text:
(a) Notwithstanding any other provision of this division, a financing of emergency apportionments upon the request of a school district pursuant to Article 2.7 (commencing with Section 41329.50) of Chapter 3 of Part 24 of Division 3 of Title 2 of the Education Code, is deemed to be in the public interest and eligible for financing by the bank. Article 3 (commencing with Section 63040), Article 4 (commencing with Section 63042), and Article 5 (commencing with Section 63043) do not apply to the financing provided by the bank in connection with an emergency apportionment.

(b) The bank may issue bonds pursuant to Chapter 5 (commencing with Section 63070) and provide the proceeds to a school district pursuant to a lease agreement. The proceeds may be used as an emergency apportionment, to reimburse the interim emergency apportionment from the General Fund authorized pursuant to subdivision (b) of Section 41329.52 of the Education Code, or to refund bonds previously issued under this section. Bond proceeds may also be used to fund necessary reserves, capitalized interest, credit enhancement costs, and costs of issuance.

(c) Bonds issued under this article are not deemed to constitute a debt or liability of the state or of any political subdivision of the state, other than a limited obligation of the bank, or a pledge of the faith and credit of the state or of any political subdivision. All bonds issued under this article shall contain on the face of the bonds a statement to the same effect.

(d) Any fund or account established in connection with the bonds shall be established outside of the centralized treasury system. Notwithstanding any other law, the bank shall select the financing team and the trustee for the bonds, and the trustee shall be a corporation or banking association authorized to exercise corporate trust powers.

(e) Pursuant to Section 41329.55 of the Education Code, a school district other than the Compton Community College District shall instruct the Controller to repay the lease from moneys in the State School Fund and the Education Protection Account designated for apportionment to the school district. Pursuant to Section 41329.55 of the Education Code, if the school district is the Compton Community College District, the Controller shall be instructed to repay the lease from moneys in Section B of the State School Fund. Any amounts necessary to make this repayment shall be drawn from the total statewide funding available for community college apportionment consisting of funds in Section B of the State School Fund. Thereafter the Controller shall transfer to Section B of the State School Fund, either in a single or multiple transfers, an amount equal to the total repayment, which amount shall be transferred from the amount designated for apportionment to the Compton Community College District from the State School Fund. If these transfers from the district prove inadequate to repay any repayments for any reason, the Compton Community College District is required to use any revenue sources available to it for transfer and repayment purposes.

(f) Notwithstanding any other law, as long as any bonds issued pursuant to this section are outstanding, the following requirements apply:

(1) The school district for which the bonds were issued is not eligible to be a debtor in a case under Chapter 9 of the United States Bankruptcy Code, as it may be amended from time to time, and no governmental officer or organization is or may be empowered to authorize the school district to be a debtor under that chapter.

(2) It is the intent of the Legislature that the Legislature should not in the future abolish the Compton Community College District or take any action that would prevent the Compton Community College from entering into or performing binding agreements or invalidate any prior binding agreements of the Compton Community College District, where invalidation may have a material adverse effect on the bonds issued pursuant to this section.

(3) The Compton Community College District shall not be reorganized or merged with another community college district unless all of the following apply:

(A) The successor district becomes by operation of law the owner of all property previously owned by the Compton Community College District.

(B) Any agreement entered into by the Compton Community College District in connection with bonds issued pursuant to this section are assumed by the successor district.

(C) The apportionment authorized by subdivision (e) remains in effect.

(D) Receipt by the bank of an opinion of bond counsel that the bonds issued for the Compton Community College District will remain tax exempt following the reorganization or merger.

(g) Nothing in this section limits the authority of the Legislature to abolish the Compton Community College District when bonds issued for that district are no longer outstanding. Further, the Legislature may provide for the redemption or defeasance of the bonds at any time so that no bonds are outstanding. If the Legislature provides for the redemption or defeasance of the bonds issued for the Compton Community College District in order to abolish that district, it is the intent of the Legislature that the funds required for the redemption or defeasance should be appropriated from Section B of the State School Fund.

(h) The bank may enter into contracts or agreements with banks, insurers, or other financial institutions or parties that it determines are necessary or desirable to improve the security and marketability of, or to manage interest rates or other risks associated with, the bonds issued pursuant to this section. The bank may pledge apportionments made by the Controller directly to the bond trustee pursuant to Section 41329.55 of the Education Code as security for repayment of any obligation owed to a bank, insurer, or other financial institution pursuant to this subdivision.

history: (History: Amended by Stats. 2013, Ch. 48, Sec. 80. (AB 86) Effective July 1, 2013.)

title: 6.7. INFRASTRUCTURE FINANCE

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 2. California Infrastructure and Economic Development Bank > 9. Financing of School District Emergency Apportionments


kind: section

code: GOV

text: The State of California pledges that (a) the state will not alter the directive to the Controller to make apportionments to the bond trustee of moneys in the State School Fund and the Education Protection Account from that set forth in Section 41329.55 of the Education Code, and (b) the state will not amend or repeal subdivision (f) of Section 63049.67, in each case in any manner that would materially impair the security or other interests of holders of any bonds issued pursuant to this article. The bank is authorized to include this pledge in the bonds, or other documents entered into in connection with the bonds, as a covenant for the benefit of the bondholders.

history: (History: Amended by Stats. 2013, Ch. 48, Sec. 81. (AB 86) Effective July 1, 2013.)

division: 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT

title: 6.7. INFRASTRUCTURE FINANCE

chapter: 2. California Infrastructure and Economic Development Bank

article: 9. Financing of School District Emergency Apportionments


text:
(a) Notwithstanding this division, the financing of energy and project costs on behalf of Golden State Energy, as defined in Section 222.5 of the Public Utilities Code, shall be deemed to be in the public interest and eligible for financing by the bank or by a special purpose trust established pursuant to this division. That financing shall be treated as financing of an economic development facility for purposes of this division, except that Article 3 (commencing with Section 63040) and Article 5 (commencing with Section 63043) shall not apply to any financing undertaken on behalf of Golden State Energy.

(b) The bank may issue bonds pursuant to Chapter 5 (commencing with Section 63070) and may loan the proceeds thereof to Golden State Energy, and deposit the proceeds into a separate account, or use the proceeds to refund bonds previously issued under this article. Bond proceeds may also be used to fund necessary reserves, capitalized interest, credit enhancement costs, or costs of issuance.

(c) Bonds or other indebtedness issued pursuant to this article shall not be deemed to constitute a debt or liability of the state or of any political subdivision of the state other than the bank or any special purpose trust established pursuant to this division, but shall be payable solely from the funds of, and any security provided by, Golden State Energy.

history: (History: Added by Stats. 2020, Ch. 27, Sec. 4. (SB 350) Effective January 1, 2021.)

title: 6.7. INFRASTRUCTURE FINANCE

article: 10. Golden State Energy Financing

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 2. California Infrastructure and Economic Development Bank > 10. Golden State Energy Financing


text:
The following definitions contained in this section are in addition to the definitions contained in Section 63010 and together with the definitions contained in that section shall govern the construction of this article, unless the context requires otherwise:

(a) “Accelerator financing plan” means a report by the bank for accelerator projects identified in subdivision (e) of Section 63049.73. The accelerator financing plan shall be based on the bank’s direct consultation with the accelerator.

(b) “California Transmission Accelerator project” or “accelerator project” means any building, structure, equipment, infrastructure, or other improvement within this state, or financing the general needs, including working capital, of any participating party for operations or activities within this state that are consistent with, and intended to, develop transmission projects for the public benefit to further California’s clean energy goals and to reduce or offset ratepayer costs.

(c) “California Transmission Accelerator Revolving Fund” or “Accelerator Revolving Fund” means any revolving fund by that name created under, and administered pursuant to, this article to provide financial assistance for eligible transmission projects.

(d) “California Transmission Accelerator Revolving Fund Program” or “Accelerator Revolving Fund Program” means the program authorized by this article to administer the California Transmission Accelerator Revolving Fund and to provide financial assistance for eligible transmission projects, to be administered by the bank pursuant to this article and any guidelines adopted by the accelerator.

(e) “Eligible transmission project” means a project as described in subdivision (f) of Section 63049.73, selected by the accelerator, and approved by the bank for financial assistance pursuant to subdivision (i) of Section 63049.73.

(f) “Funded without return on equity,” as that term is used in Section 94510 of the Public Resources Code, means, solely for the portion of a project funded by the California Transmission Accelerator Revolving Fund provided by this article, that no return on equity shall be generated and distributed to shareholders.

(g) (1) “Participating party” has the same meaning as defined in Section 63010 and includes an eligible applicant, as that term is used in Chapter 1 (commencing with Section 90000) of Division 50 of the Public Resources Code.

