BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           326 (Strickland)
          
          Hearing Date:  05/26/2009           Amended: 04/13/2009
          Consultant: Mark McKenzie       Policy Vote: T&H 10-0
          _________________________________________________________________ 
          ____
          BILL SUMMARY:   SB 326 would require the housing element to  
          include a calculation of a locality's existing and projected  
          foreclosure rate and its impact on housing needs.
          _________________________________________________________________ 
          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2009-10      2010-11       2011-12     Fund
           HCD review             No new costs to ensure compliance.General
          Mandate                Unknown, moderate costs to local Local/
                                 governments.  Unlikely to be  
          reimbursable.             General
          _________________________________________________________________ 
          ____

          STAFF COMMENTS:  For vote only.
          
          The Planning and Zoning Law requires cities and counties to  
          prepare and adopt a general plan, including a housing element to  
          guide the future growth of a community.  A housing element must  
          identify and analyze existing and projected housing needs,  
          identify adequate sites with appropriate zoning to meet its fair  
          share of the regional housing need, and ensure that regulatory  
          systems provide opportunities for, and do not unduly constrain,  
          housing development.  The Department of Housing and Community  
          Development reviews both draft and adopted housing elements to  
          determine whether or not they are in substantial compliance with  
          the law.

          SB 326 would require cities and counties to include within the  
          housing needs assessment portion of their housing elements a  
          quantification of their existing and projected foreclosure rates  
          and an analysis of the impact on housing needs.

          Legislative Counsel has keyed SB 326 as a state-mandated local  
          program.  Recent decisions by the Commission on State Mandates  
          (COSM), however, indicate that it is unlikely that local  










          governments would succeed in filing a test claim for  
          reimbursement for the higher level of service imposed by this  
          bill.  In 2005, the COSM reversed previous decisions that had  
          provided for reimbursement to local governments and councils of  
          government (COGs) for the "Regional Housing Needs Determination"  
          mandate (Statutes of 1980, Chapter 1143).  On reconsideration of  
          the previous decisions, the COSM determined, in light of  
          statutes enacted and court decisions rendered since 1980, that  
          previously approved test claims are not reimbursable because  
          cities, counties, and COGs have fee authority for this program,  
          as provided in Government Code Sections 65104 and 65584.1.  In  
          light of these decisions, staff notes that the COSM would  
          probably not approve a claim for reimbursement related to SB 326  
          because local entities have the authority to charge fees for  
          planning costs, including costs associated with housing element  
          requirements.  If a successful claim were filed, however, costs  
          would likely be relatively minor for each agency to comply with  
          the requirements of this bill.