LRB-3924/1
MDK:wlj:jf
2013 - 2014 LEGISLATURE
March 31, 2014 - Introduced by Representatives Shankland, Clark, Barnes,
Kolste, Hesselbein, Ohnstad and Berceau, cosponsored by Senators Miller,
Schultz and C. Larson. Referred to Committee on Energy and Utilities.
AB902,2,2
1An Act to amend 7.33 (1) (c), 13.172 (1), 13.62 (2), 13.94 (4) (a) 1., 13.95 (intro.),
216.002 (2), 16.004 (4), 16.004 (5), 16.004 (12) (a), 16.01 (1), 16.045 (1) (a), 16.41
3(4), 16.417 (1) (b), 16.52 (7), 16.528 (1) (a), 16.53 (2), 16.54 (9) (a) 1., 16.70 (2),
416.75 (1m), 16.765 (1), 16.765 (2), 16.765 (5), 16.765 (6), 16.765 (7) (intro.),
516.765 (7) (d), 16.765 (8), 16.838 (1) (b), 16.85 (2), 16.865 (8), 23.175 (1) (b), 71.26
6(1) (be), 77.54 (9a) (a), 100.45 (1) (dm), 103.49 (1) (f), 106.16 (2), 106.16 (3),
7230.03 (3), 238.10 (1), 281.75 (4) (b) 3., 285.59 (1) (b) and 706.11 (1) (c) 2.; and
8to create 13.94 (1) (w), 19.42 (10) (qm), 20.498, 24.61 (2) (a) 10r., 25.17 (3) (b)
914., 40.02 (54) (k), 66.0603 (1m) (a) 3v., 70.11 (38o), 71.05 (1) (c) 7m., 71.26 (1m)
10(n), 71.45 (1t) (n), 219.09 (1) (h), chapter 235 and 600.01 (1) (b) 8m. of the
11statutes;
relating to: creating the Wisconsin Renewable Energy Development
12Authority to participate in and guarantee certain energy-related loans,
1implement other energy-related programs, and make certain grants and
2making an appropriation.
Analysis by the Legislative Reference Bureau
This bill creates the Wisconsin Renewable Energy Development Authority
(WREDA) and authorizes WREDA to implement programs for developing renewable
resources, reducing energy consumption, and improving energy efficiency. An
authority is a public body created by state law that is not a state agency. Under this
bill, the board of WREDA consists of 11 members. Five members of the board are
appointed by the governor with the advice and consent of the senate to four-year
terms. One of those members must be a commercial lender and four must represent
"eligible businesses," as defined in the bill and discussed below. The other members
are the following or their designees: the secretary of natural resources; the secretary
of agriculture, trade and consumer protection; the chief executive officer of the
Wisconsin Economic Development Corporation; the chair of the public service
commission; the dean of the University of Wisconsin-Madison College of Agriculture
and Life Sciences; and the director of the Wisconsin Alumni Research Foundation.
The board must appoint an executive director and, subject to a maximum limit,
determine the executive director's compensation.
The bill authorizes WREDA to issue bonds to carry out its functions, except that
WREDA may generally have no more than $500,000,000 in outstanding bonds at any
time. WREDA's bonds are not state debt. The bill creates an individual and
corporate income tax exemption for interest on bonds issued by WREDA. Also,
WREDA's purchases are exempt from sales tax. The bill also makes an appropriation
from the general fund to WREDA, and requires WREDA to enter into an agreement
with the secretary of administration for repaying the appropriation from any
surpluses.
Because WREDA is not a state agency, numerous requirements that apply to
state agencies do not apply to WREDA. However, the bill treats WREDA like a state
agency for the purpose of specified requirements, including the following: 1) WREDA
is subject to the open meetings laws; 2) WREDA is subject to auditing by the
Legislative Audit Bureau; 3) WREDA is treated like a state agency for purposes of
requirements regarding lobbying; 4) the code of ethics for public officials and
employees applies to WREDA; and 5) employees of WREDA are considered state
employees for the purposes of state retirement benefits and health insurance
coverage. WREDA is also subject to the open records law, except that personal and
financial information provided by a person seeking financial assistance from
WREDA is confidential.