(2) For purposes of providing financial assistance to projects related to Chapter 9 (commencing with Section 94500) of Division 50 of the Public Resources Code, the participating party shall be limited to eligible applicants as defined in Chapter 1 of Division 50 of the Public Resources Code.

(h) “Transmission Infrastructure Accelerator” or “accelerator” means the Transmission Infrastructure Accelerator established pursuant to Section 12100.110 of the Government Code.

history: (History: Added by Stats. 2025, Ch. 119, Sec. 15. (SB 254) Effective September 19, 2025.)

title: 6.7. INFRASTRUCTURE FINANCE

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 2. California Infrastructure and Economic Development Bank > 10.5. California Transmission Accelerator Financing


text:
(a) The financing of projects related to Chapter 9 (commencing with Section 94500) of Division 50 of the Public Resources Code shall be deemed to be in the public interest and eligible for financing by the bank or by a special purpose trust established pursuant to this division. That financing shall be treated as financing of an economic development facility for purposes of this division, except that Article 3 (commencing with Section 63040) and Article 5 (commencing with Section 63043) shall not apply to any financing under this article. The bank shall consider an eligible transmission project for financing upon filing of an application by an appropriate participating party following the selection of the project by the accelerator. The review may be concurrent with the Public Utilities Commission’s processing of an application for the pertinent financing. Nothing in this division grants the bank authority over matters that are within the jurisdiction of the Public Utilities Commission.

(b) The bank may provide any form of financial assistance, including issuing bonds pursuant to Chapter 5 (commencing with Section 63070), and may loan the proceeds of those bonds, deposit the proceeds into a separate account in the California Transmission Accelerator Revolving Fund, or use the proceeds to refund bonds previously issued under this article. Bond proceeds may also be used to fund necessary reserves, capitalized interest, credit enhancement costs, or costs of issuance.

(c) Bonds issued under this article shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof or a pledge of the faith and credit of the state or of any political subdivision, other than the bank, but shall be payable solely from either or both the California Transmission Accelerator Revolving Fund or other revenues and assets securing the bonds. All bonds issued under this article shall contain on the face of the bonds a statement to that effect.

title: 6.7. INFRASTRUCTURE FINANCE

article: 10.5. California Transmission Accelerator Financing


text:
(a) The bank is hereby authorized and empowered to provide financial assistance under the Accelerator Revolving Fund Program to any eligible participating party, either directly or to a lending or financial institution, in connection with the financing or refinancing of an accelerator project, in accordance with an agreement or agreements between the bank and the participating party, either as a sole lender or in participation or syndication with other lenders.

(b) Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 shall not apply to any accelerator financing plan or any guidelines adopted by the bank pursuant to subdivision (i) in connection with the Accelerator Revolving Fund Program.

(c) (1) Repayments of financing made under the Accelerator Revolving Fund Program shall be deposited into the appropriate account created within the Accelerator Revolving Fund.

(2) The bank may establish separate accounts for accelerator projects within the Accelerator Revolving Fund.

(d) (1) (A) The bank shall meet and confer with the accelerator for accelerator projects.

(B) (i) The bank shall respond to requests from the accelerator and collaborating agencies to evaluate and consult on the credit and financial aspects of eligible accelerator projects.

(ii) Final authority to provide financial support to an accelerator project shall reside with the accelerator, and the accelerator shall direct the bank, at its discretion, to effectuate approved financing in the form and at the terms the accelerator deems optimal, consistent with the objectives and requirements contained in Section 12100.111.

(2) Consultation on a potential transmission project shall not constitute approval of that project by the Public Utilities Commission or the State Energy Resources Conservation and Development Commission under their decisionmaking authority, to the extent that authority exists under other law.

(3) Consultation on, or evaluation of, a transmission project by the bank shall not indicate the bank’s approval.

(e) The accelerator financing shall set forth conditions, including, but not limited to, the following:

(1) Priority shall be given to transmission projects with public sponsors partnering with private entities.

(2) Actions to maximum savings to ratepayers, as determined by the accelerator and its coordinating entities, by minimizing equity in the capital structure, minimizing return on equity, and reducing tax obligations through the use of public ownership structures, to the fullest extent possible, consistent with project risk and viability.

(3) Actions to collaborate with prospective participating parties to inform bid proposals for the Independent System Operator competitive solicitation process.

(f) All financial assistance under the Accelerator Revolving Fund Program approved by the bank board shall be consistent with the applicable accelerator financing plan then in effect, and may include the necessary technical cost elements of transmission infrastructure, including, but not limited to, environmental planning, permitting, and preconstruction costs for a project.

(g) The bank shall inform the Franchise Tax Board of any accelerator projects that are approved by bank for financial assistance pursuant to subdivision (h) and shall provide any other information the Franchise Tax Board requires for administration of the tax credits under Sections 17053.40 and 23640 of the Revenue and Taxation Code.

(h) (1) The bank shall prepare, and the bank board shall approve, guidelines for the provision of financial assistance under the Accelerator Revolving Fund Program for eligible transmission projects selected by the accelerator. The bank board’s approval of any financial assistance for an accelerator project shall take into consideration those guidelines, together with the applicable accelerator financing plan currently in effect. The guidelines shall include, as factors for determining whether to approve the provision of financial assistance, the ability of the participating party potentially receiving financial assistance to satisfy any obligation incurred and the return of capital to the Accelerator Revolving Fund.

(2) The bank board may consider additional factors when determining whether to approve financial assistance for an accelerator project, taking into consideration the relevant accelerator financing plan.

(3) The bank shall consider applications for financial assistance by eligible transmission projects selected by the accelerator as they are received, on an ongoing basis, if there are available moneys remaining within the Accelerator Revolving Fund to provide that financial assistance. The bank board’s determination of whether to approve applications for financial assistance shall be based on the accelerator financing plan and the guidelines in effect at the time the bank received the application.

(4) A participating party shall comply with the terms and conditions that control the use of the funds provided, if any.

(i) The bank shall provide financial assistance only for an accelerator project that both the accelerator selected and the bank board has approved.

(j) The bank is hereby authorized to enter into an agreement with the accelerator to operate a program to provide financial assistance to any eligible participating party, either directly or to a lending or financial institution, in connection with the financing or refinancing of an eligible project, in accordance with the agreement or agreements. Information shared among consulting agencies and the bank, or between any consulting agency and the bank, shall not constitute the waiver of any exemption under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1) applicable to each entity.

(k) (1) This section shall remain in effect only until January 1, 2031, and as of that date is repealed.

(2) Any project approved for financing by the Bank pursuant to this section before January 1, 2031, shall have its financing terms remain in force for the duration of the contract.

history: (History: Added by Stats. 2025, Ch. 119, Sec. 15. (SB 254) Effective September 19, 2025. Repealed as of January 1, 2031, by its own provisions.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) There is hereby created the California Transmission Accelerator Revolving Fund in the State Treasury for the purpose of providing financial assistance under the Accelerator Revolving Fund Program in accordance with this article.

(b) The Accelerator Revolving Fund shall be eligible to receive funding from other sources determined by the Legislature.

(c) Revenues of, and all other income collected by, participating entities to support the Accelerator Revolving Fund Program shall be deposited into the Accelerator Revolving Fund.

(d) Proceeds of revenue bonds issued pursuant to this division article shall be deposited into the Accelerator Revolving Fund.

(e) (1) Eligible entities may pledge any or all of the moneys in the Accelerator Revolving Fund as security for payment of the principal of, and interest on, any particular issuance of bonds issued for the purposes of this article.

(2) The bank may use any or all of the moneys in the Accelerator Revolving Fund to retain or purchase for retention or sale, subordinated bonds issued by the bank, by a special purpose trust, or by a sponsor, all in connection with the purposes of this article.

(f) (1) Notwithstanding Section 13340, moneys, except as provided in paragraphs (2) and (3), in the Accelerator Revolving Fund are continuously appropriated, without regard to fiscal year, for the support of eligible entities and shall be available for expenditure for the purposes as stated in this article.

(2) Moneys in the Accelerator Revolving Fund received pursuant to a federal appropriation are available for expenditure only upon appropriation by the Legislature.

(3) Moneys in the Accelerator Revolving Fund shall be available for expenditure to support administrative costs only upon appropriation by the Legislature.

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Notwithstanding any other provision of this division, pursuant to Section 10100.3 of the Insurance Code and upon approval of the bank, a financing of the costs of claims or to increase liquidity and claims-paying capacity upon the request of the California FAIR Plan Association shall be deemed to be in the public interest and eligible for financing by the bank. Article 3 (commencing with Section 63040), Article 4 (commencing with Section 63042), Article 5 (commencing with Section 63043), Article 5.5 (commencing with Section 63047.1), Article 6 (commencing with Section 63048), Article 6.3 (commencing with Section 63048.55), Article 6.5 (commencing with Section 63048.6), Article 6.7 (commencing with Section 63048.91), Article 7 (commencing with Section 63049), Article 8 (commencing with Section 63049.6), Article 9 (commencing with Section 63049.67), and Article 10 (commencing with Section 63049.70) shall not apply to that financing provided by the bank.

