BILL NUMBER: AB 2259	AMENDED
	BILL TEXT

	AMENDED IN SENATE  AUGUST 21, 2012
	AMENDED IN SENATE  AUGUST 6, 2012
	AMENDED IN SENATE  JUNE 18, 2012
	AMENDED IN ASSEMBLY  MAY 25, 2012
	AMENDED IN ASSEMBLY  APRIL 19, 2012
	AMENDED IN ASSEMBLY  MARCH 29, 2012

INTRODUCED BY   Assembly Member Ammiano

                        FEBRUARY 24, 2012

   An act to amend Sections 53395.8, 53395.81, and 53397.71 of the
Government Code, relating to infrastructure financing.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2259, as amended, Ammiano. Infrastructure financing districts:
America's Cup and waterfront district venues.
   Existing law authorizes the City and County of San Francisco to
create infrastructure financing districts, including districts that
include specified waterfront property, adopt infrastructure financing
plans for those districts, and issue bonds financed by projected
increases in ad valorem property taxes to fund certain public
facilities, pursuant to a specified procedure.
   With respect to the infrastructure financing district provisions
that apply to the City and County of San Francisco and waterfront
districts, this bill would modify the definition of key terms and
authorize a waterfront district to finance improvements to protect
against potential sea level rise. The bill would modify provisions
relating to the ordinance establishing the base year for the district
and would specify the base year of land annexed into a district. In
the event the district requests an affected tax entity to subordinate
the amount to be paid to the entity, the bill would authorize the
affected taxing entity to disapprove a request for subordination only
if there will be insufficient tax increment funds.
   Existing law authorizes the adoption of infrastructure financing
plans for special waterfront districts that include the waterfront
area in the City and County of San Francisco designated as the
America's Cup venues, and the use of specified tax revenues produced
in the districts for the construction of the Port of San Francisco's
maritime facilities at Pier 27, improvement of publicly held
waterfront lands used as viewing sites, and other matters, subject to
specified allocation procedures.
   Existing law requires that, with respect to the special waterfront
district Education Revenue Augmentation Fund (ERAF) share produced
in a Port America's Cup district with a special waterfront district
enhanced financing, 20% of that amount be set aside to finance costs
of specified improvements to federally or state-owned waterfront
lands approved by trustee agencies.
   The bill would provide that the ERAF share of set-aside funds be
used to finance costs of planning, design, and acquisition and
construction of improvements to publicly owned waterfront lands owned
by federal, state, or San Francisco local department trustee
agencies. The bill would impose new requirements and grant certain
exceptions in the event any portion of the set-aside funds is
allocated to a federal or state trustee agency.
   Existing law authorizes the legislative body of a waterfront
district to, by resolution, authorize the issuance of bonds without
holding an election of the voters residing in the waterfront
district.
   The bill would additionally authorize the legislative body of a
waterfront district to undertake proceedings and actions relating to
infrastructure financing districts with respect to the district as a
whole or separately with respect to one or more project areas. The
bill would authorize the legislative body to increase the principal
amount of bonds that may be issued for a district or project area
within a district.
   This bill would make legislative findings and declarations as to
the necessity of a special statute for the City and County of San
Francisco.
   The bill would make legislative findings and declarations to
ratify any action taken by San Francisco consistent with the special
statute prior to its effective date.
   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 53395.8 of the Government Code is amended to
read:
   53395.8.  (a) This section applies only to the City and County of
San Francisco, and to any waterfront district.
   (b) In addition to the findings and declarations in Section 53395,
the Legislature further finds and declares that providing the
ability to capture property tax increment revenues to finance needed
public facilities in waterfront lands in San Francisco that are
subject to the public trust to the public agencies with the
responsibility to administer those areas will further the objectives
of the public trust and enjoyment of those trust lands by the people
of the state.
   (c) For purposes of this section, the following terms have the
following meanings except as otherwise provided:
   (1) "Affected taxing entity" means any governmental taxing agency,
except San Francisco and its local educational agencies, that levied
or had levied on its behalf a property tax on all or a portion of
the land located in the proposed district in the fiscal year prior to
the designation of the district, all or a portion of which the
district proposes to collect in the future under its infrastructure
financing plan, except as provided in subdivision (h).
   (2) "Base year" means the fiscal year in which the assessed value
of taxable property in the district was last equalized prior to the
effective date of the ordinance adopted to create the district, or a
subsequent fiscal year specified in the infrastructure financing plan
for the district.
   (3) "Board" means the Board of Supervisors of the City and County
of San Francisco, which shall be the legislative body for any
district formed under this section.
   (4) "Debt" means loans, advances, or other forms of indebtedness
and financial obligations, including, but not limited to, commercial
paper, variable rate demand notes, all moneys payable in relation to
the debt, and all debt service coverage requirements in any debt
instrument, in addition to the obligations specified in the
definition of "debt" in Section 53395.1.
   (5) "District" means any district created under this chapter,
including any project area within a district.
   (6) "ERAF" means the Educational Revenue Augmentation Fund.
   (7) "ERAF-secured debt" means debt incurred to finance a Pier 70
district subject to a Pier 70 enhanced financing plan that is secured
by and will be repaid from the ERAF share.
   (8) "ERAF share" means the county ERAF portion of incremental tax
revenue committed to a Pier 70 district under a Pier 70 enhanced
financing plan.
   (9) "Local educational agencies" means, collectively, the San
Francisco Unified School District, the San Francisco Community
College District, and the San Francisco County Office of Education.
   (10) "Mirant site" means the San Francisco waterfront land owned
by Mirant Corporation, on which it or its affiliate formerly operated
a coal gasification powerplant.
   (11) "Pier 70 district" means a waterfront district that includes
65 acres of waterfront land in the area near Pier 70.
