BILL NUMBER: AB 2412 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 27, 2014
INTRODUCED BY Assembly Member Atkins
FEBRUARY 21, 2014
An act to add Chapter 9 (commencing with Section 51299) to Part 1
of Division 1 of Title 5 of the Government Code, relating to local
government.
LEGISLATIVE COUNSEL'S DIGEST
AB 2412, as amended, Atkins. Cities: community benefit districts.
Existing law authorizes cities and counties to establish various
districts and other entities to provide improvements and other
benefits within their jurisdiction. Existing law, the Property and
Business Improvement District Law of 1994, authorizes cities and
counties, and joint exercise of powers agencies comprised of cities
and counties, to establish property and business improvement
districts for the purpose of financing certain activities and certain
improvements on real property located within the district.
This bill would authorize a local agency , as defined, in the
County of San Diego to form a community benefit district by
complying with specified procedures and requirements, to be operated
by a nonprofit management company, and to levy an assessment for the
funding of certain improvements and activities within the district.
This bill would make legislative findings and declarations as to
the necessity of a special statute for the County of San Diego.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 9 (commencing with Section 51299) is added to
Part 1 of Division 1 of Title 5 of the Government Code, to read:
CHAPTER 9. COMMUNITY BENEFIT DISTRICTS
51299. As used in this chapter the following terms shall have the
following meanings:
(a) "Activities" means activities that benefit real property
located within a commercial, retail, or mixed-use, industrial, or
residential district or neighborhood within the district, and
includes, but is not limited to, all of the following:
(1) Promotion of public events and programs that benefit real
property in the district.
(2) Furnishing of music in any public place within the district.
(3) Promotion of district or neighborhood identity within the
district.
(4) Marketing, planning, zoning, and economic development,
including business retention and recruitment.
(5) Providing security, sanitation, graffiti removal, street and
sidewalk cleaning, parking, and other services supplemental to those
normally provided by the local agency.
(b) "Improvement" means the acquisition, construction,
installation, or maintenance of any tangible property with an
estimated useful life of five years or more, including, but not
limited to, the following:
(1) Parking facilities.
(2) Benches.
(3) Booths.
(4) Kiosks.
(5) Display cases.
(6) Pedestrian shelters and signs.
(7) Trash receptacles and public restrooms.
(8) Lighting and heating facilities.
(9) Decorations.
(10) Fountains.
(11) Planting areas.
(12) Minor modifications of existing streets, facilities, or
equipment, or any combination thereof, to enhance security of persons
and property within the district.
(13) Ramps, sidewalks, plazas, town centers, or pedestrian malls.
(14) Rehabilitation or removal of existing public structures.
(15) Installation or planting of landscaping, the installation or
construction of statuary, fountains, and other ornamental structures
and facilities.
(16) Installation or construction of any facilities that are
appurtenant to any of the foregoing or that are necessary or
convenient for the maintenance or servicing thereof, including, but
not limited to, grading, clearing, removal of debris, the
installation or construction of curbs, gutters, walls, sidewalks or
paving, or water, irrigation, drainage or electrical facilities.
(c) "Legislative body" means a city council or board of
supervisors for a local agency located in the County
of San Diego .
(d) "Local agency" means a city , county, or city and
or county.
(e) "Maintain" or "maintenance" means the furnishing of services
and materials for the ordinary and usual maintenance, operation, and
servicing of any improvement, including the following:
(1) Repair, removal, or replacement of any part of the
improvement.
(2) Providing for the life, growth, health, and beauty of
landscaping, including cultivation, irrigation, trimming, spraying,
fertilization, or treating for disease or injury.
(3) The removal of trimmings, rubbish, debris, and other solid
waste.
(4) The cleaning, sandblasting, and painting of walls and other
improvements to remove or cover graffiti.
(f) "Nonprofit management corporation" means a private nonprofit
entity that is under contract with a city or county to administer or
implement activities and improvements specified in the community
benefit district plan.
