BILL ANALYSIS                                                                                                                                                                                                    






                             SENATE JUDICIARY COMMITTEE
                             Senator Noreen Evans, Chair
                              2013-2014 Regular Session


          AB 1024 (Torres)
          As Amended June 24, 2013
          Hearing Date: July 2, 2013
          Fiscal: Yes
          Urgency: No
          TH


                                        SUBJECT
                                           
                            Real Property: Divided Lands

                                      DESCRIPTION  

          This bill would exempt stock cooperatives and limited equity  
          housing cooperatives from restrictions in the Subdivided Lands  
          Act prohibiting the sale or leasing of lots or parcels within a  
          subdivision subject to a blanket encumbrance under certain  
          circumstances.  The bill would expand the sources from which a  
          limited equity housing cooperative may obtain financing and  
          remain exempt from the Subdivided Lands Act.  The bill would  
          also amend the election requirements of the Davis-Stirling  
          Common Interest Development Act to exempt developments from  
          having to elect members to a board of directors when the  
          development's governing documents provide that all members are  
          directors.

                                      BACKGROUND  

          California's Subdivided Lands Act gives the Bureau of Real  
          Estate (formerly the Department of Real Estate) certain  
          authority over planned developments, community apartment  
          projects, condominiums, and housing cooperatives.  Its purpose  
          is "to prevent fraud and misrepresentation in the marketing of  
          parcels of land by requiring disclosure of the financial risks  
          and benefits of a transaction to proposed purchasers and  
          lessees."  (California Coastal Com. v. Quanta Investment Corp.  
          (1980) 113 Cal.App.3d 579, 589.)  "To accomplish this, the  
          [Bureau of Real Estate] issues public reports based on extensive  
          disclosures made by the subdividers in connection with the  
          parcels they offer for sale or lease," and "[any] sale or lease  
                                                                (more)



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          [made] without providing a public report to the transferee is  
          prohibited."  (Id.)  Additionally, the Subdivided Lands Act  
          makes it unlawful for an owner, subdivider, or agent to sell or  
          lease lots or parcels within a subdivision that are subject to a  
          blanket encumbrance unless the purchaser or lessee of a lot or  
          parcel can obtain legal title to the interest free and clear of  
          the encumbrance.  As was the case with a parallel restriction in  
          its predecessor statute, the Real Estate Act, the prohibition  
          against blanket encumbrances in the Subdivided Lands Act is  
          aimed at both the "prevention of fraud and sharp practices in a  
          type of real estate transaction peculiarly open to such abuses,"  
          and ensuring "protection for the innocent purchaser against loss  
          of his land by foreclosure of [an] underlying mortgage."  (In re  
          Sidebotham (1938) 12 Cal.2d 434, 436.)

          This bill would exempt stock cooperatives and limited equity  
          housing cooperatives from restrictions in the Subdivided Lands  
          Act prohibiting the sale or leasing of lots or parcels within a  
          subdivision subject to a blanket encumbrance if the following  
          conditions are met:
           notice is provided to every prospective purchaser of an  
            interest in the cooperative and is included in every purchase  
            contract, warning of the risk that he or she could lose the  
            interest through foreclosure of the blanket encumbrance even  
            though the buyer is not delinquent in his or her payments for  
            the interest; 
           the property subject to the sale has obtained a public report  
            from the Bureau of Real Estate that accounts for the blanket  
            encumbrance; and
           the governing documents for the cooperative require it to  
            create within one year of the sale of at least 50 percent of  
            the individual interests in the cooperative, and maintain  
            during the term of the blanket encumbrance, a financing  
            reserve amount equal to at least three months of the amount of  
            the debt service payments due on the blanket encumbrance or a  
            lesser amount acceptable to the Commissioner of Real Estate.