   (12) "Pier 70 enhanced financing plan" means an infrastructure
district financing plan for a Pier 70 district that contains a
provision authorized under subparagraph (D) of paragraph (3) of
subdivision (g).
   (13) "Port" means the Port of San Francisco.
   (14) "Project area" means a defined area designated for
development within a waterfront district formed under this chapter in
accordance with subdivision (g).
   (15) "Public facilities" means facilities and, where the context
requires, related services, authorized to be financed in whole or in
part by a district formed under this chapter in accordance with
subdivision (g). Public facilities may be publicly owned or privately
owned utility infrastructure if they are available to or serve the
general public. "Public facilities" includes any capital facility
fees used to pay for public facilities.
   (16) "San Francisco" means the City and County of San Francisco.
For purposes of applying this chapter, San Francisco is a city.
   (17) "Waterfront district" means a district formed under this
chapter on land under port jurisdiction along the San Francisco
waterfront and any special waterfront district as defined in Section
53395.81.
   (18) "Waterfront  set aside"   set-aside
  "  means the restricted funds required to be set
aside under clause (ii) of subparagraph (C) of paragraph (3) of
subdivision (g).
   (19) "County tax collector" means the county auditor-controller,
tax collector, or other officer responsible for the payment of
property taxes into the funds of taxing entities.
   (d) In addition to the facilities and services authorized by
Section 53395.3, a waterfront district may finance any of the
following:
   (1) Remediation of hazardous materials in, on, under, or around
any real or tangible property.
   (2) Seismic and life-safety improvements to existing buildings.
   (3) Rehabilitation, restoration, and preservation of structures,
buildings, or other facilities having special historical,
architectural, or aesthetic interest or value and that are listed on
the National Register of Historic Places, are eligible for listing on
the National Register of Historic Places individually or because of
their location within an eligible registered historic district, or
are listed on a state or local register of historic landmarks.
   (4) Structural repairs and improvements to piers, seawalls, and
wharves  , and installation of piles  .
   (5) Removal of bay fill.
   (6) Stormwater management facilities, other utility
infrastructure, or public open-space improvements.
   (7) Shoreline restoration.
   (8) Other repairs and improvements to maritime facilities.
   (9) Planning and design work that is directly related to any
public facilities authorized to be financed by a waterfront district.

   (10) Reimbursement payments made to the California Infrastructure
and Economic Development Bank in accordance with paragraph (5) of
subdivision (e) of Section 53395.81.
   (11) Improvements, which may be publicly owned, to protect against
potential sea level rise.
   (e) A waterfront district may include, and finance public
facilities on, tidelands and submerged lands, including filled or
unfilled lands, subject to the public trust for commerce, navigation,
and fisheries, and the applicable statutory trust grant or grants.
Public facilities located on tidelands and submerged lands shall
serve and promote uses and purposes consistent with the public trust
and applicable statutory trust grants. Public facilities that
increase access to, or the use or enjoyment of, public trust lands
will be deemed to be facilities of communitywide significance that
provide significant benefits to an area larger than the area of the
district.
   (f) Public facilities financed by a waterfront district shall be
public trust assets subject to the administration and control of the
district, except for the following:
   (1) Utility infrastructure and public transportation facilities,
except maritime transportation facilities that are administered and
controlled by another entity under an agreement with the port.
   (2) Public facilities on land located in a previously formed
waterfront district that the port subsequently leases, sells, or
otherwise transfers to any person free of the public trust, the
Burton Act trust, and any additional restrictions on use or
alienability created by the Burton Act transfer agreement, provided
that the State Lands Commission has concurred in the lifting of trust
restrictions on the transferred land and that the transferred land
will remain in and subject to the district.
   (g) For a waterfront district, the requirements of this
subdivision supplant and replace the provisions of Sections 53395.10
to 53395.25, inclusive. The board may adopt or amend one or more
infrastructure financing plans for districts along the San Francisco
waterfront according to the procedures in this section. Except as
provided otherwise in this subdivision or in Section 53395.81, the
provisions of subdivisions (a) and (b) of Section 53395.4 shall not
apply to a waterfront district. A waterfront district may be formed
and become effective at any time. A district may be divided into
project areas, each of which may be subject to distinct limitations
established under this subdivision. Within a district, one or more
project areas may be a special waterfront district as defined in
Section 53395.81.
   (1) The board shall initiate proceedings for the establishment of
a district by adopting a resolution of intention to establish the
proposed district that does all of the following:
   (A) States an infrastructure financing district is proposed to be
established and describes the boundaries of the proposed district.
The boundaries may be described by reference to a map on file in the
office of the clerk of the board.
   (B) States the type of public facilities proposed to be financed
by the district.
   (C) States that incremental property tax revenue from San
Francisco and some or all affected taxing entities within the
district, but none of the local educational agencies, except as
provided in subdivision (h) or as a result of the allocation of the
ERAF share, may be used to finance these public facilities.
   (D) Directs the executive director of the port, or an appropriate
official designated by the executive director, to prepare a proposed
infrastructure financing plan.
   (2) The board shall direct the city clerk to mail a copy of the
resolution of intention to any affected taxing entities.
   (3) The proposed infrastructure financing plan shall be consistent
with the general plan of San Francisco, as amended from time to
time, and shall include all of the following:
   (A) A map and legal description of the proposed district, which
may include all or a portion of the district designated by the board
in its resolution of intention.
   (B) A description of the public facilities required to serve the
development proposed in the district, including those to be provided
by the private sector, those to be provided by governmental entities
without assistance under this chapter, those public facilities to be
financed with assistance from the proposed district, and those to be
provided jointly. The description shall include the proposed
location, timing, and projected costs of the public facilities. The
description may consist of a reference to the capital plan for the
territory in the district that is approved by the board, as amended
from time to time.