51299.1. (a) A local agency may establish a community benefit
district by complying with the procedures established in this
chapter.
(b) A community benefit district may be used to order
improvements, maintenance, or activities, or any combination thereof,
in specifically defined commercial, retail, mixed-use, industrial,
or residential districts or neighborhoods of a local agency. The
local agency shall determine and declare the property owners to be
benefited by the improvement, maintenance, or activities, or any
combination thereof, and assess the cost and expenses of the
improvements, maintenance, and activities, including all expenses
incurred incidentally, upon the lots or parcels of real property in
proportion to the estimated benefits to be received.
51299.2. (a) Upon the receipt of a written petition prepared
pursuant to Section 51299.3, and a community benefit district plan
prepared pursuant to Section 51299.4, the city clerk or county clerk
shall prepare a report pursuant to Section 51299.5, and submit that
report to the legislative body for its consideration.
(b) The legislative body may approve, correct, or modify the
report in any respect, or may direct the city clerk or county clerk
to make changes to the report. If the legislative body approves of
the report, or approves the report as modified and corrected, the
legislative body may pass an ordinance of intention to establish the
district pursuant to Section 51299.6.
(c) If the legislative body passes an ordinance of intention
pursuant to subdivision (b), that legislative body shall notify the
affected property owners at least 45 days prior to the public hearing
pursuant to Sections 51299.7 and 51299.8, and hold a public hearing
on the matter consistent with the procedures of Section 53753.
(d) If the legislative body complies with subdivision (c), and
there is no majority protest as described in Section 53753, then the
legislative body may adopt an ordinance establishing a community
benefit district and levying an assessment pursuant to Section
51299.9.
51299.3. The written petition shall be signed by the property
owners in the proposed district who support the establishment of the
district and who will pay more than 30 percent of the assessments
proposed to be levied. The amount of assessment attributable to
property owned by the same property owner that is in excess of 20
percent of the amount of all assessments proposed to be levied shall
not be included in determining whether the petition is signed by
property owners who will pay more than 30 percent of the total amount
of assessments proposed to be levied.
51299.4. The property owners in the proposed district who support
the establishment of the district shall prepare a community benefit
district plan that shall contain all of the following:
(a) A map of the district in sufficient detail to locate each
parcel of property within the district.
(b) The name of the proposed district.
(c) A description of the boundaries of the district, including the
boundaries of any benefit zones, proposed for the establishment or
extension of the district in a manner sufficient to identify the
lands included. Under no circumstances shall the boundaries of a
proposed district overlap with the boundaries of another existing
district created pursuant to this chapter. Nothing in this chapter
prohibits the boundaries of a district created pursuant to this
chapter from overlapping with other types of assessment districts.
(d) The improvements and activities proposed for each year of
operation of the district and their maximum cost.
(e) The total annual amount proposed to be expended for
improvements, maintenance, and operations.
(f) The proposed source or sources of financing, including the
proposed method and basis of levying the assessment in sufficient
detail to allow each property owner to calculate the amount of the
assessment to be levied against his or her property, including a
statement setting forth the requirement to provide completion bonds
for any improvements that are proposed to be constructed.
(g) The time and manner of collecting the assessments.
(h) Any proposed rules and regulations to be applicable to the
district.
(i) A statement, placed in a conspicuous place in the community
benefit district plan, stating that assessments for the maintenance
of improvements constructed by the district, if any, shall continue
to be levied on each parcel of land within the district for a period
of time equal to the useful life of the improvement, as determined by
the city clerk or county clerk, regardless of whether the district
is disestablished or the term of the original levy has expired.
(j) The name of the nonprofit management corporation that will
administer the district on behalf of the property owners.
51299.5. (a) Before the city council or board of supervisors may
take any action on the ordinance of intention, the city clerk or
county clerk shall prepare and file a report in writing proposing
that the proceeding be commenced as requested in the petition,
designating the plans and specifications of the proposed maintenance,
improvements, and activities for the proposed district, and
estimating the cost and expenses of the work for each year during
which the proposed work will be done.
