BILL NUMBER: AB 1656 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 22, 2014
AMENDED IN SENATE AUGUST 5, 2014
AMENDED IN ASSEMBLY MAY 23, 2014
AMENDED IN ASSEMBLY MARCH 28, 2014
INTRODUCED BY Assembly Member Dickinson
FEBRUARY 11, 2014
An act to add Section 14669.16 to the Government Code, relating to
the Department of General Services.
LEGISLATIVE COUNSEL'S DIGEST
AB 1656, as amended, Dickinson. Department of General Services:
State Board of Equalization headquarters
State buildings .
Existing law creates the Department of General Services to provide
centralized services, including, but not limited to, planning,
acquisition, construction, and maintenance of state buildings and
property, purchasing, printing, architectural services,
administrative hearings, and accounting services. Existing law
provides that the department is under the control of an executive
officer known as the Director of General Services.
This bill would authorize the department, in
consultation with the State Board of Equalization (BOE), to enter
into one or more agreements for the planning, design, construction,
and acquisition of facilities, including any improvements,
betterments, and related facilities, and to enter into one or more
agreements to acquire, construct, purchase, lease-purchase, or may
enter into a lease with an option to purchase, for the relocation and
consolidation of the BOE according to specific conditions. The bill
would require the department to determine whether it is in the best
interest of the state to sell, lease to other tenants, or exchange
the current BOE headquarters property and to notify the chairs of the
fiscal committees of the Legislature and the Joint Legislative
Budget Committee, or their designees, of the most cost-effective
option. The bill also would authorize the State Public Works Board to
issue revenue bonds, negotiable notes, or negotiable bond
anticipation notes to finance the acquisition of land and facilities
for the headquarters, and would permit the State Public Works Board
and the department to borrow funds for project costs from the Pooled
Money Investment Account, as specified. The bill would require the
department to be reimbursed for the cost of entering into these
agreements or leases in an amount not to exceed $3,000,000 from a
loan of funds in the Architecture Revolving Fund, as specified. The
bill also would authorize the BOE to relocate and consolidate its
offices without obligation to pay rent on the existing state-owned or
state-leased facilities after they are vacated.
require, by July 1, 2015, the Department of General Services to
complete a long-range planning study of the state-controlled and
owned office buildings in the County of Sacramento and the City of
West Sacramento, including the headquarters of the State Board of
Equalization (BOE), for the management of the state's space needs in
the Sacramento region, as specified. The bill would require the
Director of General Services to issue one or more requests
for proposals for the planning, design, construction, and
acquisition of facilities recomended by the Legislature based on the
planning study.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature hereby finds and declares all of the
following:
(a) Located in the City of Sacramento, the state owns
approximately 2.50 acres of real property on one city block bounded
by N Street on the north, 5th Street on the east, O Street on the
south, and 4th Street on the west, that is the State Board of
Equalization's current state-owned headquarters. The state-owned
facility is a 24-story building that contains approximately 616,000
gross square feet, with 463,000 usable square feet of office space.
The ground floor contains a full-service cafeteria and a child care
center. The state-owned facility also includes a three-story parking
structure with 711 spaces.
(b) The State Board of Equalization collects taxes and fees that
provide approximately 35 percent of the annual revenue for state
government and essential funding for cities, counties, and special
districts. In the 2012-13 fiscal year, the State Board of
Equalization-administered tax and fee programs produced $56 billion
for education, public safety, transportation, housing, health
services, social services, and natural resource management.
(c) The current State Board of Equalization headquarters building
lacks sufficient space to meet the State Board of Equalization's
existing and future consolidated space needs.
(d) The state has expended approximately $65 million in taxpayer
dollars over the last decade to make repairs to the State Board of
Equalization building. The State plans to spend another $30 million
or more to address new issues with the building.
(e) Consolidating the various State Board of Equalization
headquarters and annexes into one location will greatly facilitate
and improve the efficiency of the administrative operations of the
agency.
(f) Allowing the State Board of Equalization to move out of the
real property described in subdivision (b) permanently and to
consolidate its operations into one location will accommodate future
growth as part of its revenue-administrative mission.
(a) The Department of General Services operates and manages 34
state-controlled and owned office buildings totaling over 8,000,000
net square feet in the County of Sacramento and the City of West
Sacramento. At least 4,000,000 gross square feet located in 21
buildings are over 40 years old, many of which have antiquated
systems and will eventually experience failure and for which
replacement parts will not exist in the future. The state has been
repairing and replacing critical building systems when necessary, but
for some of the older buildings, this approach to handling building
deficiencies is no longer sufficient.
