BILL ANALYSIS Ó
AB 1963
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1963 (Atkins and Dickinson)
As Amended June 4, 2014
2/3 vote. Urgency
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|ASSEMBLY: |78-0 |(May 15, 2014) |SENATE: |32-0 |(June 26, |
| | | | | |2014) |
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Original Committee Reference: L. GOV.
SUMMARY : Extends the date, from January 1, 2015, to January 1,
2016, by which the Long Range Property Management Plan (LRPMP)
submitted by a successor agency must be approved by the
Department of Finance (DOF), and makes several other changes
related to successor agencies.
The Senate amendments repeal the statute that requires the State
Controller to review successor agencies' transfers of specified
assets to cities or counties and provides for the return of
improperly transferred assets.
EXISTING LAW :
1)Dissolves redevelopment agencies and provides for the
designation of successor agencies.
2)Requires successor agencies to wind down the affairs of the
dissolved redevelopment agencies.
3)Defines "enforceable obligations."
4)Requires successor agencies make payments due to enforceable
obligations, as specified.
5)Requires each successor agency to have an oversight board of
seven members to approve certain actions of the successor
agency.
6)Requires DOF to review the actions of an oversight board.
7)Requires DOF to issue a finding of completion to the successor
agency, within five business days, once the following
conditions have been met and verified:
AB 1963
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a) The successor agency has paid the full amount as
determined during the due diligence reviews and the county
auditor-controller has reported those payments to DOF;
b) The successor agency has paid the full amount as
determined during the July True-Up process; or,
c) The successor agency has paid the full amount upon a
final judicial determination of the amounts due and
confirmation that those amounts have been paid by the
county auditor-controller.
8)Allows the successor agency, upon receiving the finding of
completion, to:
a) Retain dissolved redevelopment agency assets;
b) Place loan agreements between the former redevelopment
agency and sponsoring entity on the Recognized Obligation
Payments Schedule, as an enforceable obligation, provided
the oversight board makes a finding that the loan was for
legitimate redevelopment purposes; and,
c) Utilize proceeds derived from bonds issued prior to
January 1, 2011, in a manner consistent with the original
bond covenants.
9)Requires, after DOF issues a finding of completion, the
successor agency to prepare a LRPMP that addresses the
disposition and use of the real properties of the former
redevelopment agency, and requires the report to be submitted
to the oversight board and DOF for approval no later than six
months following the issuance to the successor agency of the
finding of completion.
10) Specifies, if DOF has not approved a LRPMP by January 1,
2015, that property of the former redevelopment agency be
disposed of according to current law.
AS PASSED BY THE ASSEMBLY , this bill extended the date by which
the LRPMP submitted by a successor agency must be approved by
the DOF, from January 1, 2015, to January 1, 2016.
FISCAL EFFECT : According to the Senate Appropriations
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Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS :
1)Purpose of this bill. This bill extends, from January 1,
2015, to January 1, 2016, the date by which the LRPMP
submitted by a successor agency must be approved by DOF. This
bill is author-sponsored.
2)RDA Dissolution. As part of the winding down of redevelopment
agencies, AB 1484 (Blumenfield), Chapter 26, Statutes of 2012,
made various statutory changes associated with the dissolution
of redevelopment agencies and addressed a number of
substantive issues related to administrative processes,
affordable housing activities, repayment of loans from
communities, use of existing bond proceeds and the disposition
or retention of former redevelopment agency assets.
One of the provisions in AB 1484 allowed successor agencies
that have received a "finding of completion" from DOF to have
additional discretion regarding former agency real property
assets, loan repayments to the local government community that
formed the agency, and use of proceeds from bonds issued by
the former redevelopment agency. In order to receive the
finding of completion, the successor agency must undergo
specified due diligence reviews and make the requirement
payments to DOF.
Once the successor agency receives the finding of completion,
the agency gains access to three specific benefits listed in
statute - first, the ability to transfer former redevelopment
agency-owned properties to the city or county for
redevelopment upon completion of a
long-term management plan approved by DOF; second, the ability
to repay city loans made to the redevelopment agency; and
third, the ability to use unspent bond proceeds issued by
redevelopment agencies prior to December 31, 2010. Once a
finding of completion is issued, the successor agency must
prepare a LRPMP that addresses the disposition and use of the
real properties of the former redevelopment agency. The
report is required to be submitted to the oversight board and
DOF for approval no later than six months following the
issuance to the successor agency of the finding of completion.
Existing law requires DOF to approve a long-range property
management plan by January 1, 2015.
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3)Author's statement. The author notes, "During the February
25, 2014 hearing of the Assembly Budget Subcommittee 6, DOF
reported to Committee members that there are currently 230
long range property management plans that have been submitted
to DOF, 65 of which have been approved. This means that 320
active successor agencies still need DOF approval by the end
of 2014. This submission and review process may take longer
than originally planned.
"Given the fact that the approval of the Plans [LRPMPs] are
the key to preventing widespread "fire sale" of properties
that Legislators were hoping to avoid through the passage of
AB 1484, it is crucial that all successor agencies that are
able to receive a finding of completion are able to get an
approved plan."
4)Arguments in support. Supporters argue that by extending the
deadline, both successor agencies and DOF will experience
increased flexibility to review property assets and the
LRPMPs.
5)Arguments in opposition. None on file.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958
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