(b) The report shall include a certified engineer's report stating
that the establishment of the district is consistent with the
provisions of Article XIII D of the California Constitution in that
each lot or parcel within the district to be assessed is being
assessed in proportion to the estimated benefit to be received, and
containing a diagram showing the boundaries of the proposed
assessment district and each lot or parcel of land within the
district proposed to be assessed.
51299.6. (a) The ordinance of intention shall briefly describe
the proposed improvements, state the period of time, which shall not
exceed 20 years, for which the proposed improvements are to be made,
and contain a description of the district that will benefit from the
improvements and that will pay the costs and expenses of the
improvements.
(b) In addition to the requirements of subdivision (a), the
ordinance of intention shall also do all of the following:
(1) State that a district is proposed to be established pursuant
to this chapter and describe the boundaries of the proposed district
and the boundaries of each separate benefit zone to be established
within the district. The boundaries may be described by reference to
the map and description contained in the preliminary report of the
city clerk or county clerk on file in the office of the city clerk or
county clerk.
(2) State the name of the proposed district.
(3) State the type or types of improvements and activities
proposed to be funded by the levy of assessments on property owners
within the district, including any improvements to be acquired.
(4) State the amount of the proposed assessment for the entire
district, the duration of the payments, the reason for the
assessment, and the basis upon which the proposed assessment was
calculated.
(5) State the date, time, and location of a public hearing on the
proposed assessment.
(6) Include a ballot as described in Section 53753.
(7) State, in a conspicuous place, a summary of the procedures
applicable to the completion, return, and tabulation of the ballots,
including a disclosure statement that the existence of a majority
protest will result in the assessment not being imposed.
(8) State that at the public hearing the testimony of all
interested persons for or against the establishment of the district,
the boundaries of the district, or the furnishing of specified types
of improvements or activities will be heard.
(9) Refer to the preliminary report of the city clerk or clerk of
the board of supervisors on file in the office of the city clerk or
clerk of the board of supervisors.
(10) State the manner of collection of the assessment.
51299.7. (a) In addition to the notice and protest procedures
established pursuant to Section 53753, a legislative body shall mail
a complete copy of the ordinance of intention by first-class mail to
each property owner in the proposed district, and to each
neighborhood council known by the legislative body to be located
within the proposed district, no later than 45 days before the public
hearing.
(b) In addition to a first-class mailed notice sent pursuant to
subdivision (a), the legislative body shall publish the ordinance of
intention in a newspaper of general circulation in the local agency
once at least seven days before the public hearing.
51299.8. Following the adoption of the ordinance of intention
pursuant to subdivision (c) of Section 51299.2, the city clerk or
county clerk shall prepare a notice and map describing the assessment
district pursuant to Division 4.5 (commencing with Section 3100) of
the Streets and Highways Code, and file a copy of that map with the
county recorder of each county in which all or any part of the
proposed district is to be located.
Following the adoption of the ordinance establishing the district
pursuant to subdivision (d) of Section 51299.2, the city clerk or
county clerk shall record a map of the newly created district
pursuant to Division 4.5 (commencing with Section 3100) of the
Streets and Highways Code. All the provisions of that division apply
to the district established pursuant to this chapter.
51299.9. (a) The ordinance establishing the district shall
contain all of the following:
(1) A summary of the community benefit district plan.
(2) The number, date of adoption, and title of the ordinance of
intention.
(3) The time and place where the public hearing was held
concerning the establishment of the district or the levying of a new
assessment.
(4) A determination regarding any protests received.
(5) A statement that a district has been established.
(6) A statement that the improvements and activities to be
provided to the district will be funded by the levy of assessments.
