Bill Text: CA AB189 | 2009-2010 | Regular Session | Chaptered

California Assembly Bill 189 (Prior Session Legislation)

Bill Title: Budget Act of 2009.

Spectrum: Partisan Bill (Democrat 14-0)

Status: (Passed) 2009-11-05 - Chaptered by Secretary of State - Chapter 646, Statutes of 2009. [AB189 Detail]

Download: California-2009-AB189-Chaptered.html

BILL NUMBER: AB 189	CHAPTERED
	BILL TEXT

	CHAPTER  646
	FILED WITH SECRETARY OF STATE  NOVEMBER 5, 2009
	APPROVED BY GOVERNOR  NOVEMBER 4, 2009
	PASSED THE SENATE  OCTOBER 14, 2009
	PASSED THE ASSEMBLY  OCTOBER 26, 2009
	AMENDED IN SENATE  SEPTEMBER 8, 2009

INTRODUCED BY   Committee on Budget (Evans (Chair), Arambula, Beall,
Blumenfield, Brownley, Caballero, Carter, De La Torre, Feuer, Hill,
Huffman, Monning, Ruskin, and Swanson)

                        FEBRUARY 2, 2009

   An act to amend, repeal, and add Section 5924 of the Government
Code, relating to state finances, making an appropriation therefor,
and declaring the urgency thereof, to take effect immediately.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 189, Committee on Budget. Budget Act of 2009.
   Existing law sets forth the duties and authority of the Treasurer
generally in the sale of state bonds. Moneys are continuously
appropriated from the General Fund in an annual amount necessary to
pay all obligations, including principal, interest, fees, costs,
indemnities, and all other amounts incurred by the state under or in
connection with any credit enhancement or liquidity agreement entered
into by the state, as specified, for bonds payable pursuant to an
appropriation from the General Fund. Existing law prohibits the
amount appropriated for these fees, costs, and other similar expenses
from exceeding a percentage of the original principal amount of the
bonds that is specified in the federal Internal Revenue Code.
   This bill would, until June 30, 2013, instead increase that
percentage by which those expenses are calculated to 3%, thereby
making an appropriation.
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Appropriation: yes.


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

  SECTION 1.  Section 5924 of the Government Code is amended to read:

   5924.  (a) (1) Notwithstanding Section 13340, there is hereby
continuously appropriated without regard to fiscal years, from the
General Fund in the State Treasury for the purpose of this chapter,
an amount that will equal the sum annually as will be necessary to
pay all obligations, including principal, interest, fees, costs,
indemnities, and all other amounts incurred by the state under or in
connection with any credit enhancement or liquidity agreement, as
specified in paragraph (2), that is entered into by the state
pursuant to this chapter for bonds payable pursuant to an
appropriation from the General Fund.
   (2) A credit enhancement or liquidity agreement subject to this
section includes a credit enhancement or liquidity agreement that is
in the form of a letter of credit, standby purchase agreement,
reimbursement agreement, liquidity facility, or other similar
arrangement.
   (b) (1) If the agent for sale determines that the credit
enhancement or liquidity agreement is expected to result in a lower
cost of the borrowing for the bonds to which the credit enhancement
or liquidity agreement pertains, the state may incur fees, costs, and
other similar expenses under or in connection with any credit
enhancement or liquidity agreement entered into by the state pursuant
to this chapter.
    (2) The amount appropriated pursuant to subdivision (a) for fees,
costs, and other similar expenses incurred in connection with any
credit enhancement or liquidity agreement, when expressed as a
percentage of the original principal amount of the bonds to which the
credit enhancement or liquidity agreement pertains, may not exceed 3
percent.
   (3) The amount appropriated pursuant to subdivision (a) for
interest incurred in connection with any credit enhancement or
liquidity agreement, when expressed as a percentage of the
outstanding principal amount of the bonds to which the credit
enhancement or liquidity agreement pertains, may not exceed the
interest rate percentage set forth in subdivision (d) of Section
16731.
   (c) This section shall become inoperative on June 30, 2013, and,
as of January 1, 2014, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2014, deletes or
extends the dates on which it becomes inoperative and is repealed.
  SEC. 2.  Section 5924 is added to the Government Code, to read:
   5924.  (a) (1) Notwithstanding Section 13340, there is hereby
continuously appropriated without regard to fiscal years, from the
General Fund in the State Treasury for the purpose of this chapter,
an amount that will equal the sum annually as will be necessary to
pay all obligations, including principal, interest, fees, costs,
indemnities, and all other amounts incurred by the state under or in
connection with any credit enhancement or liquidity agreement, as
specified in paragraph (2), that is entered into by the state
pursuant to this chapter for bonds payable pursuant to an
appropriation from the General Fund.
   (2) A credit enhancement or liquidity agreement subject to this
section includes a credit enhancement or liquidity agreement that is
in the form of a letter of credit, standby purchase agreement,
reimbursement agreement, liquidity facility, or other similar
arrangement.
   (b) (1) If the agent for sale determines that the credit
enhancement or liquidity agreement is expected to result in a lower
cost of the borrowing for the bonds to which the credit enhancement
or liquidity agreement pertains, the state may incur fees, costs, and
other similar expenses under or in connection with any credit
enhancement or liquidity agreement entered into by the state pursuant
to this chapter.
   (2) The amount appropriated pursuant to subdivision (a) for fees,
costs, and other similar expenses incurred in connection with any
credit enhancement or liquidity agreement, when expressed as a
percentage of the original principal amount of the bonds to which the
credit enhancement or liquidity agreement pertains, may not exceed
the percentage set forth in paragraph (1) of subdivision (g) of
Section 147 of Title 26 of the United States Code enacted as of
January 1, 2003.
   (3) The amount appropriated pursuant to subdivision (a) for
interest incurred in connection with any credit enhancement or
liquidity agreement, when expressed as a percentage of the
outstanding principal amount of the bonds to which the credit
enhancement or liquidity agreement pertains, may not exceed the
interest rate percentage set forth in subdivision (d) of Section
16731.
   (c) This section shall become operative June 30, 2013.
  SEC. 3.  This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
   In order to ensure that the state may meet its financial
obligations and to enable the state to market debt issuances, thereby
improving the state's fiscal status, it is necessary that this act
take effect immediately.