SECTIONS 63021-63028 - California Statutes

GOVERNMENT CODE

SECTION 63021-63028

63021. (a) There is within the Business, Transportation and Housing
Agency the Infrastructure and Economic Development Bank which shall
be responsible for administering this division.
(b) The bank shall be under the direction of an executive director
appointed by the Governor, and who shall serve at the pleasure of
the Governor. The appointment shall be subject to confirmation by the
Senate.

63021.5. (a) The bank shall be governed and its corporate power
exercised by a board of directors that shall consist of the following
persons:
(1) The Director of Finance or his or her designee.
(2) The Treasurer or his or her designee.
(3) The Secretary of Business, Transportation and Housing or his
or her designee, who shall serve as chair of the board.
(4) An appointee of the Governor.
(5) The Secretary of State and Consumer Services Agency or his or
her designee.
(b) Any designated director shall serve at the pleasure of the
designating power.
(c) 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) A member of the board shall not participate in any bank action
or attempt to influence any decision or recommendation by any
employee of, or consultant to, the bank that involves a sponsor of
which he or she is a representative or in which the member or a
member of his or her immediate family has a personal financial
interest within the meaning of Section 87100. For purposes of this
section, "immediate family" means the spouse, children, and parents
of the member.
(e) 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.

63022. The executive director shall manage and conduct the business
and affairs of the bank, the infrastructure bank fund, and guarantee
trust 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
chapter. Any action involving final approval of any bonds, notes, or
loans shall require the approval of a majority of the members of the
board. Subject to any conditions that the board may from time to time
prescribe, the executive director may exercise any power, function,
or duty conferred by law on the bank in connection with the
administration, management, and conduct of the business and affairs
of the bank, the infrastructure bank fund, and the guarantee trust
fund.

63022.5. (a) The officers of the bank shall be subject to the
Political Reform Act of 1974 (Title 9 (commencing with Section
81000)), the applicable rules and standards of the Municipal
Securities Rulemaking Board, and all other applicable provisions of
law.
(b) The bank 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 fiduciary
obligation by the fiduciary.

63023. In administering and directing the day-to-day operations of
the bank in regard to this division, the executive director, or
whoever he or she shall assign, may do any of the following if
authorized by resolution of the board:
(a) Enter into contracts for investment, guarantee, or
enhancement.
(b) Establish procedures, guidelines, criteria, terms, conditions,
or other requirements of any contract, bond, grant, or program, as
the case may be, in order to carry out the intents and purposes of
the board in authorizing any bond, loan, or grant program pursuant to
this division.
(c) Decline to guarantee any risk, or to enter into any contract,
in which the minimum requirements of the guarantee trust fund or the
infrastructure bank fund are not complied with.
(d) Reinsure any risk or any part of any risk.
(e) Make rules for payments through the infrastructure bank fund
and the settlement of claims against the guarantee trust fund and
determine to whom and through whom the payments are to be made.
(f) Enter into any contracts or obligations relating to the
infrastructure bank fund and the guarantee trust fund.
(g) Invest and reinvest the moneys belonging to the infrastructure
bank fund and the guarantee trust fund as provided by this division.
(h) Enter into any contract or agreement, execute any instrument,
conduct all business and affairs, and perform all acts relating to
the infrastructure bank fund and the guarantee trust fund whether or
not specifically designated in this division.

63023.1. The board may delegate to the executive director, or
whomever he or she shall assign, the authority to execute a contract
or agreement, execute an instrument, conduct all business and
affairs, and perform all acts relating to the infrastructure bank
fund and the guarantee trust fund.

63024. The executive director may contract with the Department of
Finance, the State Department of Health Services, the Department of
Transportation, the Department of Water Resources, the California
Integrated Waste Management Board, the State Water Resources Control
Board, the Governor's Office of Planning and Research, and any other
necessary agencies, persons, or firms to enable the agency to
properly perform the duties imposed by this division.

63025. The bank board shall do the following:
(a) Adopt bylaws for the regulation of its affairs and the conduct
of its business.
(b) Adopt an official seal.

