BILL NUMBER: AB 667 AMENDED
AMENDED IN ASSEMBLY MARCH 19, 2013
INTRODUCED BY Assembly Member Roger Hernández
FEBRUARY 21, 2013
An act to
amend Section 65950 of add
Sections 65928.3, 65928.4, 65928.7, 65935, and 65957.3 to the
Government Code, relating to land use.
LEGISLATIVE COUNSEL'S DIGEST
AB 667, as amended, Roger Hernández. Land use: development project
review. review: superstores.
The Permit Streamlining Act within the Planning and Zoning Law
requires the lead agency that has the principal responsibility for
approving a development project, as defined, to approve or disapprove
the project within a specified number of days from the date of
certification of an environmental impact report, the date of the
adoption of a negative declaration, or the determination by the lead
agency that the project is exempt from the California Environmental
This bill would, in addition, require a city, county, or city and
county, including a charter city, prior to approving or disapproving
a proposed development project that would permit the construction of
a superstore retailer, as defined, to cause an economic impact report
to be prepared, as specified, to be paid for by the project
applicant, and that includes specified assessments and projections,
including, among other things, an assessment of the effect that the
proposed superstore will have on specified designated economic
assistance areas, as defined, and an assessment of the effect that
the proposed superstore will have on retail operations and employment
in the same market area. The bill would also require the governing
body to provide an opportunity for public comment on the economic
impact report. By increasing the duties of local public officials,
the bill would impose a state-mandated local program. The bill would
additionally find and declare that these provisions are an issue of
statewide concern and not a municipal affair.
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
This bill would provide that no reimbursement is required by this
act for a specified reason.
This bill would make technical, nonsubstantive changes to those
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. It is the intent of the Legislature to
promote economic development in all communities of the state and in
particular in identified Economic Assistance Areas, with the goal of
creating good jobs, economically self-sustaining communities, and
promoting a vibrant small business sector. It is the intent of the
legislature to ensure that the superstore retail model meets these
goals and does not undermine efforts toward those ends. Therefore,
the Le gislature finds and declares all of the following:
(a) The state has identified geographically targeted economic
development areas. Each of these areas has related tax incentive
benefits as well as a variety of locally provided incentives and
benefits. The purpose of these benefits is to stimulate business
investment and job creation for qualified disadvantaged individuals
in state-designated economically distressed areas. Similarly, other
redevelopment plan areas have been developed by former redevelopment
agencies and their successor agencies pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33300) of Division
24 of the Health and Safety Code), with the purpose of revitalizing
the economy of local jurisdictions.
(b) The state and local governments have provided financial
assistance to certain businesses to stimulate business development
and job creation.
(c) It is in the interest of local governments to promote economic
development in their jurisdictions.
(d) Land use decisions are frequently linked to fiscal policy
because local governments receive a share of sales tax revenues
generated within their borders. California cities thus often seek
large sales tax revenue sources, such as superstores, without taking
into account all of the external economic effects that superstores
bring to communities.
(e) Transformations in the big box retail industry have altered
retail business nationwide. The engine of this change is the retail
format known as the superstore, a big box retail store that also
contains the equivalent of a full-service grocery store, with the
total floor space often three to four times as large as that of a
(f) As a result of the restructuring of retail business,
particularly the grocery sector in California, the following effects
may be seen: local grocers, who yield a greater community return on
investment, are driven out of business; anchor stores to other local
businesses are closed down impacting many small businesses, and
resulting in less community access to viable superstore alternatives;
lower wages and benefits paid to grocery workers by superstore
retailers; and a host of complex land use, traffic, and fiscal
(g) Superstores typically combine a large variety of discount
general merchandise with full-service grocery sales to the general
public under one roof, thereby generating more intense land use and
environmental impacts than other large-scale retailers and wholesale
(h) Industry and academic studies indicate superstores rarely add
any retail services not currently provided within a community, and
the majority of sales growth at a superstore comes from a direct
shift of dollars from existing retailers within a community,
primarily from grocery stores.
