BILL NUMBER: AB 484 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 27, 2011
AMENDED IN ASSEMBLY MARCH 29, 2011
INTRODUCED BY Assembly Member Alejo
FEBRUARY 15, 2011
An act to amend Section 65965 of the Government Code, relating to
land use.
LEGISLATIVE COUNSEL'S DIGEST
AB 484, as amended, Alejo. Land use: natural resources: transfer
of long-term management funds.
The Planning and Zoning Law authorizes a state or local public
agency to authorize a nonprofit organization to hold title to, and
manage an interest in, real property that the state or local public
agency requires a property owner to transfer to the agency to
mitigate any adverse impact upon natural resources caused by
permitting the development of a project or facility, provided the
nonprofit organization meets specified conditions. That law also
authorizes an agency that, in the development of its own project, is
required to transfer an interest in real property to mitigate an
adverse impact upon natural resources, to transfer the interest to a
nonprofit organization that meets the specified conditions.
This bill would authorize funds set aside for the long-term
management of any lands or easements conveyed to a nonprofit
organization pursuant to the above provisions to also be conveyed to
the nonprofit organization as specified. The bill would also require
the nonprofit organization to hold, manage, invest, and disburse the
funds in furtherance of managing and stewarding the land or easement
for which the funds were set aside.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 65965 of the Government Code is amended to
read:
65965. (a) For the purposes of this section, the following
definitions apply:
(1) "Direct protection" means the protection and preservation of
natural lands or resources, including, but not limited to,
agricultural lands, wildlife habitat, wetlands, endangered species
habitat, open-space areas, or outdoor recreational areas.
(2) "Stewardship" encompasses the range of activities involved in
controlling, monitoring, and managing for conservation purposes a
property, or a conservation or open-space easement, as defined by the
terms of the easement, and its attendant resources.
(b) Notwithstanding any other provision of law to the contrary, if
a state or local public agency requires a property owner to transfer
to the agency an interest in real property to mitigate any adverse
impact upon natural resources caused by permitting the development of
a project or facility, the state or local public agency may
authorize a nonprofit organization to hold title to and manage that
interest in real property, provided that the nonprofit organization
is all of the following:
(1) Exempt from taxation as an organization described in Section
501(c)(3) of the Internal Revenue Code, and qualified to do business
in the state.
(2) A "qualified organization" as defined in Section 170(h)(3) of
the Internal Revenue Code.
(3) An organization that has as its principal purpose and activity
the direct protection or stewardship of natural land or resources,
or cultural or historic resources, including, but not limited to,
agricultural lands, wildlife habitat, wetlands, endangered species
habitat, open-space areas, and outdoor recreational areas.
(c) If a state or local public agency, in the development of its
own project, is required to transfer an interest in real property to
mitigate an adverse impact upon natural resources, the agency may
transfer the interest to a nonprofit organization that meets the
requirements set forth in paragraphs (1) to (3), inclusive, of
subdivision (b).
(d) (1) Funds set aside for the long-term management of any lands
or easements conveyed to a nonprofit organization pursuant to
subdivisions (b) and (c) may also be conveyed to the nonprofit
organization. The nonprofit organization shall hold, manage, invest,
and disburse the funds in furtherance of managing and stewarding the
land or easement for which the funds were set aside.
(2) The state or local agency may require the nonprofit
organization to submit a report, not more than once every 12 months,
that details the management and condition of the property or easement
and the accompanying funds. The mitigation or funding agreement
shall specify the reporting due dates and elements of the report.
(3) If, after the state or local agency receives the report
described in paragraph (2), the state or local agency determines that
there is cause to consider whether the terms of the mitigation or
funding agreement have been violated, the agency may review the
accounting documents involving the funds or require an independent
audit of the funds to be performed and the audit report submitted to
the agency.
(e) The recorded instrument that places title with a nonprofit
organization pursuant to subdivision (b) shall include, at a minimum,
a provision that if the state or local public agency that authorized
the nonprofit organization to hold the title, or its successor
agency, determines that the interest in real property that is held by
the nonprofit organization is not being held, monitored, or managed
for conservation purposes in the manner specified in that instrument
or in the mitigation agreement between the state or local public
agency and the nonprofit organization, the interest in real property
shall revert to the state or that local public agency, or to another
public agency or nonprofit organization qualified pursuant to
subdivision (b), approved by the state or local public agency.
(f) The funds of a nonprofit organization holding funds for the
long-term management of property shall revert to the state or local
public agency or to another public agency or nonprofit organization
approved by the state or local agency and qualified under subdivision
(b), if any of the following conditions exist:
(1) The nonprofit organization ceases operations.
(2) The nonprofit organization is dissolved.
(3) The nonprofit organization becomes bankrupt or insolvent.
(4) The nonprofit organization fails to preform its duties
pursuant to this section for any reason.
(g) (1) A state or local public agency shall exercise due
diligence in reviewing the qualifications of a nonprofit organization
to effectively manage and steward natural land or resources, as well
as the accompanying funds. The state or local public agency may
adopt guidelines to assist the agency in that review process.
(2) The state or local agency shall determine that the holder of
accompanying funds meets all of the following requirements:
(A) The holder has the capacity to effectively manage the
mitigation funds.
(B) The holder has the capacity to achieve reasonable rates of
return on investment of those funds, similar to those of other
prudent investors, over the life of the agreement.
(C) The holder utilizes general accepted accounting practices, and
will be able to ensure that funds are accounted for, and tied to, a
specific property or project.
(D) The holder has an adopted investment policy with regard to
endowment funds that is consistent with the Uniform Management of
Institutional Funds Act (Part 7 (commencing with Section 18501) of
Division 9 of the Probate Code) and Sections 18505 and 18506 of the
Probate Code.
(h) The state or local public agency may contract with or
designate an independent third party to do any of the following:
(1) Review the qualifications of a nonprofit organization to
effectively manage and steward natural land or resources.
(2) Review the qualifications of a nonprofit organization to hold
and manage the funds set aside for long-term management associated
with the property.
(3) Determine whether the holder of the funds meets the
requirements set forth in paragraph (2) of subdivision (f).
(4) Review reports or other performance indicators to evaluate the
management of lands, resources, or funds.
(i) (1) If a state or local agency authorizes a nonprofit
organization to hold land or natural resources created for mitigation
purposes, the state or local agency may require an administrative
endowment from the project proponent for costs associated with
reviewing qualifications, approving holders, and regular oversight of
compliance and performance.
(2) The state or local public agency may also require project
proponents to provide a separate account that will provide for
initial management costs while the endowment matures.
(j) This section shall not apply retroactively to endowment funds
held by the state in the Pooled Money Investment Account as of
January 1, 2012.
(k) A property that has been previously protected for conservation
purposes, including the placement of a conservation easement on the
property, shall not be used for mitigation purposes.
(l) This section is not intended to interfere with or prevent the
existing authority of an agency or department to carry out its
programs, projects, or responsibilities to identify, review, approve,
deny, or implement any mitigation requirement, and nothing in this
section shall be construed as a limitation on mitigation requirements
for the project, or a limitation on compliance requirements under
this division or any other provision of law.