BILL NUMBER: AB 495 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 21, 2013
INTRODUCED BY Assembly Member Campos
FEBRUARY 20, 2013
An act to add Article 6 (commencing with Section 12099.1) to
Chapter 1.6 of Part 2 of Division 3 of Title 2 to the
Government Code, relating to the California Fund
Community investment .
LEGISLATIVE COUNSEL'S DIGEST
AB 495, as amended, Campos. The California Fund.
Community investment.
Existing law authorizes the Governor's Office of Business and
Economic Development to, among other things, advance statewide
economic goals.
This bill would establish the California Community Investment
Initiative within the Governor's Office of Business and Economic
development. The initiative would be governed by a 13 member
oversight board comprised of 6 citizens appointed by the Governor, 4
members of the Legislature, the Treasurer, the Controller, and the
Secretary of the Business, Consumer Services, and Housing Agency, as
specified.
The initiative would be required to create an inventory of
low-income neighborhoods, public interments, state and local
programs, and sources of public-sector finance, coordinate
public-sector financial investment and public programs to assist
low-income communities to become business, development, and
investment ready, develop criteria for determining the type of
economically, socially, and environmentally responsible businesses
and real estate developments to assist in starting-up, locating, and
growing in low-income neighborhoods, establish a broad array of
incentives to encourage responsible businesses and real estate
developments to grow in low income neighborhoods and to encourage
investment in low income neighborhoods, assist with formulating
Community Development Strategies with associated Zoning and Area
Plans, report annually to the Legislature and the Governor on whether
the initiative has met the criteria established for measuring the
economic, social, and environmental returns, and establish the
California Community Investment Network, as specified.
This bill would also make legislative findings and declarations.
This bill would state the intent of the Legislature to establish
the California Fund, a socially responsible investment fund sponsored
by the state, to encourage investment in historically underserved
communities and, via these investments, to further encourage
additional development activities of scale within these communities.
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. This act shall be known and may be
cited as the California Community Investment Initiative
.
SEC. 2 . The Legislature
finds and declares all of the following:
(a) Despite having the largest state economy in the United States,
California has the highest poverty rate of any state, with nearly a
quarter of its residents living in poverty.
(b) In this era of public budget constraints, public-sector
dollars are insufficient to solve the problems of low-income
neighborhoods. Therefore, private-sector market forces need to be
engaged to make substantial investments that produce a risk adjusted
market rate of return.
(c) Low-income neighborhoods constitute domestic emerging markets
with significant purchasing power and location efficiencies, but
suffer from social, public safety, broadband, and physical
infrastructure problems that contribute to market prejudices that
lead to disinvestment.
(d) To overcome these problems and market prejudices, low-income
neighborhoods need to become business, development, and
investment-ready through a partnership of government, private-sector,
community, and the environmental leaders focused on generating
coordinated, focused, effective human services, public safety,
broadband, workforce, education, and physical infrastructure.
(e) A new class of business and real estate developments are
emerging that are actively pursuing economically, socially, and
environmentally responsible outcomes.
(f) Businesses and real estate developments of this type that are
helping to reduce poverty and improve the social and environmental
dynamics of low-income neighborhoods can benefit from coordinated
state assistance.
(g) Many of these neighborhoods are at transit hubs or have the
transit and mixed-use characteristics in place to make development in
them more climate friendly than development elsewhere.
(h) The State of California should encourage responsible
businesses and real estate developments to locate and do business in
business and development-ready low-income neighborhoods in ways that
solve economic, social, and environmental problems rather than
causing them.
(i) To accomplish this, California needs a California Community
Investment Initiative and regional Community Development Strategies
to assist low-income neighborhoods and the cities, counties, and
regions where they are located to become business, development, and
investment-ready.
SEC. 3. Article 6 (commencing with Section
12099.1) is added to Chapter 1.6 of Part 2 of Division 3
of Title 2 of the Government Code , to read:
Article 6. California Community Investment Initiative
12099.1. (a) The California Community Investment Initiative is
hereby created within the Governor's Office of Business and Economic
Development. The California Community Investment Initiative shall be
staffed by the Governor's Office of Business and Economic Development
using existing resources.