          The Subdivided Lands Act also exempts limited equity housing  
          cooperatives from the Act's provisions if the cooperative meets  
          a number of conditions, including conditions concerning the  
          financing of construction or development costs of the real  
          property to be occupied by the cooperative.  This bill would  
          expand the sources from which a limited equity housing  
          cooperative may obtain financing and remain exempt from the  
          Subdivided Lands Act.  The bill would also amend the election  
          requirements of the Davis-Stirling Common Interest Development  
                                                                      



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          Act to exempt developments, including housing cooperatives, from  
          having to elect members to a board of directors when the  
          development's governing documents provide that all members are  
          directors.

                                CHANGES TO EXISTING LAW
           
           Existing law  , the Subdivided Lands Act, governs "Subdivided  
          lands" and the "subdivision" of improved or unimproved land or  
          lands, wherever situated within California, divided or proposed  
          to be divided for the purpose of sale or lease or financing,  
          whether immediate or future, into five or more lots or parcels.   
          (Bus. & Prof. Code Sec. 11000.)

           Existing law  states that the reference in the Subdivided Lands  
          Act to "subdivided lands" and "subdivision" shall include, among  
          other things, any stock cooperative, including any legal or  
          beneficial interests therein, having or intended to have five or  
          more shareholders, and any limited-equity housing cooperative.   
          (Bus. & Prof. Code Sec. 11004.5.)
           Existing law  states that it shall be unlawful, except as  
          provided, for an owner, subdivider, or agent to sell or lease  
          lots or parcels within a subdivision that is subject to a  
          blanket encumbrance unless there exists in such blanket  
          encumbrance or other supplementary agreement a provision which  
          by its terms shall unconditionally provide that the purchaser or  
          lessee of a lot or parcel can obtain legal title or other  
          interest contracted for, free and clear of such blanket  
          encumbrance, upon compliance with the terms and conditions of  
          the purchase or lease.  (Bus. & Prof. Code Sec. 11013.1.)

           Existing law  provides that if the blanket encumbrance or  
          supplementary agreement does not contain a release clause as  
          described above, then it shall be unlawful for the owner,  
          subdivider, or agent to sell or lease lots or parcels within a  
          subdivision unless one of the following conditions is met:
           the entire sum of money paid or advanced by the purchaser or  
            lessee of any such lot or parcel, or such portion thereof as  
            the Commissioner of Real Estate (Commissioner) shall determine  
            is sufficient to protect the interest of the purchaser or  
            lessee, is deposited into an escrow depository acceptable to  
            the Commissioner, as specified;
           the title to the subdivision is held in trust under an  
            agreement of trust acceptable to the Commissioner until a  
            proper release from such blanket encumbrance is obtained; 
           a bond to the State of California is furnished to the  
                                                                      



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            Commissioner for the benefit and protection of purchasers or  
            lessees of such lots or parcels, in such amount and subject to  
            such terms as may be approved by the Commissioner, as  
            specified; or
           the Commissioner provides an alternative requirement or method  
            deemed acceptable to protect the interest of the purchaser of  
            lessee.  (Bus. & Prof. Code Sec. 11013.2.)

           Existing law  provides that a limited-equity housing cooperative  
          or a workforce housing cooperative trust shall be exempt from  
          the requirements of the Subdivided Lands Act if the  
          limited-equity housing cooperative or workforce housing  
          cooperative trust complies with certain conditions, including:
           The United States Department of Housing and Urban Development,  
            the United States Department of Agriculture, the National  
            Consumers Cooperative Bank, the California Housing Finance  
            Agency, the Public Employees' Retirement System (PERS), the  
            State Teachers' Retirement System (STRS), the Department of  
            Housing and Community Development, or the Federal Home Loan  
            Bank System or any of its member institutions, alone or in any  
            combination with each other, or with the city, county, school  
            district, or redevelopment agency in which the cooperative is  
            located, directly finances or subsidizes at least 50 percent  
            of the total construction or development cost or one hundred  
            thousand dollars ($100,000), whichever is less, of the housing  
            cooperative.  (Bus. & Prof. Code Sec. 11003.4.)

           Existing law  , the Davis-Stirling Common Interest Development  
          Act, establishes rules and regulations governing the operation  
          of a common interest development and the respective rights and  
          duties of a homeowner's association and its members.  (Civ. Code  
          Sec. 4000 et seq.)
          