   (C) A financing section that shall contain all of the following:
   (i) A provision that specifies the maximum portion of the
incremental tax revenue of San Francisco and of any affected taxing
entity proposed to be committed to the district, and affirms that the
plan will not allocate any portion of the incremental tax revenue of
the local educational agencies to the district.
   (ii) Limitations on the use of levied taxes allocated to and
collected by the district that provide that, except as provided by
this section or Section 53395.81, incremental tax revenues allocated
to a district must be used within the district for purposes
authorized under this section, and that not less than 20 percent of
the amount allocated to a district shall be set aside to be expended
solely on shoreline restoration, removal of bay fill, or waterfront
public access to or environmental remediation of the San Francisco
waterfront.
   (iii) A projection of the amount of incremental tax revenues
expected to be received by the district, assuming a district receives
incremental tax revenues for a period no later than 45 years after
San Francisco projects that the district will have received one
hundred thousand dollars ($100,000) in incremental tax revenues under
this chapter.
   (iv) Projected sources of financing for the public facilities to
be assisted by the district, including debt to be repaid with
incremental tax revenues, projected revenues from future leases,
sales, or other transfers of any interest in land within the
district, and any other legally available sources of funds. The
projection may refer to the capital plan for the territory in the
district that is approved by the board, as amended from time to time.

   (v) A limitation on the aggregate number of dollars of levied
taxes that may be divided and allocated to the district. Taxes shall
not be divided or be allocated to the district beyond this
limitation, except by amendment of the infrastructure financing plan
pursuant to the procedures in this subdivision. In the event San
Francisco divides a district into project areas, the project areas
may share this limit and the limit may be divided among the project
areas or a separate limit may be established for a project area.
   (vi) A date on which the effectiveness of the infrastructure
financing plan and all tax allocations to the district will end and a
date on which the district's authority to repay indebtedness with
incremental tax revenues received under this chapter will end, not to
exceed 45 years from the date the district has actually received one
hundred thousand dollars ($100,000) in incremental tax revenues
under this chapter. After the time limits established under this
subparagraph, a district shall not receive incremental tax revenues
under this chapter.
   (vii) An analysis of the costs to San Francisco for providing
facilities and services to the district while the district is being
developed and after the district is developed, and of the taxes,
fees, charges, and other revenues expected to be received by San
Francisco as a result of expected development in the district.
   (viii) An analysis of the projected fiscal impact of the district
and the associated development upon any affected taxing entity. If no
affected taxing entities exist within the district because the plan
does not provide for collection by the district of any portion of
property tax revenues allocated to any taxing entity other than San
Francisco, the district has no obligation to any other taxing entity
under this subdivision.
   (ix) A statement that the district will maintain accounting
procedures in accordance, and otherwise comply, with Section 6306 of
the Public Resources Code for the term of the plan.
   (D) For a Pier 70 district only, the Pier 70 enhanced financing
plan may contain a provision meeting the requirements of Section
53396 that allocates a portion of the incremental tax revenue of San
Francisco and of other designated affected taxing entities to the
Pier 70 district.
   The portion of incremental tax revenue of San Francisco to be
allocated to the Pier 70 district must be equal to the portion of the
incremental tax revenue of the county ERAF proposed to be committed
to the Pier 70 district. In addition to all other requirements under
this section, a Pier 70 district shall also be subject to the
following additional limitations:
   (i) A Pier 70 district subject to a Pier 70 enhanced financing
plan shall not be formed and become effective prior to January 1,
2014.
   (ii) Any Pier 70 enhanced financing plan shall contain all of the
following:
   (I) A time limit on the issuance of new ERAF-secured debt to
finance the district, which may not exceed 20 fiscal years from the
fiscal year in which any Pier 70 district subject to a Pier 70
enhanced financing plan first issues debt. The ERAF-secured debt may
be repaid over the period of time ending on the time limit
established under clause (vi) of subparagraph (C). This time limit on
the issuance of new ERAF-secured debt shall not prevent a Pier 70
district from subsequently refinancing, refunding, or restructuring
ERAF-secured debt if all of the following conditions are met: the
time during which the debt is to be repaid is not extended beyond the
time limit established under clause (vi) of subparagraph (C); in the
case of a refinancing or refunding to achieve savings, the total
interest cost to maturity on the new debt plus the principal amount
of the new debt does not exceed the total interest cost to maturity
on the debt to be refunded plus the principal of the debt to be
refunded; and the principal amount of the new debt does not exceed
the amount required to defease the debt to be refunded, refinanced,
or restructured, to establish customary debt service reserves and to
pay related costs of issuance. If these conditions are satisfied, the
initial principal amount of the new debt may be greater than the
outstanding principal amount of the debt to be refunded, refinanced,
or restructured.
   (II) A statement that the Pier 70 district shall be subject to a
limitation on the number of dollars of the ERAF share that may be
divided and allocated to the Pier 70 district pursuant to the Pier 70
enhanced financing plan, including any amendments to the plan, which
shall be established in consultation with the county tax collector.
This limitation and a schedule specifying the amount of the ERAF
share that must be divided and allocated to the district in each
succeeding fiscal year until all ERAF-secured debt has been paid
shall be included in the statement of indebtedness that the Pier 70
district files for the 19th fiscal year after the fiscal year in
which any ERAF-secured debt is first issued. The ERAF share shall not
be divided and shall not be allocated to the Pier 70 district beyond
that limitation.
   (III) The limitations established by subclauses (I) and (II) may
be amended only by amendment of this section. When the ERAF-secured
debt, if any, has been paid, all moneys thereafter allocated to the
ERAF share shall be paid into ERAF as taxes on all other property are
paid. In addition, beginning in the 21st fiscal year after the
fiscal year in which ERAF-secured debt is first issued, any portion
of the ERAF share in excess of the amount required to meet the Pier
70 district's ERAF-secured debt service obligations shall be paid
into ERAF.
