AB 1036

Bill Subjects

Abstract

Existing law, the Bergeson-Peace Infrastructure and Economic Development Bank Act, establishes the California Infrastructure and Economic Development Bank (I-Bank) . Among other things, the act authorizes I-Bank to make loans, issue bonds, and provide financial assistance to economic development or public development facilities. Existing law establishes the Disaster Assistance Fund and continuously appropriates the fund for these purposes. Existing law provides that when funds are available for these purposes, the Governor may allocate the funds, in connection with relief provided, in affected areas during the period of federal disaster relief, to the Small Business Expansion Fund for use by I-Bank to provide guarantees for low-interest interim loans to be made by lending institutions for the purpose of providing interim financing to enable small businesses that have suffered actual physical damage or significant economic losses, as a result of the disaster or state of emergency for which funding is made available. This bill would enact the California Manufacturing Emergency Preparedness Act of 2021, which would authorize I-Bank to establish the California Manufacturing Disaster Loan Program (disaster program) for the purpose of attracting, retaining, retooling, establishing, and expanding manufacturing and logistics capacity in the state, and would require I-Bank to establish directives and requirements for the implementation of the program. The bill would prohibit I-Bank from commencing the disaster program until it adopts a resolution finding that there is sufficient funding in the California Manufacturing Disaster Loan Program Subaccount to cover the costs of implementing the program and that the I-Bank has sufficient direction from the Director of the Office of Emergency Services, as provided. This bill would also authorize I-Bank to establish the California Manufacturing Competitiveness Loan Program (competitiveness program) for the purpose of attracting, retaining, and expanding manufacturing facilities and other companies in the state. The bill would prohibit the commencement of the competitiveness program unless there is sufficient money in the California Manufacturing Competitiveness Loan Program Subaccount, as specified. This bill would establish the Manufacturing Program Account within the California Infrastructure and Economic Development Bank Fund, a California Manufacturing Disaster Loan Program Subaccount (disaster subaccount) , and a California Manufacturing Competitiveness Loan Program Subaccount (competitiveness subaccount) within that account. The bill would create the competitiveness subaccount for purposes of providing direct loans issued pursuant to the competitiveness program, as provided. This bill would authorize the Governor to activate one or more programs to provide loans to private business enterprises for the creation, maintenance, expansion, protection, or restoration of capacity or the production of essential materials. This bill would also authorize the Governor to allocate disaster relief funds, including funds in the Disaster Assistance Fund, to the disaster subaccount for use by I-Bank, to cover the costs of administering the disaster program and to provide direct loans made by lending institutions, and to forgive those loans in appropriate circumstances, for the purpose of providing financing to enable the manufacturing and logistics sectors to support the emergency needs of Californians. This bill would provide that the moneys in the disaster subaccount be made available to I-Bank, upon a transfer of funds by the Director of Finance pursuant to an allocation by the Governor under the California Disaster Assistance Act, for specified purposes. The bill would authorize moneys in the Manufacturing Program Account to be allocated to a lending institution or financial company to act as trustee of the funds, with the approval of the Department of Finance. The bill would authorize I-Bank to create additional subaccounts in the account for specified purposes. Because this bill would expand the purposes for which a continuously appropriated fund is expended and would deposit moneys and fees into a new, continuously appropriated account, the bill would make an appropriation. This bill would require I-Bank to annually report, commencing with January 1, 2023, to the Governor and the Legislature on program activity, as specified, in any fiscal year that the program receives funding or has active loans. This bill would further provide that specified provisions of the bill would be implemented only to the extent that sufficient moneys are available to I-Bank to implement the disaster or competitiveness program. The bill would permit these provisions to be used to meet California's manufacturing and logistics needs in response to the state of emergency declared by the Governor on March 4, 2020, related to the COVID-19 virus. The bill would prohibit I-Bank from entering into loans or lines of credit pursuant to the bill on or after January 1, 2030.