Bill Text: CA AB2128 | 2013-2014 | Regular Session | Amended

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

---

Bill Title: Insurer investments: community development.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2014-09-17 - Chaptered by Secretary of State - Chapter 384, Statutes of 2014. [AB2128 Detail]

Download: California-2013-AB2128-Amended.html

---

BILL NUMBER: AB 2128	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 19, 2014

INTRODUCED BY   Assembly Member Gordon

                        FEBRUARY 20, 2014

   An act to amend  Section   Sections 
926.2  and 12939.2  of the Insurance Code, relating to
insurer investments.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2128, as amended, Gordon. Insurer investments: community
development.
   Existing law requires each admitted insurer to provide information
by January 1, 2014, to the Insurance Commissioner on all of its
community development investments and community development
infrastructure investments  , as defined,  in
California.  Community development investments are investments
where all or a portion of the investment has as its primary purpose
community development for, or that directly benefits, California low-
or moderate-income individuals, families, or communities, and
includes, but is not limited to, investments in California in or
through the California Organized Investment Network (COIN), certified
community development financial institutions (CDFIs), and
investments made pursuant to the   requirements of federal,
state, or local community development investment programs or
community development investment tax incentive programs, including
green investments, if these investments directly benefit low- or
moderate-income individuals, families, and communities and are
consistent with applicable provisions.  The commissioner and the
Department of Insurance are required to provide certain information
on  these   community development investments
and community development infrastructure  investments to the
public, as specified, by May 31, 2014, and biennally with regard to
green investments. These provisions are to remain in effect only
until January 1, 2015, and are repealed as of that date.
   This bill would extend the repeal date to January 1, 2020. 
   Existing law requires the department, COIN, or any successor
thereof, to require the CDFIs receiving specified tax credit
investments to submit reports to the department, COIN, or any
successor thereof, on their use of the program. Existing law
authorizes the commissioner to establish and appoint a California
Organized Investment Network Advisory Board. The term of each board
member is 2 years and is staggered as provided. The board has certain
powers and duties, including, but not limited to, advising COIN, or
any successor thereof, on the best methods to increase the level of
insurance industry capital in safe and sound investments while
providing fair returns to investors and social benefits to
underserved communities, meeting quarterly or as deemed necessary by
the commissioner, and recommending programmatic guidelines, but not
specific allocations of the tax credit amount, to the COIN program.
The provisions regarding the board are in effect only until December
1, 2015, and are repealed as of that date.  
   This bill would authorize the commissioner, in his or her
discretion, to extend or reduce a board member's 2-year term, and
would delete the staggered terms requirement. The bill would delete
the quarterly meeting requirement, and would instead require a
minimum of 3 or more meetings per year. The bill would also extend
the repeal date to January 1, 2020. 
   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


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

  SECTION 1.  Section 926.2 of the Insurance Code is amended to read:

   926.2.  (a) (1) Each insurer admitted in California shall provide
information, by January 1, 2014, to the commissioner on all of its
community development investments and community development
infrastructure investments in California. This information shall be
provided as part of the required filing pursuant to Section 900 or
Section 11131, or through a data call, or by other means as
determined by the commissioner. COIN shall provide insurers with
information on why investments, if any, were found not to be
qualified by the commissioner.
   (2) Nothing in this subdivision shall preclude an insurer that is
a member of an insurance holding company system, as defined in
Article 4.7 (commencing with Section 1215) of Chapter 2, from
complying with paragraph (1) through a single filing on behalf of the
entire group of affiliated companies, provided that the data so
filed accurately reflects the investments made by each of the
affiliates, and accurately attributes, by National Association of
Insurance Commissioners (NAIC) number or other identifier required by
the commissioner, which of the investments were made by each
affiliated company.
   (3) This subdivision shall not preclude an insurer from satisfying
the requirements of paragraph (1) through a filing made by a
community development financial institution, provided all of the
following conditions are met:
   (A) The insurer has no less than a 10 percent ownership interest
in a COIN-certified community development financial institution.
   (B) The insurer makes community development investments and
community development infrastructure investments in and through the
community development financial institution.
   (C) The community development financial institution accurately
files the information required by paragraph (1) with the commissioner
on behalf of the insurer and accurately attributes, by NAIC number
or other identifier required by the commissioner, which investments,
including the dollar amounts of the investments, were made by each
insurer on whose behalf the community development financial
institution is reporting.
   (b) The commissioner shall, by May 31, 2014, provide information
on the department's Internet Web site on the aggregate insurer
community development investments and community development
infrastructure investments. Insurers that make investments that are
innovative, responsive to community needs, not routinely provided by
insurers, qualify as green investments, or have a high degree of
positive impact on the economic welfare of low- or moderate-income
individuals, families, or communities in urban or rural California
shall be identified.
   (c) The department shall also, by May 31, 2014, provide
information on the department's Internet Web site regarding the
aggregate amount of California public debt (including all debt issued
by the State of California or a California state or local government
agency) purchased by insurers as reported to the department in their
NAIC annual statement filing pursuant to Section 900 or Section
11131.
   (d) The department shall also, by May 31, 2014, provide on its
Internet Web site the aggregate amount of identified California
investments, as reported to the NAIC in the annual statement filed
pursuant to Section 900 or Section 11131.
   (e) The department shall also biennially provide information on
its Internet Web site regarding the aggregate amount of identified
California insurer investments in green investments.
   (f) This article shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2020, deletes or extends
that date.
   SEC. 2.    Section 12939.2 of the  
Insurance Code   is amended to read: 
   12939.2.  (a) The commissioner may establish and appoint a
California Organized Investment Network Advisory Board.
   (b) For purposes of this section, all of the following shall
apply:
   (1) "Commissioner" means the Insurance Commissioner of this state.

   (2) "Board" means the California Organized Investment Network
Advisory Board.
   (3) "Licensed attorney" means an attorney who resides in this
state who has successfully passed the California bar examination and
has been admitted to practice in this state or has otherwise been
licensed to practice law in this state by the State Bar of
California.
   (c) The board shall include the commissioner, or his or her
designee, three executives in the insurance investment industry, and
one volunteer from each of the following categories:
   (1) A licensed attorney practicing insurance law.
   (2) A member of the public, appointed by the Speaker of the
Assembly.
   (3) A member of the public, appointed by the Senate Committee on
Rules.
   (4) A member of a consumer advocacy group.
   (5) An affordable housing practitioner.
   (6) A local economic development practitioner.
   (7) A member of a financial institution or a community development
financial institution.
   (8) A representative with experience seeking investments for low-
to moderate-income or rural communities.
   (d) The board shall elect, from among its members, a chair.
   (e) The term of each member shall be for two years  .
Staggered terms shall be established by drawing lots at the first
meeting of the advisory board so that a simple majority of the
members shall initially serve a two-year term, and the remainder
initially a one-year term.   and may be extended or
reduced at the discretion of the commissioner. 
   (f) The board shall have all of the following powers and duties:
   (1) To advise the California Organized Investment Network, or any
successor thereof, on the best methods to increase the level of
insurance industry capital in safe and sound investments while
providing fair returns to investors and social benefits to
underserved communities.
   (2) To meet  quarterly,   a minimum of three
or more times per year,  or as deemed necessary by the
commissioner.
   (3) To facilitate contacts among executives at insurance
companies, community-based organizations, and community development
financial institutions.
   (4) To recommend programmatic guidelines, but not specific
allocations of the tax credit amount, to the California Organized
Investment Network program.
   (g) The members of the board shall not receive compensation from
the state for their services under this section but, when called to
attend a meeting of the board, may be reimbursed for their actual and
necessary expenses incurred in connection with the meeting. 

   (h) This section shall remain in effect only until December 1,
2015, and as of that date is repealed.  
   (h) This section shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2020, deletes or extends
that date.