BILL NUMBER: SB 244	ENROLLED
	BILL TEXT

	PASSED THE SENATE  SEPTEMBER 9, 2011
	PASSED THE ASSEMBLY  SEPTEMBER 9, 2011
	AMENDED IN ASSEMBLY  SEPTEMBER 8, 2011
	AMENDED IN ASSEMBLY  AUGUST 30, 2011
	AMENDED IN ASSEMBLY  AUGUST 15, 2011
	AMENDED IN ASSEMBLY  JULY 1, 2011
	AMENDED IN ASSEMBLY  JUNE 23, 2011
	AMENDED IN ASSEMBLY  JUNE 14, 2011
	AMENDED IN SENATE  MAY 18, 2011
	AMENDED IN SENATE  MAY 3, 2011
	AMENDED IN SENATE  APRIL 25, 2011
	AMENDED IN SENATE  MARCH 15, 2011

INTRODUCED BY   Senator Wolk
   (Coauthors: Senators Price and Rubio)
   (Coauthors: Assembly Members Fong, Perea, and V. Manuel Pérez)

                        FEBRUARY 10, 2011

   An act to amend Sections 56375, 56425, and 56430 of, and to add
Sections 53082.5, 56033.5, and 65302.10 to, the Government Code, and
to add Section 13481.7 to the Water Code, relating to local
government.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 244, Wolk. Local government: land use: general plan:
disadvantaged unincorporated communities.
   (1) The Planning and Zoning Law requires a city or county to adopt
a comprehensive, long-term general plan for the physical development
of the city or county and of any land outside its boundaries that
bears relation to its planning. That law also requires the general
plan to contain specified mandatory elements, including a housing
element for the preservation, improvement, and development of the
community's housing.
   This bill would require, on or before the next adoption of its
housing element, a city or county to review and update the land use
element of its general plan to include an analysis of the presence of
island, fringe, or legacy unincorporated communities, as defined,
and would require the updated general plan to include specified
information. This bill would also require the city or county planning
agency, after the initial revision and update of the general plan,
to review, and if necessary amend, the general plan to update the
information, goals, and program of action relating to these
communities therein. By adding to the duties of city and county
officials, this bill would impose a state-mandated local program.
   (2) The Cortese-Knox-Hertzberg Act of 2000 requires a local agency
formation commission to develop and determine the sphere of
influence of each local governmental agency within the county and to
enact policies designed to promote the logical and orderly
development of areas within the sphere, and requires the commission,
in preparing and updating spheres of influence to conduct a service
review of the municipal services provided in the county or other area
designated by the commission, and to prepare a written statement of
its determinations with respect to the growth and population
projections for the affected area, the present and planned capacity
of public facilities and adequacy of public services, including
infrastructure needs or deficiencies, financial ability of agencies
to provide services, status of, and opportunities for, shared
facilities, accountability for community service needs, including
governmental structure, and operational efficiencies, as specified.
   This bill would also require the agency to include in its written
statement a determination with respect to the location and
characteristics and the present and planned capacity of public
facilities and adequacy of public services, including sewers, water,
and structural fire protection needs or deficiencies, of any
disadvantaged unincorporated communities within or adjacent to the
sphere of influence, thereby imposing a state-mandated local program.
The bill would also require a commission, upon the review and update
of a sphere of influence on or after July 1, 2012, to include in the
review or update of each sphere of influence of a city or special
district that provides public facilities or services related to
sewers, municipal and industrial water, or structural fire protection
to include the present and probable need for public facilities and
services of disadvantaged unincorporated communities within or
adjacent to the sphere of influence, and would authorize the agency
to assess the feasibility of governmental reorganization of
particular agencies, as specified.
   (3) Existing law generally grants various powers to cities,
counties, and certain special districts, including the power to issue
bonds and incur indebtedness for certain purposes and subject to
certain restrictions.