(b) Notwithstanding any other provision of this division, the bank shall not have authority over any matter that is subject to the approval of, or otherwise regulated by, the Insurance Commissioner under Part 1 (commencing with Section 1880) of Division 2 of the Insurance Code. The bank shall have the right to enforce all obligations of the California FAIR Plan Association under the agreements relating to bonds issued under this section.

(c) The bank may issue taxable or tax-exempt bonds pursuant to Chapter 5 (commencing with Section 63070) to finance the costs of claims or to increase liquidity and claims-paying capacity of the California FAIR Plan Association, and to refund bonds previously issued for that purpose, and may loan the proceeds thereof to the California FAIR Plan Association. Bond proceeds may also be used to fund necessary reserves, capitalized interest, credit or liquidity enhancement costs, and costs of issuance.

(d) Bonds issued under this section shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, other than the bank, or a pledge of the faith and credit of the state or of any political subdivision, but shall be payable solely from the revenues and assets securing the bonds. All bonds issued under this article shall contain on the face of the bonds a statement to that effect.

history: (History: Added by Stats. 2025, Ch. 473, Sec. 1. (AB 226) Effective October 9, 2025.)

title: 6.7. INFRASTRUCTURE FINANCE

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 2. California Infrastructure and Economic Development Bank > 11. California FAIR Plan Association Financing


text:
(a) There is hereby created in the State Treasury the California Infrastructure and Economic Development Bank Fund for the purpose of implementing the objectives and provisions of this division. Within the fund there shall also be established a Sponsor Revenue Bond Account, a Participating Party Revenue Bond Account, a State Infrastructure Revolving Account, and additional accounts and subaccounts that the bank may establish from time to time.

(b) Notwithstanding Section 13340 and except as provided in subdivisions (c) and (d), all moneys in the infrastructure bank fund are continuously appropriated without regard to fiscal years for the support of the bank and shall be available for expenditure for the purposes stated in this division.

(c) Moneys in the infrastructure bank fund shall be available for expenditure for general administration only upon appropriation by the Legislature. This subdivision shall not limit the authority of the bank to expend funds directly related to the servicing of approved debt. Moneys in the fund shall be available for the purpose of general administration of the authority only upon appropriation by the Legislature, but not more than 5 percent of any bond proceeds administered by the authority may be expended to cover the costs of issuance, as that terminology is defined under Section 147 (G) of the Internal Revenue Code.

(d) Moneys in the infrastructure bank fund shall be available for expenditure for California Transmission Accelerator financing under Article 10.5 (commencing with Section 63049.71) of Chapter 2 only upon appropriation by the Legislature.

(e) Notwithstanding any other provision of this division, not more than 15 percent of the financing annually approved by the executive director that utilizes state funds from the infrastructure bank fund may be expended upon educational facilities, environmental mitigation measures, and parks and recreational facilities.

(f) The executive director may transfer funds between the infrastructure bank fund and the guarantee trust fund when appropriate to accomplish the financing objectives of this division.

history: (History: Amended by Stats. 2025, Ch. 119, Sec. 16. (SB 254) Effective September 19, 2025.)

title: 6.7. INFRASTRUCTURE FINANCE

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 3. California Infrastructure and Economic Development Bank Fund


text:
(a) The bank may pledge any or all of the moneys in the fund as security for payment of the principal of, and interest on, any particular issuance of bonds issued pursuant to this chapter. The bank may use any or all of the moneys in the fund, including the grant account, to retain or purchase for retention or sale, subordinated bonds issued by the bank, by a special purpose trust, or by a sponsor pursuant to this chapter. For these purposes, or as necessary or convenient to the accomplishment of any other purpose of the bank, the bank may divide the fund into separate accounts or subaccounts. All moneys accruing to the bank pursuant to this division from any sources shall be deposited in the fund.

(b) Subject to priorities that may be created by the pledge of particular moneys in the infrastructure bank fund to secure any issuance of revenue bonds of the bank, a special purpose trust, or a sponsor, and subject further to reasonable costs that may be incurred by the bank in administering the program authorized by this division, all moneys in the infrastructure bank fund derived from any source, shall be held in trust for the security and payment of revenue bonds of the bank, a special purpose trust, or a sponsor and shall not be used or pledged for any other purpose so long as the revenue bonds are outstanding and unpaid.

(c) Pursuant to any agreements with the holders of revenue bonds pledging any particular assets, revenues, or moneys, the bank may create separate accounts or subaccounts in the infrastructure bank fund to manage these assets, revenues, or moneys in the manner set forth in the agreements.

(d) The bank may, from time to time, direct the Treasurer to invest moneys in the infrastructure bank fund that are not required for its current needs, including proceeds from the sale of any bonds, in any eligible securities specified in Section 16430 as the bank shall designate. The bank may direct the Treasurer to deposit moneys in interest-bearing accounts in any bank in this state or in any savings and loan association in this state. The bank may alternatively require the transfer of moneys in the infrastructure bank fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2. Notwithstanding Section 16305.7, all interest or other increment resulting from the investment or deposit of moneys from the infrastructure bank fund shall be deposited in the infrastructure bank fund. Moneys in the infrastructure bank fund shall not be subject to transfer to any other funds pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2, except to the Surplus Money Investment Fund.

(e) Subject to any agreement with holders of particular bonds, in furtherance of Section 51373 of the Health and Safety Code, and to the extent permitted by law, the bank may also invest moneys of the infrastructure bank fund, including, but not limited to, proceeds of any of its bonds or refunding bonds, in obligations of financial institutions as are permitted by board resolution. The bank may alternatively require the transfer of moneys in the infrastructure bank fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2.

(f) Subject to any agreement with the holders of particular bonds, all interest or other increment resulting from the investment or deposit shall be deposited in the infrastructure bank fund, notwithstanding Section 16305.7. Moneys in the infrastructure bank fund shall not be subject to transfer to any other fund pursuant to Part 2 (commencing with Section 16300) of Division 4 of Title 2, excepting the Surplus Money Investment Fund.

(g) The infrastructure bank fund shall be organized as a public enterprise fund.

(h) The bank shall cause all moneys in the infrastructure bank fund that are in excess of current requirements to be invested and reinvested, from time to time.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 19. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE

chapter: 3. California Infrastructure and Economic Development Bank Fund


text:
(a) The bank may administer and distribute among its accounts and subaccounts, at its discretion, the proceeds from any general obligation bonds issued in accordance with the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2).

(b) The assets of the infrastructure bank fund shall be available for the payment of the salaries and other expenses charged against it in accordance with this division.

history: (History: Amended (as added by Stats. 1994, Ch. 94) by Stats. 1994, Ch. 749, Sec. 20.5. Effective January 1, 1995.)

title: 6.7. INFRASTRUCTURE FINANCE


text: All expenses incurred in carrying out the purposes of this division shall be payable solely from funds provided pursuant to this division, and no liability or obligation shall be imposed upon the state and none shall be incurred by the agency beyond the extent to which money shall have been provided pursuant to this division.

history: (History: Added by Stats. 1994, Ch. 94, Sec. 1. Effective January 1, 1995. Conditionally operative as prescribed by Sec. 17 of Ch. 94.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Moneys in the infrastructure bank fund received from the proceeds of bonds issued pursuant to this division may not be transferred to any other fund except as necessary to pay the expenses of operating the program authorized by this division, nor shall the bank utilize any moneys under the direction and control of the California Housing Finance Agency, including, but not limited to, moneys in the California Housing Loan Insurance Fund and the Housing Finance Fund, other than moneys in the infrastructure bank fund to satisfy liabilities arising from projects authorized by this division.

(b) The infrastructure bank fund, on behalf of the bank, may borrow or receive moneys from the bank or from any federal, state, or local agency or private entity, in order to create reserves in the infrastructure bank fund as provided in this division and as authorized by resolution of the board.

history: (History: Amended by Stats. 1998, Ch. 4, Sec. 19. Effective January 1, 1999.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Notwithstanding Chapter 2 (commencing with Section 12850) of Part 2.5 of Division 3 of Title 2 and Article 2 (commencing with Section 13320) of Chapter 3 of Part 3 of Division 3 of Title 2, expenditures of the infrastructure bank fund shall not be subject to the supervision or approval of any other officer or division of state government, with the exception of the Legislature. However, the bank’s budget shall be prepared and reviewed not later than November 1 of each year and the bank shall submit to the Legislature a report of its activities for the prior fiscal year, as specified in Section 63035.