The revenue from the levy of assessments within a district shall not
be used to provide improvements or activities outside the district or
for any purpose other than the purposes specified in the ordinance
of intention, as approved, or as modified and approved, by the
legislative body at the hearing concerning the establishment of the
district.
(7) A finding that the property within the district will be
specially benefited by the improvements and activities funded by the
assessment to be levied.
(8) A statement, if applicable, that a completion bond will be
required for any improvements constructed by the district and that a
continuing assessment in an amount sufficient to maintain the
improvement throughout its useful life, as determined by the local
agency, will be levied on each parcel within the district regardless
of whether the district is disestablished or the term of the original
levy has expired.
(b) The adoption of the ordinance establishing the district and
levying the assessment pursuant to subdivision (d) of Section
51299.2, and recordation of the notice and map pursuant to Section
51299.8, shall constitute the levy of an assessment in each of the
fiscal years referred to in the community benefit district plan.
51299.10. The validity of an assessment levied under the
provisions of this chapter shall not be contested in any action or
proceeding unless the action to contest is commenced within 30 days
after the time the assessment is levied, and any appeal from a final
judgment in the action or proceeding shall be perfected within 30
days after entry of the judgment.
51299.11. (a) The legislative body shall contract with a
nonprofit management corporation to manage the district on a
day-to-day basis. The contract shall be for a minimum period of one
year, with the option to renew.
(b) The nonprofit management corporation shall comply with the
following requirements:
(1) The board of the nonprofit management corporation shall be
composed of the property owners of the district.
(2) A nonprofit management corporation is a private entity and may
not be considered a public entity for any purpose, nor may its board
members or staff be considered to be public officials for any
purpose. Notwithstanding this paragraph, a nonprofit management
corporation shall comply with the Ralph M. Brown Act (Chapter 9
(commencing with Section 54950) of Part 1 of Division 2 of Title 5 of
the Government Code), at all times when matters within the subject
matter of the district are heard, discussed, or deliberated, and with
the California Public Records Act (Chapter 3.5 (commencing with
Section 6250) of Division 7 of Title 1 of the Government Code), for
all documents relating to activities of the district.
51299.12. The legislative body may advance funds for the first
quarter of a new district so that the district may commence work
prior to the initial collection of the assessments. The funds
advanced may not exceed one-quarter of the assessment for the first
year. The funds advanced shall then be deducted from the first year's
disbursement.
51299.13. The collection of assessments levied pursuant to this
chapter shall be made at the time and in the manner set forth by the
legislative body in the ordinance of intention. The assessment may be
collected at the same time and in the same manner as for the ad
valorem property tax, and may provide for the same lien priority and
penalties for delinquent payment.
51299.14. (a) The nonprofit management corporation shall prepare
an annual report that shall explain the results of the improvements
and activities funded by the district.
(b) The report shall be filed with the city clerk or county clerk
and shall refer to the district by name, specify the fiscal year to
which the report applies, and, with respect to that fiscal year,
shall contain all of the following information:
(1) Any proposed changes in the boundaries of the district or in
any benefit zones within the district.
(2) The improvements and activities to be provided for that fiscal
year.
(3) An estimate of the cost of providing the improvements and the
activities for that fiscal year.
(4) The method and basis of levying the assessment in sufficient
detail to allow each real property owner to estimate the amount of
the assessment to be levied against his or her property for that
fiscal year.
(5) The amount of any surplus or deficit revenues to be carried
over from a previous fiscal year.
(6) The amount of any contributions to be made from sources other
than assessments levied pursuant to this chapter.
(c) The legislative body may approve the report as filed by the
nonprofit management corporation or may modify any particular
contained in the report and approve it as modified. Any modification
shall be made pursuant to Section 51299.16. The legislative body
shall not approve a change on the basis and in the method of levying
assessments that would impair an authorized or executed contract to
be paid from the revenues derived from the levy of assessments.
