BILL ANALYSIS Ó
Bill No: AB
2174
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Lou Correa, Chair
2013-2014 Regular Session
Staff Analysis
AB 2174 Author: Committee on Accountability and
Administrative Review
As Amended: June 2, 2014
Hearing Date: June 10, 2014
Consultant: Paul Donahue
SUBJECT
Department of General Services: Surplus state property
EXISTING LAW
1)Authorizes the Department of General Services (DGS),
subject to legislative approval, to sell, lease,
exchange, or transfer various specified properties for
current market value, or upon such other terms and
conditions that DGS determines are in the best interests
of the state.
2)Unless otherwise specified by law, requires the proceeds
from the sale of surplus state property to be applied
toward payment of principal and interest on the Economic
Recovery Bond Act of 2004. <1>
DESCRIPTION
1)Properties included in AB 2174 are the following:
a) Parcel 1, known as the Employment Development
Department (EDD) parking lot located at 850 Turk
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<1> Proposition 60A, November 2004, SCA 18 (Johnson). See
also, Govt. Code § 11011.
AB 2174 (Committee on Accountability and Administrative
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Street in San Francisco.<2>
b) Parcel 2, consisting of three parcels of
approximately 0.29 acres and improvements, known as
the EDD parking lot located at 700 Golden Gate Avenue
in San Francisco.<3>
c) Parcel 3, known as the Department of General
Services' Bercut Drive Building, located at 570 Bercut
Drive, in Sacramento.<4>
d) Parcel 4, known as the Department of Public Health
lab facility located at 1449 West Temple Street in Los
Angeles.<5>
e) Parcel 5, known as the Department of Corrections
and Rehabilitation (CDCR) Fresno Female Offender
Program Property, located at 2855 Whitesbridge Avenue
in Fresno.<6>
2)AB 2174 specifies, with respect to Parcel 1, an EDD
parking lot in San Francisco, that the parcel has both
federal and state equity. Therefore, proceeds received
from the disposition of Parcel 1 shall be treated as
follows:
a) Proceeds received from the disposition of Parcel 1
shall be in an amount equal to the moneys expended
from the Unemployment Compensation Disability Fund
used to purchase this parcel.
b) Proceeds received from the disposition of Parcel 1
shall be subject to the reimbursement of federal
equity financing, as required under applicable state
and federal law.
BACKGROUND
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<2> The parcel consists of approximately 0.434 acres and
improvements. San Francisco Co. APN 0744-006
<3> San Francisco Co. APN 0761-002, 0761-003, and 0761-022
<4> The parcel consists of approximately 1.5 acres and
improvements. Sacramento Co. APN 01-0181-028
<5> The parcel consists of approximately 1.1 acres and
improvements. Los Angeles Co. APN 5160-005-900
<6> The parcel consists of approximately 2.03 acres and
improvements. Fresno Co. APN 464-020-01-1
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This is the annual DGS-sponsored legislation for the
disposal of surplus State real property. State law requires
state agencies to identify real properties that are excess
to their needs. Legislative authorization is needed to
declare real properties as surplus and to authorize their
disposal by DGS.<7>
All proceeds generated from the sale of surplus properties
are deposited into the Deficit Recovery Bond Retirement
Sinking Fund Subaccount to pay the principal and interest
on bonds issued pursuant to the 2004 Economic Recovery Bond
Act. Once the principal and interest on those bonds are
fully paid, the proceeds from the sale of surplus state
property are deposited into the Special Fund for Economic
Uncertainties, or any successor fund.
General Services Real Estate Services Division (RESD) is
responsible for the disposition of state surplus real
property assets. RESD is also responsible for determining
the present and future space needs of state agencies,
administering the sales and leasing of state-owned surplus
property, and leasing privately-owned space for state
agencies. RESD also assists state landholding agencies in
making real estate decisions regarding their properties.
1) Parcels 1 and 2 - EDD Parcels - San Francisco
EDD notified DGS that these 2 parcels are surplus because
there is no programmatic need or plans for expansion that
merit holding on to the property. The two parcels are
currently used for parking; however, ingress to and
egress from both parcels do not comply with the Americans
with Disabilities Act (ADA) and the topography is a
barrier to any mitigation efforts. DGS states that
disposition of these excess parcels is consistent with
the Administration's initiative to reduce the state
property footprint and supports the City of San
Francisco's efforts to revitalize the area. Parcel 1 is
encumbered by federal equity financing, and the bill
contains necessary references to the applicable means by
which the proceeds will pay off federal obligations
pursuant to law.
