BILL NUMBER: SBX1 6 AMENDED
BILL TEXT
AMENDED IN SENATE FEBRUARY 13, 2001
INTRODUCED BY Senator Burton and Bowen
(Principal coauthors: Assembly Members Florez, Goldberg, and
Shelley)
(Coauthors: Senators Karnette, Kuehl, and Scott)
(Coauthors: Assembly Members Aroner, Cedillo, Firebaugh, Frommer,
Keeley, Papan, Romero, Steinberg, Thomson, and Wiggins)
JANUARY 18, 2001
An act to add Division 1.5 (commencing with Section 3300) to the
Public Utilities Code, relating to electrical power.
LEGISLATIVE COUNSEL'S DIGEST
SB 6, as amended, Burton. California Consumer Power and
Conservation Financing Authority.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations
and other specified entities.
The Warren-Alquist State Energy Resources Conservation and
Development Act requires the State Energy Resources Conservation and
Development Commission (Energy Commission) to certify sufficient
sites and related facilities that are required to provide a supply of
electric power sufficient to accommodate projected demand for power
statewide. The Energy Commission administers existing law with
respect to energy conservation.
This bill would create the California Consumer Power and
Conservation Financing Authority, with powers and responsibilities as
prescribed, including the issuance of revenue bonds, for
the purposes of augmenting electric generating facilities and to
ensure a sufficient and reliable supply of electricity, financing
incentives for investment in cost-effective energy-efficient
appliances and energy demand reduction, achieving a specified energy
capacity reserve level, providing financing for the retrofit of
inefficient electric powerplants, renewable energy and conservation,
and, where appropriate, developing strategies for the authority to
facilitate a dependable supply of natural gas at reasonable prices to
the public. The bill would create in the State Treasury the
California Consumer Power and Conservation Financing Authority Fund,
and all money in the fund, upon appropriation, would be available for
the support of the authority.
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. Division 1.5 (commencing with Section 3300) is added to
the Public Utilities Code, to read:
DIVISION 1.5. CALIFORNIA CONSUMER POWER AND CONSERVATION
FINANCING AUTHORITY ACT
CHAPTER 1. GENERAL PROVISIONS AND DEFINITIONS
3300. The Legislature finds and declares that in order to furnish
the citizens of California with reliable, affordable electrical
power, to ensure sufficient power reserves, to assure stability and
rationality in California's electricity market, to encourage energy
efficiency and conservation as well as the use of renewable energy
resources, and to protect the public health, welfare, and safety, the
state needs to finance, purchase, lease, own, operate, acquire, or
otherwise provide financial assistance for public and private
facilities for the generation and transmission of electricity and for
renewable energy, energy efficiency, and conservation programs.
3301. This division shall be known and may be cited as the
California Consumer Power and Conservation Financing Authority Act.
3302. As used in this division, unless the context otherwise
requires, the following terms have the following meanings:
(a) "Act" means the California Consumer Power and Conservation
Financing Authority Act.
(b) "Authority" means the California Consumer Power and
Conservation Financing Authority established pursuant to Section 3320
and any board, commission, department, or officer succeeding to the
functions thereof, or to whom the powers conferred upon the authority
by this division shall be given by law.
(c) "Board" means the Board of Directors of the California
Consumer Power and Conservation Financing Authority.
(d) "Bond purchase agreement" means a contractual agreement
executed between the authority and a participating party, or
a special purpose trust authorized by the authority or a
participating party, or both, whereby the authority or special
purpose trust authorized by the authority agrees to purchase bonds
party, whereby the authority agrees to purchase bonds
of the participating party for retention or sale.
(e) "Bonds" means bonds, including structured, senior, and
subordinated bonds or other securities; loans; notes, including bond
revenue, tax or grant anticipation notes; certificates of
indebtedness; commercial paper; floating rate and variable
maturity securities; and any other evidences of indebtedness or
ownership, including certificates of participation or beneficial
interest, asset backed certificates, or lease-purchase or installment
purchase agreements, whether taxable or excludable from gross income
for state and federal income taxation purposes.
(f) "Commission" means the Public Utilities Commission.
(g) "Cost," as applied to a program, project or portion thereof
financed under this division, means all or any part of the cost of
construction, improvement, repair, reconstruction,
renovation, and acquisition of all lands, structures, improved
or unimproved real or personal property, rights, rights-of-way,
franchises, licenses, easements, and interests acquired or used for
a project; the cost of demolishing or removing or relocating
any buildings or structures on land so acquired, including the
cost of acquiring any lands to which the buildings or structures may
be moved; the cost of all machinery, equipment, and
financing charges; interest prior to, machinery and
equipment; financing charges; the costs of issuance of bonds or other
indebtedness; interest prior to, during, and for a period
after, completion of construction, renovation, or
acquisition the project , as determined by the
authority; provisions for working capital; reserves for principal and
interest ; reserves for reduction of costs for loans or other
financial assistance; reserves for maintenance, and
for extension, enlargements, additions, replacements,
renovations, and improvements; and the cost of architectural,
engineering, financial , appraisal, and legal services,
plans, specifications, estimates, administrative expenses, and other
expenses necessary or incidental to determining the feasibility of
any project or program or incidental to the
construction, acquisition, completion or
financing of any project or program .
(h) "Electrical corporation" has the same meaning as that term is
defined in Section 218.
(i) "Energy Commission" means the State Energy Resources
Conservation and Development Commission.
