BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                   SB 244|
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                              UNFINISHED BUSINESS


          Bill No:  SB 244
          Author:   Wolk (D), et al
          Amended:  8/30/11
          Vote:     21

           
           SENATE GOVERNANCE & FINANCE COMMITTEE  :  6-3, 4/27/11
          AYES:  Wolk, DeSaulnier, Hancock, Hernandez, Kehoe, Liu
          NOES:  Huff, Fuller, La Malfa

           SENATE APPROPRIATIONS COMMITTEE :  6-3, 5/16/11
          AYES:  Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
          NOES:  Walters, Emmerson, Runner

           SENATE FLOOR  :  25-14, 5/31/11
          AYES:  Alquist, Calderon, Corbett, Correa, De León, 
            DeSaulnier, Evans, Hancock, Hernandez, Kehoe, Leno, Lieu, 
            Liu, Lowenthal, Negrete McLeod, Padilla, Pavley, Price, 
            Rubio, Simitian, Steinberg, Vargas, Wolk, Wright, Yee
          NOES:  Anderson, Blakeslee, Cannella, Dutton, Emmerson, 
            Fuller, Gaines, Harman, Huff, La Malfa, Runner, 
            Strickland, Walters, Wyland
          NO VOTE RECORDED:  Berryhill

           ASSEMBLY FLOOR  :  Not available


           SUBJECT  :    Local Summit:  general plan:  disadvantaged 
          unincorporated 
                      communities

           SOURCE  :     California Rural Legal Assistance Foundation
                      Policy Link
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           DIGEST  :    This bill requires local agencies to plan for 
          specified disadvantaged communities through the Local 
          Agency Formation Commission planning process and general 
          plan updates.

           Assembly Amendments  (1) allow, 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, to borrow money and incur 
          indebtedness pursuant to provisions in the Water Code 
          related to the State Water Pollution Control Revolving 
          Fund; (2) make clarifying and technical changes to the 
          Senate version; and (3) is double-jointed with AB 54 
          (Solorio).  

           ANALYSIS  :    The Cortese-Knox-Hertzberg Act creates a Local 
          Agency Formation Commission (LAFCO) in each county to 
          control the boundaries of cities and most special 
          districts.  To plan for the future boundaries and service 
          areas of the cities and special districts, the LAFCO 
          prepares a municipal service reviews for each entity and 
          use the information to adopt a sphere of influence for each 
          city and special district every five years.  Boundary 
          decisions by the LAFCOs must be consistent with the spheres 
          of influence of the affected cities or districts.  Many 
          disadvantaged unincorporated communities, such as county 
          islands, fringe communities, and isolated inhabited 
          communities, lack many basic public services, such as 
          domestic water, sanitary sewers, paved streets, storm 
          drains, and street lights.  

          This bill:

          1. Defines, for purposes of LAFCO law, the term 
             "disadvantaged unincorporated community" to mean 
             inhabited territory with 12 or more registered voters, 
             or as determined by LAFCO policy, that constitutes all 
             or a portion of a "disadvantaged community," which is 
             defined in the Water Code to be "a community with an 
             annual median household income that is less than 80 
             percent of the statewide annual median household 
             income."

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          2. Prohibits, in specified circumstances, a LAFCO from 
             approving an annexation to a city of any territory 
             greater than 10 acres, or as determined by LAFCO 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.

          3. Specifies that an application to annex a contiguous 
             disadvantaged community is not required if either of the 
             following apply:

             A.    A prior application for annexation of the same 
                disadvantaged community has been made in the 
                preceding five years.

             B.    The LAFCO finds, based upon written evidence, that 
                a majority of the residents within the affected 
                territory are opposed to annexation.

          4. Requires the LAFCO, in determining the sphere of 
             influence of each local agency, to additionally 
             consider, for a city or special district that provides 
             public facilities or services related to sewers, 
             municipal and industrial water, or structural fire 
             protection, the present and probable need for those 
             public facilities and services of any disadvantaged 
             unincorporated communities within the existing sphere of 
             influence, beginning with the next sphere of influence 
             update on or after July 1, 2012.

          5. Allows the LAFCO, in determining a sphere of influence, 
             to 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.

