BILL ANALYSIS Ó
AB 1235
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Date of Hearing: May 3, 2011
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
AB 1235 (Hernandez) - As Amended: March 31, 2011
As Proposed to Be Amended
SUBJECT : REDEVELOPMENT: PROPERTY: HAZARDOUS SUBSTANCE RELEASE:
IMMUNITIES
KEY ISSUE : IF REDEVELOPMENT AGENCIES ARE DISSOLVED BY
LEGISLATIVE ACT, SHOULD A CITY OR COUNTY THAT SUCCEEDS TO THE
ROLE PREVIOUSLY HELD BY THE FORMER REDEVELOPMENT AGENCY BE
GRANTED THE SAME QUALIFIED IMMUNITIES FROM LIABILITY THAT THE
REDEVELOPMENT AGENCY PREVIOUSLY HELD WITH RESPECT TO REMOVAL OF
HAZARDOUS SUBSTANCES FROM A BROWNFIELD REDEVELOPMENT PROJECT?
FISCAL EFFECT : As currently in print this bill is keyed
non-fiscal.
SYNOPSIS
Although the fate of redevelopment agencies (RDAs) is not known
at this time, this bill seeks to address the limited issue of
immunities for cleanup of brownfield properties in redevelopment
in the contingency that redevelopment agencies are dissolved by
Legislative action and cease to exist. As proposed to be
amended, this bill would extend to a city or county ("successor
agency") that succeeds to the role previously held by the former
redevelopment agency the same qualified immunities from
liability that were available to the RDA prior to its
dissolution, with respect to removal of hazardous substances
from a brownfield redevelopment project. As proposed to be
amended, this bill more precisely reflects the intent and
parameters of those qualified immunities, as provided by the
Polanco Act, if RDAs should be dissolved and replaced by the
cities and counties that authorized their creation. The bill is
sponsored by the Center for Creative Land Recycling and
supported by the California Association of Realtors, both of
whom contend that the current immunities granted redevelopment
agencies produce real benefits that deserve to be extended
without interruption if RDAs should be dissolved by the
Legislature. The Sierra Club of California and Consumer
Attorneys of California both submitted letters opposing the
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previous version of the bill, asserting, among other things,
that any bill premised on the possible dissolution of RDAs is
premature and unnecessary at this time in light of the ongoing
uncertainty regarding their continued existence. Their
positions on the measure as now amended are not known.
SUMMARY : Provides qualified immunities from liability, if
certain conditions are met, for brownfield cleanup activities
conducted by "successor agencies" assuming the authority and
duties of redevelopment agencies, if redevelopment agencies are
dissolved by Legislative act. Specifically, this bill:
1)Provides that if a redevelopment agency (RDA) has been
dissolved by an act of the Legislature and its successor
agency, as defined, maintains all the rights, powers, and
duties that were vested in the redevelopment agency prior to
its dissolution, then certain immunities that previously
applied to the redevelopment agency shall apply to the
successor agency for the removal of hazardous substance
releases, as specified, from property that was within a
redevelopment project of the redevelopment agency prior to its
dissolution.
2)Defines "successor agency" as the county, city, or city and
county that authorized the creation of the redevelopment
agency.
EXISTING LAW :
1)Authorizes a redevelopment agency to take any actions that it
determines are necessary and that are consistent with other
state and federal laws to remedy or remove a release of
hazardous substances on, under, or from property within a
project area, whether the agency owns that property or not,
subject to certain specified conditions. (Health and Safety
Code Section 33459.1. All further statutory references are to
this Code unless otherwise stated.)
2)Provides qualified immunities from liability to a
redevelopment agency or its agent that undertakes and
completes an action to remedy or remove a release of certain
hazardous substances from property within a redevelopment
project, for that release only and as long as the actions are
in accordance with a cleanup or remedial action plan prepared
by a qualified independent contractor and approved by the
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appropriate state or local authorities. (Section 33459.3(a).)
3)Limits the immunity to the release or releases specifically
identified in the approved cleanup or remedial action plan,
and not for any subsequent releases not specifically
identified. (Section 33459.3(e).)
4)Authorizes extension of immunities only to specified persons,
including but not limited to employees or agents of the
redevelopment agency, and any person who entered into an
agreement with the RDA for redevelopment of the property if
the agreement requires the person to remove or remedy a
hazardous substance release with respect to that property.
