BILL ANALYSIS Senate Appropriations Committee Fiscal Summary Senator Christine Kehoe, Chair 1085 (Runner) Hearing Date: 5/27/2010 Amended: 4/27/2010 Consultant: Bob Franzoia Policy Vote: F&A 4-0 _________________________________________________________________ ____ BILL SUMMARY: SB 1085 would permit a nonprofit organization to hold an annual fair in lieu of the annual fair by the 50th District Agricultural Association (DAA), with the consent of the Department of Food and Agriculture. This bill would permit the Department of General Services (DGS) to lease to the nonprofit organization, for less than market value, the premises known as the Antelope Valley Fair for a period not to exceed 99 years. During the period the lease is in effect, the 50th DAA would be required to be inactive and not have any powers or duties. This bill would permit employees of the 50th DAA to make an election concerning employment with the nonprofit lessee of those premises. This bill would provide that the nonprofit organization may elect to be a member of the network of California fairs on terms and conditions mutually agreed upon by the Department of Food and Agriculture and the nonprofit organization. _________________________________________________________________ ____ Fiscal Impact (in thousands) Major Provisions 2010-11 2011-12 2012-13 Fund Long term lease of state Unknown revenue from leasing at market Special* property value Lease negotiation Likely minor cost, one time Special* * Fair and Exposition Fund _________________________________________________________________ ____ STAFF COMMENTS: SUSPENSE FILE. AS PROPOSED TO BE AMENDED. This bill would permit DGS to lease to the nonprofit organization, for less than market value, the premises known as the Antelope Valley Fair for a period not to exceed 99 years. At this time, a market value has not been determined. (Government Code 11011.1 (4) (g) provides that fair market value is established by an appraisal and economic evaluation conducted by the department and approved by the department.) This bill provides that the state is not liable for any debts, liabilities, settlements, liens, or any other obligations incurred by or imposed upon the nonprofit organization. The lease shall expressly provide that the General Fund and the Fair and Exposition Fund shall be held harmless, as well. It is unclear if the nonprofit would eligible to receive state funding (approximately $20,000 from the Fair and Exposition Fund) currently being received annually by the 50th DAA. As proposed to be amended, page 3, lines 7-8 would read: (d) The lease executed pursuant to this sectionmay be for less than theshall be at market value of the property.?