BILL NUMBER: AB 935 CHAPTERED
BILL TEXT
CHAPTER 727
FILED WITH SECRETARY OF STATE OCTOBER 9, 2003
APPROVED BY GOVERNOR OCTOBER 8, 2003
PASSED THE ASSEMBLY SEPTEMBER 10, 2003
PASSED THE SENATE SEPTEMBER 8, 2003
AMENDED IN SENATE SEPTEMBER 3, 2003
AMENDED IN SENATE AUGUST 18, 2003
INTRODUCED BY Assembly Member Diaz
FEBRUARY 20, 2003
An act to add Chapter 9 (commencing with Section 100600) to Part
12 of Division 10 of the Public Utilities Code, relating to
transportation.
LEGISLATIVE COUNSEL'S DIGEST
AB 935, Diaz. Santa Clara Valley Transportation Authority:
benefit assessments.
Existing law creates the Santa Clara Valley Transportation
Authority with various powers and duties related to the operation of
rail and bus transit services in Santa Clara County. Existing law
specifies the process for establishment of benefit assessment
districts by the Los Angeles Metropolitan Transportation Authority
(LAMTA) under which benefit assessments are levied on certain
property in the vicinity of rail transit lines, with proceeds from
the assessments to be used for rail facilities and services. Under
these provisions, LAMTA is also authorized to issue revenue bonds to
be repaid from the assessments.
This bill would enact similar provisions authorizing the Santa
Clara Valley Transportation Authority to establish benefit assessment
districts relative to its rail lines and to issue revenue bonds in
that regard.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 9 (commencing with Section 100600) is added to
Part 12 of Division 10 of the Public Utilities Code, to read:
CHAPTER 9. BENEFIT ASSESSMENT DISTRICTS
100600. The Legislature finds and declares that:
(a) It is necessary and in the best interest of the citizens of
the state to authorize the Santa Clara Valley Transportation
Authority to levy special benefit assessments for needed public rail
rapid transit facilities and services on the property that benefits
from those facilities and services.
(b) The rail rapid transit facilities and services provide special
benefits to parcels of land, and improvements thereon, in the
vicinity of rail rapid transit stations, and provide general benefits
to the community at large. The Board of Directors of the Santa
Clara Valley Transportation Authority shall be the conclusive judge
of the proportion of special and general benefits produced by the
facilities and of the distribution of the special benefits among
parcels of property within the benefit assessment district.
100601. (a) Whenever the board finds that property adjacent to,
or in the vicinity of, one or more rail transit stations, or proposed
rail transit stations, of the authority receives or will receive
special benefit by reason of the location or operation of one or more
of those rail transit stations, the board may, by resolution adopted
by a two-thirds vote of its members, provide for notice and hearing
on its intention to establish one or more special benefit districts.
If the board proposes to levy a special benefit assessment on real
property therein for the purpose of financing, in whole or in part,
the acquisition, construction, development, joint development,
operation, maintenance, or repair of one or more rail transit
stations and rail transit related facilities located within the
benefit district, the board shall comply with the notice, protest,
and hearing procedures set forth in Section 53753 of the Government
Code.
(b) For purposes of this chapter, "benefit district" means a
special benefit assessment district established pursuant to this
chapter, the area of which shall not lie more than one-half mile from
the center point of any rail transit station or proposed rail
transit station.
(c) The resolution may provide that the proposed benefit district
will contain separate zones, which may consist of either contiguous
or noncontiguous areas of land within the district. The proposed
benefit district and each proposed zone, if any, therein shall be an
area adjacent to, or in the vicinity of, one or more rail transit
stations or proposed rail transit stations. The boundaries of the
benefit district and of each zone, if any, therein shall be drawn so
as to reflect, as accurately as possible, the areas in which special
benefits are conferred by reason of the proximity and operation of
one or more rail transit stations.
(d) The notice stating the time and place of the hearing, and
setting forth the boundaries and purpose of the proposed benefit
district, shall be published prior to the time fixed for the hearing
pursuant to Section 6066 of the Government Code.
