BILL ANALYSIS Ó
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UNFINISHED BUSINESS
Bill No: SB 1094
Author: Kehoe (D)
Amended: 8/20/12
Vote: 27 - Urgency
SENATE NATURAL RESOURCES AND WATER COMM : 8-0, 4/10/12
AYES: Pavley, La Malfa, Cannella, Fuller, Kehoe, Padilla,
Simitian, Wolk
NO VOTE RECORDED: Evans
SENATE GOVERNANCE & FINANCE COMMITTEE : 8-0, 4/25/12
AYES: Wolk, Dutton, DeSaulnier, Fuller, Hancock,
Hernandez, Kehoe, La Malfa
NO VOTE RECORDED: Liu
SENATE APPROPRIATIONS COMMITTEE : 7-0, 5/24/12
AYES: Kehoe, Walters, Alquist, Dutton, Lieu, Price,
Steinberg
SENATE FLOOR : 38-0, 5/31/12
AYES: Alquist, Anderson, Berryhill, Blakeslee, Calderon,
Cannella, Corbett, Correa, De León, DeSaulnier, Dutton,
Emmerson, Evans, Fuller, Gaines, Hancock, Harman,
Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu,
Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio,
Simitian, Steinberg, Vargas, Walters, Wolk, Wright,
Wyland, Yee
NO VOTE RECORDED: Runner, Strickland
ASSEMBLY FLOOR : 79-0, 8/23/12 - See last page for vote
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SUBJECT : Land use: mitigation lands: nonprofit
organizations
SOURCE : California Council of Land Trusts
DIGEST : This bill allows certain community foundations
and congressionally chartered foundations to hold endowment
accounts for mitigation lands. This bill also expands and
modifies conditions which all endowment holders must abide.
Assembly Amendments include the University of California
and Orange County's Transportation Corridor Agencies as
eligible endowment holders and provides that the bill not
preclude other methods of funding the long-term stewardship
of the property. They also makes other technical and
clarifying changes.
ANALYSIS : Under existing law, when state or local
agencies approve land use projects, they can require the
project applicant to transfer interest in real property to
the agency in order to mitigate the impact that the
development will have on natural resources. Under Section
65965 of the Government Code, a state or local agency may
authorize a nonprofit organization to hold title and to
manage the mitigation lands.
The project applicant may also be required by the local and
state agency to provide funds to finance the management of
mitigation lands in perpetuity, also known as an endowment.
Last year, the passage of SB 436 (Kehoe) Chapter 590,
Statutes of 2011, gave explicit authority to state or local
agencies to allow a nonprofit or special district, which is
holding and managing the mitigation lands, to also hold the
endowment account, subject to certain conditions. SB 436
allowed for limited exceptions where an endowment can be
held by an entity other than the entity that is holding and
managing the land. The state or local agency is required
to exercise due diligence in reviewing the qualifications
of the entity managing the land and the accompanying funds.
The entity is required to meet certain standards, including
accounting standards, and specified reporting requirements.
This bill expands the situations where an endowment can be
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held by an entity other than the one who is holding and
managing the mitigation land. The most notable expansion is
to allow certain community foundations and congressionally
chartered foundations to hold endowments. This bill would
also:
1.Allows a governmental entity to manage mitigation lands
and the associated endowment.
2.Expands the definition of special district.
3.Requires any entity holding endowment accounts to provide
an annual fiscal report to the local or state agency that
required the endowment that contains specified
information.
4.Deletes the requirement that local and state agencies
must exercise due diligence in reviewing the
qualifications of an entity holding an endowment account.
5.Defines endowments as charitable assets that are
permanently restricted funds.
6.States that specified provisions of this bill relating to
the requirements on a holder of an endowment do not apply
to funds held for the long-term management and
stewardship of property pursuant to specified acts if
certain requirements are met.
7.Defines the term "mitigation agreement" to mean either a
written agreement between the project proponent and the
entity qualified to hold the property and the endowment,
which is submitted to the state or local agency for the
purpose of obtaining any permit, clearance, or mitigation
approval from that state or local agency, or a written
agreement between the project proponent and the entity
qualified to hold the property, including any agreement
with an entity qualified to hold the endowment, which is
submitted to the state or local agency for the purpose of
obtaining any permit, clearance, or mitigation approval
from that state or local agency.
8.Expands local agency fee recovery.
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FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee, likely
ongoing costs of $200,000 to $300,000 from the Fish and
Game Preservation Fund (special fund) beginning in 2012-13
for the oversight and tracking of endowments.
SUPPORT : (Verified 8/27/12)
California Council of Land Trusts (source)
Big Sur Land Trust
California Community Foundation
Center for Natural Lands Management
Community Foundation for Monterey County
Community Foundation of Mendocino County
Community Foundation of San Joaquin
Community Foundation of Sonoma County
Community Foundation of the Verdugos
Community Foundation Santa Cruz County
Contra Costa Water District
East Bay Municipal Utility District
Fresno Regional Foundation
Kern Community Foundation
Land Trust of Santa Cruz County
League of California Community Foundations
Marin Community Foundation
Mendocino Land Trust
Metropolitan Water District
Napa Valley Community Foundation
Ojai Valley Land Conservancy
Orange County Board of Supervisors
Orange County Community Foundation
Pasadena Community Foundation
Peninsula Open Space Trust
Redwood Coast Land Conservancy
Rocky Mountain Elk Foundation
Sacramento Region Community Foundation
San Diego County Water Authority
San Francisco Public Utilities Commission
San Luis Obispo County Community Foundation
Santa Barbara Foundation
Shasta Regional Community Foundation
Sierra Foothill Conservancy
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Silicon Valley Community Foundation
Solano Land Trust
Stanislaus Community Foundation
Tahoe Truckee Community Foundation
The Community Foundation
The San Diego Foundation
The San Francisco Foundation
Transportation Agency for Monterey County
Transportation Corridor Agencies
Trust for Public Land
University of California
Ventura County Community Foundation
Wildlife Heritage Foundation
ARGUMENTS IN SUPPORT : According to the California
Council of Land Trusts, "many diverse stakeholders worked
for several years to establish strong laws and protections
for holding, managing, investing and disbursing mitigation
endowment funds. Ý?] In 2011 and after years of work and
education, SB 436 was chaptered and provided a very strong
law for mitigation endowments." Further, California "has a
vital and continuing interest in ensuring that the
mitigation endowment funds being set aside pursuant to the
issuance of state permits are well-managed by experienced
and competent organizations, are permanently restricted and
dedicated to the mitigation property they were created for,
are not consolidated into a single vast holding that is
inherently risky, and that the funds are transparent so
that the public can track them."
ASSEMBLY FLOOR : 79-0, 8/23/12
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani,
Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell,
Grove, Hagman, Halderman, Hall, Harkey, Hayashi, Hill,
Huber, Hueso, Huffman, Jeffries, Jones, Knight, Lara,
Logue, Bonnie Lowenthal, Ma, Mansoor, Mendoza, Miller,
Mitchell, Monning, Morrell, Nestande, Nielsen, Norby,
Olsen, Pan, Perea, V. Manuel Pérez, Portantino, Silva,
Skinner, Smyth, Solorio, Swanson, Torres, Valadao,
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Wagner, Wieckowski, Williams, Yamada, John A. Pérez
NO VOTE RECORDED: Roger Hernández
CTW:n 8/27/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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