   (4) The proposed infrastructure financing plan shall be mailed to
each affected taxing entity for review, together with, to the extent
available, any report required by the California Environmental
Quality Act (Division 13 (commencing with Section 21000) of the
Public Resources Code) that pertains to the proposed public
facilities and any proposed development project for which the public
facilities are needed, and shall be made available for public
inspection. The report also shall be sent to the San Francisco
Planning Department and the board.
   (5) Except as provided in subdivision (h) and except as a result
of an ERAF share allocation, the board shall not enact a resolution
proposing formation of a district and providing for the division of
taxes of any affected taxing entities for use in the Pier 70 district
as set forth in the proposed infrastructure financing plan unless a
resolution approving the plan has been adopted by the governing body
of each affected taxing entity that is proposed to be subject to
division of taxes as set forth in the proposed infrastructure
financing plan, and that resolution has been filed with the board at
or prior to the time of the hearing. A resolution approving the plan
adopted by the governing body of an affected taxing entity shall be
deemed the affected taxing entity's agreement to participate in the
plan for the purposes of Section 53395.19.
   (6) If the governing body of an affected taxing entity has not
approved the infrastructure financing plan before the board considers
the plan, the board may amend the infrastructure financing plan to
remove the allocation of the tax revenues of the nonconsenting
affected taxing entity. If a plan is so amended, the plan also shall
be amended to provide that San Francisco will allocate to the Pier 70
district funds equal on a dollar-for-dollar basis to the tax
revenues that the Pier 70 district would have received from the
allocation of tax revenues of the affected taxing entity that is
removed from the plan.
   (7) The board shall hold a public hearing regarding the
infrastructure financing plan that shall be scheduled on a date no
earlier than 60 days after the plan has been sent to each affected
taxing entity, or in the absence of any affected taxing entities, no
earlier than 30 days after the plan has been lodged with the clerk of
the board. Notice of the public hearing must be published not less
than once a week for four successive weeks in a newspaper designated
by the board for the publication of official notices in San
Francisco, or if the board no longer designates a newspaper for the
publication of official notices, a newspaper of general circulation
serving primarily San Francisco residents. The notice shall state
that the district will be established to finance public facilities,
briefly describe the public facilities and the proposed financial
arrangements, including the proposed commitment of incremental tax
revenue, describe the boundaries of the proposed district, and state
the day, hour, and place when and where any persons having any
objections to the proposed infrastructure financing plan, or the
regularity of any of the previous proceedings, may appear before the
board and object to the adoption of the proposed infrastructure
financing plan by the board.
   (8) At the hour set in the required notices, the board shall
proceed to hear and pass upon all written and oral objections. The
hearing may be continued from time to time. The board shall consider
any recommendations of affected taxing entities, and all evidence and
testimony for and against the adoption of the infrastructure
financing plan.
   (9) No election will be required to form the district, and at the
conclusion of the hearing, the board may adopt an ordinance adopting
the infrastructure financing plan, as drafted or as modified by the
board, or it may abandon the proceedings.
   (10) Any public or private owner of land that is not within an
existing district, but that has any boundary line contiguous to a
boundary of the waterfront district, may petition the board for
inclusion of the land in the waterfront district without an election.
The annexation shall take effect on the effective date of the
ordinance of the board's annexation approval. As a condition to
inclusion of its land in the waterfront district, the petitioning
landowner shall acknowledge and agree that any portion of the land
within 100 feet of the San Francisco Bay Conservation and Development
Commission shoreline (shoreline band) will include contiguous public
access along the length of the shoreline band, improved and
maintained to standards equal to adjacent waterfront public access
ways on public land, as certified by the San Francisco Bay
Conservation and Development Commission. Nothing in this section is
intended to affect or limit the authority of the San Francisco Bay
Conservation and Development Commission pursuant to Chapter 1
(commencing with Section 66600) of Title 7.2, or any other law. This
procedure will apply to any petition to include the Mirant site in
the Pier 70 district, but the board may amend the Pier 70 financing
plan to include the Mirant site in the Pier 70 district only after
the Director of Finance's approval.
   (11) The ordinance creating a district and adopting or amending an
infrastructure financing plan shall establish the base year for the
district. The base year of land annexed into a district shall be the
fiscal year in which the assessed value of the annexed land was last
equalized prior to the effective date of the annexation, or a
subsequent fiscal year specified in the ordinance of the board
approving the annexation. The board may amend an infrastructure
financing plan by ordinance for any purpose, including, but not
limited to, dividing an established district into one or more project
areas, reducing the district area, or expanding a waterfront
district to include the petitioning landowner's land in the district
in accordance with the board's established procedures. Any ordinance
adopting or amending an infrastructure financing plan will be deemed
an ordinance adopted for the purposes of Section 53395.23.
   (12) With respect to a waterfront district, San Francisco may
enter into an agreement for the construction of discrete portions or
phases of public facilities. The agreement may include any provisions
that San Francisco determines are necessary or convenient, but shall
do all of the following:
   (A) Identify the specific public facilities or discrete portions
or phases of public facilities to be constructed and purchased. San
Francisco may agree to purchase discrete portions or phases of public
facilities if the portions or phases are capable of serviceable use
as determined by San Francisco.
   (B) Notwithstanding subparagraph (A), when the purchase value of a
public facility exceeds one million dollars ($1,000,000), San
Francisco may agree to purchase discrete portions or phases of the
partially completed public facility.
   (C) Identify procedures to ensure that the public facilities are
constructed pursuant to plans, standards, specifications, and other
requirements as determined by San Francisco.
   (D) Specify a price or a method to determine a price for each
public facility or discrete portion or phase of a public facility.
The price may include an amount reflecting the interim cost of
financing cash payments that must be made during construction of the
project, at the discretion of San Francisco.
   (E) Specify procedures for final inspection and approval of public
facilities or discrete portions or phases of public facilities, for
approval of payment and for acceptance and conveyance.
