BILL ANALYSIS
AB 2705
Page 1
ASSEMBLY THIRD READING
AB 2705 (Agriculture Committee)
As Amended May 4, 2000
Majority vote
AGRICULTURE 9-0 UTILITIES & COMMERCE
8-0
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|Ayes:|Cardoza, Maldonado, |Ayes:|Wright, Pescetti, |
| |Briggs, Florez, Frusetta, | |Campbell, Cardenas, |
| |House, Reyes, Thomson, | |Maddox, Mazzoni, Papan, |
| |Wiggins | |Reyes |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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APPROPRIATIONS 21-0
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|Ayes:|Migden, Campbell, | | |
| |Ackerman, Alquist, | | |
| |Aroner, Ashburn, Brewer, | | |
| |Cedillo, Corbett, Davis, | | |
| |Kuehl, Maldonado, Papan, | | |
| |Romero, Runner, Shelley, | | |
| |Thomson, Wesson, Wiggins, | | |
| |Wright, Zettel | | |
| | | | |
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SUMMARY : Directs the loan repayments and interest from the
Agricultural Energy Assistance Program (AEAP) be deposited into
the Energy Technologies Research Development and Demonstration
Account (ETRDD), and upon appropriation be available for loans
and technical assistance. Further, this bill provides that the
loan repayments not be longer than seven years and bear an
interest rate not less than 2% below the Pooled Money Investment
Account rate.
EXISTING LAW authorizes AEAP, which provides technical
assistance and loans to agricultural entities, to develop
projects that demonstrate energy efficiency, and that the
program be administered by the California Energy Commission
(Commission). The Commission has existing loan authority to
assist low-income fishing fleet operators and other energy
AB 2705
Page 2
conservation projects and demonstrations.
FISCAL EFFECT : Potential savings to the Commission by reduced
budget change proposal (BCP's) requests. Approximately $500,000
annually is repaid to the Petroleum Violation Escrow Account
(PVEA) from outstanding AEAP loans. This bill redirects those
funds to PVEA to ETRDD, for future AEAP project loans. In 1986,
$3 million was appropriated from PVEA into ETRDD for AEAP
project loans.
COMMENTS : AEAP was created by SB 1145 (Mello), Chapter 1341,
Statutes of 1986, with
$3 million from PVEA for the purpose of providing low interest
loans to demonstrate energy efficient projects by the
agricultural industry. The program was established; however, an
account for the loan and interest payments was not. The
payments have been deposited into the General Fund. The
Commission has been annually preparing BCPs to return the loan
and interest payments back to AEAP. This bill will correct this
burdensome procedure for the Commission and continue the program
until the funds are depleted.
Since the inception of AEAP, there have been over 110 loans
totaling $6.2 million funding various energy efficiency projects
related to agriculture; there have been no defaults. Eligible
operators include food and fiber farmers, dairy producers,
cattle ranchers, food processors, greenhouse activities, and
irrigation districts. Projects have included: on-farm efficient
water pumping plant performance; on-farm irrigation water
conservation; irrigation district water delivery system
efficiencies; field machinery fuel use reduction; petrochemical
pesticide use reduction; fertilizer management; food processing
energy and water management; and, alternative energy sources.
Analysis Prepared by : Jim Collin / AGRI. / (916) 319-2084
FN: 0004806