BILL ANALYSIS Ó
SB 416
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Date of Hearing: July 3, 2013
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Ed Chau, Chair
SB 416 (Liu) - As Amended: June 24, 2013
SENATE VOTE : 39-0
SUBJECT : Surplus residential property.
SUMMARY : Makes a number of changes to the Roberti Act
governing the sale of surplus properties in the State Route (SR)
710 corridor. Specifically, this bill :
1)Requires the fair market value price that the Department of
Transportation (Caltrans) offers to non-income qualified
buyers to reflect the "as-is" condition of the property,
taking into account any repairs required to make the property
safe and habitable.
2)Allows Caltrans, at the request of an income-qualified person,
to offer a residence or property for sale in an "as-is"
condition.
3)With respect to market-rate residential sales, gives first
priority only to tenants in good standing with all rent
current and paid in full, rather than any tenant, and second
priority to former occupants who were in good standing at the
time they left the home, before the home can be offered to
purchasers who intend to be owner-occupants.
4)With respect to non-residential properties, gives tenants in
good standing priority to purchase the property at fair market
value.
5)Creates the SR 710 Rehabilitation Account and requires
Caltrans to deposit proceeds from sales of SR 710 properties
into the account.
6)Limits the total funds that can be maintained in the account
to $500,000, and specifies that funds exceeding that amount
shall be transferred to the State Highway Account to be used
exclusively to fund eligible projects located in Pasadena,
Alhambra, La Canada Flintridge, and the community of El Sereno
in the City of Los Angeles.
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7)Continuously appropriates funds in the SR 710 Rehabilitation
Account for the purpose of making required repairs to homes
being purchased by income-qualified residents, and requires
any funds exceeding the amount needed for repairs to be
transferred to the State Highway Account.
8)Prohibits funds from the sale of surplus properties in the SR
10 corridor from being used to advance or construct the
proposed North State Route 710 tunnel.
9)Requires that any funds remaining in the SR 710 Rehabilitation
Account after the last property is repaired be transferred to
the State Highway Account.
EXISTING LAW: Pursuant to the Roberti Act, establishes
priorities and procedures for the disposition of surplus
residential properties in the SR 710 corridor. Under the act,
Caltrans must offer surplus property in the following priority
order:
1)First, at market rate to a former owner who currently occupies
the property.
2)Second, at an affordable price to a current low- or
moderate-income occupant who meets minimum length of occupancy
thresholds. For these income-qualified buyers, Caltrans must
provide repairs required by lenders and government housing
assistance programs or provide the occupants with a
replacement dwelling.
3)Third, to entities that provide affordable housing at a price
necessary to make the housing affordable to present tenants
and households of low or moderate income.
4)Fourth, at market rate to occupants and then to persons who
intend to be owner-occupants.
(Government Code Section 54237)
FISCAL EFFECT : Unknown.
COMMENTS :
For decades, Caltrans has proposed the SR 710 extension project
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to close a roughly 4.5-mile unconstructed gap in the freeway
from just north of SR 10 in Los Angeles to SR 210 in Pasadena.
This gap affects the cities of Alhambra, Pasadena, South
Pasadena, and a portion of Los Angeles. The project has been in
the planning stage since 1953 for a variety of reasons related
to the federal environmental review process. The Los Angeles
County Metropolitan Transportation Authority (LCMTA), on behalf
of Caltrans, is currently preparing a Draft Environment Impact
Report to assess alternatives for ameliorating traffic
congestion in the area between the current terminus of SR 710
and SR 210 in Pasadena. At this point in the process, the
originally proposed surface route has been eliminated from
further consideration. Alternatives remaining under
consideration include a tunnel, light rail, bus rapid transit,
and transportation demand and traffic flow management. By 2014,
Caltrans plans to identify how it intends to proceed.
Caltrans currently owns 460 properties within the originally
proposed right-of-way, including 330 single-family homes and 103
multifamily housing units. According to the author, the Bureau
of State Audits has cited Caltrans a number of times over the
years for poor performance as a real estate manager and
landlord. The author believes this is a role outside of the
Caltrans' primary mission and one that Caltrans is not anxious
to continue. Given that a surface route is no longer under
consideration, the most expeditious means of taking Caltrans out
of the real estate management business is to sell the
properties. This will restore community integrity and have the
added advantage of returning the properties to private ownership
and to the local tax rolls.
SB 416 makes a number of changes to the Roberti Act governing
the sale of surplus properties in the SR 710 corridor aimed at
expediting the sale of Caltrans-owned properties in the corridor
that are no longer needed to construct the freeway extension.
The bill does the following:
1) Requires the fair market value price that Caltrans
offers to non-income-qualified buyers to reflect the
"as-is" condition of the property, taking into account any
repairs required to make the property safe and habitable.
2) Allows Caltrans, at the request of an income-qualified
person, to offer the residence in an "as-is" condition.
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3) Alters the fourth priority relating to market-rate sales
to give priority only to tenants in good standing with the
rent, rather than any tenant, and then to former occupants
who were in good standing at the time they left the home,
before the home is offered to persons who intend to be
owner-occupants.
4) With respect to non-residential properties, gives
tenants in good standing a right of first refusal to
purchase the property at fair market value.
SB 416 additionally creates the SR 710 Rehabilitation Account
and requires that Caltrans deposit proceeds from the sale of SR
710 properties into the account for the purposes of making
repairs required by the Roberti Act to homes being purchased by
income-qualified residents. The bill limits the account to
having a maximum of $500,000 on deposit at any one time. Funds
in excess of $500,000 would be deposited into the State Highway
Account to be used to fund eligible projects in Pasadena,
Alhambra, La Canada Flintridge, and the community of El Sereno
in the City of Los Angeles. The bill prohibits any of the
proceeds from the sales of SR 710 properties be used to advance
or construct the proposed North State Route 710 tunnel.
Double-referral : This bill was also referred to the
Transportation Committee, where it will be heard should it pass
out of this committee.
REGISTERED SUPPORT / OPPOSITION :
Support / Opposition
None on file.
Analysis Prepared by : Anya Lawler / H. & C.D. / (916)
319-2085