As discussed below, the bill allows WREDA to implement programs for
participating in loans, guaranteeing loans, and making grants. The bill also allows
WREDA to implement other programs.
Loan participation. The bill allows WREDA to participate in loans made by
lenders to eligible borrowers. The bill defines "eligible borrower" as an individual
residing in this state, or a partnership or corporation operating in this state, who
demonstrates a need for a loan for one of the following: 1) capital or operating
expenses of an eligible business; or 2) any expenses of an eligible project. An "eligible
business" is defined as a commercial entity that either 1) produces energy, fuels,
chemicals, or products primarily from renewable resources or agricultural, forestry,
plant, or other biological materials; or 2) provides services related to reducing energy
consumption or improving energy efficiency. "Eligible project" is defined as a project
for reducing energy consumption or improving energy efficiency of a commercial
entity. In addition, the project must involve constructing any new plant, equipment,
property, or facilities, or extending, improving, or adding to an existing plant,
equipment, property, or facilities. To qualify as an "eligible borrower," a person must
demonstrate the ability to repay a loan. In addition, if the borrower is an individual,
he or she must be in compliance with any applicable child support and related
requirements.
The bill limits WREDA's participation in a loan to financing not more than 50
percent, or $25,000,000, whichever is less, of the principal of the loan. In addition,
the lender must apply to WREDA for approval and enter into a participation
agreement with WREDA. Also, WREDA must ensure that it obtains a security
interest for the loan. The bill specifies other requirements, including requirements
for collateral, length of terms, and fees, and allows WREDA to adopt guidelines and
policies for loan participation.
Loan guarantees. The bill allows WREDA to establish programs with lenders
for guaranteeing repayment of loans for financing either 1) capital or operating
expenses of eligible businesses; or 2) expenses of eligible projects. "Eligible business"
and "eligible project" are defined as described above. A loan is eligible for guarantee
if the borrower does not meet the lender's minimum standards of creditworthiness.
Also, new or expanded business must result for the commercial entity whose eligible
business or project is the subject of the loan. In addition, if the borrower is an
individual, he or she must be in compliance with any applicable child support and
related requirements. The bill allows WREDA to guarantee repayment of not more
than 90 percent of the principal of a loan. Other requirements apply to interest rates,
security interests, length and extension of terms, business insurance, origination
fees, refinancing, and guarantee agreements between WREDA and lenders. Also,
the total outstanding amount of all loans to a borrower may not exceed $25,000,000,
or a lesser amount determined by WREDA.
The bill establishes a Wisconsin clean and renewable energy reserve fund
(reserve fund) under WREDA's control, which is used for the guarantees described
above. The bill prohibits WREDA from using any other moneys for the guarantees.
WREDA may deposit into the reserve fund an amount that it determines from the
appropriation the bill makes to WREDA from the general fund. The reserve fund
also consists of income from WREDA's investment of reserve fund moneys, loan
guarantee origination fees, and moneys received from other sources. In addition, the
bill expresses the legislature's expectation that it will make appropriations to meet
demands for funds guaranteed by the reserve fund. The bill generally limits WREDA
to guaranteeing no more than $25,000,000 in total loans, except that the bill allows
the Joint Committee on Finance to increase or decrease that limit. The bill also
requires WREDA to ensure that the cash balance in the reserve fund is sufficient for
the following purposes: 1) paying outstanding claims; and 2) maintaining a ratio of
$1 of reserve funding to $4.50 of total outstanding guarantees. If the cash balance
exceeds the amount required for those purposes, the bill requires WREDA annually
to transfer the excess to the general fund.
Grant program. The bill authorizes the WREDA to make grants to eligible
business and projects, as defined above, as well as to persons engaged in the
commercialization of biological fuel, power, or products. WREDA must adopt
guidelines for making the grants. The guidelines must provide for a committee to
make determinations regarding grants, and the committee must consist of the
secretary of agriculture, trade and consumer protection, the secretary of natural
resources, and the chief executive officer of the Wisconsin Economic Development
Corporation. The guidelines may also allow the committee to make the grants on
behalf of WREDA.