   (h) (1) All the amounts calculated under this subdivision shall be
calculated after deducting the  special  waterfront
set-aside required under clause (ii) of subparagraph (C) of
paragraph (3) of subdivision (g) of this section or  the
set-aside required for a special waterfront district under 
paragraph (3) of subdivision (c) of Section 53395.81, as applicable,
from the total amount of tax increment funds allocated to a district
in the applicable fiscal year. The payments made by the county tax
collector under this subdivision to the affected taxing entities
shall be allocated among the affected taxing entities in proportion
to the percentage share of property taxes each affected taxing entity
receives during the fiscal year the funds are allocated. The
percentage share shall be determined without regard to any amounts
allocated to a city, county, or city and county under Sections 97.68
and 97.70 of the Revenue and Taxation Code.
   (2) (A) Prior to incurring any debt, except loans or advances from
San Francisco, a district may subordinate to the debt the amount
required to be paid by the county tax collector to an affected taxing
entity under this
subdivision, if any, provided the affected taxing entity has approved
these subordinations as provided in this paragraph.
   (B) At the time the district requests an affected taxing entity to
subordinate the amount to be paid by the county tax collector to it,
the district shall provide the affected taxing entity with
substantial evidence that sufficient tax increment funds will be
available to pay when due both the debt service on the debt and the
payments by the county tax collector to the affected taxing entity
required under this subdivision.
   (C) Within 45 days after receipt of the district's request, the
affected taxing entity shall approve or disapprove the request for
subordination. An affected taxing entity may disapprove a request for
subordination only if it finds, based upon substantial evidence,
that the tax increment funds will be insufficient to pay when due the
debt payments and the amount required to be paid by the county tax
collector to the affected taxing entity. If the affected taxing
entity does not act within 45 days after receipt of the district's
request, the request to subordinate shall be deemed approved and its
deemed approval shall be final and conclusive.
   (D) For the purpose of this paragraph only, "affected taxing
entity" shall mean any governmental agency that levied, or had levied
on its behalf, a property tax on all or a portion of the land
located in the proposed district in the fiscal year prior to the
designation of the waterfront district.
   (3) The Legislature finds and declares all of the following:
   (A) The payments to be made under this subdivision are necessary
in order to alleviate the financial burden and detriment that
affected taxing entities may incur as a result of the adoption of an
infrastructure financing plan, and payments made under this
subdivision will benefit the district.
   (B) The payments to be made under this subdivision are the
exclusive payments that are required to be made by a district to
affected taxing entities during the term of an infrastructure
financing plan.
   (4) Nothing in this section requires a district, either directly
or indirectly, as a measure to mitigate a significant environmental
effect or as part of any settlement agreement or judgment brought in
any action to contest the validity of a district under Section
53395.6, to make any other payments to affected taxing entities, or
to pay for public facilities that will be owned or leased to an
affected taxing entity.
   (i) The portion of taxes required to be allocated to the Pier 70
district under a duly adopted infrastructure financing plan shall be
allocated and paid to the district by the county tax collector under
the procedure contained in this subdivision. If the approved plan
allocates to the Pier 70 district 100 percent of the incremental tax
revenue of San Francisco that is available under applicable law to be
allocated to the Pier 70 district, then the district shall not make
a payment to ERAF, but if the plan allocates less than 100 percent of
the incremental tax revenue of San Francisco that is available under
applicable law to be allocated to the Pier 70 district, then the
district shall pay a proportionate share of incremental tax revenue
into ERAF.
   (1) No later than October 1 of each year, for each district for
which the infrastructure financing plan provides for the division of
taxes, the district shall file with the county tax collector a
statement of indebtedness and a reconciliation statement for the
previous fiscal year certified by the chief financial officer of the
district.
   (2) Each statement of indebtedness shall contain all of the
following:
   (A) For each debt the district has incurred or entered into, all
of the following:
   (i) The date the district incurred or entered into the debt.
   (ii) The principal amount, term, purpose, interest rate, and total
interest payable over the term of the debt.
   (iii) The principal amount and interest due in the fiscal year in
which the statement is filed.
   (iv) The total amount of principal and interest remaining to be
paid over the term of the debt.
   (B) The sum of the principal and interest due on all debts in the
fiscal year in which the statement is filed.
   (C) The sum of principal and interest remaining to be paid on all
debts.
   (D) The available revenues as of the end of the previous fiscal
year.
   (3) The district may estimate the amount of principal or interest,
the interest rate, or term of any debt if the nature of the debt is
such that the amount of principal or interest, the interest rate, or
term cannot be precisely determined. The district may list on a
statement of indebtedness any debt incurred or entered into on or
before the date the statement is filed.
   (4) Each reconciliation statement shall include all of the
following:
   (A) A list of all debts listed on the previous year's statement of
indebtedness, if any.
   (B) A list of all debts not listed on the previous year's
statement of indebtedness, but incurred or entered into in the
previous year and paid in whole or in part from incremental tax
revenue received by the district. This listing may aggregate into a
single item debts incurred or entered into in the previous year for a
particular purpose, such as relocation expenses, administrative
expenses, consultant expenses, or remediation of hazardous materials.

   (C) For each debt described in subparagraph (A) or (B), all of the
following shall be included:
   (i) The total amount of principal and interest remaining to be
paid as of the later of the beginning of the previous year or the
date the debt was incurred or entered into.
   (ii) Any increases or additions to the debt occurring during the
previous year.
   (iii) The amount paid on the debt in the previous year from
incremental tax revenue received by the district.
   (iv) The amount paid on the debt in the previous year from revenue
other than incremental tax revenue received by the district.
   (v) The total amount of principal and interest remaining to be
paid as of the end of the previous fiscal year.
   (D) The available revenues of the district as of the beginning of
the previous fiscal year.
