BILL ANALYSIS
AB 1138
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Date of Hearing: April 17, 2001
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT AND THE ECONOMY
Sarah Reyes, Chair
AB 1138 (La Suer) - As Amended: April 16, 2001
SUBJECT : Electrical infrastructure development: low-interest
loans.
SUMMARY : Includes as an eligible project for Infrastructure
and Economic Development Bank financing non-public projects to
repower existing electrical facilities and to plan and design
construction and startup of peak demand facilities of up to 150
megawatts. Specifically, this bill :
1)Authorizes the bank board to make low-interest loans to
non-public, for-profit entities for costs associated with
repowering an existing electrical facility.
2)Authorizes the bank board to make low-interest loans to a
non-public, for-profit entity for the planning, design,
construction, and startup of peak demand facilities of up to
150 megawatts that are intended to operate only during peak
demand periods.
3)Specifies the following conditions on loans:
a) The sponsor shall agree to give Department of Water
Resources, California electrical corporations, municipal
corporations, irrigation district, and other public
electric utility districts a right of first refusal to
purchase any electricity produced by the project.
a) The party shall have an existing contract with the
Independent System Operator or the Department of Water
Resources.
a) The power generated by the facility shall be used
exclusively within the state.
a) The loan amount shall not exceed 75% of the total cost
of the project.
EXISTING LAW establishes the California Infrastructure and
Economic Development Bank to promote economic revitalization,
AB 1138
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enable future development and provide low-interest loans to
public entities. The purpose of the Infrastructure Bank is to
provide financial assistance to communities that have limited
access to capital.
FISCAL EFFECT : Unknown.
COMMENTS :
Staff poses the following questions: Is conventional financing
for this purpose scarce or unavailable in the marketplace?
Might public sector lending to private, for-profit entities
compete with private lenders or "crowd out" private lending?
Staff recommends amendments to require a public entity to act as
sponsor.
This bill carries an urgency clause.
SUPPORT:
None on file.
OPPOSITION:
None on file.
Analysis Prepared by : Celeste Cant? / J., E.D. & E. / (916)
319-2090