AB 1701

Bill Subjects

Abstract

The Bergeson-Peace Infrastructure and Economic Development Bank Act establishes the California Infrastructure and Economic Development Bank (I-Bank) in the Governor's Office of Business and Economic Development. Existing law, among other things, authorizes the I-Bank to make loans, issue bonds, and provide financial assistance for various types of projects that qualify as economic development or public development facilities. Existing law authorizes the I-Bank to consider a project for conduit financing for economic development facilities upon a filing of an application with the I-Bank by an appropriate participating party. The act establishes the California Infrastructure and Economic Development Bank Fund (I-Bank fund) , a continuously appropriated fund, for support of the I-Bank and for expenditure for the purposes stated in the act. The California Constitution, with respect to any taxes levied on taxable property in a redevelopment project established under the Community Redevelopment Law, as it then read or may be amended, authorizes the Legislature to provide for the division of those taxes under a redevelopment plan between the taxing agencies and the redevelopment agency, as provided. The portion of taxes diverted is the amount attributable to increases in assessed valuation of property in the redevelopment project area subsequent to establishment thereof and is commonly known as "tax increment" financing. This bill would require the I-Bank to establish criteria, priorities, and guidelines for receiving and reviewing applications to enter into a development agreement with a redevelopment agency in which the redevelopment agency would agree to commit a portion of property tax increment to finance a project for economic development facilities in a low-income census tract, including an Opportunity Zone designated by the United States Treasury. This bill would allow the I-Bank to accept those applications and would authorize the I-Bank to issue either tax-exempt or taxable revenue bonds to provide financing for those projects. The bill would require the I-Bank, in order to use this financing method, to determine that the redevelopment agency has demonstrated its ability to support the upward mobility of local residents and inclusive economic growth within the project area, as specified. By expanding the I-Bank's authority to finance additional projects, and thereby expanding the I-Bank's authority to expend funds in a continuously appropriated fund, the bill would make an appropriation. This bill would apply only if a successor law to the Community Redevelopment Law is enacted on or after January 1, 2020, that provides for the tax increment financing of redevelopment projects by a redevelopment agency.