(j) "Enterprise" means a revenue-producing improvement,
building, system, plant, works, facilities, or undertaking used for
or useful for the generation or production of electric energy for
lighting, heating, and power for public or private uses. Enterprise
includes, but is not limited to, all parts of the enterprise, all
appurtenances to it, lands, easements, rights in land, water rights,
contract rights, franchises, buildings, structures, improvements,
equipment, and facilities appurtenant or relating to the enterprise.
(k) "Financial assistance" in connection with a project
or program , includes, but is not limited to, any combination
of grants, loans, the proceeds of bonds issued by the authority
or a special purpose trust , insurance, guarantees
or other credit enhancements or liquidity facilities, and
contributions of money, property, labor, or other things of value, as
may be approved by resolution of the board or the participating
party, or both; the purchase or retention of authority bonds, the
bonds of a participating party for their retention or for sale by the
authority, or the issuance of authority bonds or the bonds of a
special purpose trust used to fund the cost of a project or
program for which a participating party is directly or
indirectly liable, including, but not limited to, bonds, the security
for which is provided in whole or in part pursuant to the powers
granted by this division; bonds for which the authority has provided
a guarantee or enhancement, including, but not limited to, the
purchase of the subordinated bonds of the participating party,
the subordinated bonds of a special purpose trust,
or the retention of the subordinated bonds of the authority pursuant
to this division; or any other type of assistance deemed appropriate
by the authority or the participating party .
(k)
(l) "Fund" means the California Consumer Power and
Conservation Financing Authority Fund.
(l)
(m) "Loan agreement" means a contractual agreement executed
between the authority or a special purpose trust
and a participating party that provides that the authority
or special purpose trust will loan funds to the
participating party and that the participating party will repay the
principal and pay the interest and redemption premium, if any, on the
loan.
(m)
(n) "Local publicly owned electric utility" has the same
meaning as that term is defined in Section 9604.
(n)
(o) "Participating party" means either of the following:
(1) Any person, company, corporation, partnership, firm, or other
entity or group of entities, whether organized for profit or not for
profit, engaged in business or operations within the state and that
applies for financial assistance from the authority for the purpose
of implementing a project or program .
(2) Any subdivision of the state or local government, including
departments, agencies, commissions, cities, counties, nonprofit
corporations, special districts, assessment districts, and joint
powers authorities within the state or any combination of these
subdivisions, that has, or proposes to acquire, an interest in a
project , or that operates or proposes to operate a program
under Section 3365, and that makes application to the authority
for financial assistance in a manner prescribed by the authority.
(o)
(p) "Program" means a program that provides financial assistance,
as provided in Article 7 (commencing with Section 3365).
(q) "Project" means plants, facilities, equipment,
appliances, structures, expansions, and improvements within the state
that serve the purposes of this division as approved by the
authority, and all activities and expenses necessary to initiate and
complete those projects.
(p)
(r) "Revenues" means all receipts, purchase payments, loan
repayments, lease payments , rents, fees and charges , and
all other income or receipts derived by the authority or a
participating party from the sale, lease, or derived
by the authority from an enterprise, or by the authority or a
participating party from any other financing arrangement
undertaken by the authority , or a
participating party, including, but not limited to, all receipts from
a bond purchase agreement, and any income or revenue derived from
the investment of any money in any fund or account of the authority
or a participating party.
(q) "Special purpose trust" means a trust, partnership, limited
partnership, association, corporation, nonprofit corporation, or
other entity authorized under the laws of the state to serve as an
instrumentality of the state to accomplish public purposes and
authorized by the authority to acquire, by purchase or otherwise, for
retention or sale, the bonds of a participating party or of the
authority made or entered into pursuant to this division and to issue
special purpose trust bonds or other obligations secured by these
bonds or other sources of public or private revenues.
(r)
(s) "State" means the State of California.
3304. Any action taken pursuant to this division is exempt from
the Administrative Procedure Act, as defined in Section 11370 of the
Government Code.
CHAPTER 2. PURPOSE OF THE CALIFORNIA CONSUMER POWER AND
CONSERVATION FINANCING AUTHORITY
3310. The authority may only exercise its powers pursuant to
Article 4 (commencing with Section 3340) of Chapter 3 for the
following purposes:
(a) Establish, finance, purchase, lease, own, operate, acquire
generating facilities and other projects, on its own or
through , or construct generating facilities and other
projects and enterprises, on it's own or through agreements
with public and private third parties or joint ventures with public
or private entities, or provide financial assistance for
projects by participating parties and generating facilities, to
ensure projects or programs by participating parties,
to ensure a sufficient and reliable supply of electricity for
California's consumers at just and reasonable rates.
(b) Finance incentives programs ,
administered by the Energy Commission, the commission, and other
approved participating parties for consumers and businesses to invest
in cost-effective energy efficient appliances, renewable energy
projects, and other programs that will reduce the demand for energy
in California.
(c) Achieve an adequate energy reserve capacity in California by
2006.
(d) Provide financing for owners of aged, inefficient, electric
powerplants power plants to perform
necessary retrofits to improve the efficiency and environmental
performances of those powerplants power
plants .
(e) Acquire transmission facilities pursuant to Article 5
(commencing with Section 3350) of Chapter 3.
CHAPTER 3. THE CALIFORNIA CONSUMER POWER AND CONSERVATION
FINANCING AUTHORITY
Article 1. Creation of the Authority
3320. (a) There is hereby created in the state government the
California Consumer Power And Conservation Financing Authority, which
shall be responsible for administering this division.
(b) The authority shall be under the direction of an executive
director, who shall be appointed by a majority of the members of the
board, and shall serve at the direction of the board.
