BILL ANALYSIS                                                                                                                                                                                                    




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  AB 147                      HEARING:  6/8/11
          AUTHOR:  Dickinson                    FISCAL:  No
          VERSION:  5/31/11                     TAX LEVY:  No
          CONSULTANT:  Detwiler                 

                                SUBDIVISION FEES
          

          Allows counties and cities to charge transportation 
          facilities fees when approving subdivisions and building 
          permits.


                           Background and Existing Law  

          Because land development in California is a privilege and 
          not a property right, counties and cities can use their 
          general police powers to impose conditions when approving 
          development projects.  The Mitigation Fee Act sets out four 
          criteria that local officials must meet when charging 
          developer impact fees:
                 Identify the fee's purpose.
                 Identify the fee's use.
                 Determine a reasonable relationship between the use 
               of the fee and the type of development project.
                 Determine a reasonable relationship between the 
               need for public facilities and the type of development 
               project.

          The Subdivision Map Act controls how counties and cities 
          review and approve property owners' requests to convert 
          larger parcels into smaller lots.  Local officials commonly 
          attach scores of conditions when they approve tentative 
          subdivision maps.  Mainstream legal thinking holds that 
          counties and cities have three sources of authority to 
          impose conditions on proposed subdivisions:
                 Conditions to make the subdivision consistent with 
               the local general plan.
                 Conditions to mitigate a subdivision's 
               environmental impacts.
                 Conditions that the Map Act specifically 
               authorizes.

          One example of a condition that the Map Act specifically 




          AB 147 -- 5/31/11 -- Page 2



          authorizes are parkland dedications or in lieu fees (Quimby 
          Act).  The Map Act also contains a separate article that 
          sets out the procedures for charging fees to pay for 
          drainage facilities, bridges, and major thoroughfares.  To 
          charge fees for constructing bridges and thoroughfares, a 
          county board of supervisors or city council must adopt an 
          ordinance that refers to the circulation element of its 
          general plan (which identifies the proposed bridges and 
          thoroughfares), identifies the projects' costs, identifies 
          the boundaries of the "area of benefit" where the fees will 
          apply, and proposes a fair method to allocate the costs and 
          fees.  The county or city must hold a noticed public 
          hearing and measure any protests.  If the owners of more 
          than half of the area of benefit protest, the county or 
          city must stop the proceedings.  If there is a 
          majority-protest, the county or city must wait a year 
          before trying again.  However, with the 4/5-vote of the 
          county supervisors or city council, the county or city can 
          try to levy these fees in a smaller area of benefit if they 
          find that landowners who own more than half of the area are 
          in favor.  If the proceedings succeed, the county or city 
          must record a certified copy of a resolution that describes 
          the area of benefit, the projects' costs, and the formula 
          for apportioning the fees.  The county or city can charge 
          these fees as a condition of approving a final subdivision 
          map or issuing a building permit.  The fee revenues must go 
          into a separate special fund for each proposed bridge or 
          thoroughfare.  The county or city can spend the fee 
          revenues only for constructing those projects.  A county or 
          city can borrow against those revenues, pledging the fees 
          as security.

          Contra Costa County is among a small number of counties 
          that say they can't charge subdivision fees unless the Map 
          Act specifically authorizes them.  The County wants the 
          Legislature to specifically authorize counties and cities 
          to impose transportation facilities fees, using procedures 
          similar to the existing law for bridge and thoroughfare 
          fees.


                                   Proposed Law  

          Assembly Bill 147 authorizes counties and cities to require 
          fees to pay for constructing transportation facilities as a 
          condition of approving final subdivision maps and building 





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          permits.  AB 147 defines transportation facilities as 
          pedestrian, bicycle, transit, and transportation-calming 
          facilities.  The bill requires counties and cities to 
          impose these transportation facilities fees subject to the 
          Mitigation Fee Act.