Other programs. The bill allows WREDA to implement the following to
promote eligible businesses and projects, as defined above: 1) a revolving loan fund
program to finance eligible businesses or projects; 2) an equity financing program for
renewable energy generation businesses of agricultural producers; 3) a trading
program for environmental credits related to clean and renewable energy
production; 4) a technical assistance program for eligible businesses and certain
community-based projects; and 5) a program for WREDA to obtain licenses and
royalties on technologies developed with the assistance of the WREDA.
Because this bill relates to an exemption from state or local taxes, it may be
referred to the Joint Survey Committee on Tax Exemptions for a report to be printed
as an appendix to the bill.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB902,1
1Section
1. 7.33 (1) (c) of the statutes is amended to read:
AB902,4,42
7.33
(1) (c) "State agency" has the meaning given under s. 20.001 (1) and
3includes an authority created under subch. II of ch. 114 or ch. 231, 232, 233, 234,
235, 4or 237.
AB902,2
5Section
2. 13.172 (1) of the statutes is amended to read:
AB902,5,46
13.172
(1) In this section, "agency" means an office, department, agency,
7institution of higher education, association, society, or other body in state
1government created or authorized to be created by the constitution or any law, that
2is entitled to expend moneys appropriated by law, including the legislature and the
3courts, and any authority created in subch. II of ch. 114 or subch. III of ch. 149 or in
4ch. 231, 233, 234,
235, 238, or 279.
AB902,3
5Section
3. 13.62 (2) of the statutes is amended to read:
AB902,5,106
13.62
(2) "Agency" means any board, commission, department, office, society,
7institution of higher education, council, or committee in the state government, or any
8authority created in subch. II of ch. 114 or subch. III of ch. 149 or in ch. 231, 232, 233,
9234,
235, 237, 238, or 279, except that the term does not include a council or
10committee of the legislature.
AB902,4
11Section
4. 13.94 (1) (w) of the statutes is created to read:
AB902,5,1412
13.94
(1) (w) Annually conduct a financial audit of the Wisconsin Renewable
13Energy Development Authority. The legislative audit bureau shall file a copy of each
14audit report under this paragraph with the distributees specified in par. (b).
AB902,5
15Section
5. 13.94 (4) (a) 1. of the statutes is amended to read:
AB902,6,716
13.94
(4) (a) 1. Every state department, board, examining board, affiliated
17credentialing board, commission, independent agency, council or office in the
18executive branch of state government; all bodies created by the legislature in the
19legislative or judicial branch of state government; any public body corporate and
20politic created by the legislature including specifically the Fox River Navigational
21System Authority, the Lower Fox River Remediation Authority, the Wisconsin
22Aerospace Authority,
the Wisconsin Renewable Energy Development Authority, and
23the Wisconsin Economic Development Corporation, a professional baseball park
24district, a local professional football stadium district, a local cultural arts district and
25a long-term care district under s. 46.2895; every Wisconsin works agency under
1subch. III of ch. 49; every provider of medical assistance under subch. IV of ch. 49;
2technical college district boards; every county department under s. 51.42 or 51.437;
3every nonprofit corporation or cooperative or unincorporated cooperative association
4to which moneys are specifically appropriated by state law; and every corporation,
5institution, association or other organization which receives more than 50% of its
6annual budget from appropriations made by state law, including subgrantee or
7subcontractor recipients of such funds.
AB902,6
8Section
6. 13.95 (intro.) of the statutes is amended to read:
AB902,6,21
913.95 Legislative fiscal bureau. (intro.) There is created a bureau to be
10known as the "Legislative Fiscal Bureau" headed by a director. The fiscal bureau
11shall be strictly nonpartisan and shall at all times observe the confidential nature
12of the research requests received by it; however, with the prior approval of the
13requester in each instance, the bureau may duplicate the results of its research for
14distribution. Subject to s. 230.35 (4) (a) and (f), the director or the director's
15designated employees shall at all times, with or without notice, have access to all
16state agencies, the University of Wisconsin Hospitals and Clinics Authority, the
17Wisconsin Aerospace Authority,
the Wisconsin Renewable Energy Development
18Authority, the Lower Fox River Remediation Authority, the Wisconsin Economic
19Development Corporation, and the Fox River Navigational System Authority, and to
20any books, records, or other documents maintained by such agencies or authorities
21and relating to their expenditures, revenues, operations, and structure.
