SECTIONS 25410-25422 - California Statutes

PUBLIC RESOURCES CODE

SECTION 25410-25422

25410. This chapter shall be known and may be cited as the Energy
Conservation Assistance Act of 1979.

25410.5. The Legislature finds and declares all of the following:
(a) Energy costs are frequently the second largest discretionary
expense in a local government's budget. According to the commission,
most public institutions could reduce their energy costs by 20 to 30
percent.
(b) A variety of energy conservation measures are available to
local governments. These measures are highly cost-effective, often
providing a payback on the initial investment in three years or less.
(c) Many local governments lack energy management expertise and
are often unaware of their high energy costs or the opportunities to
reduce those costs.
(d) Local governments that desire to reduce their energy costs
through energy conservation and efficiency measures often lack
available funding.
(e) Since 1980, the Energy Conservation Assistance Account has
provided $110 million in loans, through a revolving loan account, to
600 schools, hospitals, and local governments. The energy
conservation projects funded by the account save approximately $35
million annually in energy costs.
(f) Local governments and public institutions need assistance in
all aspects of energy efficiency improvements, including, but not
limited to, project identification, project development and
implementation, evaluation of project proposals and options,
operations and maintenance, and troubleshooting of problem projects.

25410.6. (a) It is the intent of the Legislature that the
commission shall administer the State Energy Conservation Assistance
Account to provide grants and loans to local governments and public
institutions to maximize energy use savings, including, but not
limited to, technical assistance, demonstrations, and identification
and implementation of cost-effective energy efficiency measures and
programs in existing and planned buildings or facilities.
(b) It is further the intent of the Legislature that the
commission seek the assistance of utility companies in providing
energy audits for local governments and public institutions and in
publicizing the availability of State Energy Conservation Assistance
Account funds to qualified entities.

25411. As used in this chapter:
(a) "Allocation" means a loan of funds by the commission pursuant
to the procedures specified in this chapter.
(b) "Building" means any existing or planned structure that
includes a heating or cooling system, or both. Additions to an
original building shall be considered part of that building rather
than a separate building.
(c) "Eligible institution" means a school, hospital, public care
institution, or a unit of local government.
(d) "Energy audit" means a determination of the energy consumption
characteristics of a building or facility that does all of the
following:
(1) Identifies the type, size, and energy use level of the
building or facility and the major energy using systems of the
building or facility.
(2) Determines appropriate energy conservation maintenance and
operating procedures.
(3) Indicates the need, if any, for the acquisition and
installation of energy conservation measures.
(e) "Energy conservation maintenance and operating procedure"
means a modification or modifications in the maintenance and
operations of a building or facility, and any installations therein
(based on the use time schedule of the building or facility), which
are designed to reduce energy consumption in the building or facility
and that require no significant expenditure of funds.
(f) "Energy conservation measure" means an installation or
modification of an installation in a building or facility that is
primarily intended to reduce energy consumption or allow the use of a
more desirable energy source.
(g) "Energy conservation project" means an undertaking to acquire
and to install one or more energy conservation measures in a building
or facility, and technical assistance in connection with that
undertaking.
(h) "Facility" means any major energy using system of an eligible
institution whether or not housed in a building.
(i) "Hospital" means a public or nonprofit institution that is
both of the following:
(1) A general hospital, tuberculosis hospital, or any other type
of hospital, other than a hospital furnishing primarily domiciliary
care.
(2) Duly authorized to provide hospital services under the laws of
this state.
(j) "Hospital building" means a building housing a hospital and
related operations, including laboratories, laundries, outpatient
departments, nurses' home and training activities, and central
service operations in connection with a hospital, and also includes a
building housing education or training activities for health
professions personnel operated as an integral part of a hospital.
(k) "Local government building" means a building that is primarily
occupied by offices or agencies of a unit of local government or by
a public care institution.
(l) "Project" means a purpose for which an allocation may be
requested and made under this chapter. Those purposes shall include
energy audits, energy conservation and operating procedures, and
energy conservation measures in existing and planned buildings and
facilities, energy conservation projects, and technical assistance
programs.
(m) "Public care institution" means a public or nonprofit
institution that owns:
(1) A long-term care institution.
(2) A rehabilitation institution.
(3) An institution for the provision of public health services,
including related publicly owned services such as laboratories,
clinics, and administrative offices operated in connection with the
institution.
(4) A residential child care center.
(n) "Public or nonprofit institution" means an institution owned
and operated by:
(1) The state, a political subdivision of the state, or an agency
or instrumentality of either.
(2) An organization exempt from income tax under Section 501(c)(3)
of the Internal Revenue Code of 1954.
(3) In the case of public care institutions, an organization also
exempt from income tax under Section 501(c)(4) of the Internal
Revenue Code of 1954.
(o) "School" means a public or nonprofit institution, including a
local educational agency, which:
(1) Provides, and is legally authorized to provide, elementary
education or secondary education, or both, on a day or residential
basis.
(2) Provides, and is legally authorized to provide, a program of
education beyond secondary education, on a day or residential basis
and meets all of the following requirements:
(A) Admits as students only persons having a certificate of
graduation from a school providing secondary education, or the
recognized equivalent of that certificate.
(B) Is accredited by a nationally recognized accrediting agency or
association.
(C) Provides an education program for which it awards a bachelor's
degree or higher degree or provides not less than a two-year program
that is acceptable for full credit toward a degree at any
institution that meets the requirements of subparagraphs (A) and (B)
and provides that program.
(3) Provides not less than a one-year program of training to
prepare students for gainful employment in a recognized occupation
and that meets the provisions of (2).
(p) "School building" means a building housing classrooms,
laboratories, dormitories, athletic facilities, or related facilities
operated in connection with a school.
(q) "Technical assistance costs" means costs incurred for the use
of existing personnel or the temporary employment of other qualified
personnel, or both, necessary for providing technical assistance.
(r) "Technical assistance program" means assistance to schools,
hospitals, local government, and public care institutions and
includes, but is not limited to:
(1) Conducting specialized studies identifying and specifying
energy savings and related cost savings that are likely to be
realized as a result of:
(A) Modification of maintenance and operating procedures in a
building or facility, in addition to those modifications implemented
after the preliminary energy audit, or
(B) Acquisition and installation of one or more specified energy
conservation measures in the building or facility, or as a result of
both.
(C) New construction activities.
(2) Planning of specific remodeling, renovation, repair,
replacement, or insulation projects related to the installation of
energy conservation measures in the building or facility.
(3) Developing and evaluating alternative project implementation
methods and proposals.
(s) "Unit of local government" means a unit of general purpose
government below the state or a special district.

