BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Tom Torlakson, Chairman
1527 (Yee)
Hearing Date: 5/22/08 Amended: 5/20/08
Consultant: Bob Franzoia Policy Vote: G O 10-0 Ag 4-1
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BILL SUMMARY: SB 1527, an urgency measure, would direct the
Department of General Services, prior to January 1, 2009, to
sell, at fair market value, a parcel of state property located
in the County of San Mateo and the City and County of San
Francisco. The net proceeds of the sale would be paid into the
Fair and Exposition Fund, a continuously appropriated fund, for
the benefit of the District 1-A Agricultural Association,
thereby making an appropriation. The bill would require
reimbursement from the net proceeds of the sale of any DGS costs
incurred in the disposition of the property.
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Fiscal Impact (in thousands)
Major Provisions 2008-09 2009-10 2010-11 Fund
Sale of state property Unknown, major revenue gain one
timeSpecial
(revenue)
* Fair and Exposition Fund (if the parcel was initially acquired
with moneys form this fund; otherwise the revenue from the sale
would be deposited in the Deficit Recovery Bond Retirement
Sinking Fund Subaccount pursuant to Prop 60A as noted below)
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STAFF COMMENTS: The property would be sold to the Daly City
Redevelopment Agency or to the City of Daly City. The net
proceeds shall be paid into the Fair and Exposition Fund for the
benefit of the District 1-A Agricultural Association. The sale
would be required to have an agreement requiring the purchaser
to retain title to the entire property sold to it for uses
consistent with the general plan of the City of Daly City, any
amendment to that general plan, any specific plan amendments to
any specific plan, and the Bayshore revitalization redevelopment
plan.
Current law generally requires a state agency to review annually
its real property holdings and determine what, if any, is in
excess of its foreseeable needs. These properties are commonly
referred to as "surplus state properties." Once real property
has been identified as surplus, the state attempts to sell the
property, or dispose of it in some other manner. When surplus
property is sold, the sales revenues are deposited into the
account that originally paid for the acquisition of the
property. In most instances, sales revenues are deposited in the
General Fund and are available for expenditure on any state
program. Pursuant to Proposition 60A (2004), the proceeds from
the sale would be used to pay the principal and interest on
Proposition 57 bonds. Once these bonds are fully repaid,
proceeds from surplus property sales would be deposited in the
General Fund. Proposition 60A only applies to those properties
that were purchased with General Fund revenue or bonds secured
by the General Fund. Staff notes that the bill, as amended on
May 20, 2008 contains a finding and declaration that appears to
be at odds with the intent of the bill to dispose of the
property. Staff recommends an amendment to strike Section 3 of
the bill.