(b) The bank’s budget regarding the infrastructure bank fund shall include the amount of credit and liabilities of the fund, based on an audit of the fund at the close of the prior fiscal year. The bank’s operating budget shall be subject to review and appropriation in the annual Budget Act.

history: (History: Amended by Stats. 2014, Ch. 132, Sec. 7. (AB 2749) Effective January 1, 2015.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) There is hereby created in the State Treasury the California Infrastructure Guarantee Trust Fund.

Notwithstanding Section 13340 and except as provided in subdivision (b), all money in the guarantee trust fund is hereby continuously appropriated to the bank without regard to fiscal years for the purpose of insuring all or a portion of the accounts and subaccounts within the infrastructure bank fund, any contracts or obligations of the bank or a sponsor, and all or a part of any series of bonds issued by the bank, by a special purpose trust, or by a sponsor pursuant to this division, and for the purpose of defraying administrative expenses incurred by the bank in operating the programs of loan and bond guarantee. All insurance premiums received by the bank for insurance, guarantees, or enhancements provided pursuant to this division shall be deposited in the guarantee trust fund. The guarantee trust fund is authorized to guarantee all or a part of any of the accounts and subaccounts within the infrastructure bank fund, any contracts or obligations of the bank, a special purpose trust, or a sponsor, and all or part of any series of bonds issued by the bank, by a special purpose trust, or by a sponsor and to authorize payment on any guarantee or enhancement of the guarantee trust fund.

(b) Moneys in the infrastructure bank fund shall be available for expenditure for general administration only upon appropriation by the Legislature. This subdivision shall not limit the authority of the bank to expend funds directly related to the servicing of approved debt.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 20. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 4. California Infrastructure Guarantee Trust Fund


text: Notwithstanding Chapter 2 (commencing with Section 12850) of Part 2.5 of Division 3 of Title 2 and Article 2 (commencing with Section 13320) of Chapter 3 of Part 3 of Division 3 of Title 2, expenditure of the guarantee trust fund shall not be subject to the supervision or approval of any other officer or division of state government, with the exception of the Legislature. However, the bank’s budget respecting the guarantee trust fund shall be prepared and reviewed not later than November 1 of each year and the bank shall submit to the Legislature a report of its activities for the prior fiscal year. However, the bank’s budget regarding the infrastructure bank fund shall be prepared and reviewed in accordance with Section 50913, and, not later than November 1 of each year, the agency shall submit to the Legislature a report of its activities for the prior fiscal year. The bank’s operating budget shall be subject to review and appropriation in the annual Budget Act.

history: (History: Amended (as added by Stats. 1994, Ch. 94) by Stats. 1994, Ch. 749, Sec. 23. Effective January 1, 1995.)

title: 6.7. INFRASTRUCTURE FINANCE

chapter: 4. California Infrastructure Guarantee Trust Fund


text:
(a) The bank may, from time to time, direct the Treasurer to invest moneys in the guarantee trust fund that are not required for its current needs in any eligible securities specified in Section 16430 that the bank shall designate. The bank may direct the Treasurer to invest the moneys by entering into repurchase agreements or reverse repurchase agreements, which, for purposes of this section, shall mean agreements for the purchase or sale of eligible securities pursuant to which the seller or buyer agrees to repurchase or sell back the securities on or before a specified date and for a specified amount. The bank may direct the Treasurer to invest the moneys in the subordinated securities of the bank, a special purpose trust, or a sponsor. The bank may direct the Treasurer to invest the moneys in investment agreements with corporations, financial institutions, or national associations within the United States that are rated by a nationally recognized rating service within the top three rating categories of the service. For purposes of this section, investment agreements shall mean any agreement for the investment of moneys in the guarantee trust fund whether at fixed or variable interest rates, and may include, but not be limited to, repurchase agreements, notes, uncollateralized time deposits, certificates of deposit, and the subordinated securities of the bank, a special purpose trust, or a sponsor. The bank may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices in this state.

(b) In furtherance of Section 51373 of the Health and Safety Code, and to the extent permitted by law, the bank may also invest moneys of the guarantee trust fund in obligations of financial institutions that are permitted by board resolution. The bank may alternatively require the transfer of moneys in the guarantee trust fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2.

(c) All interest or other increment resulting from the investment or deposit shall be deposited in the guarantee trust fund, notwithstanding Section 16305.7.

(d) The bank may create other accounts within the guarantee trust fund as are necessary or convenient to carry out the purposes of this article.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 21. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) There is a guarantee reserve account in the guarantee trust fund to secure commitments under contracts to guarantee all or part of the bonds of the bank, a special purpose trust, or of a sponsor, any contracts or obligations of the bank, a special purpose trust, or of a sponsor, and all or part of the accounts or subaccounts within the infrastructure bank fund. The bank shall take all reasonable steps to ensure that the guarantee reserve account is continuously maintained at not less than the reserve account requirement established pursuant to subdivision (a) of Section 63064. The bank shall pay all of the following into the guarantee reserve account:

(1) Moneys appropriated and made available by the Legislature for deposit in the account.

(2) Any proceeds of bonds, including general obligation bonds, to the extent provided in the resolution, trust agreement, resolutions or trust agreements authorizing the issue thereof.

(3) Any other moneys that the bank may make available for the purpose of deposit to the guarantee reserve account.

(b) The bank shall not cause sums to be withdrawn from the guarantee reserve account in amounts that would reduce the moneys therein to less than the reserve account requirement, except as necessary to satisfy liabilities arising under contracts of guarantee. In the event that the loan guarantee reserve account is reduced to less than the reserve account requirement, the bank shall cease making commitments for, and contracts of, guarantees and enhancements until the guarantee reserve account has been restored to that requirement.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 22. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) The Legislature may from time to time appropriate or transfer to the guarantee reserve account from funds or accounts that are legally available, an amount or amounts as the Legislature may determine. The Legislature may establish, and from time to time increase, for the guarantee reserve account a requirement that shall be known as the “reserve account requirement.”

(b) If the bank determines that the amount in the reserve account is below the reserve account requirement, the executive director shall immediately certify in writing to the Joint Legislative Budget Committee, the Speaker of the Assembly, the Senate Committee on Rules, and the Governor, the sum required to restore the reserve fund to the reserve account requirement.

(c) Upon making the certification, the chief executive officer shall ask the Governor to request an appropriation, and shall use his or her best efforts to have a sum requested and appropriated.

(d) Upon receiving notice that the amount in the reserve account is below the reserve account requirement, the Legislature may, at its discretion, choose to appropriate and pay to the bank for deposit into the guarantee reserve account that sum that would restore the reserve account to an amount equal to the reserve account requirement.

(e) The bank may utilize any moneys that may be appropriated to the guarantee trust fund from time to time by the Legislature for effectuating its purposes, including, but not limited to, the payment of the initial expenses of administration and operation and the restoration of the reserve account to the reserve account requirement.

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) The obligation of the bank and of the state to pay any guarantee benefit pursuant to contracts of guarantee or any other contracts or obligations of the bank, a special purpose trust, or sponsor shall be a limited obligation of the bank payable solely from amounts deposited in the guarantee trust fund that are made available therefor under the respective contracts of guarantee. The guarantee of loans or bonds under this division shall not directly or indirectly or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation whatever therefor, or to make any appropriation for their payment.

(b) All contracts of guarantee or any other contracts or obligations of the bank, special purpose trust, or a sponsor pursuant to this division shall contain on the face thereof a statement to the following effect: “Neither the faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of or interest on this contract of guarantee.”

(c) Moneys in the guarantee trust fund may not be transferred to any other fund except for payment on any guarantee or enhancements or except as necessary to pay the expenses of operating the program of bond guarantee and enhancement authorized by this division, nor shall the bank utilize any moneys under the direction and control of the agency, including, but not limited to, moneys in the California Housing Loan Insurance Fund and the California Housing Finance Fund, other than moneys in the guarantee trust fund, to satisfy liabilities arising from contracts of guarantee authorized by this division.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 23. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: The bank may charge and collect insurance guarantee or enhancement premiums or other fees for the insurance guarantees or enhancements described in this chapter and impose other reasonable charges and fees for services performed in connection with approval and processing of the guarantees or enhancements, or for pool assembly, loan servicing, or other services the bank may provide to a special service trust.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 24. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Moneys in the infrastructure bank fund received from the proceeds of bonds issued pursuant to this division may not be transferred to any other fund except as necessary to pay the expenses of operating the program authorized by this division, nor shall the bank utilize any moneys under the direction and control of the agency, including, but not limited to, moneys in the California Housing Loan Insurance Fund and the Housing Finance Fund, other than moneys in the infrastructure bank fund to satisfy liabilities arising from projects authorized by this division.