63025.1. The bank board may do or delegate the following to the
executive director:
(a) Sue and be sued in its own name.
(b) As provided in Chapter 5 (commencing with Section 63070),
issue bonds and authorize special purpose trusts to issue bonds,
including, at the option of the board, bonds bearing interest that is
taxable for the purpose of federal income taxation, or borrow money
to pay all or any part of the cost of any project, or to otherwise
carry out the purposes of this division.
(c) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this division.
(d) Employ attorneys, financial consultants, and other advisers as
may, in the bank's judgment, be necessary in connection with the
issuance and sale, or authorization of special purpose trusts for the
issuance and sale, of any bonds, notwithstanding Sections 11042 and
11043.
(e) Contract for engineering, architectural, accounting, or other
services of appropriate state agencies as may, in its judgment, be
necessary for the successful development of a project.
(f) Pay the reasonable costs of consulting engineers, architects,
accountants, and construction, land use, recreation, and
environmental experts employed by any sponsor or participating party
if, in the bank's judgment, those services are necessary for the
successful development of a project.
(g) 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, or transition property as the bank
may deem necessary or convenient for the financing of the project,
upon terms and conditions that it considers to be reasonable.
(h) Receive and accept from any source including, but not limited
to, the federal government, the state, or any agency thereof, loans,
contributions, or grants, in money, property, labor, or other things
of value, for, or in aid of, a project, or any portion thereof.
(i) Make loans to any sponsor or participating party, either
directly or by making a loan to a lending institution, in connection
with the financing of a project in accordance with an agreement
between the bank and the sponsor or a participating party, either as
a sole lender or in participation with other lenders. However, no
loan shall exceed the total cost of the project as determined by the
sponsor or the participating party and approved by the bank.
(j) Make loans to any sponsor or participating party, either
directly or by making a loan to a lending institution, in accordance
with an agreement between the bank and the sponsor or participating
party to refinance indebtedness incurred by the sponsor or
participating party in connection with projects undertaken and
completed prior to any agreement with the bank or expectation that
the bank would provide financing, either as a sole lender or in
participation with other lenders.
(k) Mortgage all or any portion of the bank'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.
(l) Assign or pledge all or any portion of the bank's interests in
transition property and the revenues therefrom, or 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 sponsor or a
participating party to which the bank has made loans, and the
revenues therefrom, including payment or income from any interest
owned or held by the bank, for the benefit of the holders of bonds.
(m) Make, receive, or serve as a conduit for the making of, or
otherwise provide for, grants, contributions, guarantees, insurance,
credit enhancements or liquidity facilities, or other financial
enhancements to a sponsor or a participating party as financial
assistance for a project.
(n) Lease the project being financed to a sponsor or a
participating party, upon terms and conditions that the bank deems
proper but shall not be leased at a loss; 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 bank;
purchase any or all of the project; or, upon payment of all the
indebtedness incurred by the bank for the financing of the project,
the bank may convey any or all of the project to the lessee or
lessees.
(o) Charge and equitably apportion among sponsors and
participating parties the bank's administrative costs and expenses
incurred in the exercise of the powers and duties conferred by this
division.
(p) 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.
(q) Notwithstanding any other provision of this division, enter
into any agreement, contract, or any other instrument with respect to
any insurance or guarantee; accept payment in the manner and form as
provided therein in the event of default by a sponsor or a
participating party; and issue or assign any insurance or guarantee
as security for the bank's bonds.
(r) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary or convenient to, directly or
indirectly, secure the bank's bonds, the bonds issued by a special
purpose trust, or a sponsor's obligations to the bank or to a special
purpose trust, including, but not limited to, bonds of a sponsor
purchased by the bank 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 sponsor 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 sponsor, the bank, 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 sponsor has not paid or is in
default on its obligations to the bank or a special purpose trust,
direct the Controller to withhold payment of those funds or moneys
from the sponsor over which it is or will be custodian and to pay the
same to the bank 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 bank 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 bank or special purpose trust or their
assignee, or until arrangements satisfactory to the bank or special
purpose trust have been made to cure the default.
(s) Enter into any agreement or contract, execute any instrument,
and perform any act or thing necessary, convenient, or appropriate to
carry out any power expressly given to the bank by this division,
including, but not limited to, agreements for the sale of all or any
part, including principal, interest, redemption rights or any other
rights or obligations, of bonds of the bank or of a special purpose
trust, liquidity agreements, contracts commonly known as interest
rate swap agreements, forward payment conversion agreements, futures
or contracts providing for payments based on levels of, or changes
in, interest rates or currency exchange rates, or contracts to
exchange cash-flows or a series of payments, or contracts, including
options, puts or calls to hedge payments, rate, spread, currency
exchange, or similar exposure, or any other financial instrument
commonly known as a structured financial product.
(t) Purchase, with the proceeds of the bank's bonds, transition
property or bonds issued by, or for the benefit of, any sponsor in
connection with a project, pursuant to a bond purchase agreement or
otherwise. Bonds or transition property purchased pursuant to this
division may be held by the bank, pledged or assigned by the bank, 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 bank, and notwithstanding any other provision of law, may be
bought by the bank at private sale.
(u) 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 or transition
property.
(v) Invest any moneys held in reserve or sinking funds, or any
moneys not required for immediate use or disbursement, in obligations
that are authorized by law for the investment of trust funds in the
custody of the Treasurer.
(w) Authorize a special purpose trust or trusts to purchase or
retain, with the proceeds of the bonds of a special purpose trust,
transition property or bonds issued by, or for the benefit of, any
sponsor in connection with a project or issued by the bank or a
special purpose trust, pursuant to a bond purchase agreement or
otherwise. Bonds or transition property purchased pursuant to this
title 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 bank
or by a special purpose trust at private sale.
(x) Approve the issuance of any bonds, notes, or other evidences
of indebtedness by the Rural Economic Development Infrastructure
Panel, established pursuant to Section 15373.7.
(y) Approve the issuance of rate reduction bonds by an entity
other than the bank or a special purpose trust to acquire transition
property upon approval of the transaction in a financing order by the
Public Utilities Commission, as provided in Article 5.5 (commencing
with Section 840) of Chapter 4 of Part 1 of Division 1 of the Public
Utilities Code.
(z) Apply for and accept subventions, grants, loans, advances, and
contributions from any source of money, property, labor, or other
things of value. The sources may include bond proceeds, dedicated
taxes, state appropriations, federal appropriations, federal grant
and loan funds, public and private sector retirement system funds,
and proceeds of loans from the Pooled Money Investment Account.
(aa) Do all things necessary and convenient to carry out its
purposes and exercise its powers, provided, however, that nothing
herein shall be construed to authorize the bank to engage directly in
the business of a manufacturing, industrial, real estate
development, or nongovernmental service enterprise. Further, the bank
shall not be organized to accept deposits of money for time or
demand deposits or to constitute a bank or trust company.