(e) Notice shall also be mailed at least 30 days prior to the
hearing to all owners of real property within the boundaries of the
proposed benefit district whose names and addresses appear on the
last equalized assessment roll or are otherwise known to the board of
supervisors of the county in which the proposed benefit district is
located or to the authority.
(f) For purposes of this chapter, "transit related facilities"
means land, buildings, and equipment, or any interest therein,
whether or not the operation thereof produces revenue, which has, as
its primary purpose, the operation of the rail transit system or the
providing of services to the passengers of the rail transit system,
but does not mean any land, buildings, or equipment, or interest
therein, which is used primarily for the production of revenue not
arising from the operation of the rail transit system.
100601.5. (a) At the time and place fixed for the hearing on the
establishment of the benefit district, or at any time and place to
which the hearing is adjourned, the board shall proceed with the
hearing. At the hearing, interested persons may appear and present
matters material to the proposed board action. At the conclusion of
the hearing, the board shall, by a resolution adopted by a two-thirds
vote of its members, determine whether to proceed with the proposed
action.
The resolution shall state, as appropriate, the maximum and
minimum rate of assessment, the amount of the special benefit
assessment and the purposes for which it is to be levied, the
estimated cost of accomplishing the purposes, and the dates or
approximate intervals at which the assessment shall be levied. The
resolution shall also state that the exterior boundaries of the
benefit district are set forth on a map on file with the secretary of
the authority, which map shall govern for all purposes as to the
extent of the benefit district and zones, if any, therein and that
the area set forth on the map shall thereupon constitute and be known
as "Benefit District No. ____ of the Santa Clara Valley
Transportation Authority," or as "Benefit Zone ____ of the Benefit
District No. ____ of the Santa Clara Valley Transportation Authority,"
as designated by the board.
(b) The resolution shall be submitted to the governing body. The
governing body shall, after a public hearing conducted by the
governing body and prior to the creation of the benefit district,
approve, or amend and approve, as amended, or disapprove the
geographic boundaries of the benefit district and the method of
assessment. The resolution of approval or disapproval from the
governing body shall be returned to the board.
(c) The board shall, by a two-thirds vote of its members,
determine whether to create the benefit district as approved by the
governing body. If the board decides to proceed with creating the
benefit district as approved by the governing body, the board may, in
addition to any amendments made by the governing body, reduce the
size of the benefit district, but in so doing shall not include any
territory not included in the benefit district approved by the
governing body nor change the approved method of assessment. The
determination by the board is final and conclusive.
(d) For purposes of this section, "governing body" means the city
council of a city in which the proposed benefit district is located
or, if the benefit district is located in unincorporated territory,
the board of supervisors of the county in which the proposed benefit
district is located.
(e) The board may provide in the resolution, or in a later
resolution, for changes in the assessment to particular real property
within the benefit district or any zone therein in accordance with
the provisions of Section 53753 of the Government Code.
100602. (a) In determining the amount of a special benefit
assessment, the board shall measure the benefit to real property in
the benefit district or zones therein according to the procedures and
approval process set forth in Section 4 of Article XIII D of the
California Constitution.
(b) The special benefit assessment constitutes a charge imposed on
particular real property for an authority project of direct benefit
to that property, and does not constitute ad valorem taxes or any
other form of general tax levy applying a given rate to the assessed
valuation of all taxable property within the authority.
(c) The authority shall possess all powers necessary for,
incidental to, or convenient for, the collection, enforcement,
administration, or distribution of the special benefit assessment in
accordance with California law.
(d) The revenue from a special benefit assessment, which is
imposed pursuant to this chapter, or from bonds secured by such a
special benefit assessment, for the purpose of financing a rail
transit station or rail transit related facility located within the
benefit district, shall be used only for financing of the facility
for which it was levied, and that revenue shall not be used for any
other purpose or the payment of any other expense of the authority,
including, but not limited to, transit, transportation, or operating
expense.
100602.2. An election shall be held if the board finds that a
petition requesting that the proposal to form a benefit district be
submitted to confirmation by the voters has been signed by the owners
of at least 25 percent of the assessed value of real property within
the benefit district.
100602.3. For purposes of this chapter, "voter" means an owner of
real property which is assessed or proposed to be assessed under
this chapter and which is within the boundaries of the benefit
district.