           Existing law  states that, notwithstanding any other law or  
          provision of the governing documents, elections regarding  
          assessments legally requiring a vote, election and removal of  
          directors, amendments to the governing documents, or the grant  
          of exclusive use of common areas, shall be held by secret ballot  
          in accordance with the procedures set forth in the  
          Davis-Stirling Common Interest Development Act.  (Civ. Code Sec.  
          5100.)

           This bill  would provide that, notwithstanding prohibitions in  
          the Subdivided Lands Act, an individual interest in a stock  
          cooperative or a limited equity housing cooperative may be sold  
          or leased subject to a blanket encumbrance if all of the  
                                                                      



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          following conditions are met:
           the notice required pursuant to Section 1133 of the Civil Code  
            is provided to every prospective purchaser of the interest and  
            is included in every purchase contract;
           the property subject to the sale has obtained a public report  
            from the Bureau of Real Estate that accounts for the blanket  
            encumbrance; and 
           the governing documents for the association require the  
            association to create within one year of the sale of at least  
            50 percent of the individual interests in the stock  
            cooperative or limited-equity housing cooperative, and  
            maintain during the term of the blanket encumbrance, a  
            financing reserve amount equal to at least three months of the  
            amount of the debt service payments due on the blanket  
            encumbrance or a lesser amount acceptable to the Commissioner  
            of Real Estate.

           This bill  would provide that a limited-equity housing  
          cooperative or a workforce housing cooperative trust shall be  
          exempt from the requirements of the Subdivided Lands Act if,  
          alone or in any combination with other specified entities, a  
          state or federally chartered credit union or a state or  
          federally certified community development financial institution  
          directly finances or subsidizes at least 50 percent of the total  
          construction or development cost or one hundred thousand dollars  
          ($100,000), whichever is less, of the housing cooperative.

           This bill  would also provide that a director shall not be  
          required to be elected pursuant to the Davis-Stirling Common  
          Interest Development Act if the governing documents of a common  
          interest development, including a housing cooperative, provide  
          that all members are directors.








                                        COMMENT
           
          1.  Stated need for the bill  
          
          The author writes:
          
                                                                      



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            Existing law prohibits a recording of a blanket encumbrance on  
            a cooperative unless specified requirements are met.  As a  
            result it is very hard to finance a cooperative because  
            lenders are not interested in lending on individual units in  
            the cooperative.  This bill allows [an interest in a stock  
            cooperative or limited equity housing cooperative to be sold  
            with] a blanket encumbrance [subject to certain conditions,  
            including the preparation of] . . . a public report [and the  
            establishment of] . . . a reserve.     

            In some cases the bylaws of the governing documents of a  
            cooperative require the members to all sit on the board of  
            directors.  The state law governing CIDs [Common Interest  
            Developments] requires the homeowners association [to] hold an  
            election for the board of director[s].  This is unnecessary if  
            all members are automatically board members.  This bill states  
            that if the bylaws require all members to be board members in  
            a CID then you are not required to hold an election.

          2.  Housing cooperatives in California  

          A housing cooperative is an umbrella term that describes a type  
          of legal corporation formed by residents of a particular  
          building or area who, through the corporation, own and control  
          the building[s] in which they live.  In general, housing  
          cooperatives are formed to provide affordable housing for their  
          members.  They do this by charging members only the amount  
          required to run the cooperative (including reserve and emergency  
          expenses), and therefore operate on an at-cost or not-for-profit  
          basis.  While affordable housing is the most common reason  
          housing cooperatives form, scholars note that they may have a  
          secondary goal of preventing the displacement of residents,  
          promoting economic development, preserving historical buildings,  
          or protecting the character of neighborhoods threatened with  
          gentrification.  (Dewey Bandy, Characteristics and operational  
          performance of California's permanent Housing Cooperatives  
           [as of  
          June 27, 2013] p. 1.)

