BILL NUMBER: AB 1399	INTRODUCED
	BILL TEXT


INTRODUCED BY   Committee on Jobs, Economic Development, and the
Economy (Medina (Chair), Daly, Fong, Fox, Hueso, and V. Manuel Pérez)

                        MARCH 11, 2013

   An act to amend and renumber Sections 13997.2 and 13997.7 of, and
to add the heading of Article 6 (commencing with Section 12100) to
Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government
Code, relating to economic development.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1399, as introduced, Committee on Jobs, Economic Development,
and the Economy. Economic development.
   Existing law defines specified terms relating to economic
development and authorizes the Business, Transportation and Housing
Agency, and its secretary, to expend specified funds.
   This bill would renumber these provisions and instead authorize
the Governor's Office of Business and Economic Development, and its
director, to expend these funds.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The heading of Article 6 (commencing with Section
12100) is added to Chapter 1.6 of Part 2 of Division 3 of Title 2 of
the Government Code, to read:

      Article 6.  Local Economic Development


  SEC. 2.  Section 13997.2 of the Government Code is amended and
renumbered to read:
    13997.2.   12100.   (a) The Legislature
finds and declares all of the following:
   (1) California's economic development organizations and
corporations are an integral component of the state job creation
effort because they are a critical link between state economic
development activities and the statewide business community,
providing an excellent opportunity to leverage state resources.
   (2) Economic development corporations and organizations provide
broad public benefits to the residents of this state by alleviating
unemployment, encouraging private investment, and diversifying local
economies.
   (3) Economic development corporations engage in a wide range of
programs and strategies to attract, retain, and expand businesses,
including marketing the community, small business lending, and other
financial services, a wide range of technical assistance to small
business, preparation of economic data, and business advocacy.
   (4) By using public sector resources and powers to reduce the
risks and costs that could prohibit investment, the public sector
often sets the stage for employment-generating investment by the
private sector.
   (b) For purposes of this chapter, all of the following definitions
apply:
   (1) "Local economic development organization" means a public or
public-private job creation activity recognized by cities and
counties as the lead agency within that city or county for planning
and implementation of job creation involving business expansion,
business retention, and new business development.
   (2) "Regional economic development organization" means an
organization comprised of any of the following:
   (A) A single county.
   (B) More than one county.
   (C) A subregion within a county established by the cities and
county within that subregion.
   (D) An economic development corporation.
   (3) "Economic development corporation" means a local or regional
nonprofit public-private economic development organization recognized
in a defined region by the public and private sector as the lead
agency for the planning and implementation of job creation involving
business retention and new business development.
   (4) "Regional economic development corporation" means a
corporation comprised of any of the following:
   (A) A single county.
   (B) More than one county.
   (C) A subregion within a single county established by a group of
cities and counties.
   (5) "Economic development" means any activity that enhances the
factors of productive capacity, such as land, labor, capital, and
technology, of a national, state, or local economy. "Economic
development" includes policies and programs expressly directed at
improving the business climate in business finance, marketing,
neighborhood development, small business development, business
retention and expansion, technology transfer, and real estate
redevelopment. "Economic development" is an investment program
designed to leverage private sector capital in such a way as to
induce actions that have a positive effect on the level of business
activity, employment, income distribution, and fiscal solvency of the
community.
   (6) "Local economic development" is a process of deliberate
intervention in the normal economic process of a particular locality
to stimulate economic growth of the locality by making it more
attractive, resulting in more jobs, wealth, better quality of life,
and fiscal solvency. Prime examples of economic development include
business attraction, business expansion and retention, and business
creation.
   (7) "Emerging domestic market" means people, places, or business
enterprises with growth potential that face capital constraints due
to systemic undervaluations as a result of imperfect market
information. These markets include, but are not limited to,
ethnic-owned and women-owned firms, urban and rural communities,
companies that serve low-income or moderate-income populations, and
other small- and medium-sized businesses.
   (8) "Financial intermediary" means an institution, firm,
organization, or individual who performs intermediation between two