100602.4. (a) Where land in the benefit district is owned in
joint tenancy, tenancy in common, or any other multiple ownership,
the owners of that land shall designate in writing which one of the
owners shall be deemed the owner of that land for purposes of
qualifying as a voter.
(b) The legal representative of a corporation or an estate owning
real property in the benefit district may act on behalf of the
corporation or the estate.
(c) (1) For purposes of this chapter, "legal representative" means
an official of a corporation owning real property in the benefit
district.
(2) For purposes of this chapter, "legal representative" also
means a guardian, conservator, executor, or administrator of the
estate of the holder of title to real property in the benefit
district who is all of the following:
(A) The person is appointed under the laws of this state.
(B) The person is entitled to the possession of the estate's real
property.
(C) The person is authorized by the appointing court to exercise
the particular right, privilege, or immunity which he or she seeks to
exercise.
(d) Before a legal representative acts as a voter at a district
election, the legal representative shall present to the precinct
board a certified copy of his or her authority which shall be kept
and filed with the returns of the election.
100602.5. The petition for confirmation by the voters shall be
filed with the board within 30 days after the conclusion of the
public hearing required by Sections 100601 and 100601.5. If a
petition meeting the requirements of Section 100602.2 is filed, the
board shall adopt a resolution approving the proposal to form a
benefit district subject to confirmation by the voters of the benefit
district.
100602.6. After the board has adopted a resolution approving the
proposal to form a benefit district under Section 100602.5, but
before the board may levy any assessment, the board shall call an
election in the benefit district for the purpose of submitting to the
voters the proposition of levying the assessment by the benefit
district. The resolution calling the election shall state each of
the items required to be contained in the resolution adopted pursuant
to Section 100601.5.
100602.7. The board shall submit the proposition of levying an
assessment to the voters of the benefit district in accordance with
the requirements of Section 53753 of the Government Code.
100602.8. If the proposition is approved at the election
conducted under this chapter, the board may levy the assessment
pursuant to the resolution adopted pursuant to Section 100602.
100602.9. (a) Any owner or owners of real property, which is, in
whole or in part, within the benefit district, or their legal
representatives, may jointly or severally file with the board a
petition requesting that the real property owned by them or for which
they are the legal representative be excluded from the benefit
district on the ground that the real property sought to be excluded
is not benefited or that the assessment be reduced on the ground that
the assessment exceeds the benefit to that real property.
(b) The real property sought to be excluded or upon which the
assessment is sought to be reduced shall be described by its legal
description and shall be accompanied by a map depicting its location
in relation to the benefit district.
(c) The petition shall contain a statement of facts in support of
the petition and shall be acknowledged by the owner or the legal
representative filing the petition.
100602.10. Notice of each hearing upon the petition for exclusion
or reduction shall be given in accordance with subdivisions (d) and
(e) of Section 100601.
100602.11. At the time and place provided in the notice or at any
time and place to which the hearing is adjourned, the board or its
appointed hearing officer shall hear all of the following:
(a) The petition for exclusion or reduction.
(b) All evidence or proofs that may be introduced by or on behalf
of the petitioners.
(c) All objections to the petition that may be presented in
writing by any person, including the authority.
(d) All evidence or proofs that may be introduced in support of
objections to the petition.
100602.12. The expenses of giving the notice provided for herein
and of the hearing on the exclusion or reduction petition shall be
paid by the persons filing the petition.
100602.13. Upon the hearing on an exclusion or reduction petition
by the board, or upon the record of hearing by a hearing officer,
the board shall order the petition be denied when the petitioner has
not shown by a preponderance of the evidence that in an exclusion
petition his or her real property is not benefited or in a reduction
petition that the assessment exceeds the benefit to the property.
100602.14. The board, after the hearing on an exclusion or
reduction petition, shall order one of the following by resolution:
(a) In the case of an exclusion petition, order the exclusion of
all or any part of the real property described in the petition upon
its finding that the property will not be benefited by the operations
of the authority in the vicinity of the benefit district.