(b) The infrastructure bank fund, on behalf of the bank or a special purpose trust, may borrow or receive moneys from any federal, state, or local agency or private entity, in order to create reserves in the infrastructure bank fund as provided in this division and as authorized by resolution of the board.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 25. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) The bank may, from time to time, issue its revenue bonds in a principal amount that the bank shall determine to be necessary to provide sufficient funds for its purposes, which may include, but shall not be limited to, providing funds for the payment of costs of a project, for the purchase of bonds of a special purpose trust or a sponsor, payment of interest on bonds of the bank or of a special purpose trust, establishment of reserves to secure bonds, refunding previously issued bonds or refunding bonds of the bank, special purpose trust, or a sponsor, and payment of other expenditures of the bank or special purpose trust incident to issuance of bonds or refunding bonds of the bank.

(b) The bank, by private sale pursuant to a bond purchase agreement, may purchase the bonds of any local sponsor or of any special purpose trust that are issued pursuant to any other provision of applicable law, and may be secured with any funds, moneys, or revenues that are legally available.

(c) The bank may also issue bonds or authorize a special purpose trust to issue bonds for the purpose of making loans to a sponsor to be used by a sponsor to pay for the cost of a project, and that loan may be secured with any funds, moneys, or revenues that are legally available, including, but not limited to, any legally available funds or moneys that are due or payable to the sponsor by reason of any grant, allocation, or appropriation of the state or agencies thereof, to the extent that the Controller shall be the custodian at any time of these funds or moneys, and any legally available funds or moneys that are or will be due or payable to any sponsor, the bank, or the state or the agencies thereof by reason of any grant, allocation, apportionment, or appropriation of the federal government or agencies thereof.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 26. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE

chapter: 5. Revenue Bonds

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 5. Revenue Bonds


text:
(a) Notwithstanding any other provision of law, but consistent with Sections 1 and 18 of Article XVI of the California Constitution, a sponsor may issue bonds for purchase by the bank pursuant to a bond purchase agreement. The bank may issue bonds or authorize a special purpose trust to issue bonds. These bonds may be issued pursuant to the charter of any city or any city and county that authorized the issuance of these bonds as a sponsor and may also be issued by any sponsor pursuant to the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Division 2 of Title 5) to pay the costs and expenses pursuant to this title, subject to the following conditions:

(1) With the prior approval of the bank, the sponsor may sell these bonds in any manner as it may determine, either by private sale or by means of competitive bid.

(2) Notwithstanding Section 54418, the bonds may be sold at a discount at any rate as the bank and sponsor shall determine.

(3) Notwithstanding Section 54402, the bonds shall bear interest at any rate and be payable at any time as the sponsor shall determine with the consent of the bank.

(b) The total amount of rate reduction bonds and bonds issued to finance public development facilities that may be outstanding at any one time under this chapter shall not exceed fifteen billion dollars ($15,000,000,000).

(c) Bonds for which moneys or securities have been deposited in trust, in amounts necessary to pay or redeem the principal, interest, and any redemption premium thereon, shall be deemed not to be outstanding for purposes of this section.

history: (History: Amended by Stats. 2020, Ch. 10, Sec. 3. (AB 78) Effective June 29, 2020.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) The bank may give final approval for the issuance of the bonds or of the authorization of a special purpose trust upon terms it deems necessary or desirable.

(b) The executive director may establish the terms and conditions for the issuance of the bonds or of the authorization of a special purpose trust and take any other action necessary or desirable for the issuance of the bonds or of a special purpose trust authorized by the bank.

(c) Any action under this section shall be at the discretion of the bank.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 28. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: The Treasurer, the Governor, or the Lieutenant Governor is an elected representative of the state authorized to fulfill the public approval requirement of Section 147(f) of Title 26 of the Internal Revenue Code (26 U.S.C.A. Sec. 147(f)), including subsequent amendments thereto, or its successor provision, for the issuance of tax-exempt bonds issued by the bank, a special purpose trust, or a sponsor pursuant to this chapter.

history: (History: Amended by Stats. 2001, Ch. 508, Sec. 3. Effective January 1, 2002.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Bonds may be authorized to finance a single project for a single sponsor or a participating party, a series of projects for a single sponsor or a participating party, a single project for several sponsors or participating parties, or several projects for several sponsors or participating parties.

(b) Except as otherwise expressly provided by the bank, every issue of its bonds shall be payable from any revenues or other moneys of the bank available therefor and not otherwise pledged. These revenues or moneys may include the proceeds of additional bonds, subject only to any agreements with the holders of particular bonds pledging any particular revenues or moneys. Notwithstanding that the bonds may be payable from a special fund, these bonds shall be deemed to be negotiable instruments for all purposes.

(c) Subject to the limitations in Section 63071, bonds may be issued in one or more series, may be issued as serial bonds or as term bonds or as a combination thereof. The bonds shall be authorized by resolution of the bank and shall, as provided by the resolution, bear the date of issuance, the time of maturity, which shall not exceed 50 years from the date of issuance, bear the rate or rates of interest, be payable at the time or times provided, be in the denominations provided, be in the form or forms provided, carry the registration privileges provided, be executed in the manner provided, be payable in lawful money of the United States, or other designated currency, at the place or places provided, and be subject to any terms of redemption provided therein.

(d) Sale of the bonds of the bank or of a special purpose trust shall be coordinated by the Treasurer in accordance with Section 5702. The Treasurer shall sell the bonds within 90 days of receiving a certified copy of the resolution authorizing the sale of bonds, unless the board adopts a resolution extending the 90-day period.

(e) The sale may be a public or private sale, and for any price or prices, and on any terms and conditions, as the bank determines proper, after giving due consideration to the recommendations of any special purpose trust and any sponsor to be assisted from the proceeds of the bonds. Pending preparation of definitive bonds, the Treasurer may issue interim receipts, certificates, or temporary bonds that shall be exchanged for definitive bonds.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 30. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
Any resolution authorizing any bonds or the authorization of a special purpose trust or any issue of bonds of the bank or a special purpose trust may contain the following provisions, which shall be a part of the contract with the holders of the bonds to be authorized:

(a) Provisions pledging the full faith and credit of the bank, or pledging all or any part of the revenues of any project, or any revenue-producing contract or contracts made by the bank with any sponsor, or any other moneys of the bank, to secure the payment of the bonds or of any particular issue of bonds, subject to those agreements with bondholders as may then exist and consistent with Sections 1 and 18 of Article XVI of the California Constitution.

(b) Provisions setting out the rentals, fees, purchase payments, loan repayments, and other charges, and the amounts to be raised in each year thereby, and the use and disposition of the revenues.

(c) Provisions setting aside reserves or sinking funds, or providing for the use of subordinated classes of bonds by the bank or a special purpose trust, and the regulation and disposition thereof.

(d) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds.

(e) The procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds and the holders thereof that are required to give consent thereto, and the manner in which the consent may be given.

(f) Limitations on the bank’s expenditures for operation and administration, or other expenses.

(g) Definitions of acts or omissions to act that constitute a default in the duties of the bank to holders of its obligations, and providing the rights and remedies of the holders in the event of a default.

(h) The mortgaging of any project and the site thereof for the purpose of securing the interests of the bondholders.

(i) The mortgaging of land, improvements, or other assets owned by a sponsor or participating party for the purpose of securing the interests of the bondholders.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 31. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: Neither the officers of the bank nor any person executing the bonds of the bank or a special purpose trust shall be personally liable for the bonds or be subject to any personal liability or accountability by reason of the issuance thereof.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 32. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: The bank, a special purpose trust, or any sponsor or participating party may, out of any funds available therefor, purchase their respective bonds. The bank and a special purpose trust may hold, pledge, cancel, or resell their bonds, subject to and in accordance with agreements with bondholders.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 33. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
In the discretion of the bank, a special purpose trust, or the sponsor, as the case may be, any bonds issued under this chapter may be secured by a trust agreement between the bank, a special purpose trust, or the sponsor and a corporate trustee or trustees, that may include the Treasurer or any trust company or bank having the powers of a trust company within or without the state.

(a) The trust agreement or the resolution providing for the issuance of the bonds may pledge or assign any funds or assets of the bank or special purpose trust legally available for pledge or assignment, all or a portion of the revenues to be received by the bank, directly or indirectly, with respect to the project, or the proceeds of any contract or contracts, loan or loan agreements, bond or bond purchase agreements, and may convey or mortgage the project or projects, or any portion thereof, to be financed out of the proceeds of the bonds. The trust agreement or resolution providing for the issuance of the bonds may contain provisions for protecting and enforcing the rights and remedies of bondholders as may be reasonable and proper and not in violation of law, including provisions specifically authorized to be included in any resolution or resolutions of the bank or a sponsor authorizing bonds.

