Legislative Text
SEC. __. Section 13314 is added to the Government Code, to read:
13314. (a) It is the intent of the Legislature to increase the total amount of funding that may be made available to address the State’s critical need for resilient infrastructure by providing for the following:
(1) Encouragement to communities, cities and counties to identify and timely develop the resilient infrastructure facilities they most urgently need to address the effects of climate volatility; including, but not limited to, wildfires; coastal erosion; loss of access to water for human consumption, agriculture, and firefighting; and voluntary power outages.
(2) A means by which a task force made up of State Government agencies and departments can certify develop best practices standards for those projects and act as a clearinghouse to designate specific types of resilient infrastructure projects that both meet the needs of participating communities, cities and counties and meet the State’s objectives and risk tolerance with respect to furthering such resilient infrastructure projects.
(3) Encouragement to public retirement systems to participate in funding such certified resilient infrastructure projects, by guaranteeing a minimum level of investment return on the funding of certified projects through a qualifying direct investment vehicle; all in conjunction with and complementary to other state sponsored funding programs, including the Infrastructure Bank or resiliency bonds.
(b) For purposes of this section:
(1) “Department” means the Department of Finance.
(2) “Fund” means the Resilient Activities and Development Fund established pursuant to paragraph (1) of subdivision (c) of this section.
(3) “Qualified Direct Investment Vehicle” means a corporation a) established by or owned by one or more public retirement system(s) in which the Board of Directors of such corporation is designated and controlled by the participating public retirement system(s), the corporation’s investment activities are managed by an investment team hired (and subject to termination) by such Board as “at will” employees with no asset-based management fees or carried interest, and which investment team shall be entitled to participate through in the profits of the corporation through ownership of common shares (or options therefore); b) established and run for the sole purpose of financing resilience infrastructure projects; and c) designated by executive order pursuant to subparagraph (A) of paragraph (1) of subdivision (d).
(5) “Resilient Infrastructure Project” means a project to construct new infrastructure or upgrade existing infrastructure in order to allow communities to withstand the effects of climate change, including, but not limited to, the following:
(A) Microgrids to provide emergency electrical power.
(B) Water storage and treatment facilities.
(C) Tree cutting and brush reduction, including the construction of safe egress routes from communities.
(D) Shoreline protection and systems to prevent the incursion of seawater.
(E) Undergrounding or sectionalizing electrical wires and other measures to prevent the sparking of fires from electrical lines.
(F) Programs providing financial assistance to communities and property owners in making climate-resilient retrofits or reconstructing in a climate-resilient manner structures that are damaged or destroyed by natural disaster.
(c) (1) The Resilient Activities and Development Fund is hereby established in the State Treasury. Moneys in the fund shall be used for the following purposes:
(A) Upon appropriation by the Legislature, monies to the fund, for purposes of making grants from time to time to support the formation of one or more Qualified Direct Investment Vehicles, designated pursuant to paragraph (1) of subdivision (d), for the purpose of providing initial financing for resilience infrastructure projects, designated as provided in paragraph (2) in subdivision (d).
(B) Notwithstanding Section 13340, all other moneys in the fund are continuously appropriated, without regard to fiscal years, to the department for the purpose of guaranteeing a rate of return on investments made by public retirement systems in an investment vehicle, as provided in subdivision (f).
(2) (A) Except as otherwise expressly provided by law, moneys from the General Fund, within the meaning of Section 12 of Article IV of the California Constitution, shall not be deposited into the fund.
(B) It is the intent of the Legislature to identify and deposit into the Fund special fund moneys, including trust fund moneys that are otherwise legally available for these purposes, through the Budget Act or other measure.
(d) The Governor may, by executive order, do both of the following:
(1) (A) Designate one or more Qualified Direct Investment Vehicle(s) to select and finance resilience infrastructure projects from those certified by a task force, established pursuant to paragraph (2), for which a public retirement system that owns or controls such Qualified Direct Investment Vehicle may receive a guaranteed rate of return pursuant to this section.
(B) The Governor may require that an entity, as a condition of being designated as an Qualified Direct Investment Vehicle, demonstrate to the reasonable satisfaction of the Governor that it can provide to a public retirement system an amount of return on investments made through the investment of that public retirement system’s moneys in one or more resilience infrastructure projects that will, at a minimum, meet the minimum guaranteed rate of return specified in subdivision (e).
(2) Establish a task force comprised of representatives from the Department and state agencies with jurisdiction over economic development, environmental quality, and infrastructure, for the purpose of developing best practices standards for resilience infrastructure projects and certifying which resilience infrastructure projects submitted by communities, cities and counties shall be eligible to receive financing from a Qualified Direct Investment Vehicle and for which the department may provide a guaranteed rate of return.
(e) In accordance with California Government Code Section 7514.2, (1) the Legislature encourages the Boards of its public retirement systems to set up and/or invest in Qualified Direct Investment Vehicles , in each case subject to and consistent with such public retirement system board's fiduciary duties to minimize the risk of loss and to maximize the rate of return.
(2) Nothing in this section shall require the governing board of a public retirement system to take action that is inconsistent with its plenary authority and fiduciary responsibilities, as described in Section 17 of Article XVI of the California Constitution.
(f) Subject to the availability of moneys in the fund, the department shall guarantee a rate of return of seven percent on investments in certified resilient infrastructure projects made by a public retirement system through a Qualified Direct Investment Vehicle.
SEC. __. Section 21080.50 is added to the Public Resources Code, to read:
21080.50. (a) For purposes of this section, “resilience infrastructure project” has the same meaning as defined in Section 13314 of the Government Code.
(b) Without limiting any other statutory or categorical exemption, this division shall not apply to any project for the approval, including, but not limited to, the designation, funding, selection, or permitting, of a resilience infrastructure project designated pursuant to paragraph (2) of subdivision (d) of Section 13314 of the Government Code.