(b) Therefore, it is the intent of the Legislature that the
Department of General Services perform a study developing a
long-range plan for the Sacramento region. The 2014 Budget Act
appropriated funding in the amount of $2.5 million to the Department
of General Services for this purpose. This study will determine the
best course of action to address the state's infrastructure
deficiencies and space needs within the region, while focusing on
long-term asset management. In addition to developing a long-range
plan for the Sacramento Region, the study will also serve as the
framework to develop the recommendations and detailed cost and scope
information necessary for future budget proposals.
SEC. 2. Section 14669.16 is added to the Government Code, to read:
14669.16. (a) For purposes of this section, the "Sacramento
property" means the 2.50 acres of real property, owned by the state
and located in the City of Sacramento, on one city block bounded by N
Street on the north, 5th Street on the east, O Street on the south,
and 4th Street on the west, that is the State Board of Equalization's
current state-owned headquarters.
(b) (1) Notwithstanding any other law, the Department of General
Services, in consultation with the State Board of Equalization, may
enter into one or more agreements for the planning, design,
construction, and acquisition of facilities, including any
improvements, betterments, and related facilities, for the relocation
of the State Board of Equalization in the Sacramento region. The
Department of General Services may enter into one or more agreements
to acquire, construct, purchase, lease-purchase, or may enter into a
lease with an option to purchase, to provide usable office and
related space in the Sacramento region in order to consolidate
various departments of the State Board of Equalization into a single
location.
14669.16. (a) The Department of General Services
shall, by July 1, 2015, complete a long-range planning study of the
state-controlled and owned office buildings in the County of
Sacramento and the City of West Sacramento, including the Board of
Equalization's headquarters, for the management of the state's space
needs in the Sacramento region.
(b) The planning study shall contain, but is not limited to, the
following:
(1) Evaluation of the overall state facility needs in the
Sacramento region, including the capacity of currently owned and
leased space.
(2) Evaluation of each building including, but not limited to,
condition, age, building use, and the extent that it meets the
business needs and location of the state entity occupying the space.
(3) The impact the building's age and design has on potential
reconfiguration and consolidation for state needs.
(4) The viability of antiquated building infrastructure systems,
including the present and probable future availability of replacement
parts for the systems in the buildings.
(5) Evaluation of office buildings in need of major repairs or
renovations to correct deficiencies, including estimated costs for
fire and life safety, accessibility, seismic safety, and other
building code compliance issues, and known existence of encapsulated
hazardous materials and lead-based paint.
(6) Other considerations deemed appropriate by the Department of
General Services, in consultation with the state entity occupying the
building, may be included.
(7) The development of a logical sequencing plan for renovation,
replacement, or both, of existing state office buildings and new
office development in the Sacramento region to guide the state over
the next 25 years.
(c) The findings in this long-range planning study shall be used
as the basis for recommendations and developing detailed cost and
scope information to be considered in future budget proposals.
(d) Beginning with the three buildings with the most significant
and immediate renovation or replacement needs, including highest cost
of total maintenance and repair to usable space, and other related
costs identified in the long-range planning study, the Director of
General Services shall issue one or more requests for proposals for
the planning, design, construction, and acquisition of facilities
that have been recommended by the Legislature based on the planning
study completed under this section. The Director of General Services
shall issue the requests for proposals within 12 months of the
Legislature making the recommendation described in this subdivision.
(2) The Department of General Services shall solicit and accept
proposals for acquiring or constructing consolidated facilities for
the State Board of Equalization on the basis of the best value. For
purposes of this paragraph, "best value" means a value determined by
objective criteria, including, but not limited to, price, features,
functions, life-cycle costs, experience, and other criteria deemed
appropriate by the department.
(3) The Department of General Services shall develop the terms and
conditions of the agreements or leases authorized by paragraph (1)
no later than December 31, 2015.
(4) The acquisition of a new facility and sale of the existing
facility may be handled separately or combined into one proposal. The
Department of General Services may solicit and accept proposals and
may enter into one or more agreements for the sale, exchange, lease,
rehabilitation, or any combination thereof, of all or a portion of
the Sacramento property for the purpose of providing office space to
one or more entities.
