BILL ANALYSIS Ó AB 615 Page 1 Date of Hearing: April 25, 2011 ASSEMBLY COMMITTEE ON TRANSPORTATION Bonnie Lowenthal, Chair AB 615 (Bonnie Lowenthal) - As Amended: April 25, 2011 SUBJECT : California High-Speed Rail Authority - rights-of-way powers SUMMARY : Aligns the authority of the California High-Speed Rail Authority (HSRA) for the purchase of property, easements, and other property rights consistent with the authorities of other state entities. Further, provides authorities for property disposal, leasing, rental, and management, as well as establishes where revenues from these activities will be deposited. Authorizes alternate processes for the HSRA separate from the real estate procurement processes and approvals from the Department of General Services (DGS), the State Public Works Board (SPWB), and the Department of Finance (DOF). Specifically, this bill : 1)Aligns the authority of HSRA to purchase of property, easements, and other property rights consistent with the authorities of other state entities, such as the Department of Transportation (Caltrans) and the Department of Water Resources (DWR). 2)Authorizes HSRA, when it has acquired title to any real property for highway purposes and leases that property for commercial or business uses to the former owner for a term exceeding six months, to secure insurance against the risk of damage or destruction by fire where the former owner requests this coverage, with the premium included in the rental agreement. This is similar to the authority conferred upon the Caltrans. 3)Provides an exemption, similar to the exemptions accorded to Caltrans, the University of California, State Lands Commission, and the Legislature, from the property inventory reporting to DGS. 4)Accords similar treatment to HSRA from the provisions of the state's property acquisition law, that provides exceptions to California Water Project and Caltrans. AB 615 Page 2 5)Provides that Caltrans does not have sole charge and direct control of HSRA projects. 6)Prohibits DGS from granting easements or acquiring rights-of-way across the property of the HSRA. 7)Authorizes the HSRA to negotiate, in the name of the state, access to rights-of-way it owns, including the value of the right of access. The revenues received to be deposited with HSRA for use in the development, improvement, and maintenance of the high-speed rail system. 8)Separates HSRA's role from DGS in terms of state quitclaims and the DGS role in public contracting for projects. 9)Similar to the authority granted to the State Lands Commission, authorizes HSRA to exercise property takings. 10)Authorizes HSRA to lease property for any term not to exceed 99 years, similar to authority conferred to Caltrans. EXISTING LAW : 1)Enacts the Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century (High-Speed Rail Bond Act). The High-Speed Rail Bond Act, approved as Proposition 1A in November 2008, provides $9.95 billion in general obligation bond authority to fund the planning and construction of a high-speed passenger train system and complementary improvements to other specified rail systems in the state. The law authorizes the HSRA bond funds to be used for "all activities necessary for acquisition of interests in real property and rights-of-way and improvement" as well as relocation assistance for displaced property owners and occupants. Places a cap on the amount of such funds expended. Authorizes HSRA to contract with Caltrans for right-of-way activities. Requires HSRA to use established processes for right-of-way acquisition pursuant to the state's public acquisition law. 2)Requires every gift or dedication to the state of personal or real property to be approved by DOF and every contract for the acquisition or hiring of real property is to be approved by DGS. Exempts Caltrans, State Compensation Insurance Fund, Department of Parks and Recreation, and State Coastal AB 615 Page 3 Conservancy from these provisions as specified. 3)Requires the approval of DGS before a state agency may acquire, or dispose, of real property but exempts real property obtained for highway purposes by Caltrans, State Lands Commission, the Controller, or the State Compensation Insurance Fund. 4)Authorizes Caltrans, when it has acquired title to any real property for highway purposes, and leases that property for commercial or business uses to the former owner for a term exceeding six months, to secure insurance against the risk of damage or destruction by fire where the former owner requests this coverage, with the premium included in the rental agreement. 