(c)
(b) The authority shall implement the purposes of Chapter 2
(commencing with Section 3310), and to that end finance projects and
programs in accordance with this division, all to the mutual benefit
of the people of the state and to protect their health, welfare, and
safety.
Article 2. Board of Directors
3325. (a) The authority shall be governed by a
seven-member five-member board of directors that
shall consist of the following persons:
(1) Two individuals appointed by the Governor, subject to
confirmation by the Senate. These two members shall have
considerable experience in power generation, conservation, and
financing.
(2) The Chair of the Energy Commission.
(3) The President of the commission.
(4)
(2) A member of the public appointed by the Senate Rules
Committee.
(5)
(3) A member of the public appointed by the Speaker of the
Assembly.
(6)
(4) The State Treasurer.
(b) Any appointed member of the board shall serve at the pleasure
of the appointing power.
(c) Four of the members shall constitute a quorum and the
affirmative vote of four board members shall be necessary for any
action to be taken by the board.
(c) A quorum is necessary for any action to be taken by the board.
Three of the members shall constitute a quorum, and the affirmative
vote of three board members shall be necessary for any action to be
taken by the board.
(d) Except as provided in this subdivision, the members of the
board shall serve without compensation, but shall be reimbursed for
actual and necessary expenses incurred in the performance of their
duties to the extent that reimbursement for these expenses is not
otherwise provided or payable by another public agency, and shall
receive one hundred dollars ($100) for each full day of attending
meetings of the authority.
3326. (a) The members of the board shall be subject to the
Political Reform Act of 1974 (Title 9 (commencing with Section
81000)) of the Government Code, the applicable rules and standards of
the Municipal Securities Rulemaking Board, and all other applicable
provisions of law.
(b) The board may purchase insurance for its fiduciaries or for
itself to cover liability or losses occurring by reason of the act or
omission of a fiduciary, if the insurance permits recourse by the
insurer against the fiduciary in the case of a breach of a fiduciary
obligation by the fiduciary.
3327. Meetings of the board shall be open to the public and
shall be conducted in accordance with the Bagley-Keene Open Meeting
Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1
of Division 3 of Title 2 of the Government Code).
Article 3. Executive Director Chief
Executive Officer
3330. The executive director chief
executive officer shall manage and conduct the business and
affairs of the authority and the fund subject to the direction of the
board. Except as otherwise provided in this section, the board may
assign to the executive director, by resolution, those duties
generally necessary or convenient to carry out its powers and
purposes under this division. Any action involving final approval of
any bonds, notes, loans, or other financial assistance shall require
the approval of a majority of the members of the board.
Article 4. Powers of the Authority
3340. The authority is authorized and empowered to do any of the
following:
(a) Adopt an official seal.
(b) Sue and be sued in its own name.
(c) Adopt rules and regulations for the regulation of its affairs
and the conduct of its business.
(d) Do all things generally necessary or convenient to carry out
its powers and the purposes under this division.
3341. The board may do all of the following:
(a) Exercise the power of eminent domain.
(b) Issue bonds and authorize special purpose trusts to issue
bonds to pay all or part of the cost of any project, or to otherwise
carry out the purposes of this division.
(c) Enter into joint powers agreements with eligible public
agencies pursuant to Chapter 5 (commencing with Section 6500) of
Division 7 of Title 1 of the Government Code.
(d) Subject to any statutory or constitutional limitation on their
use, do any of the following:
(1) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this division; employ attorneys and other advisers as
may, in the determination of the board, be necessary in connection
with the issuance and sale, or authorization of special purpose
trusts for the issuance and sale, of any bonds.
(2) Contract for engineering, architectural, accounting, or other
services of appropriate state agencies as may, in the determination
of the board, be necessary for the successful development of a
project.
(3) Pay the reasonable costs of consulting engineers, architects,
accountants, and construction, land use and environmental experts
employed by any participating party if, in the determination of the
board, those services are necessary for the successful development of
a project.
(e) Charge and equitably apportion among participating parties or
other public or private entities the authority's administrative costs
and expenses, including operating and financing-related costs
incurred in the exercise of the powers and duties conferred by this
division.
(f) Acquire, take title to, and sell by installment sale or
otherwise, lands, structures, real or personal property, rights,
rights-of-way, franchises, easements, and other interests in lands
that are located within the state as the authority determines to be
necessary or convenient for the financing of the project, upon terms
and conditions that it considers to be reasonable.
(g) Make, receive, or serve as a conduit for the making of, or
otherwise provide for, grants, contributions, guarantees, insurance,
credit enhancements or liquidity of facilities, or other financial
enhancements to a participating party as financial assistance for a
project. The sources may include bond proceeds, dedicated taxes,
state appropriations, federal appropriations, federal grants and loan
funds, public and private sector retirement system funds, and
proceeds of loans from the Pooled Money Investment Account, or any
other source of money, property, labor, or other things of value.
(h) Make loans to any participating party, either directly or by
making a loan to a lending institution or other financial
intermediary, in connection with the financing of a project in
accordance with an agreement between the authority and a
participating party, either as a sole lender or in participation with
other lenders.
(i) Make loans to any participating party, either directly or by
making a loan to a lending institution, in accordance with an
agreement between the authority and the participating party to
refinance indebtedness incurred by the participating party in
connection with projects undertaken and completed prior to any
agreement with the authority or expectation that the authority would
provide financing, either as a sole lender or in participation with
other lenders.
