BILL ANALYSIS SENATE LOCAL GOVERNMENT COMMITTEE Senator Dave Cox, Chair BILL NO: SB 1019 HEARING: 4/7/10 AUTHOR: Correa FISCAL: Yes VERSION: 2/11/10 CONSULTANT: Detwiler SUBDIVISION PERFORMANCE SECURITIES Background and Existing Law The Subdivision Map Act controls how counties and cities approve the conversion of large landholdings into separate parcels. Counties and cities commonly impose conditions when they approve proposed subdivisions, often requiring the subdividers to install public works such as street lights, curbs, and sewers. Sometimes subdividers must provide assurances that the work will be completed, including performance bonds, deposits, credit instruments, liens, or other property interests. Until 2006, counties and cities followed their own procedures in deciding when to release these securities. At the request of builders, the Legislature adopted uniform procedures and time limits by which counties and cities must either release the securities provided for subdivision conditions or tell the subdividers about the incomplete performance or unsatisfactory work (AB 1460, Umberg, 2005). Wary that these new requirements might not work, city officials asked the Legislature to impose a January 1, 2011 sunset clause. Since the 2005 Umberg bill, there are no reported problems with the statutory procedures for releasing subdivision performance securities, nor have counties and cities filed any claims for state-mandated local costs. Builders want legislators to make the statute permanent. Proposed Law Senate Bill 1019 repeals the automatic termination date for the procedures for counties and cities to release subdivision performance securities, thereby making the statute permanent. Comments SB 1019 -- 2/11/10 -- Page 2 1. It's time . Before the 2005 Umberg bill, counties and cities created their own procedures for releasing subdivision performance securities, resulting in a patchwork of local practices. The uniform procedures appear to have worked without creating problems for local officials and without resulting in local claims for state-mandated costs. After trying out the uniform procedures, it's time to make them permanent. 2. Moving parts . SB 189 (Lowenthal) rewrites the state laws on mechanics liens, based on the California Law Revision Commission's recommendations. The Assembly Judiciary Committee will act on the Lowenthal bill later this year. Among other changes, SB 189 repeals a Title of the Civil Code and replaces it with a new Part. If that effort succeeds, legislators will need to amend SB 1019 to correct the statutory cross-reference to the Civil Code (page 4, lines 9-11). Support and Opposition (4/1/10) Support : California Building Industry Association. Opposition : Unknown.