BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 310| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ UNFINISHED BUSINESS Bill No: SB 310 Author: Hancock (D) Amended: 8/29/11 Vote: 21 SENATE GOVERNANCE & FINANCE COMMITTEE : 6-3, 4/27/11 AYES: Wolk, DeSaulnier, Hancock, Hernandez, Kehoe, Liu NOES: Huff, Fuller, La Malfa SENATE FLOOR : 22-17, 5/19/11 AYES: Alquist, Calderon, Corbett, De León, DeSaulnier, Evans, Hancock, Kehoe, Leno, Lieu, Liu, Lowenthal, Padilla, Pavley, Price, Rubio, Simitian, Steinberg, Vargas, Wolk, Wright, Yee NOES: Anderson, Berryhill, Blakeslee, Cannella, Correa, Dutton, Emmerson, Fuller, Gaines, Harman, Huff, La Malfa, Negrete McLeod, Runner, Strickland, Walters, Wyland NO VOTE RECORDED: Hernandez ASSEMBLY FLOOR : 49-27, 09/08/11 - See last page for vote SUBJECT : Local development SOURCE : Author DIGEST : This bill allows cities and counties to create incentives for transit priority projects. Assembly Amendments (1) delete all provisions related to the formation of an infrastructure financing district CONTINUED SB 310 Page 2 (IFD), how an IFD issues bonds and how an IFD functions, (2) clarify that a city may only participate in Transit Priority Project Program (TPPP) if it forms an IFD, and (3) remove the requirement standards for expedited review to be eligible for TPPP funding. ANALYSIS : Existing law: 1. Requires the regional transportation plan for specified regions to include a sustainable communities strategy (SCS), as specified, designed to achieve certain goals for the reduction of greenhouse gas (GHG) emissions from automobiles and light trucks in a region. 2. Provides that an SCS must: A. Identify the general location of uses, residential densities, and building intensities within the region; B. Identify areas within the region sufficient to house all the population of the region, including all economic segments of the population, over the course of the planning period of the regional transportation plan; C. Identify areas within the region sufficient to house an eight-year projection of the regional housing need for the region; D. Identify a transportation network to service the transportation needs of the region; E. Gather and consider the best available scientific information regarding resource areas and farmland in the region; F. Set forth a forecasted development pattern for the region, which, when integrated with the transportation network, and other transportation measures and policies, will reduce GHG emissions from automobiles and light trucks to achieve, if there is a feasible way to do so; and, CONTINUED SB 310 Page 3 G. Quantify the reduction in GHG emissions projected to be achieved by the SCS and, if the SCS does not achieve the targeted reductions in GHG emissions, set forth the difference between the amount that the SCS would reduce GHG emissions and the target for the region. 3. Requires a transit priority project to: (A) contain at least 50 percent residential use, based on total building square footage and, if the project contains between 26 percent and 50 percent nonresidential uses, a floor area ratio of not less than 0.75; (B) provide a minimum net density of at least 20 dwelling units per acre; and, (C) be within one-half mile of a major transit stop or high-quality transit corridor included in a regional transportation plan. 4. Defines "major transit stop" as a site containing an existing rail transit station, a ferry terminal served by either a bus or rail transit service, or the intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods. 5. Authorizes cities and counties to create IFDs and issue bonds to pay for community scale public works: highways, transit, water systems, sewer projects, flood control, child care facilities, libraries, parks, and solid waste facilities. 6. Allows an IFD to divert property tax increment revenues from other local governments, excluding school districts, for up to 30 years, in order to pay back bonds issued by the IFD. 7. Requires any IFD that constructs dwelling units to set aside not less than 20 percent of those units to increase and improve the community's supply of low- and moderate-income housing available at an affordable housing cost to persons and families of low- and moderate-income. This bill: CONTINUED SB 310 Page 4 1. States that it is the intent of the Legislature to provide a process for cities and counties to create development patterns in the form of transit priority projects that comply with the implementation of a SCS, create jobs, reduce vehicle miles traveled, expand the availability of accessible open-space, build the density needed for transit viability, and meet regional housing targets. 2. Establishes the TPPP. 3. Authorizes a city or county to participate in TPPP by adopting an ordinance indicating its intent to participate in the program and by forming and IFD. 4. Requires a city or county, if it elects to participate in TPPP, to amend, if necessary, the general plan and any related specific plan to allow participating developers to build at an increased height of a minimum of three stories within the boundaries of the IFD. 5. Requires a TPPP development project to meet all of the following: A. Is located in a designated transit priority project and within one-half of one mile of a transit station consistent with the implementation of an SCS; B. Is located within a zone in which buildings of three stories or more are authorized; C. Meets State Air Resources Board land use guidelines with respect to distance from major emitters; D. Provides onsite bicycle parking; E. Provides for car sharing if a car sharing program is available in the city or county; F. Provides unbundled parking; G. Provides to all units transit passes for 10 years CONTINUED SB 310 Page 5 as part of the rent or condo fees if transit passes are available from local providers; H. Provides to tenants recycling for bottles, cans, paper, and plastic containers; I. Provides open space onsite, including, but not limited to, accessible roof gardens, or pays a fee into a fund established for local open space; J. Provides 20 percent affordable units in rental or owner occupied housing for low- or moderate-income persons and families, or pays a fee in an amount equivalent to the cost to provide affordable units elsewhere within the city's or county's jurisdiction, as determined by the city or county. Built units require an affordability covenant of 55 years for rental units and 45 years for owner occupied units; and, K. Pays prevailing wages to construction workers for residential projects over 100 units. 6. Requires a development project that meets the criteria for a TPPP to comply with any local design guidelines that were adopted prior to the submission of the project application. 7. Provides that an IFD may reimburse a developer for any permit costs or costs associated with the construction of the affordable housing units in a TPPP. 8. Specifies for the car sharing program the car sharing area may be onsite, or the developer may pay a fee to the city or county to cover the cost of providing for car sharing at an offsite location near the project. The developer is required to provide one car share for the first 20 units and one car share for every 50 units thereafter. 9. Defines "unbundled parking" as renting a parking space for the residential units separately from the residential units, or pays a fee to the appropriate local transit management fund to cover one-half of the CONTINUED SB 310 Page 6 cost of providing a parking space. 10.Prohibits the fee a developer could pay in lieu of providing space from exceeding $0.10 per square foot. 11.Authorizes an IFD to reimburse a developer of a project that is both located entirely within the boundaries of that IFD for any permit expenses incurred pursuant to that TPPP or to offset additional expenses incurred by the developer in constructing affordable housing units. 12.Prohibits a city or county from participating in a TPPP if it: (A) prohibits paying prevailing wages for public works; or, (B) prohibits contractors and others from prehire collective bargaining or similar agreements with labor organizations regarding employment terms and conditions on construction projects. Comments California has a goal of reducing GHG emissions (AB 32 ÝNuñez and Pavley], Chapter 488, Statutes of 2006). Reducing vehicle emissions involves multiple strategies, including clean technology as well as reducing the amount of vehicle miles traveled. Among the ways to reduce vehicle miles is better coordination of transportation and land use plans and increasing the density in existing areas and new development projects. To those ends, the Legislature linked transportation planning and land use planning by state, regional, and local agencies. Metropolitan planning organizations and their constituent counties and cities are preparing sustainable communities strategies. Among the incentives to implement those policies is the opportunity for developers to gain accelerated approval for projects that promote those goals (SB 375 ÝSteinberg], Chapter 728, Statutes of 2008). Building better communities in the new century requires intense collaboration among willing developers, local leaders, and supportive neighbors. The statewide goals launched by AB 32 (Nuñez and Pavley, 2006) need to be translated into well-designed and economically feasible development projects in downtowns, older suburbs, and new development. SB 375 (Steinberg, 2008) pointed the way to CONTINUED SB 310 Page 7 this future by linking transportation and land use planning programs. SB 375 contained incentives for developers who want to build projects that fit state, regional, and local growth policies. This bill encourages builders with projects that meet these goals by allowing local officials to use funds from infrastructure financing districts to pay for the developer's processing fees and the costs of affordable housing. FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local: No SUPPORT : (Verified 9/8/11) American Federation of State, County and Municipal Employees, AFL-CIO California Infill Builders Association (if amended) Metropolitan Transportation Commission Natural Resources Defense Council Paratransit, Inc. San Francisco Bay Area Rapid Transit District Santa Clara Valley Transportation Authority State Building and Construction Trades Council of California TransForm OPPOSITION : (Verified 9/8/11) Associated Builders and Contractors of California Coalition for San Francisco Neighborhoods ARGUMENTS IN SUPPORT : Supporters argue that this bill creates a more flexible development tool to finance needed affordable housing and transit-oriented development projects. Given the "opt-in" nature of IFDs tax increment financing, more local governments will have a voice in if their growth in property tax is allocated, a luxury currently not provided to them under redevelopment law. Paratransit, Inc. states "this bill will help California to achieve its land use and air quality goals as part of SB 375 and AB 32, will encourage transit ridership, and will enhance cooperation between cities, counties, developers, and transit." CONTINUED SB 310 Page 8 ARGUMENTS IN OPPOSITION : Associated Builders and Contractors of California (ABC California) states, "SB 310 requires that to qualify for the economic subsidies offered by this bill, a builder must propose a project that meets more than a dozen conditions, from car sharing to prevailing wages for transit village residences. Currently, contractors are required to pay state-mandated construction wage rates ('prevailing wages') to workers engaged in various occupations allegedly related to public works construction. The definition of public works has been expanded in recent years to include numerous kinds of privately built projects that are obviously not government projects for public use. ABC California also opposes SB 310's proposed new Government Code 65470 (d)(11) that mandates all contractors must pay 'prevailing wages to construction workers for residential projects over 100 units pursuant to Sections 1770, 1773, and 1773.1 of the Labor Code.'" ASSEMBLY FLOOR : 49-27, 09/08/11 AYES: Alejo, Allen, Ammiano, Atkins, Beall, Block, Blumenfield, Bonilla, Bradford, Brownley, Butler, Campos, Cedillo, Chesbro, Davis, Dickinson, Eng, Feuer, Fong, Fuentes, Furutani, Galgiani, Gatto, Gordon, Hall, Hayashi, Roger Hernández, Hill, Huber, Hueso, Huffman, Lara, Bonnie Lowenthal, Ma, Mendoza, Mitchell, Monning, Pan, Perea, V. Manuel Pérez, Portantino, Skinner, Solorio, Swanson, Torres, Wieckowski, Williams, Yamada, John A. Pérez NOES: Achadjian, Bill Berryhill, Conway, Cook, Donnelly, Fletcher, Beth Gaines, Garrick, Grove, Hagman, Halderman, Harkey, Jeffries, Jones, Knight, Logue, Mansoor, Miller, Morrell, Nestande, Nielsen, Norby, Olsen, Silva, Smyth, Valadao, Wagner NO VOTE RECORDED: Buchanan, Charles Calderon, Carter, Gorell AGB:kc 9/9/11 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE CONTINUED SB 310 Page 9 **** END **** CONTINUED