(j) Mortgage all or any portion of the authority's interest in a
project and the property on which any project is located, whether
owned or thereafter acquired, including the granting of a security
interest in any property, tangible or intangible.
(k) Assign or pledge all or any portion of the authority's
interests in assets, things of value, mortgages, deeds of trust,
bonds, bond purchase agreements, loan agreements, indentures of
mortgage or trust, or similar instruments, notes, and security
interests in property, tangible or intangible and the revenues
therefrom, of a participating party to which the authority has made
loans, and the revenues therefrom, including payment or income from
any interest owned or held by the authority, for the benefit of the
holders of bonds.
(l) Lease the project being financed to a participating party,
upon terms and conditions that the authority deems proper; charge and
collect rents therefor; terminate any lease upon the failure of the
lessee to comply with any of the obligations thereof; include in any
lease, if desired, provisions that the lessee shall have options to
renew the lease for a period or periods, and at rents determined by
the authority; purchase any or all of the project; or, upon payment
of all the indebtedness incurred by the authority for the financing
of the project, the authority may convey, any or all of the project
to the lessee or lessees.
(m) Issue, obtain, or aid in obtaining, from any department or
agency of the United States, from other agencies of the state, or
from any private company, any insurance or guarantee to, or for, the
payment or repayment of interest or principal, or both, or any part
thereof, on any loan, lease, or obligation or any instrument
evidencing or securing the same, made or entered into pursuant to
this division.
(n) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary or convenient to, directly or
indirectly, secure the authority's bonds, the bonds issued by a
special purpose trust, or a participating party's obligations to the
authority or to a special purpose trust, including, but not limited
to, bonds of a participating party purchased by the authority or a
special purpose trust for retention or sale, with funds or moneys
that are legally available and that are due or payable to the
participating party by reason of any grant, allocation, apportionment
or appropriation of the state or agencies thereof, to the extent
that the Controller shall be the custodian at any time of these funds
or moneys, or with funds or moneys that are or will be legally
available to the participating party, the authority, or the state or
any agencies thereof by reason of any grant, allocation,
apportionment, or appropriation of the federal government or agencies
thereof; and in the event of written notice that the participating
party has not paid or is in default on its obligations to the
authority or a special purpose trust, direct the Controller to
withhold payment of those funds or moneys from the participating
party over which it is or will be custodian and to pay the same to
the authority or special purpose trust or their assignee, or direct
the state or any agencies thereof to which any grant, allocation,
apportionment or appropriation of the federal government or agencies
thereof is or will be legally available to pay the same upon receipt
by the authority or special purpose trust or their assignee, until
the default has been cured and the amounts then due and unpaid have
been paid to the authority or special purpose trust or their
assignee, or until arrangements satisfactory to the authority or
special purpose trust have been made to cure the default.
(o) Purchase, with the proceeds of the authority's bonds, bonds
issued by, or for the benefit of, any participating party in
connection with a project, pursuant to a bond purchase agreement or
otherwise. Bonds purchased pursuant to this division may be held by
the authority, pledged or assigned by the authority, or sold to
public or private purchasers at public or negotiated sale, in whole
or in part, separately or together with other bonds issued by the
authority, and notwithstanding any other provision of law, may be
bought by the authority at private sale.
(p) Enter into purchase and sale agreements with all entities,
public and private, including state and local government pension
funds, with respect to the sale or purchase of bonds.
(q) Authorize a special purpose trust or trusts to purchase or
retain proceeds of the bonds of a special purpose trust or bonds
issued by, or for the benefit of, any participating party in
connection with a project or issued by the authority or a special
purpose trust, pursuant to a bond purchase agreement or otherwise.
Bonds purchased pursuant to this division may be held by a special
purpose entity, pledged or assigned by a special purpose entity, or
sold to public or private purchasers at public or negotiated sale, in
whole or in part, with or without structuring, subordination or
credit enhancement, separately or together with other bonds issued by
a special purpose trust, and notwithstanding any other provision of
law, may be bought by the authority or by a special purpose trust at
private sale.
(c) Employ or contract with officers and employees to administer
the authority. The authority may contract for the services of a
chief executive officer, who shall serve at the pleasure of the
board. The chief executive officer, subject to the approval of the
board, may contract for the services of other persons as are needed
to effectuate the purposes of this division. These contracts shall
not be subject to any otherwise applicable provisions of
the Government Code and
the Public Contract Code.
(d) Exercise the power of eminent domain.
(e) Adopt rules and regulations for the regulation of its affairs
and the conduct of its business.
(f) Do all things generally necessary or convenient to carry out
its powers under, and the purposes of, this division.
3341. In connection with the purposes of this division, the
authority may do any or all of the following:
(a) Issue bonds, from time to time, as further provided in Chapter
5 (commencing with Section 3380.1), to pay all or part of the cost
of any enterprise, project, or program, or to otherwise carry out the
purposes of this division.
(b) Enter into joint powers agreements with eligible public
agencies pursuant to Chapter 5 (commencing with Section 6500) of
Division 7 of Title 1 of the Government Code.
(c) Subject to any statutory or constitutional limitation on their
use, do any of the following as may, in the determination of the
authority, be necessary or convenient for the successful development,
conduct, or financing of a project, program, or enterprise, or for
carrying out the purposes of this division:
(1) Engage the services, including, without limitation, the
services of private consultants; attorneys; financial professionals
and advisors; engineers; architects; construction, land use and
environmental experts; and accountants, to render professional and
technical assistance and advice.
(2) Contract for engineering, architectural, accounting, or other
services of appropriate state agencies.
