BILL ANALYSIS Ó
SB 341
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Date of Hearing: August 14, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
SB 341 (DeSaulnier) - As Amended: May 30, 2013
Policy Committee: Local
GovernmentVote:9-0
Housing and Community Development 7-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill revises the requirements governing expenditures and
activities for the entities, termed housing successors, assuming
the housing functions of a former redevelopment agency.
Specifically, this bill:
1)Allows the housing successor, each fiscal year, to spend up to
2% of the statutory value of real property owned by the
housing successor and of loans and grants receivable,
including real property, on administrative costs of monitoring
and preserving the long-term affordability of units and other
activities as specified.
2)Allows the housing successor, once it has fulfilled its
monitoring obligations and its obligations to replace low- and
moderate-income housing that has been removed or destroyed, to
spend up to $250,000 on homeless prevention and rapid
rehousing activities for families and individuals.
3)Requires the housing successor to spend any funds remaining on
the development of housing affordable to and occupied by
households earning 80% or less of area median income (AMI).
4)Requires a housing successor to complete a report in 2019, and
every five years after, which demonstrates that it has spent
funds on the specified income categories from January 1, 2014
through the end of the latest fiscal year.
FISCAL EFFECT
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Negligible fiscal impact.
COMMENTS
1)Purpose . According to the author, after the dissolution of
redevelopment agencies, housing successors assumed the housing
powers, obligations and physical assets of the former
redevelopment agencies. In most cases, the city or county
that hosted the redevelopment agency became the housing
successor. The author notes housing successors are subject to
all of the housing-related provisions of the Community
Redevelopment Law (CRL), but this law was written for
redevelopment agencies which were required to use at least 20%
of all redevelopment tax increment for housing, more than $1
billion per year in funding. The author argues housing
successors anticipate significantly reduced resources and
income that may be sporadic and somewhat unpredictable. The
author states SB 341 streamlines administrative requirements
while ensuring accountability, providing additional
flexibility and targeting scarce available resources to the
greatest needs.
2)Background. In 2011, the Governor signed two measures, ABX1
26 and ABX1 27 that together dissolved redevelopment
agencies as they existed at the time. The action was
challenged, eventually leading to a Supreme Court decision
requiring all redevelopment agencies to dissolve as of
February 1, 2012.
As part of the dissolution process, local jurisdictions were
required to set up a housing successor to assume the housing
functions of the former redevelopment agency. The city or
county that created the redevelopment agency could opt to
become the housing successor, but if they chose not to, the
responsibility was transferred to a housing authority in the
jurisdiction of the former redevelopment agency. If there
was no housing authority, then the housing functions were to
be transferred to HCD.
Housing successors are required to maintain any funds
generated from housing assets in a low- and moderate-income
housing fund and use them in accordance with the
housing-related provisions of the CRL. The low- and
moderate-income housing fund includes real property and
other physical assets, funds encumbered for enforceable
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obligations, loans or grants, any funds from rents or
operation of properties and repayment of loans or deferrals
owed to the fund. Funding available to a housing successor
in the post-redevelopment world is limited to program
dollars repaid from loans or investments made by the former
redevelopment agency, a much smaller amount than what was
generated by redevelopment.
3)Relevant legislation . SB 133 (DeSaulnier) is a companion
measure to this bill. The bill makes reforms to the CRL and
would apply to any future entities that are created and
vested with the same statutory powers and duties of
redevelopment agencies. SB 133 is pending in both the
Assembly Housing and Community Development Committee and
this Committee.
4)There is no registered opposition to this bill .
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081