(i) Land use decisions regarding superstores fall to city and
county governments, even if the impacts will be regional as well as
local and may impact the efforts by the state and regions in economic
(j) Currently, local governments that desire to perform due
diligence for their constituents by performing an economic analysis
are placed at a disadvantage because a neighboring city or county may
not perform an economic analysis. This situation may result in the
shifting of sales tax and destruction of the business community in a
city or county that simply wants to study the impacts of the
development project before making a final approval that the
permitting of the superstore does not have a material adverse impact
on the impact area.
SEC. 2 . Section 65928.3 is added to
the Government Code , to read:
65928.3. "Economic assistance areas" means existing economic
development areas, that may be amended from time to time by the
Legislature, including an enterprise zone established pursuant to
Chapter 12.8 (commencing with Section 7070) of Division 7 of Title 1,
a local agency military base recovery area established pursuant to
Chapter 12.97 (commencing with Section 7105) of Division 7 of Title
1, a manufacturing incentive area designated pursuant to Section
7073.8, a targeted tax area designated pursuant to Section 7097, or
any redevelopment area identified by any successor or agency to a
former redevelopment agency, or recipients of over one hundred
thousand dollars ($100,000) of financial assistance as defined in
SEC. 3. Section 65928.4 is added to the
Government Code , to read:
65928.4. "Financial assistance" includes, but is not limited to,
any of the following in the amount of one hundred thousand dollars
($100,000) or greater:
(a) Any appropriation of public funds, including, but not limited
to, loans, grants, or subsidies or the payment for or construction of
(b) Any tax incentive, including, but not limited to, tax
exemptions, rebates, reductions, or moratoria of a tax, including any
rebate or payment based upon the amount of sales tax generated from
(c) The sale or lease of real property at a cost that is less than
fair market value.
(d) Payment for, forgiveness of, or reduction of fees.
SEC. 4. Section 65928.7 is added to the
Government Code , to read:
65928.7. "Impact area" means a five-mile radius surrounding the
proposed location of a superstore.
SEC. 5. Section 65935 is added to the
Government Code , to read:
65935. "Superstore" means a business establishment that exceeds
90,000 square feet of gross floor area, sells a wide range of
consumer goods, and devotes 10,000 square feet or more of the sales
floor area to the sale of items that are exempted from the Sales and
Use Tax Law (Part 1 (commencing with Section 6001) of Division 2 of
the Revenue and Taxation Code), pursuant to Section 6359 of the
Revenue and Taxation Code. "Superstore" shall include a retail
establishment with multiple tenants, and the cumulative sum of
related or successive permits that may be part of a larger project,
including piecemeal additions to a building, where consumer goods and
nontaxable items are sold under the same roof with shared checkout
stands, entrances, and exits. "Superstore" does not include a
discount warehouse or retail store where more than one-half of the
items carried by the discount warehouse or retail store are sold in
large quantities or in bulk, and the discount warehouse or retail
store requires shoppers to pay a membership or assessment fee.
SEC. 6. Section 65957.3 is added to the
Government Code , to read:
65957.3. (a) Prior to the permitting of the construction of, the
addition to, or the alteration of, any buildings or structures which
would create a superstore in an economic assistance area, in addition
to the findings otherwise required by any ordinance or regulation of
the city, county, or city and county, the legislative body of the
city, county, or city and county shall make a finding that, based on
consideration of all economic benefits and costs, the superstore will
not materially adversely affect the economic welfare of the impact
area. This finding shall be based upon information contained in an
economic impact report, any other information received or obtained by
the designated agency of the city, county, or city and county, and
any other information received before or at a public hearing
conducted as required by this section.