(Section 33459.3(e).)
5)Prohibits extension of immunities to specified persons,
including but not limited to any person who was a responsible
party for the release, and any contractor who prepares the
cleanup or remedial action plan or who conducts the removal or
remedial action itself. (Section 33459.3(f).)
COMMENTS : This bill, sponsored by the Center for Creative Land
Recycling, represents the forward-thinking judgment of the
author that the Legislature ought not to wait until RDA's are
officially dissolved before it starts to develop policy for a
post-RDA landscape in California. Although the fate of
redevelopment agencies is not known at this time, this bill
seeks to address the limited issue of immunities for cleanup of
brownfield properties in redevelopment, in the contingency that
redevelopment agencies are dissolved by Legislative action and
cease to exist. As proposed to be amended, this bill would
extend to a city or county ("successor agency") that succeeds to
the role previously held by the former redevelopment agency the
same qualified immunities from liability that were available to
the RDA prior to its dissolution, with respect to removal of
hazardous substances from a brownfield redevelopment project.
Stated Need for the Bill. According to the author, the bill is
needed at this time in order to preserve existing legal
protections to entities wishing to redevelop brownfield
properties without interruption in case redevelopment agencies
are dissolved. The author states:
The governor and Democratic Leaders have indicated that
as part of closing the 2011-12 State Budget they intend
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to eliminate Redevelopment Areas in order to achieve a
$1.7 billion in savings. The purpose of the governor's
proposal is to gain revenue for the State. It is not
to eliminate the other benefits associated with
Redevelopment Areas. AB 1235 preserves one of those
other benefits. Without this bill, development will be
further hindered in what was once California
Redevelopment Areas.
A few months ago, this Legislative body was one vote
shy of approving the Governor's proposal to eliminate
redevelopment agencies. It is important to note that
this proposal did not address how legal immunities were
going to be transferred upon the dissolution of RDAs.
It is difficult to predict when or if this proposal
will be brought up again but we need a vehicle to move
along the legislative process that explicitly addresses
legal immunities so as to not risk having redevelopment
come to a standstill if the Legislature approves an
elimination of RDAs. Absent this bill, if that scenario
were to play out, several months would pass before we
could pass and approve a bill to address this.
Brief Background of Redevelopment Agencies and the Polanco Act.
Since 1945, state law has given local city and county government
the authority to form a redevelopment agency with the specific
purpose of revitalizing deteriorated or blighted areas of the
community. According to the California Redevelopment
Association, there are nearly 400 active RDAs throughout the
state, all of which are overseen either by a local city council,
county board of supervisors, or a separate appointed board, and
thus are publicly accountable. With respect to contaminated
properties (also known as brownfields), RDAs are often in a good
position to take an active role in the cleanup and redevelopment
of these sites to attract private investment.
In 1990, the Legislature passed and the governor signed AB 3193
(Polanco), Ch. 1113, Stats. 1990, ("the Polanco Redevelopment
Act", or "the Act") which granted redevelopment agencies with
qualified immunity from liability under the state Superfund and
other environment liability cleanup laws for hazardous substance
cleanup actions conducted pursuant to an approved remedial plan.
Research of the legislative history of the Act shows that its
purpose was to "encourage the cleanup and redevelopment of sites
contaminated by hazardous materials . . . by providing a
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qualified immunity from liability for future cleanup costs."
(Senate Judiciary bill analysis, August 7, 1990.) Proponents of
AB 3193 contended at the time that RDAs and developers were
prepared to expend financial resources to clean up these sites,
but were reluctant to do so because of the liability exposure
under then-existing law for a less than perfect cleanup
operation. (Id.) This is essentially the same argument that
proponents of this bill now make-that cleanup of brownfield
sites will "come to a standstill" unless immunities from
liability are extended to the actors who would otherwise invest
the resources needed to do the cleanup.
Importantly, the Legislature approved AB 3193 only after
establishing a number of specific parameters for the qualified
immunity provided under the bill, all of which continue to exist
within Section 33459.3. These parameters include: (1) the RDA
must follow and properly complete a remedial action plan
approved by a specified state agency for the immunity to apply;
(2) the plan must be prepared by an independent contractor, not
by any employee of the agency that would benefit from the
immunity; (3) the immunity applies only to releases identified
in the plan, and not to any subsequent or unidentified release
of a hazardous substance; (4) the immunity is available only to
the RDA, its employees and agents, and other specified persons
who have entered into agreements with the RDA; and (5) immunity
is not available to certain persons, particularly any person
responsible for the hazardous substance release.