          6. Requires the LAFCO, in the written statement of its 
             determinations for a municipal service review to 
             additionally consider the following:

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             A.    The location and characteristics of any 
                disadvantaged unincorporated communities within or 
                contiguous to the sphere of influence; and, 

             B.    Present and planned capacity of public facilities 
                and adequacy of public services, and 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 agency's 
                proposed sphere of influence.

          7. Allows the LAFCO, in conducting a municipal service 
             review, to 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.

          8. Requires, on or before the due date for the next 
             adoption of its housing element, each city or county to 
             review and update the land use element of its general 
             plan to include all of the following:

             A.    In the case of a city, an identification of each 
                unincorporated island or fringe community, within the 
                city's sphere of influence.

             B.    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.

             C.    Requires that the identification include a 
                description of the community and a map designating 
                its location.

             D.    For each identified community, an analysis of 
                water, wastewater, stormwater drainage, and 
                structural fire protection needs or deficiencies. 

             E.    An analysis, based on then existing available 
                data, of benefit assessment districts or other 

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                financing alternatives that could make the extension 
                of services to identified communities financially 
                feasible.

          9. Requires, on or before the due date for each subsequent 
             revision of its housing element, each city or county to 
             review, and if necessary amend, its general plan to 
             update the analysis, as specified.

          10.Defines, for purposes of general plan law, the following 
             terms:

             A.    "Community" to mean 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.

             B.    "Disadvantaged unincorporated community" to mean a 
                fringe, island, or legacy community in which the 
                median household income is 80 percent or less than 
                the statewide median household income;

             C.    "Unincorporated fringe community" to mean any 
                inhabited and unincorporated territory that is within 
                a city's sphere of influence; and, 

             D.    "Unincorporated island community" to mean 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 
                of the Pacific Ocean.

          11.Allows, 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, to borrow money and 
             incur indebtedness pursuant to provisions in the Water 
             Code related to the State Water Pollution Control 
             Revolving Fund.

          12.Makes legislative findings and declarations.

          13.Contains chaptering out provisions in order to avoid 
             conflicts with AB 54 (Solorio).

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          The most recent amendments to the bill add in provisions 
          that provide explicit statutory authority for cities, 
          counties, and special districts to borrow money and incur 
          indebtedness pursuant to statutes in the Water Code 
          relating to the Clean Water State Revolving Fund Loan 
          Program, for wastewater treatment facilities or services.  
          This enabled disadvantaged communities, like those in the 
          bill, to gain financial assistance for planning costs.  The 
          author's office notes that often these are the same 
          communities that are unable to obtain funding necessary to 
          conduct planning for wastewater infrastructure projects.

           Comments
           
          The U.S. Census Bureau identifies a "census designated 
          place" (CDP) as the statistical counterpart of a city in 
          that it is a named place with a concentration of residents, 
          housing, and commercial activity, but located in a county's 
          unincorporated territory.  The 2000 Census identified 583 
          census designated places in California.  The Department of 
          Finance says that 159 of those CDPs had 2005-09 household 
          median incomes that were less than 80 percent of the 
          statewide household median income.  The 2010 Census 
          identified 1,043 CDPs in California and when fresh income 
          data become available in late 2011, many of them will be 
          considered disadvantaged.
          Some of these disadvantaged unincorporated communities are 
          county islands (mostly surrounded by cities), some are 
          fringe communities (at or near the edge of cities), and 
          others are legacy communities (geographically isolated).

          Proposition 84 (2006) authorized $5.4 billion in state 
          bonds and specifically set aside $90 million for "planning 
          grants and planning incentives."  The Strategic Growth 
          Council manages these programs (SB 732 ÝSteinberg], Chapter 
          729, Statutes of 2008).  The Council has awarded $26 
          million in planning grants.  Concerned about the inequities 
          faced by disadvantaged communities, the Council will 
          prioritize 20 percent of each year's planning grants for 
          work that benefits economically disadvantaged communities.

          Many disadvantaged unincorporated communities lack public 
          services and even public facilities like domestic water, 

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          sanitary sewers, paved streets, storm drains, and street 
          lights.  Some cities and special districts are reluctant to 
          annex these areas.  Advocates want legislators to require 
          local officials to include disadvantaged communities in 
          their long-range planning for land use and public 
          facilities.

           Prior Legislation
           
          SB 1174 (Wolk), of 2010, concentrated on local general 
          plans; the bill died on the Assembly Appropriations 
          Committee's suspense file.

          AB 853 (Arambula), of 2010, focused on the LAFCOs' 
          municipal service reviews, spheres of influence, and city 
          annexation procedures; Governor Schwarzenegger vetoed the 
          bill as "unnecessary."

          SB 194 (Florez), of 2010, looked at disadvantaged 
          communities' needs for public works funding; Governor 
          Schwarzenegger vetoed the bill as "unnecessary."

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  Yes

                          Fiscal Impact (in thousands)

           Major Provisions                2011-12     2012-13    
           2013-14   Fund  

          Local planning mandate                                 
          significant local costs, not reimbursable              
          Local

           SUPPORT  :   (Verified  9/8/11)

          California Rural Legal Assistance Foundation (co-source)
          Policy Link (co-source)
          California Coalition for Rural Housing
          California Pan-Ethnic Health Network
          Catholic Charities Diocese of Stockton
          Clean Water Action California
          Committee for a Better Seville
          Community Water Center

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          Environmental Justice Coalition for Water
          Food and Water Watch
          Green California
          Having Our Say
          Natural Resources Defense Council 
          Planning and Conservation League
          Sierra Club
          Southern California Watershed Alliance
          Unitarian Universalist Legislative Ministry California
          United for Change in Tooleville
          Urban Habitat
          Urban Semillas
          Winnemem Winti Tribe - Middle River People

           OPPOSITION  :    (Verified  9/8/11)

          City of Fresno, Gilroy, Merced, Sacramento, Santa Rosa, 
            Vacaville, Visalia, Vista, Wasco, Waterford, West Covina, 
            Whittier
          County of Los Angeles
          Cucamonga Valley Water District
          League of CA Cities
          Orange County Local Agency Formation Commission
          Riverside Local Agency Formation Commission
          San Bernardino County Local Agency Formation Commission
          San Diego Local Agency Formation Commission

           ARGUMENTS IN SUPPORT  :    According to the author's office, 
          many disadvantaged unincorporated communities lack public 
          services and even public facilities like domestic water, 
          sanitary sewers, paved streets, storm drains, and street 
          lights.  Some cities and special districts are reluctant to 
          annex these areas.  The intent of this bill is to require 
          local officials to include disadvantaged communities in 
          their long-range planning for land use and public 
          facilities.

          Additionally, this bill provides authority for local 
          governments to access the Clean Water State Revolving Fund 
          (CWSRF) Loan Program for planning costs to implement 
          infrastructure projects.  This would give disadvantaged 
          communities with limited access to capital markets the 
          ability to undertake planning for capital wastewater 
          projects and level the playing field for various classes of 

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          local government.

          The sponsor of the bill, the California Rural Legal 
          Assistance Foundation, argues that "these communities are 
          systematically underserved in the overall allocation of 
          public resources and are frequently left out of local 
          planning processes?this neglect and deprivation prevents 
          these neighborhoods from realizing their potential as 
          livable and economically viable communities."

          Supporters argue that few local government land use plans 
          focus on the existence of disadvantaged unincorporated 
          communities, much less how to solve their many challenges.  
          This bill will result in greater awareness of these 
          communities and their needs in local government planning 
          documents.

           ARGUMENTS IN OPPOSITION  :    The League of California Cities 
          (League), in opposition, believes that local agencies do 
          not have the legal authority to impose fees to recover the 
          costs of the new duties mandated in the bill.  The bill's 
          provisions right now include a fee disclaimer that says 
          that "no reimbursement is required by this act?.because a 
          local agency has the authority to levy service charges, 
          fees or assessments sufficient to pay for the program or 
          level of service mandated by this act."  The League is 
          concerned that cities, under the new rules dictated by 
          Proposition 26, cannot charge current residents of the city 
          for the costs associated with the considerable analysis 
          required by the bill's provisions since the residents of 
          the city are not being provided a service.

          The County of Los Angeles opposes this bill because the 
          County believes it to be both costly and burdensome.  They 
          argue they already have a long term plan for all 
          unincorporated areas and that the bill does not adequately 
          address the fiscal strains the bill would place on already 
          distressed counties, cities, communities and taxpayers.  
           

          AGB:DLW:do  9/8/11   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE


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