   Existing law continuously appropriates state and federal funds in
the State Water Pollution Control Revolving Fund to the State Water
Resources Control Board for loans and other financial assistance for
the construction of publicly owned treatment works and other related
purposes, to a municipality, intermunicipal agency, interstate
agency, or state agency in accordance with the federal Clean Water
Act and the Porter-Cologne Water Quality Control Act.
   This bill would authorize those public agencies, including
counties, cities, and special districts, subject to applicable
constitutional restrictions, to borrow money and incur indebtedness
for purposes of the State Water Pollution Control Revolving Fund.
   (4) This bill would incorporate changes to Sections 56375 and
56430 of the Government Code proposed by this bill and AB 54, to be
operative if both bills are enacted and become operative as
specified.
   (5) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.



THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  (a) The Legislature finds and declares all of the
following:
   (1) Hundreds of disadvantaged unincorporated communities, commonly
referred to as "colonias," exist in California. There are more than
200 of these communities in the San Joaquin Valley alone. Many of
these communities are geographically isolated islands, surrounded by
the city limits of large and medium-sized cities.
   (2) Conditions within these disadvantaged unincorporated
communities evidence a distinct lack of public and private investment
that threatens the health and safety of the residents of these
communities and fosters economic, social, and educational inequality.
Many of these communities lack basic infrastructure, including, but
not limited to, streets, sidewalks, storm drainage, clean drinking
water, and adequate sewer service.
   (3) The Clean Water State Revolving Fund, the Safe Drinking Water
State Revolving Fund, and the Community Development Block Grant are
robust and continuous sources of funding for drinking water,
wastewater, and other basic infrastructure.
   (b) It is the intent of the Legislature to encourage investment in
these communities and address the complex legal, financial, and
political barriers that contribute to regional inequity and
infrastructure deficits within disadvantaged unincorporated
communities.
  SEC. 2.  Section 53082.5 is added to the Government Code, to read:
   53082.5.  Subject to all applicable constitutional restrictions, a
county, a city, or a special district that provides, or intends to
provide, wastewater treatment facilities or services may borrow money
and incur indebtedness pursuant to Chapter 6.5 (commencing with
Section 13475) of Division 7 of the Water Code.
  SEC. 3.  Section 56033.5 is added to the Government Code, to read:
   56033.5.  "Disadvantaged unincorporated community" means inhabited
territory, as defined by Section 56046, or as determined by
commission policy, that constitutes all or a portion of a
"disadvantaged community" as defined by Section 79505.5 of the Water
Code.
  SEC. 4.  Section 56375 of the Government Code is amended to read:
   56375.  The commission shall have all of the following powers and
duties subject to any limitations upon its jurisdiction set forth in
this part:
   (a) (1) To review and approve with or without amendment, wholly,
partially, or conditionally, or disapprove proposals for changes of
organization or reorganization, consistent with written policies,
procedures, and guidelines adopted by the commission.
   (2) The commission may initiate proposals by resolution of
application for any of the following:
   (A) The consolidation of a district, as defined in Section 56036.
   (B) The dissolution of a district.
   (C) A merger.
   (D) The establishment of a subsidiary district.
   (E) The formation of a new district or districts.
   (F) A reorganization that includes any of the changes specified in
subparagraph (A), (B), (C), (D), or (E).
   (3) A commission may initiate a proposal described in paragraph
(2) only if that change of organization or reorganization is
consistent with a recommendation or conclusion of a study prepared
pursuant to Section 56378, 56425, or 56430, and the commission makes
the determinations specified in subdivision (b) of Section 56881.
   (4) A commission shall not disapprove an annexation to a city,
initiated by resolution, of contiguous territory that the commission
finds is any of the following:
   (A) Surrounded or substantially surrounded by the city to which
the annexation is proposed or by that city and a county boundary or
the Pacific Ocean if the territory to be annexed is substantially
developed or developing, is not prime agricultural land as defined in
Section 56064, is designated for urban growth by the general plan of
the annexing city, and is not within the sphere of influence of
another city.
   (B) Located within an urban service area that has been delineated
and adopted by a commission, which is not prime agricultural land, as
defined by Section 56064, and is designated for urban growth by the
general plan of the annexing city.
   (C) An annexation or reorganization of unincorporated islands
meeting the requirements of Section 56375.3.
   (5) As a condition to the annexation of an area that is
surrounded, or substantially surrounded, by the city to which the
annexation is proposed, the commission may require, where consistent
with the purposes of this division, that the annexation include the
entire island of surrounded, or substantially surrounded, territory.
   (6) A commission shall not impose any conditions that would
directly regulate land use density or intensity, property
development, or subdivision requirements.
   (7) The decision of the commission with regard to a proposal to
annex territory to a city shall be based upon the general plan and
prezoning of the city. When the development purposes are not made
known to the annexing city, the annexation shall be reviewed on the
basis of the adopted plans and policies of the annexing city or
county. A commission shall require, as a condition to annexation,
that a city prezone the territory to be annexed or present evidence
satisfactory to the commission that the existing development
entitlements on the territory are vested or are already at build-out,
and are consistent with the city's general plan. However, the
commission shall not specify how, or in what manner, the territory
shall be prezoned.
   (8) (A) Except for those changes of organization or reorganization
authorized under Section 56375.3, and except as provided by
subparagraph (B), a commission shall not approve an annexation to a
city of any territory greater than 10 acres, or as determined by
commission policy, where there exists a disadvantaged unincorporated
community that is contiguous to the area of proposed annexation,
unless an application to annex the disadvantaged unincorporated
community to the subject city has been filed with the executive
officer.
   (B) An application to annex a contiguous disadvantaged community
shall not be required if either of the following apply:
   (i) A prior application for annexation of the same disadvantaged
community has been made in the preceding five years.
   (ii) The commission finds, based upon written evidence, that a
majority of the residents within the affected territory are opposed
to annexation.
   (b) With regard to a proposal for annexation or detachment of
territory to, or from, a city or district or with regard to a
proposal for reorganization that includes annexation or detachment,
to determine whether territory proposed for annexation or detachment,
as described in its resolution approving the annexation, detachment,
or reorganization, is inhabited or uninhabited.
   (c) With regard to a proposal for consolidation of two or more
cities or districts, to determine which city or district shall be the
consolidated successor city or district.
   (d) To approve the annexation of unincorporated, noncontiguous
territory, subject to the limitations of Section 56742, located in
the same county as that in which the city is located, and that is
owned by a city and used for municipal purposes and to authorize the
annexation of the territory without notice and hearing.
   (e) To approve the annexation of unincorporated territory
consistent with the planned and probable use of the property based
upon the review of general plan and prezoning designations. No
subsequent change may be made to the general plan for the annexed
territory or zoning that is not in conformance to the prezoning
designations for a period of two years after the completion of the
annexation, unless the legislative body for the city makes a finding
at a public hearing that a substantial change has occurred in
circumstances that necessitate a departure from the prezoning in the
application to the commission.
   (f) With respect to the incorporation of a new city or the
formation of a new special district, to determine the number of
registered voters residing within the proposed city or special
district or, for a landowner-voter special district, the number of
owners of land and the assessed value of their land within the
territory proposed to be included in the new special district. The
number of registered voters shall be calculated as of the time of the
last report of voter registration by the county elections official
to the Secretary of State prior to the date the first signature was
affixed to the petition. The executive officer shall notify the
petitioners of the number of registered voters resulting from this
calculation. The assessed value of the land within the territory
proposed to be included in a new landowner-voter special district
shall be calculated as shown on the last equalized assessment roll.
   (g) To adopt written procedures for the evaluation of proposals,
including written definitions consistent with existing state law. The
commission may adopt standards for any of the factors enumerated in
Section 56668. Any standards adopted by the commission shall be
written.
   (h) To adopt standards and procedures for the evaluation of
service plans submitted pursuant to Section 56653 and the initiation
of a change of organization or reorganization pursuant to subdivision
(a).
   (i) To make and enforce regulations for the orderly and fair
conduct of hearings by the commission.
   (j) To incur usual and necessary expenses for the accomplishment
of its functions.
   (k) To appoint and assign staff personnel and to employ or
contract for professional or consulting services to carry out and
effect the functions of the commission.
   (  l  ) To review the boundaries of the territory
involved in any proposal with respect to the definiteness and
certainty of those boundaries, the nonconformance of proposed
boundaries with lines of assessment or ownership, and other similar
matters affecting the proposed boundaries.
   (m) To waive the restrictions of Section 56744 if it finds that
the application of the restrictions would be detrimental to the
orderly development of the community and that the area that would be
enclosed by the annexation or incorporation is so located that it
cannot reasonably be annexed to another city or incorporated as a new
city.
   (n) To waive the application of Section 22613 of the Streets and
Highways Code if it finds the application would deprive an area of a
service needed to ensure the health, safety, or welfare of the
residents of the area and if it finds that the waiver would not
affect the ability of a city to provide any service. However, within
60 days of the inclusion of the territory within the city, the
legislative body may adopt a resolution nullifying the waiver.
   (o) If the proposal includes the incorporation of a city, as
defined in Section 56043, or the formation of a district, as defined
in Section 2215 of the Revenue and Taxation Code, the commission
shall determine the property tax revenue to be exchanged by the
affected local agencies pursuant to Section 56810.
   (p) To authorize a city or district to provide new or extended
services outside its jurisdictional boundaries pursuant to Section
56133.
   (q) To enter into an agreement with the commission for an
adjoining county for the purpose of determining procedures for the
consideration of proposals that may affect the adjoining county or
where the jurisdiction of an affected agency crosses the boundary of
the adjoining county.
  SEC. 4.5.  Section 56375 of the Government Code is amended to read:

   56375.  The commission shall have all of the following powers and
duties subject to any limitations upon its jurisdiction set forth in
this part:
   (a) (1) To review and approve with or without amendment, wholly,
partially, or conditionally, or disapprove proposals for changes of
organization or reorganization, consistent with written policies,
procedures, and guidelines adopted by the commission.
   (2) The commission may initiate proposals by resolution of
application for any of the following:
   (A) The consolidation of a district, as defined in Section 56036.
   (B) The dissolution of a district.
   (C) A merger.
   (D) The establishment of a subsidiary district.
   (E) The formation of a new district or districts.
   (F) A reorganization that includes any of the changes specified in
subparagraph (A), (B), (C), (D), or (E).
   (3) A commission may initiate a proposal described in paragraph
(2) only if that change of organization or reorganization is
consistent with a recommendation or conclusion of a study prepared
pursuant to Section 56378, 56425, or 56430, and the commission makes
the determinations specified in subdivision (b) of Section 56881.
   (4) A commission shall not disapprove an annexation to a city,
initiated by resolution, of contiguous territory that the commission
finds is any of the following:
   (A) Surrounded or substantially surrounded by the city to which
the annexation is proposed or by that city and a county boundary or
the Pacific Ocean if the territory to be annexed is substantially
developed or developing, is not prime agricultural land as defined in
Section 56064, is designated for urban growth by the general plan of
the annexing city, and is not within the sphere of influence of
another city.
   (B) Located within an urban service area that has been delineated
and adopted by a commission, which is not prime agricultural land, as
defined by Section 56064, and is designated for urban growth by the
general plan of the annexing city.
   (C) An annexation or reorganization of unincorporated islands
meeting the requirements of Section 56375.3.
   (5) As a condition to the annexation of an area that is
surrounded, or substantially surrounded, by the city to which the
annexation is proposed, the commission may require, where consistent
with the purposes of this division, that the annexation include the
entire island of surrounded, or substantially surrounded, territory.
   (6) A commission shall not impose any conditions that would
directly regulate land use density or intensity, property
development, or subdivision requirements.
   (7) The decision of the commission with regard to a proposal to
annex territory to a city shall be based upon the general plan and
prezoning of the city. When the development purposes are not made
known to the annexing city, the annexation shall be reviewed on the
basis of the adopted plans and policies of the annexing city or
county. A commission shall require, as a condition to annexation,
that a city prezone the territory to be annexed or present evidence
satisfactory to the commission that the existing development
entitlements on the territory are vested or are already at build-out,
and are consistent with the city's general plan. However, the
commission shall not specify how, or in what manner, the territory
shall be prezoned.
   (8) (A) Except for those changes of organization or reorganization
authorized under Section 56375.3, and except as provided by
subparagraph (B), a commission shall not approve an annexation to a
city of any territory greater than 10 acres, or as determined by
commission policy, where there exists a disadvantaged unincorporated
community that is contiguous to the area of proposed annexation,
unless an application to annex the disadvantaged unincorporated
community to the subject city has been filed with the executive
officer.
   (B) An application to annex a contiguous disadvantaged community
shall not be required if either of the following apply:
   (i) A prior application for annexation of the same disadvantaged
community has been made in the preceding five years.
   (ii) The commission finds, based upon written evidence, that a
majority of the residents within the affected territory are opposed
to annexation.
   (b) With regard to a proposal for annexation or detachment of
territory to, or from, a city or district or with regard to a
proposal for reorganization that includes annexation or detachment,
to determine whether territory proposed for annexation or detachment,
as described in its resolution approving the annexation, detachment,
or reorganization, is inhabited or uninhabited.
   (c) With regard to a proposal for consolidation of two or more
cities or districts, to determine which city or district shall be the
consolidated successor city or district.
   (d) To approve the annexation of unincorporated, noncontiguous
territory, subject to the limitations of Section 56742, located in
the same county as that in which the city is located, and that is
owned by a city and used for municipal purposes and to authorize the
annexation of the territory without notice and hearing.
   (e) To approve the annexation of unincorporated territory
consistent with the planned and probable use of the property based
upon the review of general plan and prezoning designations. No
subsequent change may be made to the general plan for the annexed
territory or zoning that is not in conformance to the prezoning
designations for a period of two years after the completion of the
annexation, unless the legislative body for the city makes a finding
at a public hearing that a substantial change has occurred in
circumstances that necessitate a departure from the prezoning in the
application to the commission.
   (f) With respect to the incorporation of a new city or the
formation of a new special district, to determine the number of
registered voters residing within the proposed city or special
district or, for a landowner-voter special district, the number of
owners of land and the assessed value of their land within the
territory proposed to be included in the new special district. The
number of registered voters shall be calculated as of the time of the
last report of voter registration by the county elections official
to the Secretary of State prior to the date the first signature was
affixed to the petition. The executive officer shall notify the
petitioners of the number of registered voters resulting from this
calculation. The assessed value of the land within the territory
proposed to be included in a new landowner-voter special district
shall be calculated as shown on the last equalized assessment roll.
   (g) To adopt written procedures for the evaluation of proposals,
including written definitions consistent with existing state law. The
commission may adopt standards for any of the factors enumerated in
Section 56668. Any standards adopted by the commission shall be
written.
   (h) To adopt standards and procedures for the evaluation of
service plans submitted pursuant to Section 56653 and the initiation
of a change of organization or reorganization pursuant to subdivision
(a).
   (i) To make and enforce regulations for the orderly and fair
conduct of hearings by the commission.
   (j) To incur usual and necessary expenses for the accomplishment
of its functions.
   (k) To appoint and assign staff personnel and to employ or
contract for professional or consulting services to carry out and
effect the functions of the commission.
   (  l ) To review the boundaries of the territory involved
in any proposal with respect to the definiteness and certainty of
those boundaries, the nonconformance of proposed boundaries with
lines of assessment or ownership, and other similar matters affecting
the proposed boundaries.
   (m) To waive the restrictions of Section 56744 if it finds that
the application of the restrictions would be detrimental to the
orderly development of the community and that the area that would be
enclosed by the annexation or incorporation is so located that it
cannot reasonably be annexed to another city or incorporated as a new
city.
   (n) To waive the application of Section 22613 of the Streets and
Highways Code if it finds the application would deprive an area of a
service needed to ensure the health, safety, or welfare of the
residents of the area and if it finds that the waiver would not
affect the ability of a city to provide any service. However, within
60 days of the inclusion of the territory within the city, the
legislative body may adopt a resolution nullifying the waiver.
   (o) If the proposal includes the incorporation of a city, as
defined in Section 56043, or the formation of a district, as defined
in Section 2215 of the Revenue and Taxation Code, the commission
shall determine the property tax revenue to be exchanged by the
affected local agencies pursuant to Section 56810.
   (p) To authorize a city or district to provide new or extended
services outside its jurisdictional boundaries pursuant to Section
56133.
   (q) To enter into an agreement with the commission for an
adjoining county for the purpose of determining procedures for the
consideration of proposals that may affect the adjoining county or
where the jurisdiction of an affected agency crosses the boundary of
the adjoining county.
   (r) To approve with or without amendment, wholly, partially, or
conditionally, or disapprove pursuant to this section the annexation
of territory served by a mutual water company formed pursuant to Part
7 (commencing with Section 14300) of Division 3 of Title 1 of the
Corporations Code that operates a public water system to a city or
special district. Any annexation approved in accordance with this
subdivision shall be subject to the state and federal constitutional
prohibitions against the taking of private property without the
payment of just compensation. This subdivision shall not impair the
authority of a public agency or public utility to exercise eminent
domain authority.
  SEC. 5.  Section 56425 of the Government Code is amended to read:
   56425.  (a) In order to carry out its purposes and
responsibilities for planning and shaping the logical and orderly
development and coordination of local governmental agencies to
advantageously provide for the present and future needs of the county
and its communities, the commission shall develop and determine the
sphere of influence of each local governmental agency within the
county and enact policies designed to promote the logical and orderly
development of areas within the sphere.
   (b) Prior to a city submitting an application to the commission to
update its sphere of influence, representatives from the city and
representatives from the county shall meet to discuss the proposed
new boundaries of the sphere and explore methods to reach agreement
on development standards and planning and zoning requirements within
the sphere to ensure that development within the sphere occurs in a
manner that reflects the concerns of the affected city and is
accomplished in a manner that promotes the logical and orderly
development of areas within the sphere. If an agreement is reached
between the city and county, the city shall forward the agreement in
writing to the commission, along with the application to update the
sphere of influence. The commission shall consider and adopt a sphere
of influence for the city consistent with the policies adopted by
the commission pursuant to this section, and the commission shall
give great weight to the agreement to the extent that it is
consistent with commission policies in its final determination of the
city sphere.
   (c) If the commission's final determination is consistent with the
agreement reached between the city and county pursuant to
subdivision (b), the agreement shall be adopted by both the city and
county after a noticed public hearing. Once the agreement has been
adopted by the affected local agencies and their respective general
plans reflect that agreement, then any development approved by the
county within the sphere shall be consistent with the terms of that
agreement.
   (d) If no agreement is reached pursuant to subdivision (b), the
application may be submitted to the commission and the commission
shall consider a sphere of influence for the city consistent with the
policies adopted by the commission pursuant to this section.
   (e) In determining the sphere of influence of each local agency,
the commission shall consider and prepare a written statement of its
determinations with respect to each of the following:
   (1) The present and planned land uses in the area, including
agricultural and open-space lands.
   (2) The present and probable need for public facilities and
services in the area.
   (3) The present capacity of public facilities and adequacy of
public services that the agency provides or is authorized to provide.

   (4) The existence of any social or economic communities of
interest in the area if the commission determines that they are
relevant to the agency.
   (5) For an update of a sphere of influence of a city or special
district that provides public facilities or services related to
sewers, municipal and industrial water, or structural fire
protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities
and services of any disadvantaged unincorporated communities within
the existing sphere of influence.
