CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill No. 1696

Introduced by Assembly Members Chau and Cervantes

February 22, 2019

An act to amend Section 13997 of, and to add Section 13996.43 to, the Government Code, relating to economic development, and making an appropriation therefor.


LEGISLATIVE COUNSEL'S DIGEST


AB 1696, as introduced, Chau. The California International Trade and Investment Office Act of 2019.
Existing law requires the Governor’s Office of Business and Economic Development (GO-Biz) to develop and implement an International Trade and Investment Program that serves specified purposes. Existing law authorizes the Director of GO-Biz to establish and terminate international trade and investment offices outside of the United States if certain conditions are met. Existing law also authorizes GO-Biz to designate a nonprofit entity to operate international trade and investment offices outside of the United States.
This bill would require the Director of GO-Biz to establish a process for specified public and nonprofit organizations to submit proposals on the establishment or operation of an international trade and investment office in a foreign country. The bill would require the director to accept a letter of interest that includes specified information. The bill would require the office to review a letter of interest and determine whether it is complete within 30 days of submittal. The bill would also require the director to make a determination, within 90 days of receipt of a complete letter of interest, as to whether to request a full proposal, as specified, for the operation of the office.
Existing law authorizes GO-Biz to accept nonstate moneys for the purposes of operating an international trade and investment office. Existing law requires private sector moneys for these purposes to be deposited in the Economic Development and Trade Promotion Account, which is continuously appropriated to the Director of GO-Biz for these purposes.
This bill would authorize GO-Biz to accept in-kind services for the purposes of operating an international trade and investment office and additionally authorize those services and the moneys in the account to be used for the support of the operation of an international trade and investment office. By expanding the purposes of a continuously appropriated fund, this bill would make an appropriation.
Vote: MAJORITY   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 This act shall be known and may be cited as the California International Trade and Investment Office Act of 2019.

SEC. 2.

 The Legislature finds and declares all of the following:
(a) International trade and foreign investment are important components of California’s $2.7 trillion economy, supporting over four million California jobs.
(b) The value of trade to the California economy is increasing as reflected by the percentage of California jobs tied to trade having more than doubled from 1992 to 2013: 10.6 percent vs. 21.8 percent. Nationally, jobs supported by United States exports totaled 10.7 million with nearly 684,000 of those jobs being in California.
(c) Businesses from a range of industry sectors support trade and foreign investment activities in California. Among other advantages, the workers in these businesses earn on average 13 percent to 28 percent higher wages than the national average.
(d) Advances in transportation and communication technologies are encouraging the development of previously undeveloped markets and expanding multinational business opportunities for California firms. With more than 95 percent of consumers located outside the United States and emerging economies experiencing a growing middle class, accessing these global markets is key to California’s continued economic growth.
(e) California’s land, sea, and air ports of entry serve as key international commercial gateways. In 2016, $573.5 billion in products entered and exited the United States through these ports. Today, four of California’s top five exports include component parts, which leave the state to be combined and assembled into final products in foreign countries.
(f) If California were a country, it would be the 29th largest exporter and the 13th largest importer in the world, based on 2017 trade numbers. Exports out of California were valued at $171.9 billion and represented 11.1 percent of total United States exports in 2017. Imports into California were valued at $440 billion and represented 18.8 percent of total United States imports in 2017.

SEC. 3.

 Section 13996.43 is added to the Government Code, to read:

13996.43.
 The director shall establish a process for public and nonprofit organizations with expertise in economic development, business development, foreign trade, and foreign investment to submit proposals on the establishment or operation of an international trade office located in a foreign country. At a minimum, the process shall include each of the requirements established in this section.
(a) The director shall accept a letter of interest that includes all of the following:
(1) The proposed location of the international trade and investment office.
(2) A preliminary market analysis of the proposed location, including export and import opportunities that would benefit California businesses.
(3) A list of resources and services that could be made available to California businesses and potential California investors at this location.
(4) A description of how the activities of the international trade and investment office are aligned with the international trade and investment strategy developed pursuant to Section 13996.55.
(5) An outline of a proposed management structure, including a description of staffing levels and the positions needed to operate the international trade and investment office.
(6) A list of potential key stakeholder partnerships that will support the operations and activities of the international trade and investment office.
(7) Potential funding opportunities.
(8) A preliminary first and second year budget.
(9) Any other information the director deems necessary to make a determination to request a full proposal pursuant to paragraph (1) of subdivision (e).
(b) The Governor’s Office of Business and Economic Development shall review a letter of interest and determine whether it is complete within 30 days of submittal. Interested parties may submit additional information following the initial submittal to ensure that the office is able to review a complete letter of interest.
(c) The Governor’s Office of Business and Economic Development may facilitate discussions between key stakeholder groups in order to support the development of a letter of interest and other trade and investment purposes consistent with this chapter.
(d) The director or his or her designee shall meet with each entity or group of entities that submits a complete letter of interest. The director may request additional information prior to, during, or following that meeting.
(e) (1) The director shall determine within 90 days of receipt of a complete letter of interest whether to request the entities that submitted the letter to provide a full proposal for the operation of an international trade and investment office. A full proposal shall include sufficient evidence of support for any claims and representations made within the letter of interest.
(2) After the Governor’s Office of Business and Economic Development receives a full proposal, the director shall determine whether to establish an international trade and investment office pursuant to Section 13996.42 in partnership with the entities that submitted the letter of interest and full proposal.
(f) A potential partner in the operation of an international trade and investment office may submit more than one letter of interest.