(b) Any bank or trust company doing business under the laws of the state that may act as a depository of the proceeds of bonds or of revenues or other moneys shall furnish indemnifying bonds or pledge securities when required by the bank, a special purpose trust, or a sponsor.

(c) The trust agreement may set forth the rights and remedies of the bondholders and of the trustee or trustees, and may restrict the individual right of action by bondholders. In addition, any trust agreement or resolution may contain other provisions that the bank may deem reasonable and proper for the security of the bondholders.

(d) The trust agreement may provide for the pledge or assignment of funds or moneys in the custody of the Controller that are legally available to a sponsor and that are due or payable to the sponsor by reason of any grant, allocation, apportionment, or appropriation of the state or agencies thereof, and any legally available funds or moneys that are or will be due or payable, to any sponsor, the bank, the state or the agencies thereof by reason of any grant, allocation, apportionment, or appropriation of the federal government or agencies thereof.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 34. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Bonds issued under this chapter do not constitute a debt or liability of the state or of any political subdivision thereof, other than the bank or a special purpose trust, and do not constitute a pledge of the full faith and credit of the state or any of its political subdivisions, other than the bank or special purpose trust, but are payable solely from the funds provided therefor under this chapter and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. This subdivision shall in no way preclude bond guarantees or enhancements pursuant to this title. All the bonds shall contain on the face thereof a statement to the following effect:

“Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.”

(b) The issuance of bonds under this chapter shall not directly or indirectly or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation therefor or to make any appropriation for their payment. Nothing in this section shall prevent, or be construed to prevent, the bank from pledging the full faith and credit of the infrastructure bank fund to the payment of bonds or issuance of bonds authorized pursuant to this chapter.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 35. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: The validity of any bonds issued under this chapter shall not be affected by any proceedings related to the authorization or implementation of the project financed by the bonds.

history: (History: Added by Stats. 1994, Ch. 94, Sec. 1. Effective January 1, 1995. Conditionally operative as prescribed by Sec. 17 of Ch. 94.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) The bank or a special purpose trust may issue bonds for the purpose of refunding any bonds, notes, or other securities of the bank, a special purpose trust, or a sponsor then outstanding, including the payment of any redemption premium thereon and any interest accrued, or to accrue, on their earliest or any subsequent date of redemption, purchase, or maturity of these bonds. The bank, or a sponsor, if it deems advisable, may issue or authorize a sponsor to issue bonds for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of any project or any portion thereof.

(b) The proceeds of any bonds issued for the purpose of refunding outstanding bonds as provided in subdivision (a) may, in the discretion of the bank, be applied to the purchase or retirement at maturity or redemption of those outstanding bonds either on their earliest or any subsequent redemption date or upon the purchase or retirement at the maturity thereof and may, pending this application, be placed in escrow to be applied to the purchase or retirement at maturity or redemption of those outstanding bonds on the date or dates as may be determined by the bank.

(c) Pending this use, the escrowed proceeds may be invested and reinvested by the Treasurer or a trustee in obligations of, or guaranteed by, the United States, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States, maturing at the time or times appropriate to assure prompt payment, of the principal, interest, and redemption premium, if any, of the outstanding bonds to be refunded. The interest, income, and profits, if any, earned or realized on the investment may also be applied to the payment of the outstanding bonds to be refunded. After the terms of the escrow have been fully satisfied and carried out, any balance of the proceeds and interest, income, and profits, if any, earned or realized on the investments thereof, shall be returned to the agency for use in carrying out the purposes of this division.

(d) The portion of the proceeds of the bonds issued for the additional purpose of paying all or any part of the cost of construction and acquiring additions, improvements, extensions, or enlargements of any project may be invested and reinvested by the Treasurer or a trustee in obligations of, or guaranteed by, the United States, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States, maturing not later than the time or times when these proceeds will be needed for the purpose of paying all or any part of the cost. The interest, income, and profits, if any, earned or realized on this investment may be applied to the payment of all, or any part of, the cost or may be used by the bank in carrying out the purposes of this division.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 36. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text: Notwithstanding anything herein to the contrary, this act shall be supplemental to, and not in lieu of, the right of any sponsor to issue general obligation bonds or bonds that it is otherwise lawfully authorized to issue or cause to be issued.

title: 6.7. INFRASTRUCTURE FINANCE


text: Any and all bonds issued by the bank or a special purpose trust, their transfer and the income therefrom, shall at all times be free from taxation of every kind by the state and by all political subdivisions of the state.

history: (History: Amended by Stats. 1995, Ch. 863, Sec. 37. Effective January 1, 1996.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) Any issue of revenue bonds by the bank may be secured and made more attractive to capital markets through financial instruments, including, but not limited to:

(1) Deeds of trust on the resources, facilities, and revenues of the projects.

(2) Credit enhancements, including, but not limited to, letters of credit, bond insurance, and surety bonds provided by private financial institutions.

(3) Insurance and guarantees provided by the bank itself.

(b) The bank may make loans to help establish and support the revolving loan funds of small business development corporations, economic development corporations, community development corporations, and nonprofit corporations. The loans may be made from any appropriate account or subaccount of the California Infrastructure and Economic Development Bank Fund and as determined by the bank.

history: (History: Added by Stats. 1998, Ch. 4, Sec. 21. Effective January 1, 1999.)

title: 6.7. INFRASTRUCTURE FINANCE


text: Whenever the bank deems that it will increase the salability or the price of the bonds to obtain, prior to or after sale, a legal opinion from private counsel as to the validity or tax-exempt nature of the bonds, the bank may obtain a legal opinion. Payment for legal services may be made out of the proceeds of the sale of the bonds.

history: (History: Added by Stats. 1998, Ch. 4, Sec. 22. Effective January 1, 1999.)

title: 6.7. INFRASTRUCTURE FINANCE


text: The bank may employ financial consultants, advisers, and accountants, as may be necessary in its judgment, in connection with the issuance and sale of any bonds of the bank. Payment for these services may be made out of the proceeds of the sale of the bonds.

history: (History: Added by Stats. 1998, Ch. 4, Sec. 23. Effective January 1, 1999.)

title: 6.7. INFRASTRUCTURE FINANCE


text: Section 10295 and Sections 10335 to 10382, inclusive, of the Public Contract Code shall not apply to agreements entered into by the bank in connection with the sale of bonds or notes authorized under this division.

history: (History: Added by Stats. 1998, Ch. 4, Sec. 24. Effective January 1, 1999.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
For purposes of this chapter:

(a) “Participating party” includes the California FAIR Plan Association.

(b) “Project” has the same meaning as defined in Section 63010, and also includes financing all or any portion of the costs of claims or to increase liquidity and the claims-paying capacity of the California FAIR Plan Association in an amount, together with necessary reserves, capitalized interest, credit or liquidity enhancement costs, or costs of issuance, that may be determined by the California FAIR Plan Association, with prior approval from the Insurance Commissioner, in a request to the bank made pursuant to Section 63049.75.

history: (History: Added by Stats. 2025, Ch. 473, Sec. 2. (AB 226) Effective October 9, 2025.)

title: 6.7. INFRASTRUCTURE FINANCE


text:
(a) This chapter shall be known, and may be cited, as the Small Business Financial Assistance Act of 2013.

(b) Notwithstanding any other provision of this division, this chapter shall not apply to any other activities, powers, and duties of the bank under any of the other chapters of this division.

history: (History: Added by Stats. 2013, Ch. 537, Sec. 4. (AB 1247) Effective October 4, 2013.)

title: 6.7. INFRASTRUCTURE FINANCE

article: 1. Introduction

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 6. Small Business Financial Assistance Act of 2013 > 1. Introduction


text:
The Legislature finds all of the following:

(a) Small businesses form the core of the California economy and that it is in the interest of the state to increase opportunities for entrepreneurs, the self-employed, and microbusiness and small business owners to have better access to capital and other technical resources.

(b) Unemployment in California is a matter of statewide concern requiring concerted public and private action to develop employment opportunities for the disadvantaged, unemployed persons, veterans, and youth.

(c) It is necessary to direct additional capital, general management assistance, business education, and other resources to encourage the development of small business opportunities, particularly for minorities, women, and disabled persons, to alleviate unemployment.

title: 6.7. INFRASTRUCTURE FINANCE

chapter: 6. Small Business Financial Assistance Act of 2013

article: 1. Introduction


text:
Unless the context otherwise requires, the definitions in this section shall govern the construction of this chapter. The definitions provided in this section shall only apply to this chapter and not to any other chapter of this division.

(a) “Bank” means the California Infrastructure and Economic Development Bank.