          Members of a housing cooperative typically buy shares in their  
          cooperative corporation and pay a monthly amount to cover the  
          operating expenses of maintaining the land, buildings, and  
          common areas which the cooperative owns.  Ownership of a share  
          in the cooperative normally guarantees a member an exclusive  
          right to occupy a particular dwelling unit in the community  
          owned by the cooperative.  Use of the unit may be governed by a  
                                                                      



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          proprietary lease or occupancy agreement entered into with the  
          corporation.  (Northcountry Cooperative Development Fund,  
          Housing Cooperatives: An Accessible and Lasting Tool for  
          Homeownership  [as of June 27, 2013].)
          Housing cooperatives are usually self-governing -- the  
          membership enacts bylaws and elects from among themselves a  
          board of directors to oversee the cooperative's day to day  
          operations.  The board of directors usually must approve the  
          purchase and sale of shares in the cooperative, thereby  
          controlling who can join the community.  With some exceptions, a  
          new member typically borrows all or part of the share purchase  
          price from a private lender, which is secured by his or her  
          individual interest in the cooperative. (Northcountry  
          Cooperative Development Fund, Housing Cooperatives: An  
          Accessible and Lasting Tool for Homeownership  
           [as of June 27, 2013].)

          Housing cooperatives in California come in many forms, including  
          limited equity housing cooperatives, stock or market rate  
          cooperatives, manufactured home park cooperatives, and senior  
          housing cooperatives.  A limited equity housing cooperative is  
          formed primarily to offer permanently affordable home ownership  
          opportunities for low and moderate income individuals.  These  
          cooperatives are typically financed with a combination of  
          private and public funds, and price restrictions are put on the  
          sale of shares in order to preserve affordability for future  
          purchasers.  Stock cooperatives, in contrast, operate in the  
          private market and membership shares are sold at full market  
          value.  Much like conventional real estate, a share's sale price  
          is determined by the market, allowing for the potential  
          accumulation or loss of equity by the cooperative's members.   
          (California Center for Cooperative Development, Housing  
          Cooperatives  [as  
          of June 27, 2013].)

          Manufactured home park cooperatives allow members to privately  
          own their own manufactured home, while the land underneath the  
          home, utility systems, and all common areas are owned by the  
          cooperative.  In contrast to a condominium where an owner holds  
          title to his or her dwelling unit in fee simple, the real  
          property of a manufactured home park cooperative (like all  
          cooperatives) is owned by the cooperative corporation, and  
          shareholders are granted the right to occupy a space for their  
          home.  Manufactured home park cooperatives can be organized as  
                                                                      



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          either stock cooperatives or limited equity cooperatives.   
          Finally, senior housing cooperatives are cooperatives designed  
          specifically to meet the particular needs of their members.   
          These cooperatives usually have established age restrictions and  
          offer various degrees of graduated care.  (California Center for  
          Cooperative Development, Housing Cooperatives  
           [as of June 27,  
          2013].)

          3.  Prohibition on blanket encumbrances  

          As noted above, the Subdivided Lands Act contains a general  
          prohibition on selling or leasing subdivided lands, including  
          interests or shares in a housing cooperative, subject to a  
          blanket encumbrance.  If an interest is sold with such a blanket  
          encumbrance, the sale or lease instrument must "include a  
          release clause so that purchasers of lots or parcels within the  
          subdivision can obtain title to their lots or parcels free of  
          the blanket lien upon compliance with the terms and conditions  
          of their purchase agreement."  (Drake v. Martin (1994) 30  
          Cal.App.4th 984, 992.)  This prohibition acts as a consumer  
          safeguard, ensuring that "innocent purchaser[s] [are protected]  
          against loss of [their] land by foreclosure of the underlying  
          mortgage."  (In re Sidebotham (1938) 12 Cal.2d 434, 436.)  The  
          Act does permit exceptions to this general prohibition when the  
          parties take special precautions to protect the financial  
          interest of a purchaser or lessee, including:  placing the money  
          paid by the purchaser or lessee in an escrow account until a  
          release from the blanket encumbrance is obtained or the  
          underlying encumbrance is resolved; placing title to the  
          subdivision in trust until a release from the blanket  
          encumbrance is obtained; or furnishing a bond to the state in  
          such an amount so as to protect the individual interests of  
          purchasers or lessees until the blanket encumbrance is released  
          or otherwise extinguished.  In each exception, the Act imposes  
          strict measures to ensure that a purchaser or lessee's interest  
          is protected from the risk of default by the subdivider or  
          developer on the underlying encumbrance.