As proposed to be amended, this bill more precisely reflects the
intent and parameters of the qualified immunity provided by the
Polanco Act, if RDAs should be dissolved and replaced by the
cities and counties that authorized their creation. As
currently in print, the bill would extend immunities specified
in Section 3349.3 of the Polanco Act to any person or entity
that acquires property formerly owned by a RDA if the RDA has
been dissolved. Because those immunities are highly qualified
and premised on the role, authority and duties fulfilled by a
publicly accountable redevelopment agency, it was not clear if
or how the parameters of the Act's immunities would apply to
"any person or entity that acquires property formerly owned by a
RDA" under the bill as currently in print. Therefore, to
clarify his intent to preserve existing legal immunities for
cleanup of brownfield redevelopment properties that would be
affected by Legislative dissolution of RDAs, the author proposes
to amend the bill to read as follows:
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Author's Proposed Amendment : On page 2, strike lines 3-17
and replace with:
33460 (a) If a redevelopment agency has been
dissolved by an act of the Legislature and its
successor agency maintains all the rights, powers, and
duties that were vested by this part in the
redevelopment agency prior to its dissolution, then any
immunity specified in Section 33459.3 that applied to a
redevelopment agency shall apply to the successor
agency for any property that was within a redevelopment
project of the redevelopment agency prior to its
dissolution.
(b) "Successor agency" means the county, city, or city
and county that authorized the creation of each
redevelopment agency.
ARGUMENTS IN SUPPORT : The Center for Creative Land Recycling,
the sponsor of the bill, writes in support, "As the governor and
Legislature debate the 2011-12 State Budget and the future of
Redevelopment Areas, it is prudent and timely for the
Legislature to concurrently develop policy to preserve those
benefits of Redevelopment Areas that have proved successful and
that do not have a state budget consequence. Without this bill,
development may be further hindered in the even Redevelopment
Areas are eliminated."
The California Association of Realtors also supports the bill as
proposed to be amended, asserting that the immunities afforded
to RDAs by the Polanco Act deserve to be extended to successor
interests because they have successfully "served to promote the
remediation of urban brownfields and have allowed communities
throughout the state to recapture and rehabilitate blighted
properties." The Realtors further contend that this bill "will
help to ensure continued investment in the remediation and
redevelopment of these vital urban parcels."
ARGUMENTS IN OPPOSITION : The Sierra Club of California and
Consumer Attorneys of California both submitted letters opposing
the previous version of the bill (i.e. as currently in print.)
Both groups specifically opposed the extension of immunities to
any person that acquired property previously owned by an RDA,
primarily on the basis that, unlike a redevelopment agency, a
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private property owner has no accountability to the public and
therefore immunity should not apply. As proposed to be amended,
the bill now extends qualified immunities only to cities and
counties that are "successor agencies"; however, it is unknown
whether either group still opposes the bill on this basis.
In addition, both groups expressed opposition to the previous
version of the bill based on its timing and not its specific
content. They argued that the bill is "premature" and
potentially "unnecessary" given the current uncertainty about
whether RDAs will indeed be dissolved. The Sierra Club noted,
"At that time (if dissolution occurs), the Legislature will need
to address a variety of issues related to redevelopment
agencies, including Polanco Act issues that go well beyond the
immunities addressed by this bill, rather than just dealing with
the immunities in isolation." The bill as proposed to be
amended does not address either group's concern with respect to
timing, but their positions on the measure as now amended are
not known.
Pending Legislation : SB 77 (Committee on Budget and Fiscal
Review) would dissolve redevelopment agencies across the state
and reallocate funds previously allocated to those agencies.
The definition of "successor agencies" in this bill corresponds
to the definition of that term in SB 77. That bill passed the
Senate (22-2), but failed passage by the necessary 3/4 margin in
the Assembly (53-23) and is currently pending a motion to
reconsider.
REGISTERED SUPPORT / OPPOSITION :
Support (as proposed to be amended)
Center for Creative Land Recycling
California Association of Realtors
Opposition (to previous version of the bill)
Sierra Club of California
Consumer Attorneys of California
Analysis Prepared by : Anthony Lew / JUD. / (916) 319-2334
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