BILL NUMBER: AB 484	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 14, 2015
	AMENDED IN ASSEMBLY  MARCH 26, 2015

INTRODUCED BY   Assembly Member Gipson

                        FEBRUARY 23, 2015

   An act to amend Sections 63088.5 and 63089.5 of,  to add
Chapter 2.6 (commencing with Section 13996.85) to Part 4.7 of
Division 3 of Title 2 of,   and  to add Article 8.5
(commencing with Section 63089.85) to Chapter 6 of Division 1 of
Title 6.7 of,  and to add Chapter 7 (commencing with Section
63090) to Division 1 of Title 6.7 of,  the Government Code,
relating to state government, and making an appropriation therefor.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 484, as amended, Gipson.  Trade promotion of California
ports: California Export Finance Office.   California
Infrastructure and Economic Development Bank: insurance. 

   (1) Existing law requires the Director of the Governor's Office of
Business and Economic Development, known as GO-Biz, to provide to
the Legislature, not later than February 1, 2019, a strategy for
international trade and investment that, at a minimum, includes
specified information, goals, objectives, and actions related to the
promotion of trade.  
   The bill would require the director to convene, no later than
February 1, 2016, a statewide business partnership for the promotion
of trade for California ports and to explore greater utilization of
California ports, that would be required to advise the director for
those purposes, as prescribed.  
   (2) The 
    The  Bergeson-Peace Infrastructure and Economic
Development Bank Act authorizes the California Infrastructure and
Economic Development Bank, within  the Governor's Office of
Business and Economic Development, known as  GO-Biz, to make
loans and provide other assistance to public and private entities for
various types of economic development projects, among other things.
The bank is governed by a board of directors and under the direction
of an executive director. The bank administers the California Small
Business Finance Center that administers programs to assist
businesses seeking new capital resources. The Small Business
Financial Assistance Act of 2013 continues in existence the
California Small Business Expansion Fund (expansion fund), a
continuously appropriated fund which includes General Fund moneys,
and authorizes all or a portion of the funds in the expansion fund to
be paid out to a financial institution or financial company that
will establish a trust fund and act as a trustee of the funds, as
specified. The Small Business Financial Assistance Act of 2013
authorizes the program manager, as defined, to create one or more
accounts in the expansion fund and the trust fund for corporations
participating in one or more specified programs.
   The Small Business Financial Assistance Act of 2013 authorizes the
bank board to continue programs funded by the expansion fund or to
establish one or more programs administered by the bank or under
contract with small business financial development corporations.
Existing law further authorizes those programs to include specific
types of financial products, including loan guarantees and surety
bond guarantees. The expansion fund may be used to pay defaulted loan
guarantee or surety bond losses, or other financial product defaults
or losses, to fund direct loans and other debt instruments, to pay
administrative costs of corporations, to pay state support and
administrative costs, and to pay costs to protect a real property
interest in a financial product default.
   This bill would authorize the bank to include insurance,
coinsurance, and other forms of surety among the types of financial
products included in programs administered by the bank, as
prescribed. The bill would authorize the bank to act as agent for
creditworthy California growers, manufacturers, and other exporters,
to sell approved and insured accounts receivable to qualified
parties, and function as a clearinghouse for the collection and
disbursement of funds relative to those sales. By expanding the
activities of the bank that are funded by continuous appropriation
from the expansion fund, this bill would make an appropriation.

   The bill would establish the California Export Finance Office
(office) within the California Small Business Finance Center, within
the bank, to be headed by the executive director, for the purpose of
expanding employment and income opportunities for Californians
through increased exports of California goods, services, and
agricultural commodities. The bill would authorize the office to
coordinate state export activities with international, federal, and
other state entities and disseminate information to California
exporters.  
   The bill would also establish within the office an 11-member
California Export Finance Advisory Board (export advisory board),
composed of specified state officers and individuals appointed by the
Governor and the Legislature, to serve 2-year terms at the pleasure
of their appointing authority, as specified. The bill would require
the export advisory board, among other duties, to advise on specified
export-related programs and issue an annual report. 

   The bill would require the office to comply with existing laws
relating to open and public meetings and access to public records.

   Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Trade is critical to California's prosperity by fueling
economic growth, supporting and creating jobs, and raising living
standards. In 2012, California's three customs districts led the
nation by processing $579 billion in two-way trade value. Exports
have been the second largest contributor to our nation's gross
domestic product since the recession ended.
   (b) California's success as a trade leader cannot be taken for
granted, given the weakening of the national and global economies,
the European debt crisis, and the increased competition of Gulf
Coast, East Coast, and Mexican ports preparing to compete with
California's market share as the expanded Panama Canal becomes
operational in 2015.
   (c) There are substantial opportunities that can strengthen and
grow California's trade sector and increase jobs. As the gateway to
China, India, and emerging countries, California is well positioned
to access China, India, and emerging nations that are, or are
becoming, large markets for exported goods and services.
   (d) Exports support jobs for California workers and more than one
million direct and indirect jobs. Exports sustain nearly 60,000
businesses in the state, of which 96 percent are small- to
medium-sized businesses.
   (e) Many small- and medium-sized California businesses and
agricultural enterprises, both those that are already exporting and
want to expand their business and those that are new to exporting,
would benefit from financing and technical assistance. 
   (f) California-based small- and medium-sized exporters were
assisted from 1985 to 2003, inclusive, under a state program designed
to work with federal, state, and private institutions to provide
California exporters with information, technical assistance, and
financial resources, but the state program ceased when the
Technology, Trade, and Commerce Agency was eliminated for budgetary
reasons in 2004 by Chapter 229 of the Statutes of 2003. 

   (g) Reestablishing the state program will expand job opportunities
for California's workforce by increasing exports of California
goods, services, and agricultural commodities through the provision
of information, technical assistance, and financial support to
California exporters.  
  SEC. 2.    Chapter 2.6 (commencing with Section
13996.85) is added to Part 4.7 of Division 3 of Title 2 of the
Government Code, to read:
      CHAPTER 2.6.  TRADE PROMOTION OF CALIFORNIA PORTS