          The proponents of this bill argue that this restriction is an  
          unnecessary regulatory barrier that stymies the development of  
          housing cooperatives in the state.  According to the sponsor,  
          the California Center for Cooperative Development, "[t]he  
          California Subdivided Lands Act prohibits the sale of housing  
          cooperative shares when the units are subject to a mortgage  
          secured by the entire property, which has the effect of banning  
                                                                      



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          housing cooperatives in California, because most cooperatives  
          finance the purchase of a building with a single blanket  
          mortgage."  Absent this prohibition in the Act, a blanket  
          mortgage could be used to purchase, build or rehabilitate a  
          building, and part of each member's monthly payment to the  
          cooperative could be used to retire the blanket mortgage.

          The Committee should note that this bill represents a departure  
          from existing law concerning exceptions to the prohibition on  
          blanket encumbrances.  Instead of requiring a developer to take  
          measures to protect the financial interests of purchasers and  
          lessees of interests in subdivided lands, this bill would shift  
          the loss following default more onto the purchaser.  It would  
          permit the sale or lease of an encumbered interest in a housing  
          cooperative so long as the prospective purchaser receives a  
          clear and specific notice of the risks of buying a share subject  
          to a blanket encumbrance.  Specifically, it would require every  
          purchase agreement to contain the following acknowledgment:


            BUYER/LESSEE IS AWARE OF THE FACT THAT THE LOT, PARCEL, OR  
            UNIT WHICH HE OR SHE IS PROPOSING TO PURCHASE OR LEASE IS  
            SUBJECT TO A DEED OF TRUST, MORTGAGE, OR OTHER LIEN KNOWN AS A  
            "BLANKET ENCUMBRANCE".


            IF BUYER/LESSEE PURCHASES OR LEASES THIS LOT, PARCEL, OR UNIT,  
            HE OR SHE COULD LOSE THAT INTEREST THROUGH FORECLOSURE OF THE  
            BLANKET ENCUMBRANCE OR OTHER LEGAL PROCESS EVEN THOUGH  
            BUYER/LESSEE IS NOT DELINQUENT IN HIS OR HER PAYMENTS OR OTHER  
            OBLIGATIONS UNDER THE MORTGAGE, DEED OF TRUST, OR LEASE.   
            (Civ. Code Sec. 1133(a).)


          This bill would also require a developer to provide each  
          purchaser with a copy of a public report from the Bureau of Real  
          Estate that accounts for the blanket encumbrance.  Additionally,  
          it would mandate that the governing documents for the  
          cooperative require the creation within one year of the sale of  
          at least 50 percent of the individual interests in the stock  
          cooperative or limited-equity housing cooperative a financing  
          reserve amount equal to at least three months of the amount of  
          the debt service payments due on the blanket encumbrance,  
          maintained for the duration of the encumbrance.  Once it becomes  
          operational and funded, this financial reserve could help  
          insulate individual shareholders from the consequences of  
                                                                      



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          default on a blanket encumbrance by providing the cooperative  
          with a stable, limited-term source of revenue for making  
          payments toward the blanket obligation.  However, this reserve  
          funding mechanism still places the burden on shareholders (as  
          opposed to a developer or subdivider) to guard against the risk  
                                                                 of default, and, unlike the existing exceptions in the Act,  
          would not necessarily be operational or funded when the first  
          purchaser or lessee executes a purchase or lease agreement.