25412. Any eligible institution may submit an application to the
commission for an allocation for the purpose of financing all or a
portion of the costs incurred in implementing a project. The
application shall be in such form and contain such information as the
commission shall prescribe.
An application may be for the purpose of financing the eligible
institution's share of such costs which are to be jointly funded
through a state, local, or federal-local program.

25413. Applications may be approved by the commission only in those
instances where the eligible institution has furnished information
satisfactory to the commission that the costs of the project, plus
interest on state funds loaned, calculated in accordance with Section
25415, will be recovered through savings in the cost of energy to
the institution during the repayment period of the allocation.
The savings shall be calculated in a manner prescribed by the
commission.

25414. Annually at the conclusion of each fiscal year, but not
later than October 31, each eligible institution that has received an
allocation pursuant to this chapter shall compute the cost of energy
saved as a result of implementing a project funded by the
allocation. The cost shall be calculated in a manner prescribed by
the commission.

25415. (a) Each eligible institution to which an allocation has
been made under this chapter shall repay the principal amount of the
allocation, plus interest, in not more than 30 equal semiannual
payments, as determined by the commission. The first semiannual
payment shall be made on or before December 22 of the fiscal year
following the year in which the project is completed. The repayment
period may not exceed the life of the equipment, as determined by the
commission or the lease term of the building in which the energy
conservation measures will be installed.
(b) Notwithstanding any other provision of law, the commission
shall, unless it determines that the purposes of this chapter would
be better served by establishing an alternative interest rate
schedule, periodically set interest rates on the loans based on
surveys of existing financial markets and at rates not less than 1
percent per annum.
(c) The governing body of each eligible institution shall annually
budget an amount at least sufficient to make the semiannual payments
required in this section. The amount shall not be raised by the levy
of additional taxes but shall instead be obtained by a savings in
energy costs or other sources.

25416. (a) The State Energy Conservation Assistance Account is
hereby created in the General Fund. Notwithstanding Section 13340 of
the Government Code, the account is continuously appropriated to the
commission without regard to fiscal year.
(b) The money in the account shall consist of all money authorized
or required to be deposited in the account by the Legislature and
all money received by the commission pursuant to Sections 25414 and
25415.
(c) The money in the account shall be disbursed by the Controller
for the purposes of this chapter as authorized by the commission.
(d) The commission may contract and provide grants for services to
be performed for eligible institutions. Services may include, but
are not limited to, feasibility analysis, project design, field
assistance, and operation and training. The amount expended for those
services may not exceed 10 percent of the unencumbered balance of
the account as determined by the commission on July 1 of each year.
(e) The commission may make grants to eligible institutions for
innovative projects and programs. Except as provided in subdivision
(d), the amount expended for grants may not exceed 5 percent of the
annual unencumbered balance in the account as determined by the
commission on July 1 of each fiscal year.
(f) The commission may charge a fee for the services provided
under subdivision (d).
(g) Notwithstanding any other provision of law, the Controller may
use the State Energy Conservation Assistance Account for loans to
the General Fund as provided in Sections 16310 and 16381 of the
Government Code.