63025.2. Nothing in Section 63025.1 shall be construed to extend or
limit the authority of the bank that is otherwise provided in
Section 19130.

63026. The fiscal powers granted to the bank by this part may be
exercised without regard or reference to any other department,
division, or agency of the state, except the Legislature. 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.

63027. (a) The bank may provide insurance or reinsurance of loans
or portions thereof, or their debt service, including amounts payable
as premiums of penalties in the event of mandatory or optional
prepayment, made to finance a project, and to provide insurance or
reinsurance or reserves, or portions thereof, or the yield therefrom,
established to secure bonds issued to fund those loans or reserves.
(b) The bank may enter into or arrange agreements for insurance or
reinsurance with users, mortgagors, lending institutions, insurers,
and others, the bank being authorized to reinsure or cede risks to
the insurers in any amounts as the bank may determine and the
insurers, if otherwise authorized to reinsure or insure those risks
in California, being hereby authorized to reinsure the bank or cede
risks to the bank to the same extent as if the bank were a company
authorized to reinsure or insure those risks.
(c) The bank may fix a rate or rates of premium for insurance or
reinsurance, which need not be uniform, and may reflect any risks and
classifications of risk as the bank determines to be reasonable.
(d) The bank may exercise those other powers as are necessary or
incidental to insurance, reinsurance, and related matters.
(e) The bank shall make reasonable provisions for the security of
loans made by the bank, and any insurance, reinsurance, and other
financing arrangements negotiated by the bank.
(f) The insurance or reinsurance provided for by the bank shall
not constitute a debt or pledge of the faith and credit of the state
or any subdivision of the state.

63028. The bank assumes and shall observe, keep, and perform all of
the responsibilities, liabilities, and obligations of the former
California Economic Development Financing Authority established under
Part 10.2 (commencing with Section 15710) of Division 2 of Title 2,
as it read prior to the effective date of this section, and the
assumption of the responsibilities, liabilities, and obligations of
the former California Economic Development Financing Authority shall
occur without any execution or filing of any paper or any further
act. Any reference in any law, contract, bond, indenture, or other
document to the former California Economic Development Financing
Authority shall be deemed, hereafter, to mean the bank.