(b) The city, county, or city and county may prepare the economic
impact report or contract with a private entity, other than the
permit applicant, or with another public agency for the preparation
of the report. Any private entity or other public agency contracted
to prepare the economic impact report shall be qualified by
education, training, and experience to conduct economic and fiscal
(c) The applicant for the proposed superstore shall pay the city,
county, or city and county for the costs of preparing the economic
(d) The economic impact report shall include, but is not limited
to, all of the following:
(1) An assessment of whether the proposed superstore will meet the
purposes of any designated economic assistance areas, including an
enterprise zone, a local agency military base recovery area, a
manufacturing enhancement area, a targeted tax area, or any plan area
administered by a successor agency to a former redevelopment agency,
in which the superstore is proposed to be located.
(2) An assessment of whether the proposed superstore will
negatively impact any retailer that is the beneficiary of any
benefits from any program adopted in connection with any designated
economic development area, including an enterprise zone, a local
agency military base recovery area, a manufacturing enhancement area,
a targeted tax area, or any program adopted by a successor agency to
a former redevelopment agency, in which the superstore is proposed
to be located.
(3) An assessment of the extent to which the proposed superstore
will capture a share of retail sales in the impact area.
(4) An assessment of the extent to which the construction and
operation of the proposed superstore will affect the supply and
demand for retail space in the impact area.
(5) An assessment of the extent to which the construction and
operation of the proposed superstore will affect employment in the
impact area, including all of the following:
(A) The number of persons employed in existing retail stores in
the impact area.
(B) An estimate of the number of people who will likely be
employed by the proposed superstore.
(C) An analysis of whether the proposed superstore will result in
a net increase or decrease in employment in the impact area.
(D) The effect on wages and benefits of employees of other retail
businesses, and community income levels in the impact area.
(6) A projection of the costs of public services and public
facilities resulting from the construction and operation of the
proposed superstore and the incidence of those costs, including the
cost to the state, city, or county of any public assistance that
employees of the proposed superstore will be eligible for based on
the wages and benefits to be paid by the proposed superstore.
(7) A projection of the public revenues resulting from the
construction and operation of the proposed superstore retailer and
the incidence of those revenues.
(8) An assessment of the effect that the construction and
operation of the proposed superstore will have on retail operations,
including grocery stores or retail shopping centers, in the impact
area, including the potential for blight resulting from retail
business closures and the nature of any businesses displaced.
(9) An assessment of the effect that the construction and
operation of the proposed superstore will have on the ability of the
city, county, or city and county to implement the goals contained in
its general plan, including, but not limited to, local policies and
standards that apply to land use patterns, traffic circulation,
affordable housing, and natural resources, including water supplies,
open-space lands, noise problems, and safety risks.
(10) An assessment of the effect that the construction and
operation of the proposed superstore will have on average total
vehicle miles traveled by retail customers in the same impact area.
(11) An assessment of the potential for long-term vacancy of the
property on which the superstore is proposed in the event that the
business vacates the premises, including any restrictions that exist
on the subsequent use of the property on which the superstore is
proposed to be located, including the provisions of any lease that,
in the event the owner or operator of the proposed superstore vacates
the premises, would require the premises to remain vacant for a
significant amount of time.
(12) An assessment of whether the superstore would require the
demolition of housing or any other action or change that would result
in a decrease or negative impact on the creation of extremely low-,
very low-, low-, or moderate-income housing.
(13) An assessment of whether the superstore would result in the
destruction or demolition of park or other green space, playgrounds,
child care facilities, or community centers.
(14) An assessment of whether the superstore would result in any
other adverse or positive economic impacts or blight in the impact
(15) An assessment of whether any measures identified by the
superstore are available that may mitigate any materially adverse
economic impacts of the superstore.
(e) At any regularly scheduled meeting or meetings of the
legislative body of a city, county, or city and county, following the
completion and approval of the economic impact report required by
this section, and 30 days prior to the issuance of any entitlement,
including, but not limited to, a building permit, a city, county, or
city and county shall provide the opportunity for public comment on
the economic impact report and its findings.
