Bill Text: CA AB495 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Community investment.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2014-08-14 - In committee: Held under submission. [AB495 Detail]

Download: California-2013-AB495-Amended.html
BILL NUMBER: AB 495	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JANUARY 13, 2014
	AMENDED IN ASSEMBLY  JANUARY 6, 2014
	AMENDED IN ASSEMBLY  SEPTEMBER 3, 2013
	AMENDED IN ASSEMBLY  MARCH 21, 2013

INTRODUCED BY   Assembly Member Campos
    (   Coauthor:   Assembly Member  
Dickinson   ) 

                        FEBRUARY 20, 2013

   An act to add Article 6 (commencing with Section 12099) to Chapter
1.6 of Part 2 of Division 3 of Title 2 to the Government Code,
relating to community investment.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 495, as amended, Campos. 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
Program within the Governor's Office of Business and Economic
development. The program would be governed by a 14 member California
Community Investment Council comprised of 6 citizens appointed by the
Governor, 4 members of the Legislature, the Treasurer, the
Controller, the Secretary of the Business, Consumer Services, and
Housing Agency, and the Director of the Governor's Office of Business
and Economic Development, as specified.
   The program would be required to create a database of low-income
neighborhoods, compile and maintain an inventory of California public
sector funding resources and financing mechanisms, coordinate public
sector financial investment and public programs to assist low-income
communities to become business, development, and investment ready,
develop criteria for triple bottom-line equity funds, establish
overall triple bottom-line goals and standardized metrics for
economic, social, and environmental outcomes to be accepted by
eligible investment funds,  survey counties and cities to
identify and inventory local governments that want to partner with
triple bottom-line investment funds to invest in low-income
neighborhoods,  establish and convene regular meetings of
the California Community Investment Network comprised of
organizations and institutions with expertise and resources to advise
the California Community Investment Council and eligible investment
fund managers, and report biannually to the Legislature and the
Governor on the status and progress of the California Community
Investment  Initiative   Program  and
performance on goals and triple bottom-line outcomes, as specified.
   This bill would also make legislative findings and declarations.
   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.  This act shall be known and may be cited as the
California Community Investment  Initiative  
Program  .
  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, according to
the United States Census Bureau's new definition of poverty that
takes cost of living into consideration, 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 environmental leaders focused on generating
coordinated, focused, effective human services, public safety,
broadband, workforce, education, and physical infrastructure.
   (e) A new class of real estate and business developments is
emerging that actively pursues economically, socially, and
environmentally responsible outcomes. These real estate and business
developments often are the result of investments from private sector
investment funds that generate market-rate returns to investors, but
are also committed to improving economic, social, and environmental
conditions and characteristics for the existing residents in these
neighborhoods. These private sector investment mechanisms often are
referred to as "triple bottom-line" investment funds.
   (f) Triple bottom-line investment funds and the real estate and
business developments resulting from them are helping to reduce
poverty and improve the social and environmental dynamics of
low-income neighborhoods. Triple bottom-line investments can be
encouraged and the benefits from them can be enhanced and accelerated
by coordinated assistance from existing State of California programs
and funding resources.
   (g) Many low-income 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 cause
them.
   (i) To accomplish this, the State of California intends to
establish the California Community Investment  Initiative
  Program  to assist low-income neighborhoods by
encouraging private sector investment consistent with the economic
development and community improvement strategies of the cities,
counties, and regions where they are located. It is the intent of the
State of California that such private sector investment is
accomplished without permanent displacement of existing residents in
low-income neighborhoods. 
   (j) It is the intent of the Legislature that state agencies
cooperate with the California Community Investment Program to align
their resources to transform low-income neighborhoods and to attract
private investments into these neighborhoods. 
  SEC. 3.  Article 6 (commencing with Section 12099) 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
  Program 


