BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1138
                                                                  Page  1

          Date of Hearing:   May 9, 2001

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                              Carole Migden, Chairwoman

                    AB 1138 (La Suer) - As Amended:  May 3, 2001 

          Policy Committee:                              Economic  
          Development  Vote:                            11-0
                        Utilities                             12-0

          Urgency:     No                   State Mandated Local Program:   
                 Reimbursable:               

           SUMMARY  

          This bill: 

          1)Authorizes the California Infrastructure and Economic  
            Development Bank to make low-interest loans for projects to  
            repower existing powerplants or to develop new peaker plants  
            of up to 150 megawatt capacity.

          2)Requires that power from the financed projects be sold in  
            California and that the Department of Water Resources, local  
            public power entities, or the state's investor-owned utilities  
            be given the right of first refusal to purchase the power.

          3)Sunsets the loan authorization provisions on January 1, 2007.

           FISCAL EFFECT  

          Potential ongoing special fund cost of about $100,000 for one  
          staff position to review powerplant financing proposals.   
          [California Infrastructure and Economic Development Bank Fund]

           COMMENTS  

           Purpose  .  The California Infrastructure and Economic Development  
          Bank was created in 1994 to promote economic revitalization,  
          enable future development and encourage a healthy climate for  
          jobs for California.  The bank's revolving loan program has been  
          capitalized with $475 million in General Fund appropriations in  
          the 1998-99 and 1999-00 Budget Acts.  According to the author,  
          use of the bank to provide low cost loans to peaker plant  








                                                                  AB 1138
                                                                  Page  2

          repowering or for new construction is an appropriate source of  
          funding and should encourage repowering of peak demand  
          facilities.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916)319-2081