(3) Pay the reasonable costs, including, without limitation, costs
of consulting engineers, architects, accountants, and construction,
land use, and environmental experts employed by the authority or any
participating party.
(d) Charge and equitably apportion among participating parties or
other public or private entities the authority's administrative costs
and expenses, including operating and financing-related costs
incurred in the exercise of the powers and duties conferred by this
division.
(e) Acquire, lease, take title to, and sell by installment sale or
otherwise, lands, structures, real or personal property, rights,
rights-of-way, franchises, easements, and other interests in lands
that are located within the state, as the authority determines to be
necessary or convenient for an enterprise or the financing of a
project, upon terms and conditions the authority considers to be
reasonable.
(f) Make, receive, or serve as a conduit for the making of, or
otherwise provide for, grants, contributions, guarantees, insurance,
credit enhancements or liquidity of facilities, or other financial
enhancements to a participating party as financial assistance for a
project or program. The sources may include bond proceeds, dedicated
taxes, state appropriations, federal appropriations, federal grants
and loan funds, public and private sector retirement system funds,
and proceeds of loans from the Pooled Money Investment Account, or
any other source of money, property, labor, or other things of value.
(g) Make loans to any participating party, either directly or by
making a loan to a lending institution or other financial
intermediary, in connection with the financing of a project or
program in accordance with an agreement between the authority and a
participating party, either as a sole lender or in participation with
other lenders.
(h) Make loans to any participating party, either directly or by
making a loan to a lending institution, in accordance with an
agreement between the authority and the participating party to
refinance indebtedness incurred by the participating party in
connection with projects undertaken and completed prior to any
agreement with the authority or expectation that the authority would
provide financing, either as a sole lender or in participation with
other lenders. The power generated by those projects shall be
subject to the terms and conditions specified by the authority in the
agreement and pursuant to Section 3351.
(i) Mortgage all or any portion of the authority's interest in a
project or enterprise and the property on which any project or
enterprise is located, whether owned or thereafter acquired,
including the granting of a security interest in any property,
tangible or intangible.
(j) Assign or pledge all or any portion of the authority's
interest in assets, things of value, mortgages, deeds of trust,
bonds, bond purchase agreements, loan agreements, indentures of
mortgage or trust, or similar instruments, notes, and security
interests in property, tangible or intangible and the revenues
therefrom, of a participating party to which the authority has made
loans, and the revenues therefrom, including payment or income from
any interest owned or held by the authority, for the benefit of the
holders of bonds.
(k) Lease the project being financed to a participating party,
upon terms and conditions that the authority deems proper; charge and
collect rents therefor; terminate any lease upon the failure of the
lessee to comply with any of the obligations thereof; include in any
lease, if desired, provisions that the lessee shall have options to
renew the lease for a period or periods, and at rents determined by
the authority; purchase any or all of the project; or, upon payment
of all the indebtedness incurred by the authority for the financing
of the project, the authority may convey, any or all of the project
to the lessee or lessees. The power generated by those projects
shall be subject to the terms and conditions specified by the
authority in the agreement and pursuant to Section 3351.
(l) (1) Issue, obtain, or aid in obtaining, from any department or
agency of the United States, from other agencies of the state, or
from any private company, any insurance or guarantee to or for, or
any letter or line of credit regarding, the payment or repayment of
interest or principal, or both, or any part thereof, on any bond,
loan, lease, or obligation or any instrument evidencing or securing
the same, made or entered into pursuant to this division.
(2) Notwithstanding any other provision of this division, enter
into any agreement, contract or other instrument regarding any
insurance, guarantee, letter or line of credit specified in paragraph
(1), and accept payment in the manner and form provided therein in
the event of default by a participating party.
(3) Assign any insurance, guarantee, letter or line of credit
specified in paragraph (1) as security for bonds issued by the
authority.
(m) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary or convenient to, directly or
indirectly, secure the authority's bonds or a participating party's
obligations to the authority, including, but not limited to, bonds of
a participating party purchased by the authority for retention or
sale, with funds or moneys that are legally available and that are
due or payable to the participating party by reason of any grant,
allocation, apportionment, or appropriation of the state or agencies
thereof, to the extent that the Controller shall be the custodian at
any time of these funds or moneys, or with funds or moneys that are
or will be legally available to the participating party, the
authority, or the state or any agencies thereof by reason of any
grant, allocation, apportionment, or appropriation of the federal
government or agencies thereof; and in the event of written notice
that the participating party has not paid or is in default on its
obligations to the authority, direct the Controller to withhold
payment of those funds or moneys from the participating party over
which it is or will be custodian and to pay the same to the authority
or its assignee, or direct the state or any agencies thereof to
which any grant, allocation, apportionment, or appropriation of the
federal government or agencies thereof is or will be legally
available to pay the same upon receipt to the authority or its
assignee, until the default has been cured and the amounts then due
and unpaid have been paid to the authority or its assignee, or until
arrangements satisfactory to the authority have been made to cure the
default.
(n) Purchase, with the proceeds of the authority's bonds, bonds
issued by, or for the benefit of, any participating party in
connection with a project, pursuant to a bond purchase agreement or
otherwise. Bonds purchased pursuant to this division may be held by
the authority, pledged or assigned by the authority, or sold to
public or private purchasers at public or negotiated sale, in whole
or in part, separately or together with other bonds issued by the
authority, and notwithstanding any other provision of law, may be
bought by the authority at private sale.