   13996.85.  The Director of the Governor's Office of Business and
Economic Development shall convene, no later than February 1, 2016, a
statewide business partnership for promotion of trade for California
ports and to explore greater utilization of California ports, as
follows:
   (a) The business partnership shall include, but is not limited to,
representatives from ports of entry, ocean carriers, marine terminal
operators, warehouse operators, railroads, trucking companies, labor
representatives, and foreign trade zones, representatives of
environmental groups, and shippers, specifically including
agricultural exporters, manufacturers, postconsumer secondary
material handlers, and retailers.
   (b) The business partnership shall advise the Director of the
Governor's Office of Business and Economic Development on promoting
trade for California ports while increasing the use of California
ports of entry, and ways to increase the opportunity for growth and
trade activity. 
   SEC. 3.   SEC. 2.   Section 63088.5 of
the Government Code is amended to read:
   63088.5.  (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) Pursuant to this chapter and Chapter 1 (commencing with
Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations
Code, the bank board may continue programs funded by the California
Small Business Expansion Fund or establish one or more programs
administered by the bank or under contract with small business
financial development corporations. 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.
   (5) Insurance, coinsurance, and other forms of surety.
   (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.
   SEC. 4.   SEC. 3.   Section 63089.5 of
the Government Code, as added by Section 4 of Chapter 537 of the
Statutes of 2013, is amended to read:
   63089.5.  (a) There is hereby continued in existence in the State
Treasury the California Small Business Expansion Fund. All or a
portion of the funds in the expansion fund may be paid out, with the
approval of the Department of Finance, to a financial institution or
financial company that will establish a trust fund and act as trustee
of the funds.
   (b) The expansion fund and the trust fund shall be used for the
following purposes:
   (1) To pay defaulted loan guarantee or surety bond losses, or
other financial product defaults or losses.
   (2) To fund direct loans and other debt instruments.
   (3) To pay administrative costs of corporations.
   (4) To pay state support and administrative costs.
   (5) To pay those costs necessary to protect a real property
interest in a financial product default.
   (c) The expansion fund and trust fund are created solely for the
purpose of receiving state, federal, or local government moneys, and
other public or private moneys to make loans, guarantees, and other
financial products that the California Small Business Finance Center
or a financial development corporation is authorized to provide. The
program manager shall provide written notice to the Joint Legislative
Budget Committee and to the Chief Clerk of the Assembly and the
Secretary of the Senate who shall provide a copy of the notice to the
relevant policy committees within 10 days of any nonstate funds
being deposited in the expansion fund. The notice shall include the
source, purpose, timeliness, and other relevant information as
determined by the bank board.
   (d) (1) One or more accounts in the expansion fund and the trust
fund may be created by the program manager for corporations
participating in one or more programs authorized under this chapter
and Section 8684.2. Each account is a legally separate account, and
shall not be used to satisfy loan guarantees or other financial
product obligations of another corporation except when the expansion
fund or trust fund is shared by multiple corporations.
   (2) The program manager may create one or more holding accounts in
the expansion fund or the trust fund, or in both, to accommodate the
temporary or permanent transfers of funds pursuant to Section
63089.3.
   (e) The amount of guarantee liability outstanding at any one time
shall not exceed five times the amount of funds on deposit in the
expansion fund plus any receivables due from funds loaned from the
expansion fund to another fund in state government as directed by the
Department of Finance pursuant to a statute enacted by the
Legislature, including each of the trust fund accounts within the
trust fund.
   (f) The amount of insured export transaction liability outstanding
at any one time shall be secured by no less than a 25-percent
reserve amount of funds on deposit in the expansion fund plus any
receivables due from funds loaned from the expansion fund to another
fund in state government as directed by the Department of Finance
pursuant to a statute enacted by the Legislature, including each of
the trust fund accounts within the trust fund.
   (g) This section shall remain in effect only until January 1,
2018, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2018, deletes or extends
that date.
   SEC. 5.   SEC. 4.   Section 63089.5 of
the Government Code, as amended by Section 8 of Chapter 132 of the
Statutes of 2014, is amended to read:
   63089.5.  (a) There is hereby continued in existence in the State
Treasury the California Small Business Expansion Fund. All or a
portion of the funds in the expansion fund may be paid out, with the
approval of the Department of Finance, to a financial institution or
financial company that will establish a trust fund and act as trustee
of the funds.
   (b) The expansion fund and the trust fund shall be used for the
following purposes:
   (1) To pay defaulted loan guarantee or surety bond losses, or
other financial product defaults or losses.
   (2) To fund direct loans and other debt instruments.
   (3) To pay administrative costs of corporations.
   (4) To pay state support and administrative costs.
   (5) To pay those costs necessary to protect a real property
interest in a financial product default.
   (c) The expansion fund and trust fund are created solely for the
purpose of receiving state, federal, or local government moneys, and
other public or private moneys to make loans, guarantees, and other
financial products that the California Small Business Finance Center
and a small business financial development corporation are authorized
to provide.
   (d) One or more accounts in the expansion fund and the trust fund
may be created by the program manager for corporations participating
in one or more programs authorized under this chapter and Section
8684.2. Each account is a legally separate account, and shall not be
used to satisfy loan guarantees or other financial product
obligations of another corporation except when the expansion fund or
trust fund is shared by multiple corporations.
   (e) The amount of guarantee liability outstanding at any one time
shall not exceed four times the amount of funds on deposit in the
expansion fund plus any receivables due from funds loaned from the
expansion fund to another fund in state government as directed by the
Department of Finance pursuant to a statute enacted by the
Legislature, including each of the trust fund accounts within the
trust fund.
   (f) The amount of insured export transaction liability outstanding
at any one time shall be secured by no less than a 25-percent
reserve amount of funds on deposit in the expansion fund plus any
receivables due from funds loaned from the expansion fund to another
fund in state government as directed by the Department of Finance
pursuant to a statute enacted by the Legislature, including each of
the trust fund accounts within the trust fund.
   (g) This section shall become operative on January 1, 2018.
   SEC. 6.   SEC. 5.   Article 8.5
(commencing with Section 63089.85) is added to Chapter 6 of Division
1 of Title 6.7 of the Government Code, to read:

      Article 8.5.  Insurance, Coinsurance, and Other Forms of Surety



   63089.85.  (a) The bank or its delegate may utilize funds for
offering insurance or coinsurance to businesses with less than 250
employees that export or plan to export pursuant to the directives
and requirements.
   (b) The amount of funds available for insurance, coinsurance, and
other forms of surety shall be determined by the directives and
requirements.
   (c) The bank or its delegate shall not issue insurance,
coinsurance, and other forms of surety unless and until it determines
that all of the following conditions are satisfied:
   (1) The insurance, coinsurance, and other forms of surety
assistance would not be granted by an insurer under reasonable terms
and conditions and the business has demonstrated a reasonable
prospect of repayment.
   (2) The insurance will be extended exclusively to support the
export of goods, services, and agricultural commodities produced or
grown primarily in California by companies or agricultural
enterprises that have California as the principal place from which
their trade or business is directed or managed.
   (3) The business has a minimum equity interest in the business as
determined by the directives and requirements.
   (4) As a result of the insurance, coinsurance, and other forms of
surety instruments, the jobs generated or retained demonstrate
reasonable conformance to any directives and requirements specifying
employment criteria.
   (d) The maximum direct insurance, coinsurance, and other forms of
surety instrument amount to a small business shall be set by the
directives and requirements.
   (e) The bank shall establish directives and requirements for the
formation, operation, and responsibilities of an insurance review
committee, that, at a minimum, requires the following:
   (1) An insurance review committee shall be comprised of at least
five or more persons, a majority of whom shall be experienced in
insurance and export finance.
   (2) An insurance review committee shall expeditiously act to
accept or reject loan applications.
   (3) A person who has a financial interest related to a matter over
which the insurance review committee has authority shall not make,
participate in making, or in any way attempt to influence that
matter.
   (f) The bank board shall adopt collateral or security requirements
to ensure the solvency of any insurance, coinsurance, or surety
extended under this chapter and to assist in evaluating the program
authorized by this chapter.
   (g) The bank may charge the applicant or financial institution an
insurance origination fee or other fee on all insurance made by the
bank or its insurance provider to defray the operating expenses of
the program. The amount of the fee shall be determined by the
directives and requirements.
   63089.86.  The bank may do any of the following:
   (a) Act as an agent for creditworthy California growers,
manufacturers, and other exporters to sell accounts receivable that
are approved by the office and insured by the Foreign Credit
Insurance Association or an acceptable private insurer, to qualified
parties.
   (b) Function as a clearinghouse for the collection and
disbursement of funds relative to those sales through the use of a
segregated bank account.
   (c) Take any other related actions as may be appropriate and
necessary to facilitate the sale of export accounts receivable for
California exporters. 
  SEC. 7.    Chapter 7 (commencing with Section
63090) is added to Division 1 of Title 6.7 of the Government Code, to
read:
      CHAPTER 7.  CALIFORNIA EXPORT FINANCE


