BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 1585| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: AB 1585 Author: John A. Pérez (D), et al. Amended: 8/24/12 in Senate Vote: 21 SENATE TRANSPORTATION & HOUSING COMMITTEE : 8-1, 7/3/12 AYES: DeSaulnier, Gaines, Harman, Kehoe, Lowenthal, Pavley, Rubio, Simitian NOES: Wyland SENATE APPROPRIATIONS COMMITTEE : 6-1, 8/16/12 AYES: Kehoe, Alquist, Dutton, Lieu, Price, Steinberg NOES: Walters ASSEMBLY FLOOR : 58-7, 3/26/12 - See last page for vote SUBJECT : Reappropriation of Proposition 1C bond funds SOURCE : Author DIGEST : This bill reappropriates $50 million of Proposition 1C bond funds to the Infill Infrastructure Grant Program and the Transit-Oriented Development Program. Senate Floor Amendments of 8/24/12 delete provisions in the bill which transferred the responsibility to perform housing related function of a former redevelopment agency to the Department of Housing and Community Development (HCD). CONTINUED AB 1585 Page 2 ANALYSIS : In November 2006, California voters approved Proposition 1C, the $2.85 billion Housing and Emergency Shelter Trust Fund Act of 2006. Among other things, Proposition 1C included: $790 million for the Infill Infrastructure Grant (IIG) Program, under which HCD offers gap financing grants to cover the costs of infrastructure improvements necessary for the development of higher-density affordable and mixed-income housing in locations designated as infill. $300 million for the Transit-Oriented Development (TOD) Program, under which HCD provides grants to cities, counties, and transit agencies for the provision of infrastructure necessary to support mixed-income housing developments within close proximity to a transit station. Housing developers may also obtain loans for the development of the TOD housing units. Over the succeeding years, the Legislature appropriated these funds to HCD, and HCD awarded all of the funds available under both programs. For various reasons, some awardees have returned their awards, making the funds again available for a new round of awards. HCD reports that it currently has $25 million available for the IIG Program and another $25 million available for the TOD Program. HCD made these particular awards in the first rounds of funding, for which its appropriation (i.e., deadline to encumber funds) expired on June 30, 2008. Citing a significant State General Fund deficit, Governor Brown's 2011-12 budget proposed eliminating redevelopment agencies (RDAs) and returning billions of dollars of property tax revenues to schools, cities, and counties to fund core services. Among the statutory changes that the Legislature adopted to implement the 2011-12 Budget, AB 26X1 (Blumenfield, Chapter 5, Statutes of 2011) dissolved all RDAs and established procedures for winding down RDA activity. Existing law requires successor agencies to dispose of former RDAs' assets and properties, at an oversight board's direction, in an expeditious manner aimed at maximizing value. Successor agencies are required to make any payments related to enforceable obligations, as specified in an adopted recognized obligation payment CONTINUED AB 1585 Page 3 schedule, and remit unencumbered balances of RDA funds and proceeds from asset sales to the county auditor-controller for distribution to local taxing entities in the county. This bill: 1. Appropriates $50 million to HCD as follows: A. $25 million for the purpose of funding infill incentive grants under the IIG Program. B. $25 million for the purpose of funding transit-oriented grants and loans under the TOD Program. 2. Reallocates any moneys which were previously allocated and appropriated under the IIG Program which become disencumbered and redeposited in the Regional Planning, Housing, and Infill Incentive Account during the 2012-13 and 2013-14 fiscal years, for the purpose of funding infill incentive grants under the IIG Program. 3. Reallocates any moneys allocated and appropriated under the TOD Program that become disencumbered and redeposited in the Transit-Oriented Development Account during the 2012-13 fiscal year, for the purpose of funding transit-oriented grants and loans pursuant to the TOD Program. 4. Clarifies that specified provisions of the Community Redevelopment Law relating to the Low and Moderate Income Housing Fund apply for purposes of funding administrative and planning costs associated with the implementation of housing-related provision of the Community Redevelopment Law. Comments According to the author's office, it is important to sustain and build critical infrastructure projects in our state, especially in the housing sector. Given the economic downturn and loss of jobs in the construction industry, the state must use its available resources to stimulate recovery of the economy. In 2006, the voters CONTINUED AB 1585 Page 4 approved Proposition 1C and put their faith in government to use bond funds efficiently and as quickly as possible. The appropriation in this bill will allow HCD to issue a Notice of Funding Availability for infill and transit-oriented projects that are shovel-ready and of great value to our communities and neighborhoods. FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes Local: No According to the Senate Appropriations Committee: Appropriation of $25 million from the Regional Planning, Housing, and Infill Incentive Account to HCD (bond funds). Appropriation of $25 million from the Transit-Oriented Development Implementation Fund to HCD (bond funds). SUPPORT : (Verified 8/22/12) (Unable to reverify at time of writing) AFSCME Bridge Housing California Association of Housing Authorities California Association of Local Housing Finance Agencies Commercial Investment Services John Stewart Company Oakland Tenants Union Resources for Community Development San Francisco Bay Area Rapid Transit District Tenderloin Neighborhood Development Corporation ASSEMBLY FLOOR : 58-7, 3/26/12 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill Berryhill, Block, Blumenfield, Bonilla, Bradford, Brownley, Buchanan, Butler, Charles Calderon, Campos, Carter, Cedillo, Chesbro, Davis, Dickinson, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, Galgiani, Garrick, Gatto, Gordon, Hall, Hayashi, Roger Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Lara, Ma, Mendoza, Miller, Mitchell, Monning, Pan, Perea, V. Manuel Pérez, Portantino, Skinner, Smyth, Solorio, Swanson, Torres, CONTINUED AB 1585 Page 5 Wieckowski, Williams, Yamada, John A. Pérez NOES: Conway, Donnelly, Beth Gaines, Logue, Mansoor, Nielsen, Norby NO VOTE RECORDED: Cook, Gorell, Grove, Hagman, Halderman, Harkey, Jones, Knight, Bonnie Lowenthal, Morrell, Nestande, Olsen, Silva, Valadao, Wagner JJA:mn 8/27/12 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED