Amended in Assembly August 26, 2013

Amended in Senate March 6, 2013

Senate Bill No. 33

Introduced by Senator Wolk

( begin delete Coauthor end delete begin insert Coauthors end insert : Assembly begin delete Member end delete begin insert Members end insert Frazier begin insert and V. end insert begin insert  Manuel end insert begin insert  Pérez end insert )

December 3, 2012

An act to amend Sections 53395, 53395.1, 53395.2, 53395.3, 53395.4, 53395.5, 53395.6, 53395.7, 53395.10, 53395.11, 53395.12, 53395.13, 53395.14, 53395.16, 53395.17, 53395.19, 53395.20, 53396, 53397.1, and 53397.2 of, to repeal Sections 53395.22, 53395.23, 53395.24, 53395.25, 53397.5, 53397.6, and 53397.7 of, and to repeal and add Section 53395.21 of, the Government Code, relating to infrastructure financing districts.

LEGISLATIVE COUNSEL’S DIGEST

SB 33, as amended, Wolk. Infrastructure financing districts: voter approval: repeal.

(1) Existing law authorizes a legislative body, as defined, to create an infrastructure financing district, adopt an infrastructure financing plan, and issue bonds, for which only the district is liable, to finance specified public facilities, upon voter approval. Existing law authorizes an infrastructure financing district to fund infrastructure projects through tax increment financing, pursuant to the infrastructure financing plan and agreement of affected taxing entities, as defined.

This bill would revise and recast the provisions governing infrastructure financing districts. The bill would eliminate the requirement of voter approval for creation of the district and for bond issuance, and would authorize the legislative body to create the district subject to specified procedures. The bill would instead authorize a newly created public financing authority, consisting of 5 members, 3 of whom are members of the city council or board of supervisors that established the district, and 2 of whom are members of the public, to adopt the infrastructure financing plan, subject to approval by the legislative body, and issue bonds by majority vote of the authority by resolution. The bill would authorize a public financing authority to enter into joint powers agreements with affected taxing entities with regard to nontaxing authority or powers only. The bill would authorize a district to finance specified actions and projects, and prohibit the district from providing financial assistance to a vehicle dealer or big box retailer, as defined. begin insert The bill would prohibit a district from financing any project or portion of a project within the boundaries of a former redevelopment agency until the successor agency to the former redevelopment agency has received a finding of completion. end insert The bill would create a public accountability committee, as specified, to review the actions of the public financing authority.

(2) Existing law requires that an infrastructure financing plan created by a legislative body include a date on which the district will cease to exist, which shall not be more than 30 years from the date on which the ordinance forming the district is adopted.

This bill instead would specify that the date on which the district would cease to exist would not be more than 40 years from the date on which the public financing authority adopted the resolution adopting the infrastructure financing plan. The bill would also impose additional reporting requirements after the adoption of an infrastructure financing plan.

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.  

Section 53395 of the Government Code is
amended to read:

53395.  

(a) The Legislature finds and declares that the state
and federal governments have withdrawn in whole or in part from
their former role in financing infrastructure, including highways
and interchanges, sewage treatment and water reclamation works,
water supply and treatment works, flood control and drainage
works, schools, libraries, parks, parking facilities, open space, and
seismic retrofit and rehabilitation of public facilities.

(b) The Legislature further finds and declares that the methods
available to local agencies to finance public works often place an
undue and unfair burden on buyers of new homes, especially for
public works that benefit the broader community.

(c) The Legislature further finds and declares that the absence
of practical and equitable methods for financing public works leads
to a declining standard of public works, a reduced quality of life
and decreased safety for affected citizens, increased objection to
otherwise desirable development, and excessive costs for
homebuyers.

(d) The Legislature further finds and declares that because
California’s disadvantaged communities, as defined in Section
75005 of the Public Resources Code, may not be beneficiaries of
quality public works, these communities are neglected and, thus,
isolated from and deprived of the basic facilities needed for public
health and safety.

(e) The Legislature further finds and declares that it is equitable
and in the public interest to provide alternative procedures for
financing public works and services needed to meet the needs of
new housing, disadvantaged communities, and other development
projects.

(f) The Legislature further finds and declares that it is in the
public interest to develop a mechanism that allows public agencies
to jointly dedicate their revenues to projects that support sustainable
communities.

(g) The Legislature further finds and declares that infrastructure
financing districts implement and fulfill the intent of Article 2
(commencing with Section 53395.10) and of Article XIII B of the
California Constitution, and are consistent with the conclusion of
California courts that tax increment revenues are not “proceeds of
taxes” for purposes of Article XIII B of the California Constitution.
The allocation and payment to a district of the portion of taxes
specified in this section for the purpose of paying principal of, or
interest on, loans, advances, or indebtedness incurred for facilities
or the cost of acquisition and construction of facilities under this
section shall not be deemed the receipt by a district of proceeds
of taxes levied by or on behalf of the district within the meaning
or for the purposes of Article XIII B of the California Constitution,
nor shall this portion of taxes be deemed receipt of proceeds of
taxes by, or an appropriation subject to limitation of, any other
public body within the meaning or for the purposes of Article XIII
B of the California Constitution or any statutory provision enacted
in the implementation of Article XIII B of the California
Constitution. The allocation and payment to a district of this portion
of taxes shall not be deemed the appropriation by a district of
proceeds of taxes levied by or on behalf of a district within the
meaning or for the purposes of Article XIII B of the California
Constitution.

SEC. 2.  

Section 53395.1 of the Government Code is amended
to read:

53395.1.  

Unless the context otherwise requires, the definitions
contained in this article shall govern the construction of this
chapter.

(a) “Affected taxing entity” means any governmental taxing
agency which levied or had levied on its behalf a property tax on
all or a portion of the property located in the proposed district in
the fiscal year prior to the designation of the district, but not
including any county office of education, school district, or
community college district.

(b) “City” means a city, a county, or a city and county.

(c) “Debt” means any binding obligation to repay a sum of
money, including obligations in the form of bonds, certificates of
participation, long-term leases, loans from government agencies,
or loans from banks, other financial institutions, private businesses,
or individuals.

(d) “Designated official” means the city engineer or other
appropriate official designated pursuant to Section 53395.13.

(e) (1) “District” means an infrastructure financing district.

(2) An infrastructure financing district is a “district” within the
meaning of Section 1 of Article XIII A of the California
Constitution.

(f) “Infrastructure financing district” means a legally constituted
public and corporate governmental entity separate and distinct
from the city that established it pursuant to this chapter for the sole
purpose of financing public facilities. An infrastructure financing
district shall be a “local agency” for purposes of Chapter 9
(commencing with Section 54950).

(g) “Landowner” or “owner of land” means any person shown
as the owner of land on the last equalized assessment roll or
otherwise known to be the owner of the land by the legislative
body. The legislative body has no obligation to obtain other
information as to the ownership of land, and its determination of
ownership shall be final and conclusive for the purposes of this
chapter. A public agency is not a landowner or owner of land for
purposes of this chapter, unless the public agency owns all of the
land to be included within the proposed district.

(h) “Legislative body” means the city council or board of
supervisors.

(i) “Public capital facilities of communitywide significance”
means facilities that benefit all areas within the district or serve or
are made available to those areas.

(j) “Public financing authority” means the legislative body of
the infrastructure financing district established pursuant to this
chapter. The public financing authority shall be comprised of five
people, three of whom shall be members of the city council or
board of supervisors that established the district pursuant to this
chapter and two of whom shall be public members. The three
members of the city council or board of supervisors shall appoint
the two public members in accordance with Chapter 11
(commencing with Section 54970) of Part 1 of Division 2 of Title
5.

begin insert

(k) “Net available revenue” means periodic distributions to the
city, county, or special district from the Redevelopment Property
Tax Trust Fund, created pursuant to Section 34170.5 of the Health
and Safety Code, that are available to the city, county, or special
district after all preexisting legal commitments and statutory
obligations funded from that revenue are made pursuant to Part
1.85 (commencing with Section 34170) of Division 24 of the Health
and Safety Code. Net available revenue shall not include any funds
deposited by the county auditor-controller into the Redevelopment
Property Tax Trust Fund or funds remaining in the Redevelopment
Property Tax Trust Fund, prior to distribution. Net available
revenues shall not include any moneys payable to a school district
that maintains kindergarten and grades 1 to 12, inclusive, or to
the Educational Revenue Augmentation Fund, pursuant to
paragraph (4) of subdivision (a) of Section 34183 of the Health
and Safety Code.

end insert

SEC. 3.  

Section 53395.2 of the Government Code is amended
to read:

53395.2.  

(a) The revenues available pursuant to Article 3
(commencing with Section 53396) may be used directly for work
allowed pursuant to Section 53395.3, may be accumulated for a
period not to exceed five years to provide a fund for that work,
may be pledged to pay the principal of, and interest on, bonds
issued pursuant to Article 4 (commencing with Section 53397),
or may be pledged to pay the principal of, and interest on, bonds
issued pursuant to the Improvement Bond Act of 1915 (Division
10 (commencing with Section 8500) of the Streets and Highways
Code) or the Mello-Roos Community Facilities Act of 1982
(Chapter 2.5 (commencing with Section 53311)), the proceeds of
which have been or will be used entirely for allowable purposes
of the district. The revenue of the district may also be advanced
for allowable purposes of the district to an integrated financing
district established pursuant to Chapter 1.5 (commencing with
Section 53175), in which case the district may be party to a
reimbursement agreement established pursuant to that chapter.
The revenues of the district may also be committed to paying for
any completed public facility acquired pursuant to Section 53395.3
over a period of time, including the payment of a rate of interest
not to exceed the bond buyer index rate on the day that the
agreement to repay is entered into by the district.

(b) The public financing authority may enter into an agreement
with any affected taxing entity providing for the construction of,
or assistance in, financing activities pursuant to Section 53395.3.

SEC. 4.  

Section 53395.3 of the Government Code is amended
to read:

53395.3.  

(a) A district may finance (1) the purchase,
construction, expansion, improvement, seismic retrofit, or
rehabilitation of any real or other tangible property with an
estimated useful life of 15 years or longer that satisfies the
requirements of subdivision (b), (2) may finance planning and
design work that is directly related to the purchase, construction,
expansion, or rehabilitation of that property, (3) the costs described
in Sections 53395.5 and 53396.5, and (4) may contribute to the
cost of maintaining facilities that are financed pursuant to
subdivision (b). A district may only finance the purchase of
facilities for which construction has been completed, as determined
by the legislative body. The facilities need not be physically located
within the boundaries of the district. Except as specifically provided
in this section, a district shall not finance routine maintenance,
repair work, or the costs of ongoing operation or providing services
of any kind. A district shall not compensate the members of the
legislative body of the city or the district for any activities
undertaken pursuant to this chapter.

(b) The district shall finance only structural or nonstructural
public capital facilities of communitywide significance, including,
but not limited to, all of the following:

(1) Highways, interchanges, ramps and bridges, arterial streets,
parking facilities, and transit facilities.

(2) Sewage treatment and water reclamation plants and
interceptor pipes.

(3) Facilities and watershed lands used for the collection and
treatment of water for urban uses.

(4) Flood control management including levees, bypasses, dams,
retention basins, and drainage channels.

(5) Child care facilities.

(6) Libraries.

(7) Parks, recreational facilities, open space, and habitat
restoration.

(8) Facilities for the transfer and disposal of solid waste,
including transfer stations and vehicles.

(c) The district shall be a local agency within the meaning of
subdivision (d) of Section 33459 of the Health and Safety Code
and may finance any actions necessary to implement the Polanco
Redevelopment Act (Article 12.5 (commencing with Section
33459) of Chapter 4 of Part 1 of Division 24 of the Health and
Safety Code).

(d) The district may finance any project that implements a transit
priority project pursuant to Section 65470, regional transportation
plan, or other projects that are consistent with the general use
designation, density, building intensity, and applicable policies
specified for the project area in either a sustainable communities
strategy or an alternative planning strategy, for which the State
Air Resources Board, pursuant to Chapter 2.5 (commencing with
Section 65080) of Division 2 of Title 7, has accepted a metropolitan
planning organization’s determination that the sustainable
communities strategy or the alternative planning strategy would,
if implemented, achieve the greenhouse gas emission reduction
targets.

(e) Any district that constructs dwelling units shall set aside not
less than 20 percent of those units to increase and improve the
community’s supply of low- and moderate-income housing
available at an affordable housing cost, as defined by Section
50052.5 of the Health and Safety Code, to persons and families of
low- and moderate-income, as defined in Section 50093 of the
Health and Safety Code.

(f) Projects financed pursuant to this section that involve
construction, alteration, demolition, installation, or repair work
and dwelling units constructed by a district pursuant to this section,
shall be subject to Chapter 1 (commencing with Section 1720) of
Part 7 of Division 2 of the Labor Code.

SEC. 5.  

Section 53395.4 of the Government Code is amended
to read:

53395.4.  

(a) A district shall not provide any form of financial
assistance to a vehicle dealer or a big box retailer, or a business
entity that sells or leases land to a vehicle dealer or big box retailer,
that is relocating from the territorial jurisdiction of one local agency
to the territorial jurisdiction of another local agency, but within
the same market area, as those terms are used in Section 53084.

(b) A district may finance only the facilities authorized in this
chapter to the extent that the facilities are in addition to those
provided in the territory of the district before the district was
created. The additional facilities may not supplant facilities already
available within that territory when the district was created but
may supplement, rehabilitate, upgrade, or make more sustainable
those facilities.

(c) A district may include areas that are not contiguous.

begin insert

(d) If the boundaries of a district overlap with the boundaries
of a former redevelopment agency, a participating city, county, or
special district may allocate its share of net available revenue, as
defined by subdivision (k) of Section 53395.1 of the Government
Code, from within the boundaries of the former redevelopment
agency to the district.

end insert begin insert

(e) A district shall not finance any project or portion of a project
within the boundaries of a former redevelopment agency until the
successor agency to the former redevelopment agency has received
a finding of completion, as defined by Section 34179.7 of the Health
and Safety Code, and has no pending litigation against the state
related to Part 1.8 (commencing with Section 34161) or Part 1.85
(commencing with Section 34170) of the Health and Safety Code.

end insert

SEC. 6.  

Section 53395.5 of the Government Code is amended
to read:

53395.5.  

It is the intent of the Legislature that the establishment
of a district should not ordinarily lead to the removal of existing
dwelling units. If, however, any dwelling units are proposed to be
removed or destroyed in the course of private development or
public works construction within the area of the district, the
legislative body shall do all of the following:

(a) Within four years of the removal or destruction, cause or
require the construction or rehabilitation, for rental or sale to
persons or families of low or moderate income, of an equal number
of replacement dwelling units at affordable housing cost, as defined
in Section 50052.5 of the Health and Safety Code, within the
territory of the district if the dwelling units removed were inhabited
by persons or families of low or moderate income, as defined in
Section 50093 of the Health and Safety Code.

(b) Within four years of the removal or destruction, cause or
require the construction or rehabilitation, for rental or sale to
persons of low or moderate income, a number of dwelling units
which is at least one unit but not less than 20 percent of the total
dwelling units removed at affordable housing cost, as defined in
Section 50052.5 of the Health and Safety Code, within the territory
of the district if the dwelling units removed or destroyed were not
inhabited by persons of low or moderate income, as defined in
Section 50093 of the Health and Safety Code.

(c) Provide relocation assistance and make all the payments
required by Chapter 16 (commencing with Section 7260) of
Division 7 of Title 1, to persons displaced by any public or private
development occurring within the territory of the district. This
displacement shall be deemed to be the result of public action.

(d) Ensure that removal or destruction of any dwelling units
occupied by persons or families of low or moderate income not
take place unless and until there are suitable housing units, at
comparable cost to the units from which the persons or families
were displaced, available and ready for occupancy by the residents
of the units at the time of their displacement. The housing units
shall be suitable to the needs of these displaced persons or families
and shall be decent, safe, sanitary, and otherwise standard
dwellings.

SEC. 7.  

Section 53395.6 of the Government Code is amended
to read:

53395.6.  

Any action or proceeding to attack, review, set aside,
void, or annul the creation of a district or adoption of an
infrastructure financing plan, including a division of taxes
thereunder, shall be commenced within 30 days after the date the
legislative body adopted the resolution adopting the infrastructure
financing plan pursuant to Section 53395.20. Consistent with the
time limitations of this section, such an action or proceeding with
respect to a division of taxes under this chapter may be brought
pursuant to Chapter 9 (commencing with Section 860) of Title 10
of Part 2 of the Code of Civil Procedure, except that Section 869
of the Code of Civil Procedure shall not apply.

SEC. 8.  

Section 53395.7 of the Government Code is amended
to read:

53395.7.  

An action to determine the validity of the issuance
of bonds pursuant to this chapter may be brought pursuant to
Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of
the Code of Civil Procedure. However, notwithstanding the time
limits specified in Section 860 of the Code of Civil Procedure, the
action shall be commenced within 30 days after the date the
legislative body adopted the resolution adopting the infrastructure
financing plan authorizing the issuance of the bonds pursuant to
Section 53397.1, if the action is brought by an interested person
pursuant to Section 863 of the Code of Civil Procedure. Any appeal
from a judgment in that action or proceeding shall be commenced
within 30 days after entry of judgment.

SEC. 9.  

Section 53395.10 of the Government Code is amended
to read:

53395.10.  

A legislative body of a city may designate one or
more proposed infrastructure financing districts pursuant to this
chapter. Proceedings for the establishment of a district shall be
instituted by the adoption of a resolution of intention to establish
the proposed district and shall do all of the following:

(a) State that an infrastructure financing district is proposed to
be established under the terms of this chapter and describe the
boundaries of the proposed district, which may be accomplished
by reference to a map on file in the office of the clerk of the city.

(b) State the type of public facilities and development proposed
to be financed or assisted by the district in accordance with Section
53395.3.

(c) State the need for the district and the goals the district
proposes to achieve.

(d) State that incremental property tax revenue from the city
and some or all affected taxing entities within the district, if
approved by resolution pursuant to Section 53395.19, may be used
to implement the plan adopted pursuant to Section 53395.14.

(e) Fix a time and place for a public hearing on the proposal.

SEC. 10.  

Section 53395.11 of the Government Code is amended
to read:

53395.11.  

The legislative body shall direct the clerk to mail a
copy of the resolution of intention to create the district to each
owner of land within the district and to each affected taxing entity.

SEC. 11.  

Section 53395.12 of the Government Code is amended
to read:

53395.12.  

(a) The legislative body shall direct the clerk to post
a copy of the resolution of intention to create the district in an
easily identifiable and accessible location on the legislative body’s
Internet Web site.

(b) At the conclusion of the public hearing scheduled pursuant
to subdivision (e) of Section 53395.10, the legislative body of the
city may adopt a resolution establishing the infrastructure financing
district and the public financing authority of the district based upon
a finding that (1) the goals of the district are consistent with the
general plan; and (2) the financing programs undertaken by the
district are an efficient means of implementing the goals of the
district.

SEC. 12.  

Section 53395.13 of the Government Code is amended
to read:

53395.13.  

After adopting the resolution pursuant to Section
53395.12, the legislative body shall send a copy of the resolution
to the public financing authority. Upon receipt of the resolution,
the public financing authority shall designate and direct the city
engineer or other appropriate official to prepare an infrastructure
plan pursuant to Section 53395.14.

SEC. 13.  

Section 53395.14 of the Government Code is amended
to read:

53395.14.  

The official designated pursuant to Section 53395.13
shall prepare a proposed infrastructure financing plan. The
infrastructure financing plan shall be consistent with the general
plan of the city within which the district is located and shall include
all of the following:

(a) A map and legal description of the proposed district, which
may include all or a portion of the district designated by the
legislative body in its resolution of intention.

(b) A description of the public facilities, or assistance, that
benefits or serves the development proposed in the area of the
district including those to be provided by the private sector, those
to be provided by governmental entities without assistance under
this chapter, those public improvements and facilities to be financed
with assistance from the proposed district, and those to be provided
jointly. The description shall include the proposed location, timing,
and costs of the public improvements and facilities.

(c) If funding from affected taxing entities is incorporated into
the financing plan, a finding that the public facilities provide
significant benefits to an area larger than the area of the district.

(d) A financing section, which shall contain all of the following
information:

(1) A specification of the maximum portion of the incremental
tax revenue of the city and of each affected taxing entity, if any,
proposed to be committed to the district for each year during which
the district will receive incremental tax revenue. The portion need
not be the same for all affected taxing entities. The portion may
change over time.

(2) A projection of the amount of tax revenues expected to be
received by the district in each year during which the district will
receive tax revenues, including an estimate of the amount of tax
revenues attributable to each affected taxing entity for each year.

(3) A plan for financing the public facilities to be assisted by
the district, including a detailed description of any intention to
incur debt.

(4) A limit on the total number of dollars of taxes that may be
allocated to the district pursuant to the plan.

(5) A date on which the district will cease to exist, by which
time all tax allocation to the district will end. The date shall not
be more than 40 years from the date the public financing authority
adopted the resolution adopting the infrastructure financing plan
pursuant to Section 53395.20.

(6) An analysis of the costs to the city of providing facilities
and services to the area of the district while the area is being
developed and after the area is developed. The plan shall also
include an analysis of the tax, fee, charge, and other revenues
expected to be received by the city as a result of expected
development in the area of the district.

(7) An analysis of the projected fiscal impact of the district and
the associated development upon each affected taxing entity.

(8) A plan for financing any potential costs that may be incurred
by reimbursing a developer of a project that is both located entirely
within the boundaries of that district and qualifies for the Transit
Priority Project Program, pursuant to Section 65470, including
any permit and affordable housing expenses and additional
expenses related to the project or the developer of a project that
implements a transit priority project.

(e) If any dwelling units occupied by persons or families of low
or moderate income are proposed to be removed or destroyed in
the course of private development or public works construction
within the area of the district, a plan providing for replacement of
those units and relocation of those persons or families consistent
with the requirements of Section 53395.5.

(f) The goals the district proposes to achieve by financing public
facilities.

(g) The goals the district proposes to achieve by assisting the
development described in paragraph (8) of subdivision (d).

(h) If funding from affected taxing entities is included in the
plan, the creation of the public accountability committee, pursuant
to Section 53395.21.

SEC. 14.  

Section 53395.16 of the Government Code is amended
to read:

53395.16.  

The designated official shall consult with the city
and each affected taxing entity, and, at the request of any affected
taxing entity, shall meet with representatives of an affected taxing
entity. Any affected taxing entity may suggest revisions to the
plan.

SEC. 15.  

Section 53395.17 of the Government Code is amended
to read:

53395.17.  

The public financing authority shall conduct a public
hearing prior to adopting the proposed infrastructure financing
plan. The public hearing shall be called no sooner than 60 days
after the plan has been sent to each affected taxing entity. In
addition to the notice given to landowners and affected taxing
entities pursuant to Sections 53395.11 and 53395.12, notice of the
public hearing shall be given by publication not less than once a
week for four successive weeks in a newspaper of general
circulation published in the city in which the proposed district is
located. The notice shall state that the district will be used to
finance public works, briefly describe the public works, briefly
describe the proposed financial arrangements, including the
proposed commitment of incremental tax revenue, describe the
boundaries of the proposed district and state the day, hour, and
place when and where any persons having any objections to the
proposed infrastructure financing plan, or the regularity of any of
the prior proceedings, may appear before the public financing
authority and object to the adoption of the proposed plan by the
public financing authority.

SEC. 16.  

Section 53395.19 of the Government Code is amended
to read:

53395.19.  

(a) The public financing authority shall not enact
a resolution approving a financing plan that provides for the
division of taxes of any affected taxing entity pursuant to Article
3 (commencing with Section 53396), unless a resolution approving
the plan has been adopted by the governing body of each affected
taxing entity that is proposed to be subject to division of taxes
pursuant to Article 3 (commencing with Section 53396) has been
filed with the public financing authority at or prior to the time of
the hearing.

(b) In the case of an affected taxing entity that is a special district
that provides fire protection services and where the county board
of supervisors is the governing authority or has appointed itself as
the governing board of the district, the plan shall be adopted by a
separate resolution approved by the district’s governing authority
or governing board.

(c) Nothing in this section shall be construed to prevent the
public financing authority from amending its infrastructure
financing plan and adopting a resolution forming the infrastructure
financing district without allocation of the tax revenues of any
affected taxing entity that has not approved the infrastructure
financing plan by resolution of the governing body of the affected
taxing entity.

(d) A public financing authority may enter into a joint powers
agreement pursuant to Section 6500 with an affected taxing entity
to carry out the purposes of this chapter with regard to nontaxing
authority or powers only.

(e) An infrastructure financing plan that provides for the division
of taxes of any affected taxing entity shall not be implemented
until the date on which the public accountability committee is
created pursuant to Section 53395.21.

SEC. 17.  

Section 53395.20 of the Government Code is amended
to read:

53395.20.  

(a) At the conclusion of the hearing required by
Section 53395.17, the public financing authority may adopt a
resolution adopting the infrastructure financing plan, as modified,
and approving the formation of the infrastructure financing district
in a manner consistent with Sections 53395.10 and 53395.19, or
it may abandon the proceedings. The public financing authority
shall forward a copy of the plan to the legislative body to review
and approve the financing section of the plan described in
subdivision (d) of Section 53395.14. The infrastructure financing
plan shall not take effect until approved by the legislative body.

(b) No later than June 30 of each year after the adoption of the
infrastructure financing plan, the public financing authority shall
mail an annual report to each owner of land within the district and
each affected taxing entity. The public financing authority shall
post this annual report in an easily identifiable and accessible
location on the legislative body’s Internet Web site. The annual
report shall contain all of the following:

(1) A summary of the district’s expenditures.

(2) A description of the progress made towards the district’s
adopted goals.

(3) An assessment of the status regarding completion of the
district’s public works projects.

(c) If the district fails to provide the annual report required by
subdivision (b), the district shall not spend any funds to construct
public works projects until the annual report is submitted.

(d) If the district fails to produce evidence of progress made
towards achieving its adopted goals for five consecutive years, the
district shall not spend any funds to construct any new public works
projects; provided, however, the district may complete any public
works projects that it had started. Any excess property tax
increment revenues that had been allocated for new public works
projects shall be reallocated to the affected taxing entities.

SEC. 18.  

Section 53395.21 of the Government Code is
repealed.

SEC. 19.  

Section 53395.21 is added to the Government Code,
to read:

53395.21.  

(a) If an infrastructure financing plan contains a
provision that provides for the division of taxes of any affected
taxing entity, a public accountability committee shall be established
pursuant to this section.

(b) A public accountability committee shall be comprised of a
representative of each affected taxing entity that has agreed to the
division of its taxes, a representative of the public financing
authority, and one or more public members.

(c) The legislative body of each affected taxing entity and the
legislative body of the public financing authority shall each appoint
one of its members, or their designee, to the public accountability
committee. Those persons appointed pursuant to this subdivision
shall, by lot, appoint one or more public members to ensure that
the public accountability committee consists of an odd number of
members for voting purposes.

(d) The purposes of the public accountability committee shall
be to conduct or have conducted an annual performance review
and an annual independent financial review of the public financing
authority. The costs of the audits required pursuant to this
subdivision shall be paid from revenues of the public financing
authority.

SEC. 20.  

Section 53395.22 of the Government Code is
repealed.

SEC. 21.  

Section 53395.23 of the Government Code is
repealed.

SEC. 22.  

Section 53395.24 of the Government Code is
repealed.

SEC. 23.  

Section 53395.25 of the Government Code is
repealed.

SEC. 24.  

Section 53396 of the Government Code is amended
to read:

53396.  

Any infrastructure financing plan may contain a
provision that taxes, if any, levied upon taxable property in the
area included within the infrastructure financing district each year
by or for the benefit of the State of California, or any affected
taxing entity after the effective date of the resolution adopted
pursuant to Section 53395.20 to create the district, shall be divided
as follows:

(a) That portion of the taxes that would be produced by the rate
upon which the tax is levied each year by or for each of the affected
taxing entities upon the total sum of the assessed value of the
taxable property in the district as shown upon the assessment roll
used in connection with the taxation of the property by the affected
taxing entity, last equalized prior to the effective date of the
resolution adopted pursuant to Section 53395.20 to create the
district, shall be allocated to, and when collected shall be paid to,
the respective affected taxing entities as taxes by or for the affected
taxing entities on all other property are paid.

(b) That portion of the levied taxes each year specified in the
adopted infrastructure financing plan for the city and each affected
taxing entity that has agreed to participate pursuant to Section
53395.19 in excess of the amount specified in subdivision (a) shall
be allocated to, and when collected shall be paid into a special
fund of, the district for all lawful purposes of the district. Unless
and until the total assessed valuation of the taxable property in a
district exceeds the total assessed value of the taxable property in
the district as shown by the last equalized assessment roll referred
to in subdivision (a), all of the taxes levied and collected upon the
taxable property in the district shall be paid to the respective
affected taxing entities. When the district ceases to exist pursuant
to the adopted infrastructure financing plan, all moneys thereafter
received from taxes upon the taxable property in the district shall
be paid to the respective affected taxing entities as taxes on all
other property are paid.

SEC. 25.  

Section 53397.1 of the Government Code is amended
to read:

53397.1.  

The public financing authority may, by majority vote,
authorize the issuance of bonds pursuant to this chapter by adopting
a resolution.

SEC. 26.  

Section 53397.2 of the Government Code is amended
to read:

53397.2.  

The resolution adopted pursuant to Section 53397.1
shall contain all of the following information:

(a) A description of the facilities to be financed with the
proceeds of the bond issue.

(b) The estimated cost of the facilities, the estimated cost of
preparing and issuing the bonds, and the principal amount of the
bond issuance.

(c) The maximum interest rate and discount on the bond
issuance.

(d) A determination of the amount of tax revenue available or
estimated to be available, for the payment of the principal of, and
interest on, the bonds.

(e) A finding that the amount necessary to pay the principal of,
and interest on, the bond issuance will be less than, or equal to,
the amount determined pursuant to subdivision (d).

(f) The issuance of the bonds in one or more series.

(g)  The date the bonds will bear.

(h) The denomination of the bonds.

(i) The form of the bonds.

(j) The manner and execution of the bonds.

(k) The medium of payment in which the bonds are payable.

(l) The place or manner of payment and any requirements for
registration of the bonds.

(m) The terms or call of redemption, with or without premium.

SEC. 27.  

Section 53397.5 of the Government Code is repealed.

SEC. 28.  

Section 53397.6 of the Government Code is repealed.

SEC. 29.  

Section 53397.7 of the Government Code is repealed.