   (E) The amount of incremental tax revenue received by the district
in the previous fiscal year.
   (F) The amount of available revenue received by the district in
the previous fiscal year other than incremental tax revenue.
   (G) The sum of the amounts paid on all debts from sources other
than incremental tax revenue, to the extent that the amounts are not
included as available revenues under subparagraph (F).
   (H) The sum of the amounts specified in subparagraphs (D) to (G),
inclusive.
   (I) The sum of the amounts specified in clauses (iii) and (iv) of
subparagraph (C) of paragraph (4).
   (J) The amount determined by subtracting the amount determined
under subparagraph (I) from the amount determined under subparagraph
(H). The amount determined under this paragraph shall be the
available revenues as of the end of the previous fiscal year to be
reported in the statement of indebtedness.
   (5) For the purposes of this paragraph, available revenues shall
include all cash or cash equivalents held by the district that were
received by the district under subparagraph (D) of paragraph (3) of
subdivision (g) and all cash or cash equivalents held by the district
that are irrevocably pledged or restricted to payment of a debt that
the district has listed on a statement of indebtedness. In no event
shall available revenues include funds allocated to the waterfront
 set aside   set-aside  .
   (6) For the purposes of this subdivision: (A) the amount a
district is required to deposit into the waterfront  set
aside   set-aside  shall constitute an indebtedness
of the district, (B) no debt that a district intends to pay from the
waterfront  set aside   set-aside  shall
be listed on a statement of indebtedness or reconciliation statement
as a debt of the district, and (C) any statutorily authorized deficit
in or borrowing from funds in the waterfront  set aside
  set-aside  shall constitute an indebtedness of
the district.
   (7) The county tax collector shall allocate and pay, at the same
time or times as the payment of taxes into the funds of the
respective taxing agencies of the county, the portion of incremental
tax revenues allocated to each district under the infrastructure
financing plan. The amount allocated and paid shall not exceed the
amount of the district's remaining debt obligations, as determined
under subparagraph (C) of paragraph (2), minus the amount of
available revenues as of the end of the previous fiscal year, as
determined under subparagraph (D) of paragraph (2).
   (8) The statement of indebtedness constitutes prima facie evidence
of the debts of the district.
   (A) If the county tax collector disputes the amount of the
district's debts as shown on the statement of indebtedness, the
county tax collector, within 30 days after receipt of the statement,
shall give written notice to the district thereof.
   (B) The district, within 30 days after receipt of notice under
subparagraph (A), shall submit any further information it deems
appropriate to substantiate the amount of any debt that has been
disputed. If the county tax collector still disputes the amount of
debt, final written notice of that dispute shall be given to the
district, and the amount disputed may be withheld from allocation and
payment to the district as otherwise required by paragraph (7). In
that event, the county tax collector shall bring an action in the
superior court for declaratory relief to determine the matter no
later than 90 days after the date of the final notice.
   (C) In any court action brought under this paragraph, the issue
shall involve only the amount of debt, and not the validity of any
contract or debt instrument or any expenditures pursuant thereto.
Payments to a trustee under a bond resolution or indenture of any
kind or payments to a public agency in connection with payments by
that public agency under a lease or bond issue shall not be disputed
in any action under this paragraph. The matter shall be set for trial
at the earliest possible date and shall take precedence over all
other cases except older matters of the same character. Unless an
action is brought within the time provided for herein, the county tax
collector shall allocate and pay the amount shown on the statement
of indebtedness as provided in paragraph (7).
   (D) Nothing in this subdivision shall be construed to permit a
challenge to or attack on matters precluded from challenge or attack
by reason of Sections 53395.6 and 53395.7. However, nothing in this
subdivision shall be construed to deny a remedy against the district
otherwise provided by law.
   (E) The Controller shall prescribe uniform forms consistent with
this subdivision for a district's statement of indebtedness and
reconciliation statement. In preparing these forms, the Controller
shall obtain the input of the San Francisco City Controller, the San
Francisco Tax Collector, and the district.
   (F) For the purposes of this subdivision, a fiscal year shall be a
year that begins on July 1 and ends the following June 30.
   (j) (1) Prior to the adoption by the board of an infrastructure
financing plan providing for tax increment financing under
subparagraph (D) of paragraph (3) of subdivision (g), any affected
taxing entity may elect to be allocated, and every local educational
agency shall be allocated, all or any portion of the tax revenues
allocated to the district under subparagraph (D) of paragraph (3) of
subdivision (g) attributable to increases in the rate of tax imposed
for the benefit of the taxing entity which levy occurs after the tax
year in which the ordinance adopting the infrastructure financing
plan becomes effective.
   (2) The governing body of any affected taxing entity electing to
receive allocation of taxes under this subdivision shall adopt a
resolution to that effect and transmit the same, prior to the
adoption of the infrastructure financing plan, to (A) the board, (B)
the district, and (C) the county tax collector. Upon receipt by the
county tax collector of the resolution, allocation of taxes under
this section to the affected taxing entity shall be made at the time
or times allocations are made under subdivision (a) of Section 33670
of the Health and Safety Code.
   (3) An affected taxing entity, at any time after the adoption of
the resolution, may elect not to receive all or any portion of the
additional allocation of taxes under this section by rescinding the
resolution or by amending the same, as the case may be, and giving
notice thereof to the board, the district, and the county tax
collector. After receipt of a notice by the county tax collector that
an affected taxing entity has elected not to receive all or a
portion of the additional allocation of taxes by rescission or
amendment of the resolution, any allocation of taxes to the affected
taxing entity required to be made under this section shall not
thereafter be made, but shall be allocated to the district. After
receipt of a notice by the county tax collector that an affected
taxing entity has elected to receive additional tax revenues
attributable to only a portion of the increases in the rate of tax,
only that portion of the tax revenues shall thereafter be allocated
to the affected taxing entity, and the remaining portion thereof
shall be allocated to the district.
