BILL ANALYSIS                                                                                                                                                                                                    Ó






                                                       Bill No:  AB  
          826
          
                 SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
                       Senator Roderick D. Wright, Chair
                           2013-2014 Regular Session
                                 Staff Analysis



          AB 826  Author:  Jones-Sawyer
          As Proposed to be Amended in Committee:  June 25, 2013
          Hearing Date:  June 25, 2013
          Consultant:  Paul Donahue


                                     SUBJECT  
                             State surplus property

                                   DESCRIPTION
           
          AB 826 authorizes the Department of General Services (DGS)  
          to dispose of eight surplus state properties. Specifically,  
           this bill  :

          1)Authorizes the Director of General Services to sell,  
            exchange, sell combined with an exchange, or lease for  
            fair market value, upon terms and conditions determined  
            to be in the state's best interest, all or any part of  
            the following 3 parcels of real property:

             a)   Approximately 15 acres and improvements known as a  
               portion of the California Department of Corrections  
               and Rehabilitation's Preston Youth Correctional  
               Facility.  This property was used as Preston employee  
               housing.  The Preston facility was closed on June 30,  
               2011, the structures are now vacant and beyond their  
               useful life.  There is no departmental use for the  
               property.

             b)   Approximately 160 acres and improvements known as a  
               portion of the California Department of Corrections  
               and Rehabilitation's Estrella Correctional Facility.   
               This facility was closed in 2008. There is no  
               departmental use for the property.





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             c)   Approximately 0.90 acres and improvements, known as  
               the Employment Development Department's Vallejo Office  
               Building, located at 1440 Marin Street, in Vallejo,  
               Solano County.

          2)Authorizes DGS to sell all or a portion of the following  
            properties located in the City of Sacramento, County of  
            Sacramento, and leased by the Department to the Capitol  
            Area Development Authority. The properties shall be sold  
            for market value or upon the terms and conditions as the  
            Director determines are in the best interest of the  
            State: 

             a)   Approximately .027 acres and improvements, located  
               at 1627 10th Street, in Sacramento. 

             b)   Approximately .027 acres and improvements, located  
               at 1607 10th Street, in Sacramento. 

             c)   Approximately .030 acres and improvements, located  
               at 1036 P Street, in Sacramento. 

             d)   Approximately .025 acres and improvements, located  
               at 1603 10th Street, in Sacramento. 

             e)   Approximately .039 acres and improvements, located  
               at 1601 10th Street, in Sacramento. 

                                   EXISTING LAW

           1)Directs each state agency to review all land under its  
            jurisdiction, with certain exceptions, to determine what,  
            if any, land is in excess of its foreseeable needs and  
            report thereon in writing to DGS.

          2)Authorizes DGS to dispose of surplus state real property  
            by sale, lease, exchange, a sale combined with an  
            exchange, or other manner of disposition of property, as  
            authorized by the Legislature, upon any terms and  
            conditions and subject to any reservations and exceptions  
            DGS deems to be in the best interests of the state.

          3)Authorizes DGS to sell surplus real property to a local  
            agency, or to a nonprofit affordable housing sponsor for  
            affordable housing projects at a sales price less than  
            fair market value if DGS determines that such a discount  




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            will enable the provision of housing for persons and  
            families of low or moderate income.

          4)Authorizes DGS to transfer surplus real property to a  
            local agency for less than fair market value if the local  
            agency uses the surplus state real property for parks or  
            open-space purposes.

          5)Establishes criteria for state agencies to use in  
            determining and reporting excess lands.  A state agency  
            must report land as surplus that is:

             a)   Not currently utilized, or is underutilized, for  
               any existing or ongoing programs; 

             b)   Land for which the agency cannot identify any  
               specific utilization relative to future needs; and, 

             c)   Land not identified by the state agency within its  
               master plan for facility development.

          6)Exempts the sale of surplus property sold "as is" from  
            designated provisions of the California Environmental  
            Quality Act (CEQA).  However, the buyer or transferee of  
            a parcel is subject to CEQA as well as any local  
            governmental entitlement or land use approval  
            requirements.  

          7)Requires that the proceeds from the sale of surplus state  
            property, with specified exceptions, be used to pay the  
            principal and interest on the Economic Recovery Bond Act  
            of 2004. (Proposition 60A)


                                    BACKGROUND
           
           1)Purpose  :  According to the author's office, "This is the  
            annual DGS proposal for the disposal of excess state real  
            property.  State agencies are required by Government Code  
            Section 11011 to identify real properties that are excess  
            to its needs.  The proposal is necessary because  
            legislative authorization is needed to declare real  
            properties as surplus and to authorize their disposal by  
            DGS."

           2)Background  :  This measure is an annual surplus property  




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            bill sponsored by DGS.  Existing law requires all state  
            agencies to annually review and determine if any lands  
            under their jurisdiction are in excess of need.  This  
            information is provided to DGS to annually report to the  
            Legislature the excess lands and request authorization to  
            sell excess land.   When selling state surplus property,  
            DGS must determine if other state agencies can utilize  
            the land.   If the state has no need, DGS must then offer  
            surplus state real property to local agencies, and next,  
            to nonprofit affordable housing sponsors prior to  
            offering the property to private entities.  

            Under the provisions of Proposition 60A, the proceeds of  
            the sale of surplus property are used to pay the holders  
            of the state's deficit reduction bonds.  These payments  
            are intended to accelerate the redemption of the state's  
            debt, and reduce future General Fund payments to the  
            bondholders.

           3)Estrella Correctional Facility, San Luis Obispo County  :  
            The DGS reports that this facility opened in 1947, and  
            through actions by both the Legislature (SB 81 and AB  
            191), and the courts (Farrell v. Cate) altering the  
            amount and type of youthful offenders entrusted to the  
            care of the Department's Division of Juvenile Justice, it  
            eventually closed in 2008. 

           4)Properties leased by DGS to CADA, Sacramento County  : The  
            bill would authorize DGS to dispose of 5 properties that  
            are now leased to the Capitol Area Development Authority  
            (CADA).  All of these properties are apartment buildings  
            in the CADA area surrounding the State Capitol.  The CADA  
            Board of Directors has reportedly signed off on the sale  
            or transfer of these parcels.  

                            PRIOR/RELATED LEGISLATION
           
          SB 1645 (Mountjoy), Chapter 731, Statutes of 1998.  
          Authorizes Director of DGS to sell, convey, or exchange  
          properties that are not needed by any state agency at fair  
          market value under specified circumstances if 30-day notice  
          is provided to the JLBC and the applicable Members of the  
          Senate and Assembly who represent the district in which the  
          properties are located.






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           SUPPORT:   

          Department of General Services

           OPPOSE:   

          None on file

           FISCAL COMMITTEE:   Senate Appropriations Committee



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