BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 1156
                                                                  Page  1


          ASSEMBLY THIRD READING
          AB 1156 (V. Manuel Pérez)
          As Amended  May 13, 2013
          Majority vote 

           LOCAL GOVERNMENT    7-1          APPROPRIATIONS     12-5        
           
           ----------------------------------------------------------------- 
          |Ayes:|Achadjian, Levine, Alejo, |Ayes:|Gatto, Bocanegra,         |
          |     |Bradford, Gordon, Mullin, |     |Bradford,                 |
          |     |Rendon                    |     |Ian Calderon, Campos,     |
          |     |                          |     |Eggman, Gomez, Hall,      |
          |     |                          |     |Ammiano, Pan, Quirk,      |
          |     |                          |     |Weber                     |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Melendez                  |Nays:|Harkey, Bigelow,          |
          |     |                          |     |Donnelly, Linder, Wagner  |
           ----------------------------------------------------------------- 

           SUMMARY  :  Excludes improvements on land from the total assessed  
          value of land used to determine the weighted vote of a landowner  
          in the Palo Verde Irrigation District.  Specifically,  this bill  :  
           

          1)Excludes the assessed value of improvements on the land from  
            the total assessed value 
          of land used to calculate a landowner's weighted vote in the  
            Palo Verde Irrigation District (PVID).  

          2)Requires PVID to hold a public hearing about the changes to  
            the weighted vote system.  

          3)Requires PVID to provide public notice by placing an  
            advertisement in a newspaper of general circulation, and by  
            first-class mail to each landowner voter in the district, as  
            specified.  

          4)Provides that if the Commission on State Mandates determines  
            that this bill contains costs mandated by the state,  
            reimbursement to local agencies and school districts for those  
            costs shall be made pursuant to current law governing state  
            mandated local costs.  
          








                                                                  AB 1156
                                                                  Page  2


          5)Makes findings and declarations.  

          6)Makes other non-substantive and technical changes.  

           EXISTING LAW  establishes the Palo Verde Irrigation District Act,  
          and specifically:

          1)Authorizes any person, firm, or corporation owning any real  
            property and improvements, or any interest in real property  
            and any improvements to vote in any election pertaining to the  
            affairs of the district.  

          2)Provides one vote for each $100 of assessed valuation or  
            fraction greater than $50 for each qualified property owner.   
            Determines the total number of votes any voter is entitled to  
            cast by dividing the total assessed value of all parcels owned  
            by the voter by 100.  

          3)Requires the assessed valuation to be the equalized assessment  
            roll of the district preceding the election.

           FISCAL EFFECT  :  According to the Assembly Appropriations  
          Committee, this bill is keyed a state reimbursable mandate.   
          However, it is unclear if the district is an entity eligible for  
          reimbursement and if a claim would be large enough to meet the  
          minimum set by the Commission on State Mandates.  

           COMMENTS  :  PVID was established in 1923 and is comprised of  
          mostly farmland occupying about 189 square miles of territory in  
          Riverside and Imperial Counties.  PVID contains approximately  
          131,298 acres and manages and delivers water to land within its  
          jurisdiction.  PVID is governed by a seven-member board of  
          trustees elected at large among owners of property within  
          district.  Current law limits voting rights in PVID to  
          landowners and establishes a weighted vote system based on the  
          assessed value of real property, including improvements made by  
          landowners.  The weighted vote system provides one vote for each  
          $100 dollars 
          of assessed property, including improvements and divides the  
          total assessed value by 100 to determine the number of votes for  
          each landowner.  

          This bill makes changes to the weighted vote system in PVID and  
          deletes the assessment 








                                                                  AB 1156
                                                                  Page  3


          of improvements to property from the total assessed value used  
          to calculate each landowners weighted vote.  Under this bill the  
          assessed value of land alone would be used by the calculation in  
          current law to determine each landowner's weighted vote.  This  
          bill requires PVID to hold a public hearing about the changes to  
          the weighted vote system.  Prior to the public hearing PVID  
          would also have to provide specified public notification by  
          placing an advertisement in a newspaper of general circulation,  
          and by first-class mail to each landowner voter.  This bill is  
          sponsored by PVID.  

