Bill Text: CA AB1898 | 2011-2012 | Regular Session | Introduced

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Bill Title: Education finance: emergency apportionments.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2012-05-25 - In committee: Set, second hearing. Held under submission. [AB1898 Detail]

Download: California-2011-AB1898-Introduced.html

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BILL NUMBER: AB 1898	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Alejo

                        FEBRUARY 22, 2012

   An act to amend Section 41329.52 of the Education Code, relating
to education finance.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1898, as introduced, Alejo. Education finance: emergency
apportionments.
   Existing law requires a school district that receives an emergency
apportionment to enter into a lease financing with the California
Infrastructure and Economic Development Bank for the purpose of
financing the emergency apportionment. Existing law specifies various
terms of the lease.
   This bill, commencing January 1, 2013, would provide that, for any
lease financing with a total value of less than or equal to
$25,000,000, adjusted annually as specified, entered into for the
purpose of financing the emergency apportionment, the source of the
financing would be the Pooled Money Investment Account, and the
interest rate would be the rate earned by moneys in the Pooled Money
Investment Account as of the date of the initial disbursement of
emergency apportionment funds to the school district, unless the
interest rate charged by the California Infrastructure and Economic
Development Bank as of the date of the initial disbursement of
emergency apportionment funds is lower than the Pooled Money
Investment Account rate.
   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 41329.52 of the Education Code is amended to
read:
   41329.52.  (a) A school district may receive a two-part financing
designed to provide an advance of apportionments owed to the district
from the State School Fund.
   (b) The initial emergency apportionment shall be an interim loan
from the General Fund to the school district. General Fund money
shall not be advanced to a school district until that district agrees
to obtain a lease financing as described in subdivision (c)  or
(d), as appropriate,  and the bank adopts a reimbursement
resolution governing the lease financing. The interim loan shall be
repaid in full, with interest, from the proceeds of the lease
financing pursuant to subdivision (c)  or (d), as appropriate,
 at a time mutually agreed upon between the Department of
Finance and the bank. The interest rate on the interim loan shall be
the rate earned by moneys in the Pooled Money Investment Account as
of the date of the initial disbursement of emergency apportionments
to the school district.
   (c)  The   Unless subdivision (d) is
applicable, the  school district shall enter into a lease
financing with the bank for the purpose of financing the emergency
apportionment, including a repayment to the General Fund of the
amount advanced pursuant to subdivision (b). In addition to the
emergency apportionment, the lease financing may include funds
necessary for reserves, capitalized interest, credit enhancements
 ,  and costs of issuance. The bank shall issue bonds for
that purpose pursuant to the powers granted pursuant to the
Bergeson-Peace Infrastructure and Economic Development Bank Act as
set forth in Division 1 (commencing with Section 63000) of 
Part   Title  6.7 of the Government Code. The term
of the lease shall not exceed 20 years, except that if at the end of
the lease term any rent payable is not fully paid, or if the rent
payable has been abated, the term of the lease shall be extended for
a period not to exceed 10 years. 
   (d) Commencing January 1, 2013, for any lease entered into
pursuant to this section with a total value of less than or equal to
twenty-five million dollars ($25,000,000), as adjusted each January 1
by the same percentage increase or decrease as occurred in the
Implicit Price Deflator for State and Local Government Purchases of
Goods and Services published by the United States Department of
Commerce in the preceding calendar year, the school district shall
enter into a lease financing for the purpose of financing the
emergency apportionment, including a repayment to the General Fund of
the amount advanced pursuant to subdivision (b). In addition to the
emergency apportionment, the lease financing may include funds
necessary for reserves, capitalized interest, credit enhancements,
and costs of issuance. The source of the financing shall be the
Pooled Money Investment Account, and the interest rate shall be the
rate earned by moneys in the Pooled Money Investment Account as of
the date of the initial disbursement of emergency apportionment funds
to the school district. If the interest rate charged by the bank as
of the date of the initial disbursement of emergency apportionment
funds is lower than the Pooled Money Investment Account rate, the
school district shall make the repayment at the lower rate.