(b) The California Community Investment Initiative shall be
governed by a 13 member oversight board made up of:
(1) Six persons appointed by the Governor, comprised of three
citizens with private-sector business or investment expertise and
three citizens with community development expertise.
(2) Four members of the Legislature, two from the Senate appointed
by the President pro Tempore of the Senate, one from each of the two
political parties with the most representatives in the Senate, and
two from the Assembly appointed by the Speaker of the Assembly, one
from each of the two political parties with the most representatives
in the Assembly. The members shall have relevant program expertise to
contribute to the initiative. The members shall be nonvoting members
of the oversight board and shall participate in the activities of
the board only to the extent that their participation is compatible
with their respective positions as Members of the Legislature.
(3) The Treasurer.
(4) The Controller.
(5) The Secretary of the Business, Consumer Services, and Housing
Agency.
12099.2. The California Community Investment Initiative shall do
all of the following:
(a) Create an inventory of low-income neighborhoods, public
interments, state and local programs, and sources of public-sector
finance, including descriptions of asset size, underwriting criteria,
decisionmaking process, and other characteristics. The inventory
shall examine all of the following:
(1) California Department of Insurance Organized Investment.
(2) Federal and State Low-Income Housing Tax Credit Program.
(3) California Alternative Energy and Advanced Transportation
Financing Authority.
(4) California Pollution Control Financing Authority.
(5) California Transportation Financing Authority.
(6) Industrial Development Finance Authority.
(7) The California Infrastructure and Economic Development Bank.
(8) Transportation funding through the Metropolitan Planning
Agencies.
(b) Coordinate public-sector financial investment and public
programs to assist low-income communities to become business,
development, and investment ready. These programs shall include:
(1) ______.
(2) ______.
(c) Develop criteria for determining the type of economically,
socially, and environmentally responsible businesses and real estate
developments to assist in starting-up, locating, and growing in
low-income neighborhoods. These criteria shall include:
(1) ______.
(2) ______.
(3) ______.
(d) Establish a broad array of incentives to encourage responsible
businesses and real estate developments to grow in low-income
neighborhoods and to encourage investment in low-income
neighborhoods. These incentives shall include:
(1) Environmental and entitlement regulatory incentives.
(2) Integrated public agency assistance incentives.
(e) Assist with formulating Community Development Strategies with
associated Zoning and Area Plans that will help low income
neighborhoods and the cities, counties, and regions where they are
located to become business, development, and investment ready.
(f) Report annually to the Legislature and the Governor on whether
the initiative has met the criteria established for measuring the
economic, social, and environmental returns on the investments made
pursuant to this article.
12099.3. The California Community Investment Initiative shall
establish the California Community Investment Network. This network
shall do all of the following:
(a) Establish the California Family of Funds. The California
Family of Funds shall consist of venture funds and real estate funds.
(b) Invite top quartile investment fund managers to become the
managing partners of the venture and real estate funds and to
affiliate with a not-for-profit organization as a special limited
partner.
(c) Provide assistance to the managing partners and the special
limited partner in raising five hundred million dollars
($500,000,000) in assets for the venture funds and five hundred
million dollars ($500,000,000) in assets for the real estate funds
from private sector investors, institutional investors, and
foundations.
(d) Fund managers, with assistance from the special limited
partner, in turn, shall:
(1) Identify investment funds with a substantial positive,
economic, social, and environmental impact on low income individuals
and communities and a financial return at or above market rate.
(2) Make investments in funds that meet the criteria set forth in
subparagraph (1).
(3) Work with funds the initiative has invested in to assist them
in accomplishing the stated objectives.
SECTION 1. (a) It is the intent of the
Legislature to establish the California Fund, a socially responsible
investment fund sponsored by the state to encourage investment in
historically underserved communities and, via these investments, to
further encourage additional development activities of scale within
these communities. The goal of the California Fund will be the
improvement of the economic conditions and the quality of life for
residents of historically underserved communities by providing
opportunities for professional success that may otherwise be out of
their reach due to their current socioeconomic conditions.
(b) It is the intent of the Legislature that the California Fund
be modeled after successful regional funds throughout the state.