   12099.  For the purposes of this article, the following
definitions shall apply:
   (a) "Poverty" means the supplemental poverty measure, established
by the United States Census Bureau in 2013 to incorporate cost of
living in the established rate of poverty.
   (b) "Triple bottom-line investment funds" include, but are not
limited to, equity and debt investment vehicles that pursue market
and above market rates of financial return while at the same time
producing good jobs, affordable housing, and other economic, social,
and environmental benefits for the residents of the communities where
the investments are made.
   12099.1.  (a) The California Community Investment Program is
hereby established within the Governor's Office of Business and
Economic Development.
   (b) The program shall be under the direct authority of the
director.
   (c) The purpose of the program is to:
    (1) Encourage private sector investment in low-income
neighborhoods to improve the economic, environmental, and social
conditions for the existing residents, thereby helping improve the
overall economic, environmental, and social well-being for
California.
   (2) Serve investors, employers, corporate executives, business
owners, and site location consultants who are considering low-income
neighborhoods for business investment and expansion.
   (3) Coordinate state programs and funding resources that can be
used to address poverty reduction in California and to assist
low-income neighborhoods to become business, development, and
investment ready.
    (d) The California Community Investment Program shall be
supported and staffed by the Governor's Office of Business and
Economic Development using existing resources.
   (e) In implementing the program, the director shall establish and
implement a process for establishing public education programs and
providing technical assistance to private sector investors.
   (f) The California Community Investment Program shall be governed
by a 14 member California Community Investment Council comprised of:
   (1) Six persons appointed by the Governor, comprised of three
members with private sector business or investment expertise, two
members with community development expertise, and one representative
of organized labor.
   (2) Four members of the Legislature, two from the Senate appointed
by the Senate Committee on Rules, 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 be nonvoting members of the California
Community Investment Council and shall participate in the activities
of the council 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.
   (6) The Director of the Governor's Office of Business and Economic
Development, shall serve as chair of the council.
   12099.2.  The California Community Investment Program shall do all
of the following:
   (a) Develop and annually update a database of low-income
neighborhoods in California by county and city with relevant
information about each neighborhood, including socioeconomic
demographic data, descriptions of pertinent characteristics to inform
private sector investments, such as local land use plans and zoning
or other development designations, and commitments from local
governments to support private sector investments. These
neighborhoods shall be known as California Community Investment
Neighborhoods. The California Community Investment Council shall
adopt criteria whereby an eligible low-income neighborhood can become
a California Community Investment Neighborhood.
   (b) Compile and maintain a current inventory of California public
sector funding resources and financing mechanisms that may be
allocated to or utilized in low-income  neighborhoods with a
description of the amount of available funding, criteria for
allocation, and application and decisionmaking criteria. In doing
this, the California Community Investment Council shall use the
inventory of business incentives, public sector funding resources,
and financing mechanisms maintained by the Governor's Office of
Business and Economic Development and included in the State of
California Business Investment Guide. The inventory shall include,
but not be limited to, an assessment of the role and impact of all of
the following entities and programs on low-income neighborhoods:
  neighborhoods.  
   (1) California Department of Insurance's California Organized
Investment Network.  
   (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) Health and Human Services Agency.  
   (9) State Department of Education.  
   (10) Natural Resources Agency.  
   (11) Energy Commission.  
   (12) Public Utilities Commission.  
   (13) Local transportation authorities and the Transportation
Agency, including all transportation funding proposed by the
Department of Transportation or allocated by the California
Transportation Commission for expenditure by state or metropolitan
planning organizations.  
   (14) Greenhouse Gas Reduction Fund administered by the California
Environmental Protection Agency.  
   (15) California Pollution Control Financing Authority. 

   (16) Recycling Market Development Zone administered by CalRecycle.

   (c) Coordinate public sector financial investment and public
programs to assist low-income communities that are eligible
California Community Investment Neighborhoods to become business,
development, and investment ready and to attract private sector
triple bottom-line fund investments.  These programs shall
include, but not be limited to, the following purposes: 

   (1) Economic development, including research and development,
manufacturing, small business, and entrepreneurship growth and real
estate development that generates in jobs.  
   (2) Housing rehabilitation and construction.  
   (3) School construction, education, and academic performance
improvement.  
   (4) Workforce preparation and training.  
   (5) Public safety, community policing, crime prevention,
rehabilitation, and probation.  
   (6) Public health, social services, and other human services.
 
   (7) Mental health services.  
   (8) Alcohol and other drug abuse prevention and treatment.
 
   (9) Recreation and community arts and music programs. 