          4.  Expansion of permissible lenders  

          Under existing law, limited-equity housing cooperatives and  
          workforce housing cooperative trusts are exempt from the  
          Subdivided Lands Act if, among other things, the United States  
          Department of Housing and Urban Development, the United States  
          Department of Agriculture, the National Consumers Cooperative  
          Bank, the California Housing Finance Agency, the Public  
          Employees' Retirement System (PERS), the State Teachers'  
          Retirement System (STRS), the Department of Housing and  
          Community Development, or the Federal Home Loan Bank System or  
          any of its member institutions, alone or in any combination with  
          each other, or with the city, county, school district, or  
          redevelopment agency in which a cooperative is located, directly  
          finance or subsidize at least 50 percent of the total  
          construction or development cost or one hundred thousand dollars  
          ($100,000), whichever is less, of the housing cooperative.   
          (Bus. & Prof. Code Sec. 11003.4.)  This bill would expand the  
          sources from which a housing cooperative may obtain financing  
          and remain exempt from the Subdivided Lands Act to include state  
          or federally chartered credit unions and state or federally  
          certified community development financial institutions.  The net  
          effect of this change would likely be to increase the total  
          amount of funds available in California for financing the  
          development of housing cooperatives, thereby increasing home  
          ownership opportunities for low and middle income individuals  
          and families.  The Committee should note, however, that such an  
          expansion would add non-governmental entities to the list of  
          eligible financers, thereby shifting some of the decision-making  
          power over the creation of housing cooperatives under this  
          section of the Act to the private sector.

          5.  Changes to Davis-Stirling Act election requirements  

          This bill would also exempt common interest developments,  
          including housing cooperatives, from having to follow the  
          procedures for electing members to a governing board of  
                                                                      



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          directors pursuant to the Davis-Stirling Common Interest  
          Development Act if the governing documents of the development  
          provide that all members are automatically directors.  This  
          exemption seems to be a sound method of relieving entities like  
          housing cooperatives from having to try to comply with election  
          procedures that don't really apply to the governance structure  
          of their communities.  However, stakeholders have noted that  
          there may be cases where a share in a cooperative is held  
          jointly by two or more people (e.g. spouses who have joint  
          ownership), but only one person can serve as a director  
          representing the interest of their share.  To address this  
          problem, the author offers the following amendment:

                Author's amendment  :

               On page 9, lines 9-11, strike the existing text and replace  
               it with the following:
               "(f) Directors shall not be required to be elected pursuant  
               to this article if the governing documents provide that one  
               member from each separate interest is a director."

          6.  Recent amendments concerning "Public Reports"  

          Staff notes that, before the amendments taken on June 24, 2013,  
          this bill would have exempted stock cooperatives and community  
          apartment projects from the obligation of having to obtain a  
          public report from the Bureau of Real Estate prior to offering  
          interests in the cooperative for sale or lease to members of the  
          public.  Generally, before marketing new subdivisions in  
          California, a subdivider must obtain a public report from the  
          Bureau of Real Estate.  According to the Bureau:

            Public reports contain information of vital importance to  
            prospective buyers including covenant[s], conditions and  
            restrictions which govern the use of property, costs and  
            assessments for maintaining homeowners' associations and  
            common areas, and other material disclosures. . . Public  
            reports are a critical disclosure document which should be  
            read and understood by any home purchaser considering buying a  
            home in a new subdivision . . . Prior to the issuance of the  
            public report, subdividers must file an application with the  
            [Bureau] and submit documents supporting the representations  
            made in the application.  If improvements to the subdivision  
            are not complete at the time the application is filed, the  
            subdivider must also submit evidence that adequate financial  
            arrangements have been made for their completion.  (Public  
                                                                      



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            Reports   
            [as of June 25, 2013].)

          As amended, this bill has eliminated all provisions that would  
          have altered existing law concerning a subdivider's obligation  
          to obtain a public report and provide copies of the report to  
          prospective purchasers and lessees.