(f) This section shall not preclude a city, county, or city and
county from conducting additional studies of the effects of the
construction and operation of a proposed superstore.
(g) (1) The Legislature finds that the construction and operation
of a superstore has land use, environmental, economic, fiscal, and
social equity effects that extend beyond the boundaries of the city,
county, or city and county in which it is located and may impact the
goals and objectives of economic development areas, including
enterprise zones, local agency military base recovery areas,
manufacturing enhancement areas, targeted tax areas, and any plan
area administered by a successor agency to a former redevelopment
agency, and beyond the borders of the city, county, or city and
county, where financial assistance is provided to a superstore.
(2) The Legislature finds that it is essential for the statewide
public health, safety, and welfare to require cities, counties, and
cities and counties to understand the potential spillover effects of
approving the construction and operation of superstores.
(3) The Legislature further finds and declares that the review and
regulation of superstores is a matter of statewide concern and not
merely a municipal affair, as that term is used in Section 5 of
Article XI of the California Constitution. Therefore, this section
shall apply to charter cities and to charter cities and counties.
SEC. 7. 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.
SECTION 1. Section 65950 of the Government Code
is amended to read:
65950. (a) Any public agency that is the lead agency for a
development project shall approve or disapprove the project within
whichever of the following periods is applicable:
(1) One hundred eighty days from the date of certification by the
lead agency of the environmental impact report, if an environmental
impact report is prepared pursuant to Section 21100 or 21151 of the
Public Resources Code for the development project.
(2) Ninety days from the date of certification by the lead agency
of the environmental impact report, if an environmental impact report
is prepared pursuant to Section 21100 or 21151 of the Public
Resources Code for the development project and all of the following
conditions are met:
(A) At least 49 percent of the units in the development project
are affordable to very low or low-income households, as defined by
Sections 50105 and 50079.5 of the Health and Safety Code,
respectively. Rents for the lower income units shall be set at an
affordable rent, as that term is defined in Section 50053 of the
Health and Safety Code, for at least 30 years. Owner-occupied units
shall be available at an affordable housing cost, as that term is
defined in Section 50052.5 of the Health and Safety Code.
(B) Prior to the application being deemed complete for the
development project pursuant to Article 3 (commencing with Section
65940), the lead agency received written notice from the project
applicant that an application has been made or will be made for an
allocation or commitment of financing, tax credits, bond authority,
or other financial assistance from a public agency or federal agency,
and the notice specifies the financial assistance that has been
applied for or will be applied for and the deadline for application
for that assistance, the requirement that one of the approvals of the
development project by the lead agency is a prerequisite to the
application for or approval of the application for financial
assistance, and that the financial assistance is necessary for the
project to be affordable as required pursuant to subparagraph (A).
(C) There is confirmation that the application has been made to
the public agency or federal agency prior to certification of the
environmental impact report.
(3) Sixty days from the date of adoption by the lead agency of the
negative declaration, if a negative declaration is completed and
adopted for the development project.
(4) Sixty days from the determination by the lead agency that the
project is exempt from the California Environmental Quality Act
(Division 13 (commencing with Section 21000) of the Public Resources
Code), if the project is exempt from that act.
(b) This section does not preclude a project applicant and a
public agency from mutually agreeing in writing to an extension of
any time limit provided by this section pursuant to Section 65957.
(c) For purposes of paragraph (2) of subdivision (a), "development
project" means a use consisting of either of the following:
(1) Residential units only.
(2) Mixed-use developments consisting of residential and
nonresidential uses in which the nonresidential uses are less than 50
percent of the total square footage of the development and are
limited to neighborhood commercial uses and to the first floor of
buildings that are two or more stories. As used in this paragraph,
"neighborhood commercial" means small-scale general or specialty
stores that furnish goods and services primarily to residents of the
(d) For purposes of this section, "lead agency" and "negative
declaration" have the same meaning as defined in Sections 21067 and
21064 of the Public Resources Code, respectively.