(o) Enter into purchase and sale agreements with all entities,
public and private, including state and local government pension
funds, with respect to the sale or purchase of bonds.
3341.1. In connection with an enterprise, the authority may do
any or all of the following:
(a) Acquire any enterprise by gift, purchase, or eminent domain.
(b) Construct or improve any enterprise. By gift, lease,
purchase, eminent domain, or otherwise, it may acquire any real or
personal property, for an enterprise, except that no property of a
state public body may be acquired without its consent. The authority
may sell, lease, exchange, transfer, assign, or otherwise dispose of
any real or personal property or any interest in such property. It
may lay out, open, extend, widen, straighten, establish, or change
the grade of any real property or public rights-of-way necessary or
convenient for any enterprise.
(c) Operate, maintain, repair, or manage all or any part of any
enterprise, including the leasing for commercial purposes of surplus
space or other space that is not economic to use for such enterprise.
(d) Adopt reasonable rules or regulations for the conduct of the
enterprise.
(e) Prescribe, revise, and collect charges for the services,
facilities, or energy furnished by the enterprise. The charges shall
be established and adjusted so as to provide funds sufficient with
other revenues and moneys available therefor, if any, to (1) pay the
principal of and interest on outstanding bonds of the authority
financing such enterprise as the same shall become due and payable,
(2) create and maintain reserves, including, without limitation,
operating and maintenance reserves and reserves required or provided
for in any resolution authorizing, or trust agreement securing such
bonds, and (3) pay operating and administrative costs of the
authority.
(f) Execute all instruments, perform all acts, and do all things
necessary or convenient in the exercise of the powers granted by this
article.
3341.2. In connection with a project, the authority may do any or
all of the following:
(a) Determine the location and character of any project to be
financed under this division.
(b) Acquire, construct, enlarge, remodel, renovate, alter,
improve, furnish, equip, own, maintain, manage, repair, operate,
lease as lessee or lessor, or regulate any project to be financed
under this division.
(c) Contract with any participating party for the construction of
a project by such participating party.
(d) Enter into leases and agreements, as lessor or lessee, with
any participating party relating to the acquisition, construction,
and installation of any project, including real property, buildings,
equipment, and facilities of any kind or character.
(e) Establish, revise, charge and collect rates, rents, fees and
charges for a project. The rates, rents, fees, and charges shall be
established and adjusted in respect of the aggregate rates, rents,
fees, and charges from all projects so as to provide funds sufficient
with other revenues and moneys available therefor, if any, to (1)
pay the principal of and interest on outstanding bonds of the
authority financing such project as the same shall become due and
payable, (2) create and maintain reserves, including, without
limitation, operating and maintenance reserves and reserves required
or provided for in any resolution authorizing, or trust agreement
securing such bonds, and (3) pay operating and administrative costs
of the authority.
(f) Enter into contracts of sale with any participating party
covering any project financed by the authority.
(g) As an alternative to leasing or selling a project to a
participating party, finance the acquisition, construction, or
installation of a project by means of a loan to the participating
party.
(h) Execute all instruments, perform all acts, and do all things
necessary or convenient in the exercise of the powers granted by this
article.
3342. The fiscal powers granted to the authority by this division
may be exercised without regard or reference to any other
department, division, or agency of the state, except the Legislature
or as otherwise stated in this division. This division shall be
deemed to provide an alternative method of doing the things
authorized by this division, and shall be regarded as supplemental
and additional to powers conferred by other laws.
3343. No member of the board or any person executing bonds of the
authority or a special purpose trust pursuant to
this division shall be personally liable on the bonds or subject to
any personal liability or accountability by reason of the issuance
thereof.
3344. All expenses incurred in carrying out this division shall
be payable solely from funds provided under the authority of this
division and no liability or obligation shall be imposed upon the
State of California and, none shall be incurred by the authority
beyond the extent to which moneys shall have been provided under this
division. Under no circumstances shall the authority create any
debt, liability, or obligation on the part of the State of California
payable from any source whatsoever other than the moneys provided
under this division.
3345. Bonds issued under this division shall not be deemed to
constitute a debt or liability of the state or of any political
subdivision thereof, other than the authority, or a pledge of the
faith and credit of the state or of any political subdivision, other
than the authority, but shall be payable solely from the funds herein
provided therefor. All bonds issued under this division shall
contain on the face thereof a statement to the following effect:
"Neither the faith and credit nor the taxing power of the State of
California or any local agency is pledged to the payment of the
principal of or interest on this bond." The issuance of bonds under
this division shall not directly or indirectly or contingently
obligate the state or any political subdivision thereof to levy or to
pledge any form of taxation whatever therefor or to make any
appropriation for their payment. Nothing in this section shall
prevent nor be construed to prevent the authority from pledging its
full faith and credit to the payment of bonds or issue of bonds
authorized pursuant to this division.
Article 5. Generation Facilities
3350. All generation facilities constructed or improved pursuant
to this division shall comply with Chapter 1 (commencing with Section
1720) of Part 7 of Division 2 of the Labor Code.
3351. All generation-related projects financed pursuant to this
division shall provide power to the consumers of this state at
just and reasonable rates, as determined by the commission
or the governing board of a municipal public utility.
rates based on the cost of providing electricity, as determined by
the authority. In the case of a participating party, cost of service
may include a reasonable rate of return pursuant to the terms and
conditions of the agreements entered into by the authority and the
participating party for financial assistance under this division.
The authority may sell power outside the state when it determines
that supplies are sufficient to meet the purposes of this division.
