Bill Text: CA AB2274 | 2013-2014 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: The California Debt and Investment Advisory Commission.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2014-07-23 - Chaptered by Secretary of State - Chapter 181, Statutes of 2014. [AB2274 Detail]

Download: California-2013-AB2274-Introduced.html

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BILL NUMBER: AB 2274	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Gordon

                        FEBRUARY 21, 2014

   An act to amend Sections 8855 and 8856 of the Government Code,
relating to state government.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2274, as introduced, Gordon. The California Debt and Investment
Advisory Commission.
   Existing law establishes the California Debt and Investment
Advisory Commission to, among other things, maintain contact with
state and municipal bond issuers, underwriters, investors, and credit
rating agencies to improve the market for state and local government
debt issues, and assist state and local governments to prepare,
market, and sell its new debt issues. Existing law authorizes the
commission to charge a fee to a lead underwriter or purchaser, as
specified, with the funds collected to be used, upon appropriation,
for the expenses of the commission and the Treasurer.
   This bill would modify the reporting and notice requirements an
issuer of debt is required to make to the commission before a
proposed sale of debt issue and after a sale of debt issue. This bill
would also expand the commission's authorization to charge fees
relating to the principal amount of a debt issue to include also
charging a fee to a lender. This bill would also make technical,
nonsubstantive changes.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 8855 of the Government Code is amended to read:

   8855.  (a) There is created the California Debt and Investment
Advisory Commission, consisting of nine members, selected as follows:

   (1) The Treasurer, or his or her designee.
   (2) The Governor or the Director of Finance.
   (3) The Controller, or his or her designee.
   (4) Two local government finance officers appointed by the
Treasurer, one each from among persons employed by a county and by a
city or a city and county of this state, experienced in the issuance
and sale of municipal bonds and nominated by associations affiliated
with these agencies.
   (5) Two Members of the Assembly appointed by the Speaker of the
Assembly.
   (6) Two Members of the Senate appointed by the Senate Committee on
Rules.
   (b) (1) The term of office of an appointed member is four years,
but appointed members serve at the pleasure of the appointing power.
In case of a vacancy for any cause, the appointing power shall make
an appointment to become effective immediately for the unexpired
term.
   (2) Any legislators appointed to the commission shall meet with
and participate in the activities of the commission to the extent
that the participation is not incompatible with their respective
positions as Members of the Legislature. For purposes of this
chapter, the Members of the Legislature shall constitute a joint
interim legislative committee on the subject of this chapter.
   (c) The Treasurer shall serve as chairperson of the commission and
shall preside at meetings of the commission.
   (d) Appointed members of the commission shall not receive a
salary, but shall be entitled to a per diem allowance of fifty
dollars ($50) for each day's attendance at a meeting of the
commission not to exceed three hundred dollars ($300) in any month,
and reimbursement for expenses incurred in the performance of their
duties under this chapter, including travel and other necessary
expenses.
   (e) The commission may adopt bylaws for the regulation of its
affairs and the conduct of its business.
   (f) The commission shall meet on the call of the chairperson, at
the request of a majority of the members, or at the request of the
Governor. A majority of all nonlegislative members of the commission
constitutes a quorum for the transaction of business.
   (g) The office of the Treasurer shall furnish all administrative
assistance required by the commission.
   (h) The commission shall do all of the following:
   (1) Assist all state financing authorities and commissions in
carrying out their responsibilities as prescribed by law, including
assistance with respect to federal legislation pending in Congress.
   (2) Upon request of any state or local government units, to assist
them in the planning, preparation, marketing, and sale of new debt
issues to reduce cost and to assist in protecting the issuer's
credit.
   (3) Collect, maintain, and provide comprehensive information on
all state and all local debt authorization and issuance, and serve as
a statistical clearinghouse for all state and local debt issues.
This information shall be readily available upon request by any
public official or any member of the public.
   (4) Maintain contact with state and municipal bond issuers,
underwriters, credit rating agencies, investors, and others to
improve the market for state and local government debt issues.
   (5) Undertake or commission studies on methods to reduce the costs
and improve credit ratings of state and local issues.
   (6) Recommend changes in state laws and local practices to improve
the sale and servicing of state and local debts.
   (7) Establish a continuing education program for local officials
having direct or supervisory responsibility over municipal
investments and debt issuance. The commission shall undertake these
and any other activities necessary to disclose investment and debt
issuance practices and strategies that may be conducive for oversight
purposes.
   (8) Collect, maintain, and provide information on local agency
investments of public funds for local agency investment.
   (9) Publish a monthly newsletter describing and evaluating the
operations of the commission during the preceding month.
   (i) The issuer of any proposed  new  debt issue
of state or local government shall, no later than 30 days prior to
the sale of any debt issue  at public or private sale, give
written notice of the proposed sale   , submit a report
of the proposed issuance  to the  commission, by mail,
postage prepaid, or   commission  by any 
other  method approved by the commission. This subdivision
shall also apply to any nonprofit public benefit corporation
incorporated for the purpose of acquiring student loans. The 
notice shall include the proposed sale date, the name of the issuer,
the type of debt issue, and the estimated principal amount of the
debt.   commission may require information to be
submitted in the report of proposed debt issuance that it considers
appropriate.  Failure to  give this notice 
 submit the report  shall not affect the validity of the
sale.
   (j) The issuer of any  new  debt issue of state
or local government, not later than  45   21
 days after the  signing of the bond purchase contract
in a negotiated or private financing, or after the acceptance of a
bid in a competitive offering,   sale of the debt, 
shall submit a report of final sale to the commission by mail,
postage prepaid, or by any other method approved by the commission. A
copy of the final official statement for the issue shall accompany
the report of final sale. If there is no official statement, the
issuer shall provide each of the following documents, if they exist,
along with the report of final sale:
   (1) Other disclosure document.
   (2) Indenture.
   (3) Installment sales agreement.
   (4) Loan agreement  or promissory note  . 
   (5) Promissory note.  
   (5) 
    (6)  Bond purchase contract. 
   (6) 
    (7)  Resolution authorizing the issue. 
   (7) 
    (8)  Bond specimen.
   The commission may require information to be submitted in the
report of final sale that it considers appropriate. The issuer may
redact confidential information contained in the documents if the
redacted information is not information that is otherwise required to
be reported to the commission.
  SEC. 2.  Section 8856 of the Government Code is amended to read:
   8856.  (a) In carrying out the purposes of this chapter, the
commission may charge fees to the lead underwriter  or
  ,  the purchaser  , or the lender  in an
amount equal to one-fortieth of 1 percent of the principal amount of
the issue, but not to exceed five thousand dollars ($5,000) for any
one issue. Amounts received under this section shall be deposited in
the California Debt and Investment Advisory Commission Fund, which is
hereby created in the State Treasury. All money in the fund shall be
available, when appropriated, for expenses of the commission and the
Treasurer.
   (b) Until fees are received by the advisory commission and
appropriated pursuant to this chapter for the expenses of the
commission and the Treasurer, the commission may borrow the moneys
required for the purpose of meeting necessary expenses of initial
organization and operation of the commission.