51299.15. A community benefit district, the improvements or
activities provided by the community benefit district, and any
assessment levied to support the community benefit district pursuant
to this chapter shall not extend beyond 20 years after the date of
the creation of the district by the local agency.
51299.16. (a) A legislative body may modify a community benefit
district plan in accordance with the procedures established by this
section.
(b) The nonprofit management corporation may, at any time, request
that the legislative body modify the community benefit district
plan. Upon the written request of the nonprofit management
corporation, the legislative body may adopt an ordinance of intention
to modify the community district plan. The ordinance of intention
shall state the proposed modifications to the community benefit
district plan. The legislative body shall notify the affected
property owners of the proposed modifications at least 45 days prior
to the public hearing pursuant to Sections 51299.7 and 51299.8, and
hold a public hearing on the matter consistent with the procedures of
Section 53753.
(c) If the legislative body complies with subdivision (b), and
there is no majority protest as described in Section 53753, then the
legislative body may adopt an ordinance modifying the community
benefit district plan in accordance with the ordinance of intention.
(d) Any subsequent modification of the ordinance shall be
reflected in subsequent notices and maps recorded pursuant to
Division 4.5 (commencing with Section 3100) of the Streets and
Highways Code.
51299.17. (a) A legislative body may disestablish a district
established pursuant to the provisions of this chapter where there is
no indebtedness, outstanding and unpaid, incurred to accomplish any
of the purposes of the district, in either of the following
circumstances:
(1) The legislative body finds there has been misappropriation of
funds, malfeasance, or a violation of law in connection with the
management of the district.
(2) The property owners in the district who pay 30 percent or more
of the assessment levied file a written petition with the local
agency requesting to disestablish the district. During the operation
of the district, there shall be a 30-day period each year in which
assessees may request disestablishment of the district. The first
period shall begin one year after the date of establishment of the
district and shall continue for 30 days. The next 30-day period shall
begin two years after the date of the establishment of the district.
Each successive year of operation of the district shall have such a
30-day period.
(b) (1) If a valid ground to disestablish the district exists
pursuant to subdivision (a), the legislative body may disestablish
the district by adopting an ordinance of intention to disestablish
the district. The ordinance of intention shall state the reason for
the disestablishment, the time and place of the public hearing, and
contain a proposal to dispose of any assets acquired with the
revenues of the assessments levied within the property and business
improvement district.
(2) The legislative body shall notify the affected property owners
of the disestablishment as provided in Section 51299.7, and shall
hold a public hearing on the disestablishment no less than 30 days
and no more than 60 days after the adoption of the ordinance of
intention in accordance with the procedures in Section 53753.
(3) After holding a public hearing, the legislative body may adopt
an ordinance to disestablish the district.
(c) (1) Upon the disestablishment of the district, any remaining
revenues derived from the levy of assessments, or any revenues
derived from the sale of assets acquired with the revenues, shall be
refunded to the owners of the property located and operating within
the district in which assessments were levied by applying the same
method and basis that was used to calculate the assessments levied in
the fiscal year in which the district was disestablished, other than
amounts needed to maintain any improvements constructed by the
district.
(2) If the disestablishment occurs before an assessment is levied
for the fiscal year, the method and basis that was used to calculate
the assessment levied in the immediate prior fiscal year shall be
used to calculate the amount of refund.
(3) In the event that the district has constructed any
improvements, an amount of assessment equal to the amount needed to
maintain the improvements through its useful life, as determined by
the legislative body, shall continue to be levied upon each parcel in
the district after disestablishment of the district.
(d) The legislative body shall publish a notice of the
disestablishment of a district once in a newspaper of general
circulation in the local agency, not later than 15 days after the
ordinance disestablishing the district is adopted.
SEC. 2. The Legislature finds and declares that a
special law is necessary and that a general law cannot be made
applicable within the meaning of Section 16 of Article IV of the
California Constitution because of the unique circumstances and
concerns regarding the provision of real property-related
improvements and activities in the County of San Diego.