   (f) Upon determination of a sphere of influence, the commission
shall adopt that sphere.
   (g) On or before January 1, 2008, and every five years thereafter,
the commission shall, as necessary, review and update each sphere of
influence.
   (h) In determining a sphere of influence, the commission may
assess the feasibility of governmental reorganization of particular
agencies and recommend reorganization of those agencies when
reorganization is found to be feasible and if reorganization will
further the goals of orderly development and efficient and affordable
service delivery. The commission shall make all reasonable efforts
to ensure wide public dissemination of the recommendations.
   (i) When adopting, amending, or updating a sphere of influence for
a special district, the commission shall do all of the following:
   (1) Require existing districts to file written statements with the
commission specifying the functions or classes of services provided
by those districts.
   (2) Establish the nature, location, and extent of any functions or
classes of services provided by existing districts.
  SEC. 6.  Section 56430 of the Government Code is amended to read:
   56430.  (a) In order to prepare and to update spheres of influence
in accordance with Section 56425, the commission shall conduct a
service review of the municipal services provided in the county or
other appropriate area designated by the commission. The commission
shall include in the area designated for service review the county,
the region, the subregion, or any other geographic area as is
appropriate for an analysis of the service or services to be
reviewed, and shall prepare a written statement of its determinations
with respect to each of the following:

          (1) Growth and population projections for the affected
area.
   (2) The location and characteristics of any disadvantaged
unincorporated communities within or contiguous to the sphere of
influence.
   (3) Present and planned capacity of public facilities, adequacy of
public services, and infrastructure needs or deficiencies including
needs or deficiencies related to sewers, municipal and industrial
water, and structural fire protection in any disadvantaged
unincorporated communities within or contiguous to the sphere of
influence.
   (4) Financial ability of agencies to provide services.
   (5) Status of, and opportunities for, shared facilities.
   (6) Accountability for community service needs, including
governmental structure and operational efficiencies.
   (7) Any other matter related to effective or efficient service
delivery, as required by commission policy.
   (b) In conducting a service review, the commission shall
comprehensively review all of the agencies that provide the
identified service or services within the designated geographic area.
The commission may assess various alternatives for improving
efficiency and affordability of infrastructure and service delivery
within and contiguous to the sphere of influence, including, but not
limited to, the consolidation of governmental agencies.
   (c) The commission shall conduct a service review before, or in
conjunction with, but no later than the time it is considering an
action to establish a sphere of influence in accordance with Section
56425 or Section 56426.5 or to update a sphere of influence pursuant
to Section 56425.
  SEC. 6.5.  Section 56430 of the Government Code is amended to read:

   56430.  (a) In order to prepare and to update spheres of influence
in accordance with Section 56425, the commission shall conduct a
service review of the municipal services provided in the county or
other appropriate area designated by the commission. The commission
shall include in the area designated for service review the county,
the region, the subregion, or any other geographic area as is
appropriate for an analysis of the service or services to be
reviewed, and shall prepare a written statement of its determinations
with respect to each of the following:
   (1) Growth and population projections for the affected area.
   (2) The location and characteristics of any disadvantaged
unincorporated communities within or contiguous to the sphere of
influence.
   (3) Present and planned capacity of public facilities, adequacy of
public services, and infrastructure needs or deficiencies including
needs or deficiencies related to sewers, municipal and industrial
water, and structural fire protection in any disadvantaged,
unincorporated communities within or contiguous to the sphere of
influence.
   (4) Financial ability of agencies to provide services.
   (5) Status of, and opportunities for, shared facilities.
   (6) Accountability for community service needs, including
governmental structure and operational efficiencies.
   (7) Any other matter related to effective or efficient service
delivery, as required by commission policy.
   (b) In conducting a service review, the commission shall
comprehensively review all of the agencies that provide the
identified service or services within the designated geographic area.
The commission may assess various alternatives for improving
efficiency and affordability of infrastructure and service delivery
within and contiguous to the sphere of influence, including, but not
limited to, the consolidation of governmental agencies.
