exemptions from authority oversight, the bill could undermine protections for ratepayers by potentially allowing local agencies to issue bonds without thorough scrutiny. This compromise on regulatory oversight poses questions about the balance between facilitating utility financing and ensuring accountability in public funds usage. Moreover, the introduction of additional nonrefundable fees could also be seen as a barrier for some agencies, particularly smaller municipalities with limited budgets.