AB902,7
22Section
7. 16.002 (2) of the statutes is amended to read:
AB902,7,223
16.002
(2) "Departments" means constitutional offices, departments, and
24independent agencies and includes all societies, associations, and other agencies of
25state government for which appropriations are made by law, but not including
1authorities created in subch. II of ch. 114 or subch. III of ch. 149 or in ch. 231, 232,
2233, 234,
235, 237, 238, or 279.
AB902,8
3Section
8. 16.004 (4) of the statutes is amended to read:
AB902,7,94
16.004
(4) Freedom of access. The secretary and such employees of the
5department as the secretary designates may enter into the offices of state agencies
6and authorities created under subch. II of ch. 114 and subch. III of ch. 149 and under
7chs. 231, 233, 234,
235, 237, 238, and 279, and may examine their books and accounts
8and any other matter that in the secretary's judgment should be examined and may
9interrogate the agency's employees publicly or privately relative thereto.
AB902,9
10Section
9. 16.004 (5) of the statutes is amended to read:
AB902,7,1511
16.004
(5) Agencies and employees to cooperate. All state agencies and
12authorities created under subch. II of ch. 114 and subch. III of ch. 149 and under chs.
13231, 233, 234,
235, 237, 238, and 279, and their officers and employees, shall
14cooperate with the secretary and shall comply with every request of the secretary
15relating to his or her functions.
AB902,10
16Section
10. 16.004 (12) (a) of the statutes is amended to read:
AB902,7,2517
16.004
(12) (a) In this subsection, "state agency" means an association,
18authority, board, department, commission, independent agency, institution, office,
19society, or other body in state government created or authorized to be created by the
20constitution or any law, including the legislature, the office of the governor, and the
21courts, but excluding the University of Wisconsin Hospitals and Clinics Authority,
22the Wisconsin Aerospace Authority,
the Wisconsin Renewable Energy Development
23Authority, the Health Insurance Risk-Sharing Plan Authority, the Lower Fox River
24Remediation Authority, the Wisconsin Economic Development Corporation, and the
25Fox River Navigational System Authority.
AB902,11
1Section
11. 16.01 (1) of the statutes is amended to read:
AB902,8,72
16.01
(1) In this section, "agency" means any office, department, agency,
3institution of higher education, association, society or other body in state
4government created or authorized to be created by the constitution or any law which
5is entitled to expend moneys appropriated by law, including the legislature and the
6courts, and any authority created under subch. II of ch. 114 or ch. 231, 233
or, 234
,
7or 235.
AB902,12
8Section
12. 16.045 (1) (a) of the statutes is amended to read:
AB902,8,149
16.045
(1) (a) "Agency" means an office, department, independent agency,
10institution of higher education, association, society, or other body in state
11government created or authorized to be created by the constitution or any law, that
12is entitled to expend moneys appropriated by law, including the legislature and the
13courts, but not including an authority created in subch. II of ch. 114 or subch. III of
14ch. 149 or in ch. 231, 232, 233, 234,
235, 237, 238, or 279.
AB902,13
15Section
13. 16.41 (4) of the statutes is amended to read:
AB902,8,1716
16.41
(4) In this section, "authority" means a body created under subch. II of
17ch. 114 or subch. III of ch. 149 or under ch. 231, 233, 234,
235, 237, 238, or 279.
AB902,14
18Section
14. 16.417 (1) (b) of the statutes is amended to read:
AB902,8,2019
16.417
(1) (b) "Authority" means a body created under subch. II of ch. 114 or
20ch. 231, 232, 233, 234,
235, 237, 238, or 279.