   63090.  As used in this chapter:
   (a) "California Export Finance Advisory Board" or "export advisory
board" means the California Export Finance Advisory Board
established by Section 63090.7.
   (b) "California Export Finance Office" or "office" means the
entity created by Section 63090.1.
   (c) "Small-size and medium-size businesses" mean firms with less
than 250 employees.
   63090.1.  (a) The California Export Finance Office is hereby
created within the California Small Business Finance Center, within
the bank.
   (b) The purpose of the office is to expand employment and income
opportunities for Californians through increased exports of
California goods, services, and agricultural commodities by providing
actual and potential California exporters, specifically small- and
medium-sized exporters, with information and technical assistance on
export opportunities, exporting techniques, and financial assistance
in support of export transactions.
   63090.2.  The executive director, or his or her designee, shall be
the director of the California Export Finance Office and shall
administer the programs of the California Export Finance Office and
perform any duties delegated by the bank board.
   63090.3.  The executive director, or his or her designee, upon
approval of the bank board, may do all of the following:
   (a) Contract for services.
   (b) Hold public hearings.
   (c) Call upon and reimburse for services any state agency or
department for assistance in carrying out the objectives of this
chapter.
   (d) Participate with government or private industry in programs
for technical assistance, technology, transfer, or any other programs
related to this chapter.
   (e) Undertake or commission studies on methods to increase
financial resources to expand the exports of California goods,
services, and agricultural commodities.
   (f) Exercise any other power as may be necessary to carry out the
purposes of this chapter.
   (g) Provide or facilitate the provision of export finance training
for staff and other individuals involved in export finance
assistance, including, but not limited to, training sessions provided
by the federal government and other public and private
organizations.
   63090.4.  The office may do all of the following:
   (a) Coordinate state export activities with international,
federal, and other state entities that provide programs or services
that are designed to provide export assistance and export-related
financing.
   (b) Establish a network of contacts among public and private
organizations that provide information, technical assistance, and
financial support of exporting.
   (c) Assemble, publish, and disseminate information to California
exporters on export opportunities, techniques of exporting, sources
of public and private export assistance, and sources of
export-related financing.
   (d) Organize, host, and participate in seminars and other forums
designed to disseminate information and technical assistance on
exporting and export-related financing to actual and potential
California exporters.
   (e) Provide small-size and medium-size businesses, including
individual firms and agricultural enterprises, with information and
technical assistance relating to exporting and export financing.
   63090.5.  The office shall comply with the Bagley-Keene Open
Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1
of Part 1 of Division 3 of Title 2) and the California Public Records
Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of
Title 1).
   63090.7.  (a) The California Export Finance Advisory Board is
established within the bank. The export advisory board shall consist
of 11 members as follows:
   (1) The Secretary of Food and Agriculture, or his or her designee.

   (2) The executive director, or his or her designee.
   (3) One individual appointed by the Governor who shall be
knowledgeable of, and experienced in, the exporting and export needs
of California agriculture.
   (4) Three individuals appointed by the Governor and one individual
appointed by the Speaker of the Assembly, each of whom shall be
experienced in exporting, knowledgeable of the needs and problems of
small and entrepreneurial exporters, and actively employed with an
exporting firm, export trading company, or export management company.

   (5) One person appointed by the Governor and one person appointed
by the Senate Committee on Rules, each of whom shall be experienced
in export financing, knowledgeable of the export financing needs and
problems of small and entrepreneurial exporters, and actively
employed by a financial institution.
   (6) One person appointed by the Controller and one person
appointed by the Treasurer, each of whom shall be an accomplished
credit evaluation representative experienced in analyzing financial
statements, including, but not limited to, loan applications, and in
evaluating the creditworthiness of firms that are likely to seek
insurance or loan guarantees from the office.
   (b) The members shall serve two-year terms at the pleasure of the
appointing authority. Vacancies shall be filled by the appointing
authority.
   (c) Export advisory board members who are not employees of the
state shall receive the per diem authorized in Section 11564.5 for
each day they attend export advisory board or export advisory board
subcommittee meetings. In addition, these members shall be reimbursed
for their expenses in accordance with the rules of the Department of
Personnel Administration when attending export advisory board and
export advisory board subcommittee meetings and conducting export
advisory board business as determined by the export advisory board.
   63090.8.  The export advisory board shall do all of the following:

   (a) Elect a chair and vice chair from among its members. The chair
shall preside at meetings of the export advisory board.
   (b) Advise on the export-related programs authorized by Chapter 6
(commencing with Section 63088) and this chapter.
   (c) Adopt bylaws as are necessary to govern the conduct and
operation of the export advisory board.
   (d) Provide for the appointment of advisory subgroups necessary to
inform and deliberate on issues of significance to the export
advisory board.
   (e) Hold regularly scheduled meetings, at least quarterly, in
order to carry out the objectives and responsibilities of the export
advisory board.
   (f) Issue an annual report critiquing California's export-related
programs, services, and other activities, and recommended changes.
The report shall include an evaluation of how these activities impact
all of the following:
   (1) Participation of financial institutions in export financing
programs.
   (2) Access of California firms to federal export financing
programs.
   (3) Export volume of California firms.
   (4) Economic and social benefits of exports to the state.