“Assembly Bill 865 gives charitable foundations a greater ability to loan funds to non-profits to carry out their good works. At a time when public funds for environmental enhancement and protection are scarce, foundations must be able to provide loans for the public benefit,” Ruskin said.

AB 865 creates an exemption in the California Finance Lenders Law for tax exempt foundations and charities that make loans for charitable, program-related purposes. Many charities and foundations in California make low- or no-interest loans to finance conservation land acquisitions or the construction of non-profit facilities. They may also provide bridge financing for other non-profit organizations.

The bill’s sponsor, the Resources Legacy Fund, stated: “It is in California's best interest …to encourage private investment in … public purposes. Registration requirements, fees, costs, and reporting obligations such as those contained in the California Finance Lenders Law may cause foundations and charities otherwise disposed to make investments in California projects to instead invest elsewhere."

“With enactment of AB 865, these vital tax-exempt foundations and charities can make loans without having to comply with expensive and cumbersome administrative regulations meant to apply to consumer loans,” Ruskin concluded.

AB 865 is supported by the Packard Foundation, Peninsula Open Space Trust, Planning and Conservation League, Big Sur Land Trust, Second Harvest Food Bank, The Nature Conservancy, California Economic Development Lending Initiative and the Low Income Investment Fund.