(b) In the case of a reduction petition, order a change in the
benefit assessment to all or any portion of the real property
described in the petition to provide that it not exceed the amount of
benefit derived by the operations of the authority in the vicinity
of the benefit district.
(c) Confirm the assessment on the real property subject to the
petition as correctly reflecting the amount of benefit to the real
property.
100603. (a) Following formation of the benefit district or
concurrently therewith, if the board deems it necessary to incur a
bonded indebtedness for the acquisition, construction, development,
joint development, completion, operation, maintenance, or repair of
one or more rail transit stations and related rail transit facilities
located within the benefit district, the board may provide, by
resolution, that the bonded indebtedness shall be payable from
special benefit assessments levied within the benefit district. The
resolution shall be adopted by a two-thirds vote of the members of
the board, and shall declare and state all of the following:
(1) That the board intends to incur an indebtedness, by the
issuance of bonds of the authority, for the benefit district which
the board has formed, or intends to form, within a portion of the
authority.
(2) The purposes for which the proposed debt is to be incurred,
which may include all costs and estimated costs necessary or
convenient for, incidental to, or connected with, the accomplishment
of the purposes, including, without limitation, engineering,
inspection, legal, fiscal agent, financial consultant, bond and other
reserve funds, working capital, bond interest estimated to accrue
during the construction period, if any, and for a period not
exceeding three years thereafter, and the expenses of all proceedings
for the authorization, issuance, and sale of the bonds.
(3) The estimated cost of accomplishing the purposes and the
amount of the principal of the indebtedness to be incurred.
(4) That a general description of the benefit district and of each
zone, if any, therein and maps showing the exterior boundaries
thereof are on file with the secretary of the authority and available
for inspection by any interested person.
(5) Those special benefit assessments for the payment of the
bonds, and the interest thereon, are proposed to be levied in the
benefit district or zones therein in accordance with the procedures
and approval process set forth in Section 4 of Article XIII D of the
California Constitution.
(6) The extent to which, if at all, all or a portion of the
revenues of the authority are to be used to pay the principal of,
interest on, and sinking fund payments for, the bonds, including the
establishment and maintenance of any reserve fund therefor.
(7) The time and place set for hearing on the proposed issuance of
the bonds.
(8) That, prior to levying a special benefit assessment, the board
shall comply with the notice, protest, and hearing procedures set
forth in Section 53753 of the Government Code.
(9) The maximum term the proposed bonds shall run before maturity,
which shall not exceed 40 years from the date of the bonds or any
series thereof.
(10) The maximum rate or rates of interest to be paid, which shall
not exceed 12 percent per annum.
(11) That the pledge of special benefit assessment revenues to the
bonds authorized by this section has priority over the use of any of
those revenues for pay-as-you-go financing, except to the extent
that this priority is expressly restricted by any of the authority's
agreements with bondholders.
(b) The notice stating the time and place of the hearing on the
proposed issuance of bonds shall be published prior to the time fixed
for the hearing pursuant to Section 6066 of the Government Code.
The notice, protest, and hearing procedures for levying the special
benefit assessment shall comply with Section 53753 of the Government
Code.
(c) Notice shall also be mailed at least 30 days prior to the
hearing to all owners of real property within the boundaries of the
benefit district whose names and addresses appear on the last
equalized assessment roll or are otherwise known to the board of
supervisors of the county in which the benefit district is located or
to the authority.
100604. At the time and place fixed for the hearing on the
issuance of bonds payable from special benefit assessments levied
under this chapter, or at any time and place to which the hearing is
adjourned, the board shall proceed with the hearing. Interested
persons may appear at the hearing and present matters material to the
questions set forth in the resolution. At the conclusion of the
hearing on the proposed issuance of bonds, the board shall, by
resolution adopted by a two-thirds vote of the members, determine
whether to incur the bonded indebtedness.
The resolution shall state the amount of the proposed debt, the
purposes for which it is to be incurred, and the estimated cost of
accomplishing the purposes. The determinations made in the
resolution are final and conclusive.
100605. Special benefit assessments for the payment of the
principal of, and interest on, bonds issued for a benefit district
shall be levied in the benefit district in accordance with the
procedures and approval process set forth in Section 4 of Article
XIII D of the California Constitution. Other revenues of the
authority shall be used for the payment of the principal of, and
interest on, the bonds only to the extent set forth in any agreement
of the authority for the benefit of bondholders.
