Currrent as of February 4, 2022
Assembly Bill No. 386
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Introduced by Assembly Member Cooper |
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An act to add Section 6254.32 to the Government Code, relating to public records.
LEGISLATIVE COUNSEL’S DIGEST
AB 386, as amended, Cooper. Public Employees’ Retirement Fund: investments: confidentiality.
Existing law, the California Public Records Act, requires state and local agencies to make their records available for public inspection, unless an exemption from disclosure applies. Existing law excludes from the disclosure requirement certain records regarding alternative investments in which public investment funds invest.
This bill would exempt from disclosure under the act specified records regarding an internally managed private loan made directly by the Public Employees’ Retirement Fund. Under the bill, these records would include quarterly and annual financial statements of the borrower or its constituent owners, unless the information has already been publicly released by the keeper of the information. The bill would prescribe specified exceptions to this exemption from disclosure.
Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.
This bill would make legislative findings to that effect.
Vote: majority Appropriation: no Fiscal Committee: yes Local Program: no
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1.
Section 6254.32 is added to the Government Code, to read:
6254.32.
(a) For purposes of this section, the following definitions shall apply:
(1) “Constituent owner” means a person or legal entity that maintains a direct or indirect ownership interest in the borrower or one of its guarantors or sources of collateral for the loan, including, among others, a stockholder, member, or partner.
(2) “Private loan” means a loan made pursuant to or evidenced by a loan agreement, debt instrument, or other evidence of indebtedness, if that lending arrangement is exempt from registration as a security under federal securities laws.
(3) “Public investment fund” means the Public Employees’ Retirement Fund described in Section 20170.
(b) Notwithstanding any provision of this chapter or other law, the following records regarding an internally managed private loan made directly by a public investment fund shall not be subject to disclosure pursuant to this chapter unless the information has already been publicly released by the keeper of the information:
(1) Due diligence materials that are possessed by the public investment fund or that are proprietary to any participating underwriting syndicate, the borrower, or any of the borrower’s constituent owners or guarantors.
(2) Private loan agreements and all related documents.
(3) Quarterly and annual financial statements of the borrower or its constituent owners.
(4) Meeting materials of creditors’ committees.
(c) Notwithstanding subdivision (b), the following information contained in records described in subdivision (b) shall be subject to disclosure pursuant to this chapter and shall not be considered a trade secret or otherwise exempt from disclosure:
(1) The name and address of each borrower.
(2) The dollar amount of each private loan made to each borrower by the public investment fund since inception.
(3) The annualized time-weighted return and duration of each private loan.
(4) For each private loan, the aggregate amount of undrawn loan commitments.
(5) The amount of principal and interest payments made to the public investment fund by each borrower since the inception of the loan.
(6) For each private loan, whether the loan has been in default for six months or longer and any public records related to the default that are in the possession of the public investment fund and another public agency and that are open to inspection or copying upon request of the public made to the other agency.
(d) Records related to a public investment fund’s indirect funding of a private loan via a fund or other type of externally managed investment vehicle shall remain subject to Sections 6254.26 and 7514.7.
SEC. 2.
The Legislature finds and declares that Section 1 of this act, which adds Section 6254.32 to the Government Code, imposes a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:
This act strikes a balance between preserving the right of the public to access information about how public funds are invested and protecting the privacy of loan recipients and proprietary information provided to public investment funds.
AB386