   (10) Transportation and other mobility infrastructure, including
public transit, walkways, and bicycle paths.  
   (11) Other infrastructure, including water, sewer, solid waste,
recycling, and lighting.  
   (12) Broadband deployment for high-speed Internet access, other
information technology infrastructure, and smart grid. 

   (13) Energy efficiency, weatherization, and renewable energy
resources.  
   (14) Environmental quality, resource recycling, community gardens,
and local food sourcing services.  
   (15) Homeless facilities and services. 
   (d) Develop and adopt criteria for identifying eligible triple
bottom-line investments funds that will serve as partners and invest
in enterprises and employers that generate permanent jobs, including
investments to assist in starting-up, locating, and expanding
employers in low-income neighborhoods.  These criteria shall
include the spirit and intent of the preponderance of the following
criteria as refined and adopted by the California Community
Investment Council:  
   (1) Commitment to locate investments in a low-income neighborhood.
 
   (2) Generation of living wage jobs with benefits for low-income
residents.  
   (3) Projected multiplier effect for generation of additional
employment.  
   (4) Provision of employment benefits, such as health care,
retirement plans, profit sharing, and employee stock ownership.
 
   (5) Commitment to local hiring and job training. 

   (6) Engagement of local, women, and minority business enterprises
as suppliers and contractors.  
   (7) Development and sponsorship of employee training programs,
including job training and financial education.  
   (8) Provision of onsite or nearby child care for children of
employees.  
   (9) Use of green building design, construction, renovation, or
operations.  
   (10) Implementation of energy and other resource efficiency,
recycling, or pollution prevention programs.  
   (11) Deployment of broadband high-speed Internet access and other
information technologies to support and increase productivity and
reduce impacts on the environment.  
   (12) Implementation of workplace safety or effective ergonomic
programs.  
   (13) Engagement with the local community through volunteer
organizations, local school support programs, and other community
initiatives.  
   (14) Production of economically, socially, or environmentally
beneficial products and services.  
   (15) Receipt of green business certification.  
   (16) Production of Corporate Social Responsibility (CSR),
Corporate Sustainability, and Creating Shared Value (CSV) reporting.

   (e) Develop and adopt criteria for eligible triple bottom-line
investment funds that invest in real estate developments to assist in
constructing, expanding, renovating, and rehabilitating buildings in
low-income neighborhoods that accommodate all allowed land use
approved and permitted by the local government land use regulations.
 The criteria shall include the spirit and intent of the
preponderance of the following, as refined and adopted by the
California Community Investment Council:  
   (1) Commitment to locate investments in a low-income neighborhood
that benefit low-income residents.  
   (2) Consistency of development with local government land use
plans and alignment with local government priorities. 

   (3) Generation of construction jobs with living wages and
benefits.  
   (4) Establishment of job training and apprentice programs for
local residents.  
   (5) Ownership or equity participation by a local, woman, or
minority developer or use of local, women, or minority business
enterprises as contractors or subcontractors.  
   (6) Construction of affordable housing, especially as part of a
larger mixed-income, mixed-use project to optimize synergies among
land uses.  
   (7) Generation of permanent living wage jobs.  
   (8) Retention or generation of permanent living wage jobs.
 
   (9) Use of green construction materials and practices. 

   (10) Incorporation of energy efficiencies, waste reduction, and
renewable energy resources.  
   (11) Implementation of smart development practices deploying
broadband for high-speed Internet access for smart infrastructure and
smart buildings, optimizing the utility of a smart grid. 

   (12) Incorporation of a multimodal transportation system that
optimizes walking, bicycling, public transit, and other strategies to
reduce single-occupant vehicle trips.  
   (13) Design of development consistent with the concept and
principles for livable communities.  
   (14) Accommodation of green and clean technology employers.
 
   (15) Implementation of low-impact development practices
incorporating native vegetation, soil preservation, water use
conservation, recycling and other efficiencies, and pervious
pavement.  
   (16) Incorporation of parks, recreational areas, open spaces, and
other environmental amenities.  
   (17) Accommodation of locations for small and local businesses.
 
   (18) Establishment of space for neighborhood organizations,
community centers, child care centers, and other nonprofit
community-based organizations.  
   (19) Use of bioregional development practices connecting local and
regional sustainable food production with urban consumption.
 