(b) “Bank board” means the board of directors of the California Infrastructure and Economic Development Bank.

(c) “Board of directors” means the board of directors of a corporation.

(d) “California Small Business Board” means the advisory board established pursuant to Section 14004.1 of the Corporations Code for the purpose of advising on issues and programs affecting small business.

(e) “California Small Business Finance Center” means the governmental unit within the bank, which is located within the Governor’s Office of Business and Economic Development, with the administrative responsibility for programs and activities authorized pursuant to Section 8684.2 of this code, Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code, and this chapter.

(f) “Corporation” means any nonprofit California small business financial development corporation created pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code, or pursuant to Chapter 1 (commencing with Section 32000) of Division 15.5 of the Financial Code.

(g) “Directives and requirements” means a document adopted by the bank board setting forth policy direction as well as key rules governing a particular subject area.

(h) “Executive director” means the executive director of the California Infrastructure and Economic Development Bank.

(i) “Expansion fund” means the California Small Business Expansion Fund authorized pursuant to Section 63089.5.

(j) “Financial company” means banking organizations, including national banks and trust companies, savings and loan associations, certified community development financial institutions, microbusiness lenders, state insurance companies, mutual insurance companies, and other public and private banking, lending, retirement, and insurance organizations.

(k) “Financial institution” means regulated banking organizations, including national banks and trust companies authorized to conduct business in California and state-chartered commercial banks, trust companies, credit unions, and savings and loan associations.

(l) “Financial product” means the type of financial assistance described in Section 63088.5, authorized by this chapter, or that the California Small Business Finance Center or a small business financial development corporation is otherwise authorized to provide.

(m) “Loan committee” means a committee appointed by the board of directors of a corporation to determine the course of action on a loan application pursuant to this chapter.

(n) “Microbusiness lender” means a microbusiness lender as defined in Section 13997.2.

(o) “Program manager” means the manager of the California Small Business Finance Center as designated to this title by the executive director of the California Infrastructure and Economic Development Bank.

(p) “Small business loan” means a loan to a business defined as an eligible small business as set forth in Section 121.3-10 of Part 121 of Chapter 1 of Title 13 of the Code of Federal Regulations, including those businesses organized for agricultural purposes that create or retain employment as a result of the loan unless otherwise defined by the directives and requirements. Directives and requirements shall provide guidelines as to the preferred ratio of jobs created or retained to total funds borrowed for guidance to the corporations.

(q) “Trust fund” means the moneys from the expansion fund that is held in trust by a financial institution or financial company. A trust fund is not a deposit of state funds and is not subject to the requirements of Section 16506.

(r) “Trustee” means the lending institution or financial company selected by the bank board to hold and invest the trust funds, or selected by a predecessor agency to the bank, if applicable. An agreement made pursuant to this chapter and the trustee shall not be construed to be a deposit of state funds.

(s) “Trust fund account” means an account within the trust fund that is either allocated to a particular corporation or shared by multiple corporations for the purpose of paying loan defaults and claims on bond guarantees or other financial products and program uses provided in this chapter.

title: 6.7. INFRASTRUCTURE FINANCE

article: 2. Definitions

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 6. Small Business Financial Assistance Act of 2013 > 2. Definitions


text:
(a) There is within the Governor’s Office of Business and Economic Development the California Infrastructure and Economic Development Bank, which shall, among other things, administer the California Small Business Finance Center that administers programs to assist businesses seeking new capital resources, including, but not limited to, the Small Business Loan Guarantee Program.

(b) The bank board may continue programs funded by the Small Business Expansion Fund or establish one or more programs administered by the bank directly, in conjunction with financial companies or financial institutions, in direct or indirect participation with special purpose entities established for small business finance, or under contract with small business financial development corporations. The bank board may establish any and all programs pursuant to this chapter or Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code that it determines are necessary or desirable to directly or indirectly assist small businesses obtain capital. Programs established pursuant to this chapter or Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code may include the following types of financial products:

(1) Loan guarantees and other credit enhancements.

(2) Direct loans and other debt instruments.

(3) Disaster loan guarantees.

(4) Surety bond guarantees.

(c) In all of their state-funded programs, the corporations shall, to the extent practicable, be complementary to, and not competitive with, commercial lenders and other state and federal programs.

(d) In carrying out this chapter the program manager, the executive director, and the bank board may call on the California Small Business Board for advice and recommendations. All actions by the California Small Business Board are advisory.

(e) The California Small Business Board may also advise the Governor and the Small Business Advocate regarding issues and programs affecting California’s small business community, including, but not limited to, business innovation and expansion, export finance, state procurement, management and technical assistance, venture capital, and financial assistance.

history: (History: Amended by Stats. 2020, Ch. 10, Sec. 4. (AB 78) Effective June 29, 2020.)

title: 6.7. INFRASTRUCTURE FINANCE

article: 3. Purpose

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 6. Small Business Financial Assistance Act of 2013 > 3. Purpose


text:
To implement its responsibilities, a corporation shall undertake program activities that shall include, but not be limited to, the following:

(a) Outreach to low-resource small businesses and microbusinesses. The corporations located in rural areas shall give priority to low-resource farmers and rural and agriculturally related businesses.

(b) Collaboration with other organizations and lenders to identify and assist those businesses that are creditworthy but face impediments to accessing conventional sources because of reasons, such as low equity, inadequate collateral, unacceptable legal structure (such as a co-op or nonprofit organization), management inadequacies, and language problems.

(c) To the extent possible, bringing all possible financial resources to bear on the borrower’s problems, including, but not limited to, low-interest lenders, business and industrial development corporations (BIDCOs), minority enterprise small business investment companies (MESBICs), and other financial institutions, financial companies, and grantors.

(d) Technical assistance to businesses receiving loans or guarantees that will maximize the probability of loan repayment.

(e) Ongoing strategies for increasing program resources through private sector involvement and nonstate funds.

(f) A program for collecting and liquidating defaulted loans so that the corporations can qualify to become full-service lenders under the Small Business Administration. Corporations located in rural areas shall, in addition, try to qualify for lender status under the United States Department of Agriculture’s Rural Development and Farm Services Agency.

(g) Become an agent for other financial institutions and financial companies.

(h) Become an agent for other state or federal governmental agencies that need a qualified financial service provider, including, but not limited to, the State Energy Resources Conservation and Development Commission.

title: 6.7. INFRASTRUCTURE FINANCE

article: 3. Purpose


text: The bank board shall adopt directives and requirements concerning the implementation of this chapter and pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code. Any regulations adopted pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code, as that chapter read on January 1, 2013, shall remain in effect until the bank board adopts directives and requirements relating to the specific policy or activity, but in no case beyond June 1, 2015.

title: 6.7. INFRASTRUCTURE FINANCE

article: 4. Administrative Structure

path: 6.7. INFRASTRUCTURE FINANCE > 1. THE BERGESON-PEACE INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK ACT > 6. Small Business Financial Assistance Act of 2013 > 4. Administrative Structure


text:
(a) The program manager acting under the guidance of the executive director shall do all of the following:

(1) Administer this chapter.

(2) 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.

(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 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 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.

history: (History: Amended by Stats. 2016, Ch. 713, Sec. 1. (SB 936) Effective January 1, 2017.)

title: 6.7. INFRASTRUCTURE FINANCE

article: 4. Administrative Structure


text:
(a) The use of state funds paid out to the trust fund and the return on those funds from investment pursuant to Section 63089.56 is conditional pursuant to Sections 63089.3 and 63089.57. Each corporation shall enter into a written signed agreement with the bank to provide program management services for one or more programs or activities of the California Small Business Finance Center authorized under Section 8684.2, this chapter, and Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code.

(b) Agreements with the corporations entered into pursuant to this chapter are exempt from the requirements of Section 10295, and Sections 10335 to 10381, inclusive, of the Public Contract Code. The agreement shall, at a minimum, govern the activities in which the corporation engages, the investment of state funds and its return, and the budgeted administrative expenses the corporations may incur.

(c) In the event the program manager and corporation do not reach an agreement, the corporation may appeal one or more conditions of the contract to the executive director or the bank board by providing written notice to the executive director within 10 days of the final written contract proposal from the program manager. The executive director or the bank board shall make a determination within 30 days of receiving written notice.