          The bill also sets out procedures for charging fees to pay 
          for transportation facilities.  A county board of 
          supervisors or city council must adopt an ordinance that 
          refers to the circulation element of its general plan 
          (which identifies the proposed transportation facilities), 
          identifies the projects' costs, identifies the boundaries 
          of the "area of benefit" where the fees will apply, and 
          proposes a fair method of allocating the costs.  The county 
          or city must hold a noticed public hearing and measure any 
          protests.  If the owners of more than half of an area of 
          benefit protest, the county or city must stop the 
          proceedings.  If there was a majority-protest, the county 
          or city must wait a year before trying again.  However, 
          with the 4/5-vote of the county supervisors or city 
          council, the county or city can try to levy these fees in a 
          smaller area of benefit if they find that landowners who 
          own more than half of the area are in favor.  If the 
          proceedings succeed, the county or city must record a 
          certified copy of a resolution that describes the area of 
          benefit, the projects' costs, and the formula for 
          apportioning the fees.  The fee revenues must go into a 
          separate special fund for each proposed transportation 
          facility and the county or city can spend the fee revenues 
          only for constructing those projects.  A county or city can 
          pledge these fees as security and borrow against them.

          AB 147 declares that the authority in the Map Act's article 
          on fees is in addition to other legal authority.


                               State Revenue Impact
           
          No estimate.


                                     Comments  

          1.   Purpose of the bill  .  Most -- but not all -- counties 
          believe that the Subdivision Map Act allows local officials 
          to charge subdivision fees, provided that they meet the 





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          nexus tests spelled out in the Mitigation Fee Act.  In 
          contrast, Contra Costa County wants the Legislature to 
          create specific statutory authority for counties and cities 
          to charge fees to pay for constructing transportation 
          facilities.  By making these fees explicit in the 
          Subdivision Map Act and by linking the fees to the nexus 
          requirements in the Mitigation Fee Act, AB 147 satisfies 
          Contra Costa County's need for statutory specificity 
          without confusing the law for other counties and cities.

          2.   Fuzzy logic  .  Proposition 13 (1978), Proposition 218 
          (1996), and Proposition 26 (2010) put constitutional limits 
          on how local officials can impose general taxes, special 
          taxes, special assessments, property-related fees, and 
          fees.  Legislators and judges continue to wrestle with 
          these constitutional terms and how to apply them to 
          specific charges by counties, cities, and special 
          districts.  Shortly after Proposition 13, a 1979 Attorney 
          General's opinion concluded that bridge and thoroughfare 
          fees were not special taxes that require 2/3-voter 
          approval, "since they are special assessments."  The Map 
          Act's procedures for public notice and protests are similar 
          to other state laws on special assessments, as they existed 
          in the late 1970s.  After Proposition 218 passed, 
          legislators revised the statutory procedures for imposing 
          special assessments to require detailed engineers' reports, 
          assessments based on the properties' direct benefits, 
          direct mailed notices, formal public hearings to measure 
          protests, and weighted ballot voting by property owners.  
          If the AG was right and the Map Act's bridge and 
          thoroughfare charges aren't impact fees but really are 
          special assessments, then the current law may not comply 
          with Proposition 218.  If that's true, then the nearly 
          identical procedures in AB 147 may not meet constitutional 
          standards.  The distinctions between taxes, assessments, 
          and fees may need further explanation by the courts.

          3.   Avoiding the negative implication  .  One rule of legal 
          interpretation is that if a law mentions some things, by 
          implication the statute excludes other things (expressio 
          unius est exclusio alterius).  By adding another specific 
          authorization to the Map Act's article on fees, some 
          observers might argue that the Legislature accepts the 
          interpretation that the only subdivision fees that counties 
          and cities may charge are those which the statute 
          explicitly mentions.   AB 147 avoids that negative 





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          implication by including language which makes it clear that 
          the authority in the Map Act's article on fees is in 
          addition to other legal authority.  That declaration 
          preserves the mainstream legal thinking about Map Act fees.


                                 Assembly Actions  

          Assembly Local Government Committee:  6-2
          Assembly Floor:                    49-23


                         Support and Opposition  (6/2/11)

           Support  :  California State Association of Counties; 
          American Lung Association; California Transit Association; 
          Capitol Corridor Joint Powers Authority; County of Contra 
          Costa; Environmental Defense Fund; Housing California; 
          Metropolitan Transportation Commission; Natural Resources 
          Defense Fund; Regional Council of Rural Counties; 
          Sacramento Metropolitan Air Quality Management District; 
          TransForm.

           Opposition  :  Unknown.