   (c) In conducting a service review, the commission may include a
review of whether the agencies under review, including any public
water system as defined in Section 116275, are in compliance with the
California Safe Drinking Water Act (Chapter 4 (commencing with
Section 116270) of Part 12 of Division 104 of the Health and Safety
Code). A public water system may satisfy any request for information
as to compliance with that act by submission of the consumer
confidence or water quality report prepared by the public water
system as provided by Section 116470 of the Health and Safety Code.
   (d) The commission may request information, as part of a service
review under this section, from identified public or private entities
that provide wholesale or retail supply of drinking water, including
mutual water companies formed pursuant to Part 7 (commencing with
Section 14300) of Division 3 of Title 1 of the Corporations Code, and
private utilities, as defined in Section 1502 of the Public
Utilities Code.
   (e) The commission shall conduct a service review before, or in
conjunction with, but no later than the time it is considering an
action to establish a sphere of influence in accordance with Section
56425 or 56426.5 or to update a sphere of influence pursuant to
Section 56425.
  SEC. 7.  Section 65302.10 is added to the Government Code, to read:

   65302.10.  (a) As used in this section, the following terms shall
have the following meanings:
   (1) "Community" means an inhabited area within a city or county
that is comprised of no less than 10 dwellings adjacent or in close
proximity to one another.
   (2) "Disadvantaged unincorporated community" means a fringe,
island, or legacy community in which the median household income is
80 percent or less than the statewide median household income.
   (3) "Unincorporated fringe community" means any inhabited and
unincorporated territory that is within a city's sphere of influence.

   (4) "Unincorporated island community" means any inhabited and
unincorporated territory that is surrounded or substantially
surrounded by one or more cities or by one or more cities and a
county boundary or the Pacific Ocean.
   (5) "Unincorporated legacy community" means a geographically
isolated community that is inhabited and has existed for at least 50
years.
   (b) On or before the due date for the next adoption of its housing
element pursuant to Section 65588, each city or county shall review
and update the land use element of its general plan to include all of
the following:
   (1) In the case of a city, an identification of each
unincorporated island or fringe community within the city's sphere of
influence. In the case of a county, an identification of each legacy
community within the boundaries of the county, but not including any
area within the sphere of influence of any city. This identification
shall include a description of the community and a map designating
its location.
   (2) For each identified community, an analysis of water,
wastewater, stormwater drainage, and structural fire protection needs
or deficiencies.
   (3) An analysis, based on then existing available data, of benefit
assessment districts or other financing alternatives that could make
the extension of services to identified communities financially
feasible.
   (c) On or before the due date for each subsequent revision of its
housing element pursuant to Section 65588, each city and county shall
review, and if necessary amend, its general plan to update the
analysis required by this section.
  SEC. 8.  Section 13481.7 is added to the Water Code, to read:
   13481.7.  Subject to all applicable constitutional restrictions, a
municipality may borrow money and incur indebtedness pursuant to
this chapter.
  SEC. 9.  Section 4.5 of this bill incorporates amendments to
Section 56375 of the Government Code proposed by both this bill and
Assembly Bill 54. It shall only become operative if (1) both bills
are enacted and become effective on or before January 1, 2012, (2)
each bill amends Section 56375 of the Government Code, and (3) this
bill is enacted after Assembly Bill 54, in which case Section 4 of
this bill shall not become operative.
  SEC. 10.  Section 6.5 of this bill incorporates amendments to
Section 56430 of the Government Code proposed by both this bill and
Assembly Bill 54. It shall only become operative if (1) both bills
are enacted and become effective on or before January 1, 2012, (2)
each bill amends Section 56430 of the Government Code, and (3) this
bill is enacted after Assembly Bill 54, in which case Section 6 of
this bill shall not become operative.
  SEC. 11.   No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because a
local agency or school district has the authority to levy service
charges, fees, or assessments sufficient to pay for the program or
level of service mandated by this act, within the meaning of Section
17556 of the Government Code.