2) Parcel 3 - DGS Bercut Drive Building- Sacramento
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<7> See Govt. Code § 11011
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DGS states that, in 1977, the American Justice Institute
conveyed by gift to the state the property at 570 Bercut
Drive, Sacramento. The property consists of a single
story, 16,597 square foot building situated on 1.5 acres
off Richards Boulevard. DGS leased the property to the
Los Rios Community College District (LRCC District)
rent-free, stipulating only that the LRCC District
maintain the property. The LRCC District subsequently
sublet the property to the City of Sacramento Police
Department (Sacramento PD) for training purposes. On July
31, 2008, Sacramento PD vacated the property and returned
the keys to DGS. An inspection of the property found the
building clean, but in a very dated condition.
DGS noted evidence of serious roof leaks and
non-compliance with the ADA throughout the structure's
interior and exterior. A DGS infrastructure study,
completed in 2009, expressed the need for either a total
renovation of the building (approx. $5 million dollars),
or a demolition and rebuild process (approx. $6 million
dollars) to bring the structure up to current building
code standards and ADA compliance. DGS determined that
there is no foreseeable state programmatic use for the
building, and the building remains vacant.
3) Parcel 4 - Department of Public Health - 1449 W. Temple
Street, Los Angeles
This new surplus property is a 30,500 square foot lab
facility situated on 1.1 acres in Los Angeles. The CDPH
should soon have their final decommissioning personnel
moved to their new Lab located at 850 Marina Bay Parkway,
Richmond CA.
4) Parcel 5 - CDCR Fresno Female Offender Program Property
In 1998 CDCR acquired the site at 2855 Whitesbridge Road,
in Fresno. CDCR used the property until June 2012 for its
Female Offender Program. This facility was the last of
three statewide locations closed due to declining
enrollment. CDCR has subsequently determined that the
facility is not suitable for housing other inmates due to
the excessive costs to rehabilitate and secure the
property. The property has several buildings; the first
two were constructed in 1971 as a church, and in 1992,
prior to state acquisition, two dormitories were added.
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The site is approximately 2.0 acres and sits in a largely
industrial and farming area on the westernmost outskirts
of Fresno.
Security at the site is an issue and as a result the
buildings have been extensively vandalized. Until
disposed of the property will continue to present
liability to the state, on-going maintenance and security
expenses for CDCR, and poses a significant nuisance to
the community. Both CDCR and DGS report that there have
been several offers by interested persons to purchase the
property.
PRIOR/RELATED LEGISLATION
AB 826 (Jones-Sawyer), Chapter 505, Statutes of 2013. This
surplus property bill authorized the Director of DGS to
dispose of eight parcels: CDCR's former Preston Youth
Facility housing, Estrella Youth Correctional Facility, an
EDD field office in Vallejo, and five parcels leased to the
Capitol Area Development Authority.
SB 1580 (Senate G.O.Committee), Chapter 798, Statutes of
2012. This bill authorized the Director DGS to dispose of
three parcels: an EDD Field Office in Stockton, CDCR's
Watts Parole Center and CDCR's single family residence
located in Amador County.
AB 1272 (Butler), Chapter 178, Statutes of 2011. The bill
authorized the Director of DGS to dispose of the EDD office
buildings located in Hollywood, Los Angeles, and Oroville.
Other properties included the Hidden Lakes Estates Parcel
near Millerton Lake Recreation Area, the Digger Butte
Lookout near Red Bluff, and the Campbellville Lookout,
located near Chico.
SCA 18 (Johnson), Chapter 103, Statutes of 2004. Required,
among other things, that the proceeds from the sale of
surplus state real property be used to pay the principal
and interest on the Economic Recovery Bond Act of 2004. The
provisions relating to state property were adopted by the
electorate in Proposition 60A of 2004.
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Review) continued
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SUPPORT:
Department of General Services
OPPOSE:
None on File
FISCAL COMMITTEE: Senate Appropriations Committee
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