   (k) This section implements and fulfills the intent of Article 2
(commencing with Section 53395.10) and of Article XIII B and is
consistent with the conclusion of California courts that tax
increment revenues are not "proceeds of taxes" for purposes of the
latter. The allocation and payment to a district of the portion of
taxes specified in this section for the purpose of paying principal
of, or interest on, loans, advances, or indebtedness incurred for
facilities or the cost of acquisition and construction of facilities
under this section shall not be deemed the receipt by a district of
proceeds of taxes levied by or on behalf of the district within the
meaning or for the purposes of Article XIII B of the California
Constitution, nor shall this portion of taxes be deemed receipt of
proceeds of taxes by, or an appropriation subject to limitation of,
any other public body within the meaning or for purposes of Article
XIII B of the California Constitution or any statutory provision
enacted in implementation of Article XIII B. The allocation and
payment to a district of this portion of taxes shall not be deemed
the appropriation by a district of proceeds of taxes levied by or on
behalf of a district within the meaning or for purposes of Article
XIII B of the California Constitution.
  SEC. 2.  Section 53395.81 of the Government Code is amended to
read:
   53395.81.  (a) This section shall apply only to a special
waterfront district.
   (b) A special waterfront district may be created as a waterfront
district pursuant to, and shall be subject to, all applicable
requirements of Sections 53395.3 and 53395.8, except as provided in
this section.
   (c) (1) The special waterfront district ERAF share produced in a
Port America's Cup district with a special waterfront district
enhanced financing plan shall be used only to finance the following:
   (A) Construction of the port's maritime facilities at Pier 27.
   (B) Planning and design work that is directly related to the port'
s maritime facilities at Pier 27.
   (C) Planning, design, and acquisition and construction of
improvements to publicly owned waterfront lands held by trustee
agencies, such as the National Park Service, the California State
Parks, and departments of San Francisco, and used as public spectator
viewing sites for America's Cup-related events, including portions
of the San Francisco Bay Trail under the jurisdiction of those
trustee agencies. Any improvements authorized under this subparagraph
shall not be required to be in the district.
   (D) Future installations of shoreside power facilities on port
maritime facilities.
   (2) A special waterfront district enhanced financing plan for a
Port America's Cup district shall provide that the proceeds of
special waterfront district ERAF-secured debt are restricted for use
to finance directly, reimburse the port for its costs related to, or
refinance other debt incurred in, the construction of the port's
maritime facilities at Pier 27, including public access and public
open-space improvements, and for any other purposes for which the
ERAF share can be used, subject to the set-aside requirements of
paragraph (3).
   (3) Twenty percent in the aggregate of the special waterfront
district ERAF share allocated to a Port America's Cup district under
this section shall be set aside to finance costs of planning, design,
acquisition, and construction of improvements to waterfront lands
owned by federal, state, or local trustee agencies, such as the
National Park Service or the California State Parks as provided in
subparagraph (C) of paragraph (1). Any improvements authorized under
this paragraph are not required to be located in the district.
   (4) The 20 percent set-aside requirements applicable to a special
waterfront district set forth in paragraph (3) are in lieu of the
set-aside requirement set forth in clause (ii) of subparagraph (C) of
paragraph (3) of subdivision (g) of Section 53395.8.
   (5) All improvements authorized by this section in a Port America'
s Cup district shall be deemed to be public facilities of
communitywide significance, which provide significant benefits to an
area larger than the area of the district.
   (d) If any portion of the 20-percent set-aside funds described in
paragraph (3) of subdivision (c) is allocated to a federal or state
trustee agency, both of the following shall apply:
   (1) The special waterfront district enhanced financing plan for
the Port America's Cup district shall specify the portion of the
20-percent set-aside funds described in paragraph (3) of subdivision
(c) that is allocated to any federal or state trustee agency.
However, the trustee agency's proposed use of the 20-percent
set-aside funds does not need to be described in the special
waterfront district enhanced financing plan pursuant to subparagraph
(B) of paragraph (3) of subdivision (g) of Section 53395.8.
   (2) San Francisco shall direct the county tax collector to pay the
20-percent set-aside funds allocated to the federal or state trustee
agency directly to such trustee agency.
   (e) (1) Before adopting the resolution authorizing the first debt
issuance by a Port America's Cup district with a special waterfront
district enhanced financing plan authorized by this section, the
board of supervisors shall submit a fiscal analysis to the California
Infrastructure and Economic Development Bank for review and
approval.
   (2) The bank may circulate the fiscal analysis to other state
agencies, including, but not limited to, the Department of Finance,
the Department of Housing and Community Development, and the Office
of Planning and Research, and solicit their comments and
recommendations. After considering the comments and recommendations
of other state agencies, if any, the bank shall take one of the
following actions:
   (A) Approve the fiscal analysis if the bank makes the finding
required pursuant to paragraph (4).
   (B) Return the fiscal analysis to the board of supervisors with
specific recommendations for changes that would allow the bank to
approve the fiscal analysis.
   (3) The bank shall have 90 days from the receipt of the fiscal
analysis to act pursuant to this subdivision. If the bank does not
act within 90 days, the fiscal analysis shall be deemed approved.
   (4) For bank approval, the fiscal analysis shall demonstrate to
the bank's reasonable satisfaction a reasonable probability that the
economic activity proposed to occur as a result of hosting the
America's Cup event in California would result in an amount of
revenue to the General Fund with a net present value that is greater
than the net present value of the amount of property tax increment
revenues that would be diverted from ERAF over the term of the Port
America's Cup district, taking into consideration all pertinent data.
In reviewing the board's fiscal analysis, the bank shall consider
only those General Fund revenues that would occur because of economic
activity proposed to occur as a result of hosting the America's Cup
event in California. The bank shall not consider those General Fund
revenues that would have occurred if the America's Cup event were not
held in California.