          7.  Technical amendments  

          The author offers the following technical amendments:

                Author's amendment  :

               On page 7, line 36, following "purchaser" add the phrase  
          "and lessee"
               On page 7, line 37, following "purchase" add the phrase  
          "and lease"
               On page 8, line 1, following "sale" add the phrase "or  
          lease"
               On page 8, line 3, strike "encumberance" and replace it  
          with "encumbrance"


           Support  :  Bay Area Community Land Trust; East Bay Cooperative  
          Housing Coalition; San Francisco Community Land Trust;  
          Sustainable Economies Law Center; Walnut House Cooperative; 14  
          individuals 

           Opposition  :  None Known

                                        HISTORY
           
           Source  :  California Center for Cooperative Development

           Related Pending Legislation  :  None Known

           Prior Legislation  :

          AB 1246 (Jones, Chapter 520, Statutes of 2009) revised the  
          definition of a "limited-equity housing cooperative" to also  
          apply to a "workforce housing cooperative trust."  This bill  
                                                                      



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          established the manner in which a workforce housing cooperative  
          trust is organized and operated, and exempted a workforce  
          housing cooperative trust from provisions governing the  
          regulation of subdivided land if, among other organizations, the  
          Federal Home Loan Bank System or any of its member institutions  
          directly finance or subsidize at least 50% of the total  
          construction or development cost or $100,000, whichever is less,  
          of the cooperative.
           
           AB 2052 (Haynes, 2006) would have enacted the California New  
          Market Venture Capital Program Act.  This bill would have  
          declared the intent of the Legislature to facilitate free market  
          growth in low-income neighborhoods and close inter-generational  
          wealth gaps among economically disadvantaged groups by creating  
          jobs, growing small businesses, building affordable housing, and  
          revitalizing low-income neighborhoods.  This bill died in the  
          Assembly Committee on Jobs, Economic Development, & the Economy.

          AB 2511 (Jones, Chapter 888, Statutes of 2006) made a number of  
          changes to state law to promote the development of affordable  
          housing and prevent delays in processing applications for  
          development projects that include a housing element.
          SB 619 (Ducheny, Chapter 793, Statutes of 2003) made several  
          changes to laws related to the development of affordable housing  
          by streamlining the housing approval process and authorizing  
          awards of attorney's fees and costs to prevailing parties in  
          actions against local governments for alleged failure to comply  
          with affordable housing requirements.  This bill prohibited  
          discrimination against multifamily housing in zones designated  
          for multifamily housing.  This bill also specified required  
          procedures to be followed by the Department of Housing and  
          Community Development; required multifamily residential housing  
          to be permitted on any parcel zoned for multifamily housing if  
          specifications are met; clarified the meaning of and  
          requirements for "mixed use" land; and clarified the criteria  
          for awarding and administering CalHome funds.
           
           AB 369 (Dutra, Chapter 237, Statutes of 2001) authorized a  
          court, when it finds that a local agency disapproved or  
          conditioned a project rendering it infeasible for the  
          development of housing for very low-, low-, or moderate-income  
          households without making findings supporting its decision as  
          required, to award attorney's fees and costs in a lawsuit  
          challenging the disapproval or conditions, except under  
          extraordinary circumstances where the court finds that awarding  
          fees would not further the purposes of the statute.
                                                                      



          AB 1024 (Torres)
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           AB 2786 (Bates, 2000) would have required that all unclaimed  
          money, including unclaimed money from a deceased person's estate  
          that is currently escheated to the state, be deposited in the  
          Housing Rehabilitation Loan Fund.  The fund would have been used  
          for the construction, rehabilitation, or acquisition and  
          rehabilitation of multifamily rental housing developments for  
          elderly persons or households.  This bill was vetoed by Governor  
          Davis.  
           
           Prior Vote  :

          Senate Committee on Transportation and Housing (Ayes 10, Noes 0)
          Assembly Floor (Ayes 73, Noes 0)
          Assembly Committee on Appropriations (Ayes 17, Noes 0)
          Assembly Committee on the Judiciary (Ayes 10, Noes 0)
          Assembly Committee on Housing and Community Development (Ayes 7,  
          Noes 0)

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