3352. The In addition to the other powers
provided in this division, the activities of the authority
under this division are intended to supplement private sector power
generation, consistent with achieving reasonable energy capacity
reserves within five years of the effective date of the division.
3353. The authority shall have the authority to receive and act
on applications for financial assistance from owners of existing
powerplants that are 30 years old or older whose owners or operators
commit to undertake capacity expansion through facility retrofits,
new construction, or both, that will improve the efficiency and
environmental performance of generation facilities.
Article 6. Acquisition of Transmission
3360. (a) On January 1, 2002, the authority, in consultation with
the commission, shall determine and report to the Legislature, the
feasibility of the state acquiring, operating, and maintaining the
transmission facilities currently owned by the electrical
corporations and local publicly owned electric utilities of the
state. The report shall include an economic analysis of that
acquisition, describe how the authority would commence the
acquisition, and determine whether an acquisition is in the interest
of the citizens of the state.
(b) Upon determining that state acquisition, operation, and
maintenance of the transmission facilities owned by the electrical
corporations and local publicly owned electric utilities of the state
is in the interest of the citizens of the state, but no sooner than
60 days after the date that the report described in subdivision (a)
is submitted to the Legislature, the authority may commence the
acquisition.
Article 7. 6. Renewable Energy
and Conservation
3365. (a) The authority may establish programs that provide
loans, under terms and conditions approved by the authority, to any
participating party, which, in turn, shall use that loan to make
financial assistance available to California consumers and businesses
for electric and natural gas energy conservation, and for the use of
renewable energy resources.
(b) The purposes for which loans provided pursuant to subdivision
(a) may include, but shall not be limited to, any of the following:
(1) The purchase of consumer appliances and home improvements with
electric and gas energy efficiency or renewable energy
characteristics, as approved by the Energy Commission, the
commission, or a participating public utility, as applicable, and
certified by the applicable party as having been installed or
completed.
(2) The purchase or lease of business equipment and facility
improvements with electric and gas energy efficiency or renewable
energy characteristics, as approved by the Energy Commission, the
commission, or a participating public utility, as applicable, and
certified by the applicable party as having been installed or
completed.
3366. As a condition of receipt of a loan pursuant to Section
3365, a participating party shall be required to conduct a
comprehensive marketing program that makes consumers aware of the
availability of these financial assistance programs , and to
provide appropriate security for repayment of the loan, including,
without limitation, a pledge to the authority of consumer and
business loan repayments collected through utility bills, as
applicable .
Article. 8 7. Natural Gas Plans
3368. The commission shall obtain from each natural gas supplier
under its jurisdiction, plans regarding the supplier's future
investments in natural gas exploration, development, and
transportation to meet California's needs at reasonable costs to the
consumers, and shall provide these reports to the authority, as
prescribed by subdivision (a).
(a) Each natural gas supplier shall, within 90 calendar days of
the effective date of this division, submit the report required by
this section to the commission, and the commission shall forward that
report to the authority not later than 10 business days after
receipt of the report.
(b) The authority, based on these reports and in consultation with
the commission, shall develop appropriate strategies for the
authority to facilitate a dependable supply of natural gas at
reasonable prices to the public. These strategies may include the
ability of the authority to finance activities to supplement private
sector supplies of natural gas, if it is determined to be in the best
interests of the state, using the same powers under this division
applicable to supplementing private sector supplies of electricity.
CHAPTER 4. CALIFORNIA CONSUMER POWER AND CONSERVATION
FINANCING AUTHORITY FUND
3370. (a) There is hereby created in the State Treasury the
California Consumer Power and Conservation Financing Authority Fund
for expenditure by the authority for the purpose of implementing the
objectives and provisions of this division. The authority
may establish within the fund additional accounts and
For the purposes of subdivision (e), or as necessary or convenient to
the accomplishment of any other purpose of the authority, the
authority may establish within the fund additional and separate
accounts and subaccounts.
(b) The assets of the fund shall be available for the payment of
the salaries and other expenses charged against it in accordance with
this division.
(c) All moneys in the fund, upon appropriation, shall be available
for expenditure for the purposes stated in this division.
(d) The fund, on behalf of the authority, may borrow or receive
moneys from the authority, or from any federal, state, or local
agency or private entity, to create reserves in the fund as provided
in this division and as authorized by the board.
CHAPTER 5. BONDS
3380. (a) The board may so authorize, and the authority may issue
bonds, notes or other forms of indebtedness, as authorized by this
division, for the purposes provided in this division in the amount of
____ dollars ($____).
(b) Of the amount specified in subdivision (a), ____ dollars
($____) initially shall be reserved for the programs authorized by
Article 7 (commencing with Section 3365) of Chapter 3.
(c) Any portion of the initial reserved amount specified in
subdivision (b) that is not issued on or prior to January 1, 2004,
may be issued for other purposes of the authority, upon approval of
the board.
3381. Bonds issued by the authority are legal investments for all
trust funds, the funds of all insurance companies, banks, both
commercial and savings, trust companies, executors, administrators,
trustees, and other fiduciaries, for state school funds, pension
funds, and for any funds that may be invested in county, school, or
municipal bonds.
(b) Any and all bonds issued by the authority or special purpose
trust, their transfer and the income therefrom, shall at all times be
free from taxation of every kind by the state and by all political
subdivisions of the state.
(c) The issuance of bonds under this division shall not directly
or indirectly or contingently obligate the state or any political
subdivision thereof to levy or to pledge any form of taxation
whatever therefor or to make any appropriation for their payment.