   (5) The legislative body shall reimburse the bank for the
reasonable cost of the review and approval of the fiscal analysis.
   (f) The county tax collector shall allocate and pay to a special
waterfront district the portion of taxes required to be allocated
pursuant to an approved special waterfront district enhanced
financing plan. If the plan allocates 100 percent of the incremental
tax revenue of San Francisco that is available under applicable law
to be allocated to the special waterfront district, then the special
waterfront district shall not make a payment to ERAF, but if the plan
allocates less than 100 percent of the incremental tax revenue of
San Francisco that is available under applicable law to be allocated
to a special waterfront district then the special waterfront district
shall pay a proportionate share of incremental tax revenue into
ERAF. The special waterfront district shall file a statement of
indebtedness and a reconciliation statement annually in the same
manner as described in subdivision (i) of Section 53395.8. It is the
intent of this subdivision that any special waterfront district shall
be deemed to be a district formed pursuant to subparagraph (D) of
paragraph (3) of subdivision (g) of Section 53395.8 for purposes of
allocation and payment of taxes by the county tax collector as set
forth in subdivision (i) of Section 53395.8.
   (g) This section implements and fulfills the intent of Article 2
(commencing with Section 53395.10) and of Article XIII B and is
consistent with the conclusion of California courts that tax
increment revenues are not "proceeds of taxes" for purposes of the
latter. The allocation and payment to a special waterfront district
of the special waterfront district ERAF share for the purpose of
paying principal of, or interest on, loans, advances, or indebtedness
incurred for facilities or the cost of acquisition and construction
of facilities under this section shall not be deemed the receipt by
the special waterfront district of proceeds of taxes levied by or on
behalf of the special waterfront district within the meaning or for
the purposes of Article XIII B of the California Constitution, nor
shall this portion of taxes be deemed the receipt of proceeds of
taxes by, or an appropriation subject to limitation of, any other
public body within the meaning or for purposes of Article XIII B of
the California Constitution or any statutory provision enacted in
implementation of Article XIII B. The allocation and payment to a
special waterfront district of this portion of taxes shall not be
deemed the appropriation by a special waterfront district of proceeds
of taxes levied by or on behalf of a district within the meaning or
for purposes of Article XIII B of the California Constitution.
   (h) For purposes of this section, the meanings set forth in
subdivision (c) of Section 53395.8 shall apply as appropriate, and
the following terms have the following meanings, except as otherwise
provided:
   (1) "Port America's Cup district" means a special waterfront
district in the City and County of San Francisco that includes one or
more of Seawall Lot 330, Pier 19, Pier 23, and Pier 29.
   (2) "Special waterfront district" means a waterfront district in
San Francisco that may comprise some or all of the America's Cup
venues or potential venues.
   (3) "Special waterfront district enhanced financing plan" means an
infrastructure financing plan for a special waterfront district that
contains a provision substantially similar to that authorized for a
Pier 70 district under subparagraph (D) of paragraph (3) of
subdivision (g) of Section 55395.8, with only those changes deemed
necessary by the legislative body of the special waterfront district
to implement the financing of the improvements described in paragraph
(1) of subdivision (c).
   (4) "Special waterfront district ERAF-secured debt" means debt
incurred in accordance with a special waterfront district enhanced
financing plan that is secured by and will be repaid from the special
waterfront district ERAF share. For a Port America's Cup district,
special waterfront district ERAF-secured debt includes the portion of
any debt that is payable from the special waterfront district ERAF
share as long as the same percentage of debt proceeds will be used
for the purposes authorized by paragraph (2) of subdivision (c).
   (5) (A) "Special waterfront ERAF share" means the county ERAF
portion of incremental tax revenue committed, as applicable, to a
special waterfront district under a special waterfront district
enhanced financing plan.
   (B) Notwithstanding any other provision of this chapter, the
maximum amount of the county ERAF portion of incremental tax revenues
committed to a special waterfront district under this section shall
not exceed one million dollars ($1,000,000) in any fiscal year
 , subject to adjustment each fiscal year, after the 2011-12
fiscal year, by the amount of 3 percent  .
  SEC. 3.  Section 53397.71 of the Government Code is amended to
read:
   53397.71.  Notwithstanding the provisions of this article, all of
the following shall apply to the issuance of bonds by a waterfront
district established pursuant to Section 53395.8:
   (a) The legislative body may, by resolution, authorize the
issuance of bonds without holding an election of the voters residing
in the waterfront district.
   (b) The legislative body may undertake the proceedings and actions
described in this article with respect to the district as a whole,
or separately with respect to one or more project areas. If the
legislative body undertakes the proceedings for the district as a
whole, it may thereafter, by resolution, allocate the principal
amount of the authorized bond issuance to one or more project areas
within the district.
   (c) The legislative body may increase the principal amount of
bonds that may be issued for a district or a project area within a
district by undertaking the proceedings in this article, with respect
to that increased amount.

      (d) The bonds of a waterfront district may be sold at a
negotiated sale subject to the notice requirements of Section
53397.10.
  SEC. 4.  (a) The Legislature finds and declares that a special law
is necessary and that a general law cannot be made applicable within
the meaning of Section 16 of Article IV of the California
Constitution because of the unique circumstances of the City and
County of San Francisco. The facts constituting the special
circumstances are:
   Areas of San Francisco, including the portions of the San
Francisco waterfront, are characterized by deteriorating conditions
that cannot be remedied by private investment alone, and require the
use of public financing mechanisms to finance the rectification of
the deteriorating conditions. In order to adapt the provisions of law
governing infrastructure financing districts to these unique
circumstances, this special act is necessary.
   (b) The Legislature finds and declares that this special law is
primarily intended to clarify ambiguities in existing law and,
therefore, the Legislature ratifies any actions taken by San
Francisco consistent with this special law taken prior to its
effective date.