Amended in Senate August 4, 2014

Amended in Senate June 9, 2014

Amended in Assembly May 5, 2014

Amended in Assembly April 21, 2014

Amended in Assembly March 28, 2014

California Legislature—2013–14 Regular Session

Assembly BillNo. 2135


Introduced by Assembly Member Ting

February 20, 2014


An act to amend Sectionsbegin insert 54220,end insert 54223, 54225, 54226, and 54227 of, and to add Sections 54222.5 and 54233 to, the Government Code, relating to local government.

LEGISLATIVE COUNSEL’S DIGEST

AB 2135, as amended, Ting. Surplus land: affordable housing.

(1) Existing law prescribes requirements for the disposal of surplus land by a local agency, as defined. Existing law requires a local agency disposing of surplus land to negotiate in good faith with certain entities that provided notice of a desire to purchase or lease the land and, if the price or terms cannot be agreed upon within a period of not less than 60 days with those entities, the local agency may dispose of the surplus land without fulfilling further requirements, as specified. Existing law authorizes a local agency selling surplus land for specified purposes to specified entities, including, but not limited to, low- and moderate-income housing, to provide a payment period of up to 20 years in a sales contract or trust deed. Existing law requires a local agency disposing of surplus land to give first priority in a purchase or lease to an entity agreeing to use the site for housing for persons of low or moderate income, except as specified. Existing law specifies that these and other related provisions are not to be interpreted to empower a local agency to sell or lease surplus land at less than fair market value.

This bill would require an entity proposing to use the surplus land for developing low- and moderate-income housing to agree to make available not less than 25% of the total number of units developed on the parcels at affordable housing cost or affordable rent for a period of at least 55 years to lower-income households, as those terms are defined in existing law. This bill would require a local agency to give first priority in disposing of the surplus land to an entity that agrees to these requirements. This bill would also require these requirements, as specified, to be contained in a covenant or restriction recorded against the surplus land at the time of sale, to run with the land, and be enforceable, against any owner who violates the covenant or restriction and each successor-in-interest who continues the violation, by a residents’ association, as specified, and certain individuals, that include, but are not limited to, a resident of a unit subject to these requirements. This bill would increase the minimum time that an agency disposing of surplus land is required to conduct negotiations with certain entities desiring to purchase or lease the surplus land from 60 to 90 days. This bill would require, if the local agency does not agree to price and terms with those certain entities and the surplus land is used for the development of 10 or more residential units, the entity or a successor-in-interest that received the surplus land to provide not less than 15% of the total number of units developed on the parcels at affordable housing cost or affordable rent, at terms similar to an entity that received first priority for providing not less than 25% of the total number of units at affordable housing cost or affordable rent, as specified.

This bill would permit the payment period for surplus land sold for low- and moderate-income housing purposes to exceed 20 years, subject to limits related to land use requirements for low- or moderate-income housing.

This bill would delete the statement that these provisions are not to be interpreted to empower a local agency to sell or lease surplus land at less than fair marketbegin delete value.end deletebegin insert value, and would provide that a sale or lease at or less than fair market value, as specified, shall not be construed as inconsistent with an agency’s purpose.end insert By increasing the duties of local officials in connection with sales and leases of surplus land, this bill would impose a state-mandated local program.

(2) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 54220 of the end insertbegin insertGovernment Codeend insertbegin insert is
2amended to read:end insert

3

54220.  

(a) The Legislature reaffirms its declaration that
4housing is of vital statewide importance to the health, safety, and
5welfare of the residents of this state and that provision of a decent
6home and a suitable living environment for every Californian is a
7priority of the highest order. The Legislature further declares that
8there is a shortage of sites available for housing for persons and
9families of low and moderate income and that surplus government
10land, prior to disposition, should be made available for that
11purpose.

12(b) The Legislature reaffirms its belief that there is an
13identifiable deficiency in the amount of land available for
14recreational purposes and that surplus land, prior to disposition,
15should be made available for park and recreation purposes or for
16open-space purposes. This article shall not apply to surplus
17residential property as defined in Section 54236.

18(c) The Legislature reaffirms its declaration of the importance
19of appropriate planning and development near transit stations, to
20encourage the clustering of housing and commercial development
21around such stations. Studies of transit ridership in California
22indicate that a higher percentage of persons who live or work
23within walking distance of major transit stations utilize the transit
24system more than those livingbegin delete elsewhere.end deletebegin insert elsewhere, and that lower
25income households are more likely to use transit when living near
26a major transit station than higher income households. The sale
P4    1or lease of surplus land at less than fair market value to facilitate
2the creation of affordable housing near transit is consistent with
3goals and objectives to achieve optimal transportation use.end insert
The
4Legislature also notes that the Federal Transit Administration gives
5priority for funding of rail transit proposals to areas that are
6implementing higher-density,begin delete mixed-useend deletebegin insert mixed-use, and affordableend insert
7 development near major transit stations.

8

begin deleteSECTION 1.end delete
9begin insertSEC. 2.end insert  

Section 54222.5 is added to the Government Code, to
10read:

11

54222.5.  

An entity proposing to use the surplus land for
12developing low- and moderate-income housing shall agree to make
13available not less than 25 percent of the total number of units
14developed on the parcels at affordable housing cost, as defined in
15Section 50052.5 of the Health and Safety Code, or affordable rent,
16as defined in Section 50053 of the Health and Safety Code, to
17lower income households, as defined in Section 50079.5 of the
18Health and Safety Code. Rental units shall remain affordable to,
19and occupied by, lower income households for a period of at least
2055 years. The initial occupants of all ownership units shall be lower
21income households, and the units shall be subject to an equity
22sharing agreement consistent with paragraph (2) of subdivision
23(c) of Section 65915. These requirements shall be contained in a
24covenant or restriction recorded against the surplus land at the time
25of sale, which shall run with the land and shall be enforceable,
26against any owner who violates a covenant or restriction and each
27successor in interest who continues the violation, by any of the
28following:

29(a) The local agency that disposed of the property.