5)Requires DGS to develop an inventory of state property. Excludes from that inventory the Legislature, the University of California, the State Lands Commission, and Caltrans. Requires these entities, with the exception of the Legislature, to provide a separate submittal to DGS. 6)Requires state agencies to get approvals of DOF or SPWB when expending funds appropriated for capital outlay purposes, with the exceptions for Caltrans and the California Exposition and State Fair. 7)Requires any acquisition of land or other real property authorized in any appropriation, except an appropriation from the California Water Fund or to Caltrans, to be subject to the provisions of the Property Acquisition Law. 8)Requires Caltrans to have sole charge and direct control over projects that are not under the jurisdiction of the Department of Water Resources, the Department of Boating and Waterways, the Department of Corrections and Rehabilitation, or the Department of General Services. 9)Authorizes DGS to acquire or grant easements or rights-of-way for the proper utilization of real property owned or being acquired by the state, with the exception of Caltrans property to be acquired or owned. 10)Requires DGS to negotiate, in the name of the state, access to right-of-way it owns, including the value of the right of AB 615 Page 4 access. Exempts properties involving Caltrans. 11)With the exception of state highways, authorizes DGS to quitclaim in the name of the state, the right, title and interest of the state in and to easements and rights-of-way owned by the state. 12)Requires DGS to have sole charge and direct control of projects excluding those projects undertaken by the Department of Water Resources, Caltrans, the Department of Boating and Waterways, the Department of Corrections and Rehabilitation, and the Military Department. 13)Specifies general HSRA powers and duties relative to development and implementation of the project, including the acquisition of rights-of-way through purchase and eminent domain. 14)Authorizes a public entity to exercise the power of eminent domain only if it has adopted a resolution of necessity that meets the specified requirements. 15)Authorizes Caltrans to enter into leases with public agencies or private entities for any term not to exceed 99 years. 16)Requires that, no later than 90 days prior to the submittal to the Legislature and the Governor of the initial request for appropriation of state bond funds, the HSRA shall have approved and submitted to DOF, the peer review group, and specified legislative committees, a detailed funding plan for that corridor or usable segment. FISCAL EFFECT : Unknown COMMENTS : Following the passage of the High-Speed Rail Bond Act, HSRA is transitioning from a small study and planning organization to a multi-billion dollar engineering and construction entity. Subsequent to the approvals of federal and state environmental documents for their central valley corridor project and as HSRA enters the project construction phase, the HSRA will be engaged in surveying the real property alignment for the high-speed rail train trackage. As that stage of the project is approaching, this bill will ensure that property acquisition procedures and requirements are in place that will protect the interests of the State of California as well as AB 615 Page 5 private individuals. This bill will conform the HSRA's authority to that of Caltrans and other large state agencies that develop large construction projects. According to HSRA writing in support of this bill, "The current process in place is arduous and, if unchanged by legislation, could seriously jeopardize the project's schedule and cost. In order to remain on track and fulfill the promise of high-speed rail to the people of California, it is essential that the process by which the Authority obtains right-of-way be appropriate and in line with the needs of successful project delivery. Treating the Authority similarly to the state Department of Transportation regarding the process of property acquisition is appropriate." Related bills : SB 455 (Alan Lowenthal) of 2009, as passed in the Senate had similar right-of-way provisions as contained in this bill. SB 455 passed out of the Senate with bipartisan support but was later amended in the Assembly to delete the right-of-way provisions, leaving the Senate confirmation of HSRA board members as the remaining focus of bill. That bill was ultimately vetoed by Governor Schwarzenegger. AB 1375 (Galgiani) of 2009, would have re-established HSRA as the Department of High-Speed Trains, along with other provisions authorizing it to acquire property. That bill was held in the Senate Transportation and Housing Committee due to the reorganization provisions. AB 153 (Ma) Chapter 226, Statutes of 2010, would have clarified HSRA's ability to exercise eminent domain power, authorized it to employ its own legal staff or to contract with other state agencies for legal services, and would have made changes to its authority governing project development. Those provisions pertaining to HSRA were deleted in the Senate, changing AB 153 into a water bond bill that was subsequently signed into law. REGISTERED SUPPORT / OPPOSITION : Support California High-Speed Rail Authority Opposition None on file AB 615 Page 6 Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093