25417. (a) An allocation made pursuant to this chapter shall be
used for the purposes specified in an approved application.
(b) In the event that the commission determines that an allocation
has been expended for purposes other than those specified in an
approved application, it shall immediately request the return of the
full amount of the allocation. The eligible institution shall
immediately comply with such request.

25417.5. (a) In furtherance of the purposes of the commission as
set forth in this chapter, the commission has the power and authority
to do all of the following:
(1) Borrow money, for the purpose of obtaining funds to make loans
pursuant to this chapter, from the California Economic Development
Financing Authority, the California Infrastructure and Economic
Development Bank, and the California Consumer Power and Conservation
Financing Authority from the proceeds of revenue bonds issued by any
of those agencies.
(2) Pledge, to provide collateral in connection with the borrowing
of money pursuant to paragraph (1), loans made pursuant to this
chapter or Chapter 5.4 (commencing with Section 25440), or the
principal and interest payments on loans made pursuant to this
chapter or Chapter 5.4 (commencing with Section 25440).
(3) Sell loans made pursuant to this chapter or Chapter 5.4
(commencing with Section 25440), at prices determined in the sole
discretion of the commission, to the California Economic Development
Financing Authority, the California Infrastructure and Economic
Development Bank, and the California Consumer Power and Conservation
Financing Authority to raise funds to enable the commission to make
loans to eligible institutions.
(4) Enter into loan agreements or other contracts necessary or
appropriate in connection with the pledge or sale of loans pursuant
to paragraph (2) or (3), or the borrowing of money as provided in
paragraph (1), containing any provisions that may be required by the
California Economic Development Financing Authority, the California
Infrastructure and Economic Development Bank, or the California
Consumer Power and Conservation Financing Authority as conditions of
issuing bonds to fund loans to, or the purchase of loans from, the
commission.
(b) In connection with the pledging of loans, or of the principal
and interest payment on loans, pursuant to paragraph (2) of
subdivision (a), the commission may enter into pledge agreements
setting forth the terms and conditions pursuant to which the
commission is pledging loans or the principal and interest payment on
loans, and may also agree to have the loans held by bond trustees or
by independent collateral or escrow agents and to direct that
payments received on those loans be paid to those trustee,
collateral, or escrow agents.
(c) The commission may employ financial consultants, legal
advisers, accountants, and other service providers, as may be
necessary in its judgment, in connection with activities pursuant to
this chapter.
(d) Notwithstanding any other provision of law, this chapter
provides a complete, separate, additional, and alternative method for
implementing the measures authorized by this chapter, including the
authority of the eligible institutions or local jurisdictions to have
borrowed and to borrow in the future pursuant to loans made pursuant
to this chapter or Chapter 5.4 (commencing with Section 25440), and
is supplemental and additional to powers conferred by other laws.

25418. The Department of Finance, at its discretion, may audit the
expenditure of any allocation made pursuant to this chapter or the
computation of any payment made pursuant to Section 25415.

25419. In addition to the powers specifically granted to the
commission by the other provisions of this chapter, the commission
shall have the following powers:
(a) To establish qualifications and priorities, consistent with
the objectives of this chapter, for making allocations.
(b) To establish such procedures and policies as may be necessary
for the administration of this chapter.

25420. The commission may expend from the State Energy Conservation
Assistance Account an amount to pay for the actual administrative
costs incurred by the commission pursuant to this chapter. The amount
shall not exceed 5 percent of the annual unencumbered balance in the
account as determined by the commission on July 1 of each fiscal
year, to be used to defray costs incurred by the commission for
allocations made by the commission pursuant to this chapter.

25421. (a) Except as provided in subdivision (b), this chapter
shall remain in effect only until January 1, 2013, and as of that
date is repealed, unless a later enacted statute, which is enacted
before January 1, 2013, deletes or extends that date.
(b) All loans outstanding as of January 1, 2013, shall continue to
be repaid on a semiannual basis, as specified in Section 25415,
until paid in full. All unexpended funds in the State Energy
Conservation Assistance Account on January 1, 2013, and thereafter,
except to the extent those funds are encumbered pursuant to Section
25417.5, shall revert to the General Fund.

25422. (a) Federal funds available to the commission pursuant to
Chapter 5.6 (commencing with Section 25460) may be used by the
commission to augment funding for grants and loans pursuant to this
chapter. Any federal funds used for loans shall, when repaid, be
deposited into the Energy Conservation Assistance Account and used to
make additional loans pursuant to this chapter.
(b) A separate subaccount shall be established within the Energy
Conservation Assistance Account to track the award and repayment of
loans from federal funds, including any interest earnings, in
accordance with the federal American Recovery and Reinvestment Act of
2009 (Public Law 111-5).