   (20) Acquisition of LEED certification for buildings and
neighborhoods. 
    (f) Establish overall triple bottom-line goals and standardized
metrics for economic, social, and environmental outcomes that shall
be accepted by all eligible investment funds.
   (g) Gather evidence and conduct public forums to identify a broad
array of incentives that will encourage triple bottom-line fund
investments in low-income  neighborhoods and take the
following actions:   neighborhoods.  
   (1) Prepare a report to the Legislature and Governor. 

   (2) Establish incentives for which there is existing legal and
regulatory authority.  
   (3) Recommend appropriate amendments to existing laws and
regulations and work with the Legislature and the Governor to secure
adoption.  
   (h) Survey counties and cities to identify and inventory local
governments that want to partner with triple bottom-line investment
funds to invest in low-income neighborhoods. This survey shall
determine if the local government has done any of the following:
 
   (1) Approved within the last 10 years a general plan, specific
plan, or other land use plan or zoning regulation on which an
investor can rely to govern and control development. 

   (2) Identified local public funding or other resources that have
been or will be committed to the low-income neighborhood to
complement a triple bottom-line fund investment.  
   (3) Designated a person to coordinate alignment of public
resources and implementation of development plans with a fund
manager.  
   (4) Established county and city school integrated human services
teams to serve the low-income neighborhood with goals and
accountability to increase employment, improve education, reduce
poverty, reduce crime, and improve health status.  
   (5) Committed to cooperate in and assist with monitoring and
tracking performance outcomes in the low-income neighborhoods.
 
   (i) 
    (h) Establish and convene regular meetings of the
California Community Investment Network comprised of organizations
and institutions with expertise and resources to advise the
California Community Investment Council and eligible investment fund
managers. 
   (j) 
    (i)  Report biannually to the Legislature and the
Governor on the status and progress of the California Community
Investment  Initiative   Program  and
performance on goals and triple bottom-line outcomes pursuant to
subdivision (f).
   12099.3.   (a)    The California
Community Investment Program shall encourage significant private
sector commitment, cooperation, and collaboration to invest private
capital in low-income neighborhoods through eligible triple
bottom-line equity funds with the goal of obtaining at least one
billion dollars ($1,000,000,000) of new investment by triple
bottom-line investment funds in triple bottom-line real estate
developments and businesses located in low-income California
neighborhoods.  The California Community Investment Program
shall give priority consideration for award of state assistance from
public resources and programs, herein identified, to low-income
neighborhoods that adopt and implement strategies to become business,
development, and investment ready and collaborate with the
California Community Investment Program to attract investment by
triple bottom-line funds.  
   (b) The California Community Investment Council shall adopt
criteria for an eligible triple bottom-line equity fund that shall
include at least the following:  
   (1) The fund shall be legally structured to comply with both the
spirit and intent of the preponderance of the relevant criteria
delineated in subdivisions (d) and (e) of Section 12099.2, as refined
and adopted by the California Community Investment Council,
including triple bottom-line goals and outcomes with explicit
metrics.  
   (2) The fund shall be managed by a reputable fund manager with a
track record of experience and performance with triple bottom-line
funds.  
   (3) The fund shall attain a scale of at least one hundred million
dollars ($100,000,000) in capital.  
   (4) The fund shall be committed to working with relevant local
government jurisdictions to optimize the alignment of state public
funding and resources and local government funding and resources.
 
   (5) The fund shall include experienced personnel to manage
coordination with appropriate state and local government public
funding or other resources. This shall be accomplished either by the
fund manager or through a contractual relationship between the fund
manager and an appropriate nonprofit organization.  

   (6) The fund shall be organized to track performance and report
metrics for triple bottom-line goals and outcomes.  

   (c) The California Community Investment Program shall give
priority consideration to working with triple bottom-line funds that
meet the criteria established by the California Community Investment
Council, with first attention to those funds with the largest amount
of capital. The California Community Investment Program in the
Governor's Office of Business and Economic Development shall assist
funds meeting these criteria to identify and make appropriate
investments in investment ready low-income communities and shall work
with these funds to coordinate all of the appropriate state and
local financial and programmatic resources to assist these
investments to succeed.                
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