Special benefit assessments in the benefit district and zones, if
any, therein shall be calculated in accordance with the procedures
and approval process set forth in Section 4 of Article XIII D of the
California Constitution.
100606. The bonds issued pursuant to this chapter shall bear
interest at a rate or rates not exceeding 12 percent per annum,
payable semiannually, except that the first interest payable on the
bonds or any series thereof may be for any period not to exceed one
year as determined by the board.
In the resolution or resolutions providing for the issuance of
bonds, the board may also provide for call and redemption of the
bonds prior to maturity at times and prices and upon any other terms
that it may specify. However, no bond is subject to call or
redemption prior to maturity unless the bond contains a recital to
that effect. The denomination or denominations of bonds shall be
stated in the resolution providing for their issuance, but shall not
be less than five thousand dollars ($5,000). The principal of, and
interest on, the bonds shall be payable in lawful money of the United
States at the office of the treasurer of the authority or at any
other place or places that may be designated by the board, or at
either place or places at the option of the holders of the bonds.
The bonds shall be dated, numbered consecutively, signed by the board
chairperson and chief financial officer, and countersigned by the
secretary and shall have the official seal of the authority attached.
The interest coupons of the bonds shall be signed by the chief
financial officer. The seal and all signatures and countersignatures
may be printed, lithographed, or mechanically reproduced, except
that one signature or countersignature shall be manually affixed.
If an officer, whose signature or countersignature appears on the
bonds or coupons, leaves office for any reason prior to the delivery
of the bonds, the officer's signature is as effective as if the
officer had remained in office.
100607. The bonds issued pursuant to this chapter may be sold as
the board determines by resolution. The board may sell the bonds at a
price below par.
If the board determines by resolution that the bonds shall be sold
by competitive bid, the board, before selling the bonds, or any part
thereof, shall give notice inviting sealed bids in the manner that
it prescribes. If satisfactory bids are received, the bonds offered
shall be awarded to the highest responsible bidder. If no bids are
received, or if the board determines that the bids received are not
satisfactory as to price or responsibility of the bidders, the board
may reject all bids received, if any, and either readvertise or sell
the bonds at private sale or by negotiation, or by other lawful
means.
If the board determines by resolution that the bonds shall not be
sold by competitive bid, the board may sell the bonds at public or
private sale, by negotiation, or by other lawful means.
100608. Delivery of any bonds issued under this chapter may be
made at any place either inside or outside the state, and the
purchase price may be received in cash or bank credits.
100609. All accrued interest and premiums received on the sale of
bonds issued by the authority pursuant to this chapter shall be
placed in the fund to be used for the payment of principal of, and
interest on, those bonds. The remainder of the proceeds received on
the sale of the bonds shall be placed in the treasury to secure those
bonds or for the purposes for which the debt was incurred.
When the purposes for which the debt was incurred have been
accomplished, any money remaining shall be either (a) transferred to
the fund to be used for the payment of principal of, and interest on,
the bonds or (b) placed in a fund to be used for the purchase of
those outstanding bonds of the authority, from time to time, in the
open market at the prices and in the manner, either at public or
private sale or otherwise, that the board determines. Bonds so
purchased shall be canceled immediately.
100610. The board may provide for the issuance, sale, or exchange
of refunding bonds to redeem or retire any bonds issued by the
authority under this chapter upon the terms, at the times, and in the
manner that it determines. Refunding bonds may be issued in a
principal amount sufficient to pay all, or any part, of the principal
of the outstanding bonds issued under this chapter, the interest
thereon, and the premiums, if any, due upon call and redemption
thereof prior to maturity and all expenses of the refunding.
The provisions of this chapter, for the issuance and sale of bonds
apply to the issuance and sale of refunding bonds, except that, when
refunding bonds are to be exchanged for outstanding bonds, the
method of exchange shall be as determined by the board.