          According to the sponsor, "Given the size and the abundance of  
          sunshine in the geographic location of the PVID, it has been  
          identified as a preferred location for solar development.  The  
          PVID was identified in the 2011 programmatic environmental  
          impact statement of the United States Department of Energy and  
          the Interior identified the region as an area available for  
          solar development."

          According to the Association of California Water Agencies in  
          support, "These new solar projects typically utilize a few  
          thousand acres of land but the solar equipment can be worth  
          billions of dollars.  Because of the relatively high value of  
          the improvements compared to the size of the land being used,  
          the landowner of a solar project built under these terms would  
          have a disproportionate share of the district's votes.  This  
          bill would ensure that the votes of irrigated landowners would  
          not be diluted by any potential large solar projects in the  
          district's service area."  According to the author and sponsor  
          none of these projects have been developed in PVID yet. 

          The California Constitution provides that the right to vote or  
          serve in elected office may not be conditioned on a  
          landownership qualification.  However, in 1973, the U.S. Supreme  
          Court ruled in Salyer Land Co. v. Tulare Water District, that  
          the California statute requiring a landownership qualification  
          did not violate the Equal Protection Clause of the U.S.  
          Constitution.  The court ruled there was no violation because  
          those districts don't exercise normal governmental authority and  
          their activities disproportionally affect landowners.  

          California's 93 irrigation districts function under a range of  
          statutes that are a hybrid of registered voter and  
          landowner-voter type districts.  In general, registered voters  








                                                                  AB 1156
                                                                  Page  4


          are eligible to vote in district elections, but board members  
          must be landowners of the district.  Historically, the  
          Legislature has recognized landowners' special concerns for  
          irrigation districts' operations by creating unique separate  
          statutes that preserve the landowner requirement to vote in  
          districts that primarily deliver agricultural water.  Some of  
          these districts have landownership, but not residency  
          requirements.  Some districts, including PVID, Camp Far West  
          Montague, and Cordua Irrigation Districts use weighted votes in  
          their elections, based on the relative value of land under  
          ownership.  

          The Legislature may wish to note the intent of this bill as  
          expressed by the author and supporters is to "ensure voting  
          power is equally distributed among all landowners and does not  
          favor those with preferred sites for renewable energy  
          development".  This bill does not just eliminate the assessment  
          of improvements for solar energy projects, it also eliminates  
          the assessment of any improvement made by any landowner.  The  
          Legislature may wish to consider whether this bill will harm  
          individual landowners who make investments in their land, pay  
          increased assessments due to the improvements, but would not  
          have that investment go toward the calculation of their weighted  
          vote.  

          If the Legislature finds the expressed concern brought forward  
          by the author and sponsor as necessitating a change in statute,  
          the Legislature may wish to ask the author to consider a  
          different approach to accomplish the stated goal of ensuring  
          that voting power is equally distributed among landowners.  

          SB 614 (Wolk), pending in the Assembly, would delete the  
          landowner qualification in statute for most irrigation district  
          board members, but does not address the districts that have  
          unique statutes.  SB 614 builds upon several legislative  
          attempts that have sought to limit landowner qualifications for  
          board directors.  In 2000, the Legislature deleted the landowner  
          qualification for board members of irrigation districts that  
          provide electricity (SB 1939 (Alarcón), Chapter 1041, Statutes  
          of 2000).  In 2006, the Legislature removed the landowner  
          requirement for irrigation districts that provide 3,000 or more  
          acre-feet of water to residential customers or that have more  
          than 3,000 customers (AB 159 (Salinas), Chapter 847, Statutes of  
          2006).  








                                                                  AB 1156
                                                                  Page  5



          Support arguments:  Supporters argue that this bill will ensure  
          that voting power is equally distributed amongst all land  
          owners, and will not only favor those who have preferred sites  
          for solar energy development.  

          Opposition arguments:  This bill may have unintended  
          consequences for current landowners in PVID that make  
          improvements to their land.  

           
          Analysis Prepared by  :    Misa Yokoi-Shelton / L. GOV. / (916)  
          319-3958 


                                                                FN: 0000744