SEC. 4.

 Section 13997 of the Government Code is amended to read:

13997.
 (a) With respect to international trade and investment offices funded in whole or in part by nonstate funds pursuant to subdivision (e) of Section 13996.41, all of the following shall apply:
(1) The Governor’s Office of Business and Economic Development may accept in-kind services from nonprofit entities and nonstate moneys, including, but not limited to, federal and private sector funds, for the purposes of operating or supporting the operation of any international trade and investment office, subject to Title the Political Reform Act of 1974 (Title 9 (commencing with Section 81000). 81000)). A donor shall not donate more than 25 percent of the annual budget of an international trade and investment office in a calendar year. The donor may specify the international trade and investment office for which the private sector moneys shall be used. The private sector moneys shall be deposited in the Economic Development and Trade Promotion Account, which is hereby established in the Special Deposit Fund (Art. (Article 2 (commencing with Section 16370), Ch. 2, Pt. 2, Div. 4) 16370) of Chapter 2 of Part 2 of Division 4) within the State Treasury. Notwithstanding Section 13340, the Director of the Governor’s Office of Business and Economic Development may expend moneys in the Economic Development and Trade Promotion Account, without regard to fiscal year, for the purposes of this subdivision. Moneys in the Economic Development and Trade Promotion Account may be allocated to an international trade and investment office, and if so allocated shall be maintained by that office in an account. Records of donations received and expenditures made pursuant to this section shall be subject to public disclosure.
(2) For each donation that it receives to fund an international trade and investment office, the Governor’s Office of Business and Economic Development shall post a report on its Internet Web site within 30 days of receiving that donation. The report shall contain all of the following information: name and address of the donor; amount of the donation; date the donation was made; name and address of the entity receiving or using the donation; a brief description of the goods or services provided or purchased, if any; and a description of the specific purpose or event for which the donation was made, if any.
(b) The Governor’s Office of Business and Economic Development may accept private moneys for the purposes of promoting international trade and investment events subject to Title the Political Reform Act of 1974 (Title 9 (commencing with Section 81000). 81000)). The donor may specify the international trade and investment event for which the private sector moneys shall be used.
(1) The private sector moneys shall be deposited into the Economic Development and Trade Promotion Account. Notwithstanding Section 13340, the Director of the Governor’s Office of Business and Economic Development may expend moneys in the Economic Development and Trade Promotion Account without regard to fiscal year, for purposes of this subdivision. Records of donations received and expenditures made pursuant to this section shall be subject to public disclosure.
(2) For each donation that it receives to fund international trade and investment events, the Governor’s Office of Business and Economic Development shall post a report on its Internet Web site within 30 days of receiving that donation. The report shall contain all of the following information: name and address of the donor; amount of the donation; date the donation was made; name and address of the entity receiving or using the donation; a brief description of the goods or services provided or purchased, if any; and a description of the specific purpose or event for which the donation was made, if any.
(A) The name and address of the donor.
(B) The amount of the donation.
(C) The date the donation was made. The name and address of the entity receiving or using the donation.
(D) A brief description of the goods or services provided or purchased, if any.
(E) A description of the specific purpose or event for which the donation was made, if any.
(c) With respect to international trade and investment offices operated under contract with a nonprofit entity pursuant to subdivision (f) of Section 13996.41:
(1) A donor shall not donate more than 25 percent of the annual budget of an international trade and investment office in a calendar year.
(2) For each donation that it receives to fund an international trade and investment office, the Governor’s Office of Business and Economic Development shall post a report on its Internet Web site within 30 days of receiving that donation. The report shall contain the following information: name and address of the donor; amount of the donation; date the donation was made; name and address of the entity receiving or using the donation; a brief description of the goods or services provided or purchased, if any; and a description of the specific purpose or event for which the donation was made, if any.
(d) Nothing in this section shall affect any requirement of the Political Reform Act of 1974 (Title 9 (commencing with Section 81000)).