(c) The Department of General Services shall provide notice of the
terms and conditions of the proposed agreements or leases to the
chairs of the fiscal committees of the Legislature and the Joint
Legislative Budget Committee, or their designees, at least 45 days
prior to executing the agreement for a lease-purchase or lease with
an option to purchase real property authorized by this section. The
department may proceed with the agreement or lease 45 days following
the date the department gave notice to the above-mentioned chairs.
(d) The department shall determine whether it is in the best
interest of the state to sell, to lease to other tenants, or to
exchange the Sacramento property. The department shall notify the
chairs of the fiscal committees of the Legislature and the Joint
Legislative Budget Committee, or their designees, of the most
cost-effective option for the state.
(e) (1) Upon the Department of General Services making the
determination specified in subdivision (d) that the Sacramento
property should be either sold or leased to another tenant, the
department may sell, exchange, lease, or any combination thereof, all
or a portion of the Sacramento property. Upon sale, exchange, or
lease of the Sacramento property, and subject to the requirements of
Section 9 of Article III of the California Constitution, the
Department of General Services shall make an early payoff of the
total outstanding lease revenue bonds on the Sacramento property,
including accrued interest and any other obligations associated with
the Sacramento property, using the revenues resulting from any sale,
exchange, or lease.
(2) (A) If the Department of General Services sells the Sacramento
property and the sale constitutes a sale of surplus state property
for purposes of Section 9 of Article III of the California
Constitution, the "proceeds from the sale" for purposes of that
section shall be the revenues from the sale in excess of the amount
necessary to satisfy the total outstanding bonds on the Sacramento
property, as required by paragraph (1).
(B) In order to facilitate the sale of the Sacramento property,
the Department of General Services and the State Public Works Board
may borrow from the General Fund an amount necessary to satisfy the
total outstanding bonds. Any amounts loaned pursuant to this
subparagraph shall be repaid from the proceeds of the sale of the
Sacramento property.
(f) (1) The State Public Works Board may issue revenue bonds,
negotiable notes, or negotiable bond anticipation notes pursuant to
Chapter 5 (commencing with Section 15830) of Part 10b of Division 3
of Title 2 to finance the acquisition of land and facilities
authorized in subdivision (b). The State Public Works Board and the
Department of General Services may borrow funds for project costs
from the Pooled Money Investment Account pursuant to Sections 16312
and 16313. If the bonds authorized by the project are not sold, the
Department of General Services shall commit a sufficient amount of
its support appropriation to repay any loans made for the project
from the Pooled Money Investment Account. It is the intent of the
Legislature that this commitment be included in future budget acts
until outstanding loans from the Pooled Money Investment Account are
repaid either through the proceeds from the sale of bonds or from an
appropriation.
(2) The amount of revenue bonds, negotiable notes, or negotiable
bond anticipation notes to be sold may equal, but shall not exceed
the cost of acquisition, including land, construction, preliminary
plans and working drawings, construction management and supervision,
other costs relating to the design and construction of the
facilities, and any additional sums to pay interim and permanent
financing costs and costs to issue these bonds. The additional amount
may include interest and a reasonable required reserve fund.
(3) Notwithstanding Section 13332.11, the State Public Works Board
may authorize the augmentation of the amount authorized pursuant to
this subdivision by up to, but not exceeding, 10 percent of the
amount specifically authorized.
(g) The Department of General Services shall be reimbursed for the
department's costs pursuant to subdivision (b), in an amount not to
exceed three million dollars ($3,000,000), from a loan of funds that
are continuously appropriated pursuant to Section 14957 and deposited
into the Architecture Revolving Fund for repairs to the State Board
of Equalization's headquarters building located at 450 N Street in
the City of Sacramento. Any amounts loaned pursuant to this
subdivision shall be repaid from the State Board of Equalization's
operating funds within five years from the date those funds were
borrowed. Interest charges shall be waived pursuant to subdivision
(e) of Section 16314.
(h) Notwithstanding subdivision (c) of Section 14682, the State
Board of Equalization is authorized to relocate its offices from
existing state-owned or state-leased facilities for the purpose of
consolidating the State Board of Equalization headquarters and
annexes into a single location without any obligation to pay rent on
those facilities after vacating such premises.
____ CORRECTIONS
Digest--Pages 1 and 2. Text--Pages 3 and 4.
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