100611. Any bonds issued under this chapter are legal investment
for all trust funds; for the funds of insurance companies, commercial
and savings banks, and trust companies; for state school funds; and,
whenever any money or funds may, by any law now or hereafter
enacted, be invested in bonds of cities, counties, school districts,
or other districts within this state, the money or funds may be
invested in the bonds issued under this chapter.
Whenever bonds of cities, counties, school districts, or other
districts within this state may, by any law now or hereafter enacted,
be used as security for the performance of any act or the deposit of
any public money, bonds issued under this chapter may be so used.
The provisions of this chapter are in addition to all other laws
relating to legal investments and are controlling as the latest
expression of the Legislature with respect thereto.
100612. The board may change the purposes for which any proposed
debt is to be incurred, the estimated cost, the amount of bonded debt
to be incurred, or the boundaries of the benefit district or zones,
if any, therein or one or all of those matters, except that the board
shall not change the boundaries to include any territory which will
not, in its judgment, be benefited by the authority action.
100613. (a) The board shall not change the purposes, the
estimated cost, the boundaries of the benefit district or zones, if
any, therein, or the amount of bonded debt to be incurred until after
it gives notice of its intention to do so, stating each proposed
change in the purpose and stating, if applicable, that the exterior
boundaries proposed to be changed are set forth on a map on file with
the secretary of the authority. The notice shall also specify the
time and place set for hearing.
(b) The notice shall be published prior to the time set for the
hearing pursuant to Section 6066 of the Government Code.
(c) The notice shall also be mailed at least 30 days prior to the
hearing to all owners of real property affected by the proposed
change whose names and addresses appear on the last equalized
assessment roll or are otherwise known to the board of supervisors of
the county in which the
benefit district is located or to the authority.
(d) Any proposed changes to a special benefit assessment shall
follow the notice, protest, and hearing procedures set forth in
Section 53753 of the Government Code.
100614. At the time and place fixed for a hearing on changes, or
at any time and place to which the hearing is adjourned, the board
shall proceed with the hearing. At the hearing, interested persons
may appear and present matters material to the changes set forth in
the notice.
At the conclusion of the hearing, the board shall, by resolution,
determine whether to make any or all of the changes set forth in the
notice. The determinations made in the resolution are conclusive and
final. Changes to a special benefit assessment shall be made in
accordance with the notice, protest, and hearing procedures set forth
in Section 53753 of the Government Code.
100615. All decisions and determinations of the board, upon
notice and hearing, are final and conclusive upon all persons
entitled to appeal to the board as to all errors, informalities, and
irregularities which the board might have avoided or remedied during
the progress of the proceedings or which it can, at that time,
remedy.
Any objection, appeal, or protest not made at the time of any
hearing is deemed to be waived voluntarily by any person who might
have made the appeal, protest, or objection, and the person is deemed
to have consented to the action taken following the hearing and any
other matter on which objection, protest, or appeal could have been
made.
100616. Any action or proceeding, other than a petition for
election pursuant to Section 100602.2, which contests, questions, or
denies the validity or legality of the formation of any benefit
district or zone, the issuance of any bonds therefor pursuant to this
chapter, or any proceedings relating thereto, shall be commenced
within six months from the date of the formation; otherwise, the
formation of the benefit district or zone, the issuance of the bonds,
and all proceedings relating thereto shall be held to be in every
respect valid, legal, and incontestable.
100617. When the board has imposed a special benefit assessment,
the secretary shall so certify to the assessor of the county in which
the territory of any benefit district is located and deliver to the
assessor copies of all maps and diagrams of the benefit district and
zones, if any, therein, indicating the amount of the special benefit
assessment to be levied within the benefit district and zones, if
any, therein.
Special benefit assessments authorized by this chapter shall be
levied and collected by the county at the same time and in the same
manner as taxes are levied and collected. The county may deduct its
reasonable expenses of collection and shall transmit the balance of
the assessments to the authority.
100618. In the event of conflict with any other law, the
provisions of this chapter shall prevail with respect to benefit
districts within the authority.
100619. Notwithstanding any other provision of this chapter, the
authority shall not pledge any portion of its general fund revenues
to pay any part of any bonded indebtedness incurred under this
chapter unless required by provisions of the California Constitution.