(d) The state does hereby pledge to, and agrees with the holders
of any bonds issued under this division, and with those parties who
may enter into contracts with the authority pursuant to this
division, that the state will not limit or alter the rights hereby
vested in the authority to finance any project and to fulfill the
terms of any loan agreement, lease, or other contract with the
authority pursuant to this division, or in any way impair the rights
or remedies of the bond holders or of the parties until those bonds,
together with the
interest thereon, are fully discharged or provision for this
discharge has been made and those contracts are fully performed on
the part of the authority. The authority, as agent for the state,
may include this pledge and undertaking for the state in its
obligations and contracts.
3382. The authority may request and obtain, upon approval of the
Pooled Money Investment Board, a loan from the Pooled Money
Investment Account. This loan may be subject to the terms negotiated
with the Pooled Money Investment Account, including, but not limited
to, a pledge of authority bond proceeds or revenues.
(c) All moneys in the fund, upon appropriation, may be used for
any reasonable costs which may be incurred by the authority in the
exercise of its powers under this division.
(d) The fund, on behalf of the authority, may borrow or receive
moneys from the authority, or from any federal, state, or local
agency or private entity, to create reserves in the fund as provided
in this division and as authorized by the board.
(e) The authority may pledge any or all of the moneys in the fund
(including in any account or subaccount) as security for payment of
the principal of, and interest on, any particular issuance of bonds
issued pursuant to this division.
(f) The authority, may, from time to time, direct the Treasurer to
invest moneys in the fund that are not required for the authority's
current needs, including proceeds from the sale of any bonds, in any
securities permitted by law as the authority shall designate. The
authority also may direct the Treasurer to deposit moneys in
interest-bearing accounts in state or national banks or other
financial institutions having principal offices in this state. The
authority may alternatively require the transfer of moneys in the
fund to the Surplus Money Investment Fund for investment pursuant to
Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of
Division 4 of the Government Code. All interest or other increment
resulting from an investment or deposit shall be deposited in the
fund, notwithstanding Section 16305.7 of the Government Code. Moneys
in the fund shall not be subject to transfer to any other fund
pursuant to any provision of Part 2 (commencing with Section 16300)
of Division 4 of the Government Code, excepting the Surplus Money
Investment Fund.
CHAPTER 5. BONDS
3380.1. For the purposes provided in this division, the authority
is authorized to incur indebtedness and to issue securities of any
kind or class, at public or private sale by the Treasurer, and to
renew the same, provided that all such indebtedness, howsoever
evidenced, shall be payable solely from revenues. The authority may
issue bonds for the purposes of this division in the amount of five
billion dollars ($5,000,000,000).
3380.2. In connection with the issuance of bonds, in addition to
the powers otherwise provided in this division, the authority may do
all of the following:
(a) Issue, from time to time, bonds payable from and secured by a
pledge of all or any part of the revenues in order to finance the
activities authorized by this article, including, without limitation,
an enterprise or multiple enterprises, a single project for a single
participating party, a series of projects for a single participating
party, a single project for several participating parties, or
several projects for several participating parties, and to sell those
bonds at public or private sale by the Treasurer, in the form and on
those terms and conditions as the Treasurer, as agent for sale,
shall approve.
(b) Pledge all or any part of the revenues to secure bonds and any
repayment or reimbursement obligations of the authority to any
provider of insurance or a guarantee of liquidity or credit facility
entered into to provide for the payment or debt service on any bond.
(c) Employ and compensate bond counsel, financial consultants,
underwriters, and other advisers determined necessary and appointed
by the Treasurer in connection with the issuance and sale of any
bond.
(d) Issue bonds to refund or purchase or otherwise acquire bonds
on terms and conditions as the Treasurer, as agent for sale, shall
approve.
(e) Perform all acts that relate to the function and purpose of
the authority under this division, whether or not specifically
designated in this chapter.
3381. Bonds issued by the authority are legal investments for all
trust funds, the funds of all insurance companies, banks, both
commercial and savings, trust companies, executors, administrators,
trustees, and other fiduciaries, for state school funds, pension
funds, and for any funds that may be invested in county, school, or
municipal bonds. The bond issued under this division are securities
that may legally be deposited with, and received by, any state or
municipal officer or agency or political subdivision of the state,
including, without limitation, local agencies, schools, and pension
funds, for any purpose for which the deposit of bonds or obligations
of the state is now, or may hereafter be, authorized by law,
including deposits to secure public funds.
3382. The authority is authorized to obtain loans from the Pooled
Money Investment Account pursuant to Sections 16312 and 16313 of the
Government Code. These loans shall be subject to the terms
negotiated with the Pooled Money Investment Board, including, but not
limited to, a pledge of authority bond proceeds or revenues.
3383. Bonds issued under this division shall not be deemed to
constitute a debt or liability of the state or of any political
subdivision thereof, other than the authority, or a pledge of the
faith and credit of the state or of any political subdivision, other
than the authority, but shall be payable solely from the funds herein
provided therefor. All bonds issued under this division shall
contain on the face thereof a statement to the following effect:
"Neither the faith and credit nor the taxing power of the State of
California or any local agency is pledged to the payment of the
principal of or interest on this bond." The issuance of bonds under
this division shall not directly or indirectly or contingently
obligate the state or any political subdivision thereof to levy or to
pledge any form of taxation whatever therefor or to make any
appropriation for their payment. Nothing in this section shall
prevent nor be construed to prevent the authority from pledging its
full faith and credit to the payment of bonds or issue of bonds
authorized pursuant to this division.