(d) In the event that the program manager finds the corporation has violated the terms of an active agreement, the program manager may take any action under Section 63089.3 or 63089.57, or any other action as appropriate. In the event the program manager finds the corporation has substantively violated the terms of an active agreement, the corporation shall have no authority to withdraw or encumber the moneys in the trust fund or the return of those funds by the issuance of guarantees, commitments for other financial products, or by incurring expenses against the fund and its return in any manner whatsoever, and the program manager may take any action under Section 63089.3 or 63089.57, or any other action as appropriate. Any guarantee or other encumbrance made by the corporation in violation of this section shall be null and void, and the state, the bank, the expansion fund, or the trust fund will not be liable therefor.

title: 6.7. INFRASTRUCTURE FINANCE

article: 4. Administrative Structure


text:
(a) The program manager may temporarily suspend the guarantee authority or other financial product authority of a corporation if in the determination of the program manager a corporation has substantially failed to comply with any of the requirements in subdivision (b), causing irreparable harm to the program, the corporation’s guarantee, or any other financial products authority. The notice of temporary suspension sent to the corporation shall specify the reasons for the action.

(1) As used in this section, “guarantee or any other financial products authority” means the authority to make or guarantee or administer any other financial products that encumber funds in a trust fund account, any account or subaccount under the direct control of the bank or other state entity, or the expansion fund.

(2) The program manager shall make one of the determinations specified in subdivision (b) within 30 days of the effective date of the temporary suspension, unless the corporation and the program manager mutually agree to an extension. The corporation shall have the opportunity to submit written material to the program manager addressing the items stated in the temporary suspension notice. If the program manager does not make any determinations within 30 days, the temporary suspension shall be reversed. The corporation’s yearly contract shall remain in effect during the period of temporary suspension, and the corporation shall continue to receive reimbursement of necessary operating expenses.

(b) Failure of a corporation to substantially comply with the following may result in the suspension or termination of a corporation:

(1) Directives and requirements adopted by the bank board, for implementing the California Small Business Development Corporation Law (Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code) and this chapter.

(2) Failure to meet any fiscal, audit, examination, or portfolio requirement, as contained in the directives and requirements and examination reports.

(3) Failure to significantly meet any milestones or scope of work as contained in the performance contract between the corporation and the bank.

(4) Any other action in the opinion of the program manager that causes irreparable harm to the corporation, the expansion fund, or the trust fund.

(c) Pursuant to subdivisions (a) and (b), the program manager may take any of the following actions:

(1) Terminate the temporary suspension.

(2) Terminate the temporary suspension subject to the corporation’s adoption of a specified remedial action plan approved by the program manager.

(3) Continue the temporary suspension of guarantee and other financial product authority until a specified time.

(4) Terminate the corporation’s authority to administer specified loan guarantees or other financial products.

(5) Terminate the corporation’s authority to remain a corporation authorized pursuant to the California Small Business Development Corporation Law (Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code) and this chapter.

(d) The program manager shall make one of the determinations specified in subdivision (c) within 30 days of the effective date of the temporary suspension notice, unless the corporation and the program manager mutually agree to an extension. If the program manager does not make any determinations within 30 days, the temporary suspension shall be negated. The corporation’s yearly contract shall remain in effect during the period of temporary suspension, and the corporation shall continue to receive reimbursement of necessary operating expenses.

(e) The actions contained in paragraphs (3) to (5), inclusive, of subdivision (c) require a finding that irreparable harm will occur unless the action is taken, and a finding that the corporation has failed to comply with the California Small Business Development Corporation Law (Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code) and this chapter.

(f) In considering any action specified in subdivision (c), the program manager shall consider, along with other criteria as specified in subdivision (b), the corporation’s history and past performance.

(g) If the program manager decides to take any action pursuant to paragraphs (3) to (5), inclusive, of subdivision (c), the program manager shall transfer all funds subject to the action, whether encumbered or not, in the trust fund account of the suspended or terminated corporation into either the expansion fund, or either permanently or temporarily transfer the funds to the trust fund account of another corporation or a holding account in the expansion fund or trust fund established for this purpose, unless an appeal is received from the corporation pursuant to subdivision (h).

(h) If the program manager intends to transfer funds as specified in paragraph (g), the corporation shall be notified of the funds transfer 10 days before the effective date of the transfer. The corporation shall have the right to appeal the program manager’s decision to the executive director within that 10-day period by sending written notice to the executive director. Once the executive director receives notice that the action is being appealed, the program manager’s funds transfer shall be stayed.

(i) The corporation shall have the opportunity to submit written material to the executive director addressing the actions and findings stated in the program manager’s determination. The executive director shall consider and make a final determination on the appeal within 30 days of receiving the appeal notice from the corporation, or such longer time as agreed to by the executive director and the corporation. The executive director may elect to take any of the actions listed in subdivision (j). The action of the program manager shall remain in effect until the executive director issues a decision. The corporation’s performance contract shall remain in effect during the appeal period, and the corporation shall continue to receive reimbursement of necessary operating expenses.

(j) Pursuant to subdivision (i), the executive director may independently take action or seek the advice and recommendation of the California Small Business Board prior to taking any of the following actions:

(1) Rescind the action taken by the program manager.

(2) Modify the action taken by the program manager subject to the adoption by the corporation of a specified remedial action plan approved by the executive director.

(3) Affirm the action taken by the program manager.

(k) Following the executive director’s concurrence any action pursuant to paragraphs (3) to (5), inclusive, of subdivision (c), the program manager shall transfer all funds subject to the action, whether encumbered or not, in the trust fund account of the suspended or terminated corporation into either the expansion fund, or either permanently or temporarily transfer the funds to the trust fund account of another corporation or a holding account in the expansion fund or trust fund established for this purpose. The corporation shall be notified of the funds transfer 10 days before the effective date of the transfer. The corporation shall have the right to appeal the executive director’s decision to the bank board within that 10-day period by sending written notice to the chair of the bank board. Once the chair of the bank board receives notice that the executive director’s determination is being appealed, the program manager’s funds transfer shall be stayed.

(l) The corporation shall have the opportunity to submit written material to the bank board addressing the actions and findings stated in the executive director’s determination. The bank board shall consider and make a final determination on the appeal within 30 days of receiving the appeal notice from the corporation, or such longer time as agreed to by the chair of the bank board and the corporation. The action of the executive director shall remain in effect until the bank board issues a decision. The corporation’s performance contract shall remain in effect during the appeal period, and the corporation shall continue to receive reimbursement of necessary operating expenses.

(m) Pursuant to subdivision (l), the bank board may independently take action or seek the advice and recommendation of the California Small Business Board prior to taking any of the following actions:

(1) Rescind the action taken by the executive director.

(2) Modify the action taken by the executive director subject to the adoption by the corporation of a specified remedial action plan acceptable to the executive director.

(3) Affirm the action taken by the executive director.

(n) Following the bank board’s concurrence with the executive director’s determination consistent with any action pursuant to paragraphs (3) to (5), inclusive, of subdivision (c), the program manager shall transfer all funds subject to the action, whether encumbered or not, in the trust fund account of the suspended or terminated corporation into either the expansion fund, or either permanently or temporarily transfer the funds to the trust fund account of another corporation or a holding account in the expansion fund or trust fund established for this purpose. The corporation shall be notified of the funds transfer 10 days before the effective date of the transfer.

(o) Notwithstanding Section 63089.56, in the event a final determination was made by the program manager, the executive director or the bank board, whichever is applicable, to temporarily transfer the funds of the corporation to the expansion fund or to the trust fund account of another corporation or a holding account in the expansion fund or trust fund established for this purpose, upon compliance with all requirements of that final determination as determined by the executive director, the transferred funds shall be returned to the corporation’s trust fund account. While the funds of a corporation’s trust fund account reside in the expansion fund, use of the principal on the funds shall be governed by the implementing directives and requirements specifying use of funds in the expansion fund. Interest on the funds moved from a corporation’s trust fund account upon temporary withdrawal shall be limited to payment of the corporation’s administrative expenses, as contained in the contract between the corporation and the bank pursuant to this chapter.

(p) Following a final determination of termination of all activities of an active corporation, in order to continue its existence as a nonprofit corporation pursuant to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code), the corporation must amend its articles of incorporation in accordance with Chapter 8 of Part 2 of Division 2 of the Corporations Code to remove the provisions required by Section 14005 of the Corporations Code, including an amendment to remove the words “small business financial development corporation,” “small business development corporation,” or “rural or urban development corporation,” as applicable, from the corporate name and shall no longer be registered with the Secretary of State as a small business financial development corporation. A corporation shall not enjoy any of the benefits of a small business financial development corporation following suspension.

title: 6.7. INFRASTRUCTURE FINANCE

article: 4. Administrative Structure


text:
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) Select a financial institution or financial company to act as trustee of the trust fund as specified in this chapter.

(d) Invest expansion fund and trust fund moneys as specified in this chapter.

(e) Affirm, modify, or rescind the determinations of the program manager and the executive director as specified in this chapter.

(f) Adopt directives and requirements as specified in this chapter.

(g) Authorize new financial product programs and activities pursuant to this chapter.

title: 6.7. INFRASTRUCTURE FINANCE

article: 4. Administrative Structure