30(b) A resident of a unit subject to this section.

31(c) A residents association with members who reside in units
32subject to this section.

33(d) A former resident of a unit subject to this section who last
34resided in that unit.

35(e) An applicant seeking to enforce the covenants or restrictions
36for a particular unit that is subject to this section, if the applicant
37conforms to all of the following:

38(1) Is of low or moderate income, as defined in Section 50093
39of the Health and Safety Code.

40(2) Is able and willing to occupy that particular unit.

P5    1(3) Was denied occupancy of that particular unit due to an
2alleged breach of a covenant or restriction implementing this
3section.

4(f) A person on an affordable housing waiting list who is of low
5or moderate income, as defined in Section 50093 of the Health
6and Safety Code, and who is able and willing to occupy a unit
7subject to this section.

8

begin deleteSEC. 2.end delete
9begin insertSEC. 3.end insert  

Section 54223 of the Government Code is amended
10to read:

11

54223.  

After the disposing agency has received notice from
12the entity desiring to purchase or lease the land, the disposing
13agency and the entity shall enter into good faith negotiations to
14determine a mutually satisfactory sales price or lease terms. If the
15price or terms cannot be agreed upon after a good faith negotiation
16period of not less than 90 days, the land may be disposed of without
17further regard to this article, except that Section 54233 shall apply.

18

begin deleteSEC. 3.end delete
19begin insertSEC. 4.end insert  

Section 54225 of the Government Code is amended
20to read:

21

54225.  

Any public agency selling surplus land to an entity
22described in Section 54222 for park or recreation purposes, for
23open-space purposes, for school purposes, or for low- and
24moderate- income housing purposes may provide for a payment
25period of up to 20 years in any contract of sale or sale by trust deed
26for the land. The payment period for surplus land sold for housing
27for persons and families of low and moderate income may exceed
2820 years, but the payment period shall not exceed the term that the
29land is required to be used for low- or moderate-income housing.

30

begin deleteSEC. 4.end delete
31begin insertSEC. 5.end insert  

Section 54226 of the Government Code is amended
32to read:

33

54226.  

This article shall not be interpreted to limit the power
34of any local agency to sell or lease surplus land at fair market value
35or at less than fair marketbegin delete value.end deletebegin insert value, and any such sale or lease
36at or less than fair market value consistent with this article shall
37not be construed as inconsistent with an agency’s purpose.end insert
No
38provision of this article shall be applied when it conflicts with any
39other provision of statutory law.

P6    1

begin deleteSEC. 5.end delete
2begin insertSEC. 6.end insert  

Section 54227 of the Government Code is amended
3to read:

4

54227.  

(a) In the event that any local agency disposing of
5surplus land receives offers for the purchase or lease of that land
6from more than one of the entities to which notice and an
7opportunity to purchase or lease shall be given pursuant to this
8article, the local agency shall give first priority to the entity that
9agrees to use the site for housing that meets the requirements of
10Section 54222.5. If the local agency receives offers from more
11than one entity that agrees to meet the requirements of Section
1254222.5, then the local agency shall give priority to the entity that
13proposes to provide the greatest number of units that meet the
14requirements of Section 54222.5 at the deepest level of
15affordability.

16(b) Notwithstanding subdivision (a), first priority shall be given
17to an entity that agrees to use the site for park or recreational
18purposes if the land being offered is already being used and will
19continue to be used for park or recreational purposes, or if the land
20is designated for park and recreational use in the local general plan
21and will be developed for that purpose.

22

begin deleteSEC. 6.end delete
23begin insertSEC. 7.end insert  

Section 54233 is added to the Government Code, to
24read:

25

54233.  

If the local agency does not agree to price and terms
26with an entity to which notice and an opportunity to purchase or
27lease are given pursuant to this article and disposes of the surplus
28land to an entity that uses the property for the development of 10
29or more residential units, the entity or a successor-in-interest shall
30provide not less than 15 percent of the total number of units
31developed on the parcels at affordable housing cost, as defined in
32Section 50052.5 of the Health and Safety Code, or affordable rent,
33as defined in Section 50053 of the Health and Safety Code, to
34lower income households, as defined in Section 50079.5 of the
35Health and Safety Code. Rental units shall remain affordable to,
36and occupied by, lower income households for a period of at least
3755 years. The initial occupants of all ownership units shall be lower
38income households, and the units shall be subject to an equity
39sharing agreement consistent with the provisions of paragraph (2)
40of subdivision (c) of Section 65915. These requirements shall be
P7    1contained in a covenant or restriction recorded against the surplus
2land prior to land use entitlement of the project, and the covenant
3or restriction shall run with the land and shall be enforceable,
4against any owner who violates a covenant or restriction and each
5successor in interest who continues the violation, by any of the
6entities described in subdivisions (a) to (f), inclusive, of Section
754222.5.

8

begin deleteSEC. 7.end delete
9begin insertSEC. 8.end insert  

If the Commission on State Mandates determines that
10this act contains costs mandated by the state, reimbursement to
11local agencies and school districts for those costs shall be made
12pursuant to Part 7 (commencing with Section 17500) of Division
134 of Title 2 of the Government Code.



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