or more parties in a financial context, such as connecting sources of
funds with users of funds. A financial intermediary is typically an
entity that facilitates the channeling of funds between lenders,
investors, foundations, or other entities that have money and are
interested in connecting with businesses or communities where their
money can be deployed. Financial intermediaries include, but are not
limited to, banks, financial development corporations, economic
developers, microbusiness lenders, and community development
organizations.
   (9) "Community development intermediary" means an institution,
firm, organization, or individual that performs intermediation
between two or more parties in a community development context, such
as connecting people and organizations that have a stake in the
future well-being of communities and individuals who may not easily
have access to these stakeholders. A community development
intermediary is typically an entity that channels financial and
nonfinancial resources between government and foundations and other
nonprofit organizations that have resources and are interested in
connecting with small- and medium-size businesses and low- and
moderate-income households and communities. Community development
intermediaries include, but are not limited to, community development
corporations, microbusiness lenders, and community development
financial institutions.
   (10) "Triple bottom line" means the economic, environmental, and
social benefits arising from a project, investment, or community and
economic development activity.
   (11) "Small businesses" means a business with less than 100
employees and with a gross revenue of less than five million dollars
($5,000,000), or a business that is otherwise targeted by or
participating in a federal or state program engaged in programs or
services for small businesses. Application of this definition may
only be used pursuant to a direct reference.
   (12) "Community development" means a process designed to create
conditions of economic and social prosperity for the whole community,
or a targeted subset of the whole community, with the fullest
possible reliance on the community's initiative and active
participation.
   (13) "Financial institution capital" means resources of a
financial institution, including, but not limited to, a bank or
credit union, that are legally available to be used to generate
wealth for the financial institution.
   (14) "California Council on Science and Technology" means the
council established by California academic research institutions,
including the University of California, the University of Southern
California, the California Institute of Technology, Stanford
University, and the California State University, in support of
Assembly Concurrent Resolution No. 162 (Res. Ch. 148, Stats. 1988).
   (15) "Microbusiness lender" means a nonprofit or nonbank lender
that serves very small businesses in low- and moderate-income
communities that experience barriers in accessing capital. These
businesses are often owned by minorities, immigrants, women, and
persons with disabilities. Microbusiness lenders generally provide
loans under fifty thousand dollars ($50,000) and offer business
technical assistance, both preloan and postloan, to improve an
applicant's ability to qualify and successfully repay a loan.
  SEC. 3.  Section 13997.7 of the Government Code is amended and
renumbered to read:
    13997.7.   12098.7.   (a)
Notwithstanding any other  provision of  law,
effective January 1, 2008, the Economic Adjustment Assistance Grant
funded through the United States Economic Development Administration
under Title IX of the Public Works and Economic Development Act of
1965 (Grant No. 07-19-02709 and 07-19-2709.1) shall be administered
by the  Secretary of Business, Transportation and Housing
  director  , and, for the purpose of state
administration of this grant, the  secretary  
director  shall be deemed to be the successor to the former
Secretary of Technology, Trade and Commerce. The  secretary
  director  may assign and contract administration
of the grant to a public agency created pursuant to Chapter 5
(commencing with Section 6500) of Division 7 of Title 1.
   (b) On January 1, 2008, all federal moneys held in the Sudden and
Severe Economic Dislocation Grant Account within the Special Deposit
Fund are hereby transferred to the Small Business Expansion Fund
created pursuant to Section 14030 of the Corporations Code for
expenditure by the  Business, Transportation and Housing
Agency   office  pursuant to Article 9 (commencing
with Section 14070) of the Corporations Code for purposes of the
Sudden and Severe Economic Dislocation Grant program, or other
purposes permitted by the cognizant federal agency.
   (c) All loan repayments received on or after January 1, 2008, for
the Sudden and Severe Economic Dislocation Grant program loans issued
pursuant to former Section 15327 (repealed by Section 1.8 of Chapter
229 of the Statutes of 2003 (AB 1757)) and this section, shall be
deposited into the Small Business Expansion Fund and shall be
available to the  Business, Transportation and Housing Agency
  office  for expenditure pursuant to the
provisions of Article 9 (commencing with Section 14070) of the
Corporations Code for the Sudden and Severe Economic Dislocation
Grant program, or other purposes permitted by the cognizant federal
agency.