BILL ANALYSIS                                                                                                                                                                                                    



                                                                            



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                                    THIRD READING


          Bill No:  SB 470
          Author:   Wright (D)
          Amended:  5/8/13
          Vote:     21

           
           SENATE GOVERNANCE & FINANCE COMMITTEE  :  6-0, 4/3/13
          AYES:  Wolk, Knight, Beall, DeSaulnier, Emmerson, Hernandez
          NO VOTE RECORDED:  Liu

           SENATE ENVIRONMENTAL QUALITY COMMITTEE  :  9-0, 5/1/13
          AYES:  Hill, Gaines, Calderon, Corbett, Fuller, Hancock,  
            Jackson, Leno, Pavley

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8


           SUBJECT  :    Community development:  economic opportunity

           SOURCE  :     City of Long Beach


           DIGEST  :    This bill allows cities and counties to use some of  
          the Community Redevelopment Laws financing, property sale, and  
          brownfield cleanup powers to promote economic development.

           ANALYSIS  :    

          Existing law:

          1. Dissolved redevelopment agencies (RDAs) and community  
             development agencies (CDAs), as of February 1, 2012, and  
             provides for the designation of a successor agency, as  
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             defined, to resolve the final matters of the agencies and to  
             dispose of assets and properties in accordance with certain  
             procedures.

          2. Under the Polanco Redevelopment Act (Polanco Act) which was  
             part of the Community Redevelopment Act, assisted  
             redevelopment agencies in responding to brownfield properties  
             in their redevelopment areas.  It prescribed processes for  
             redevelopment agencies to follow when remediating a hazardous  
             substance release in a redevelopment project area.  It also  
             provided specified immunity from liability for sites cleaned  
             up under a cleanup plan approved by the Department of Toxic  
             Substances Control (DTSC) or a Regional Water Quality Control  
             Board (RWQCB).  It provided limited liability protections for  
             RDAs and future purchasers of properties remediated under the  
             Polanco Act.

          This bill:

          1. Replicates the provisions of the California Community  
             Redevelopment Law (CRL) for cities and counties instead of  
             RDAs, allowing cities and counties to exercise powers that  
             are similar to statutory powers that former RDAs used to  
             have, including:  sell property, provide financial assistance  
             to development projects, and clean up contaminated property  
             in order to promote economic opportunity specifically for  
             properties that were part of a former RDA.

          2. Defines "economic opportunity" as any of the following: 

             A.    Development agreements or other agreements that create,  
                retain, or expand new jobs.  A city or county must make a  
                finding that the agreement will create or retain at least  
                one full-time equivalent, permanent job per $35,000 of  
                city, county, or city and county investment in the project  
                after full capacity and implementation of the agreement. 

             B.    Development agreements that increase property tax  
                revenues to all property tax-collecting entities.  A city  
                or county must make a finding that the agreement will  
                result in an increase of at least 15% of total property  
                tax resulting from the project at full implementation when  
                compared to the year prior to the property being acquired  
                by the government entity.   

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             C.    Creation of affordable housing, if a demonstrated  
                affordable housing need exists in the community, as  
                defined in the approved housing element or regional  
                housing needs assessment. 

             D.    Projects that meet specified climate, air quality, and  
                energy conservation goals and have been included in an  
                adopted Sustainable Communities Strategy or Alternative  
                Planning Strategy, or a project that specifically  
                implements the goals of those adopted plans. 

             E.    Transit priority project areas, as defined in state  
                law.

          3. Replicates the provisions of the Polanco Act for cities and  
             counties instead of RDAs, allowing cities and counties the  
             authority to remediate brownfields and provides immunity from  
             liability to public agencies and property purchasers under an  
             approved cleanup plan.  

          4. Specifically this bill:

             A.    Allows a city, county, or city and county to take any  
                actions that it determines are necessary and that are  
                consistent with other state and federal laws to remedy  
                or remove a release of hazardous substances on, under,  
                or from property within its jurisdiction, that  
                previously was within the jurisdiction of a former RDA,  
                whether it owns that property or not, subject to  
                specified conditions. 

             B.    Requires the city, county, or city and county to  
                request cleanup guidelines from the DTSC or RWQCB before  
                taking action to remedy or remove a release, unless an  
                administering agency has been designated under state  
                law.  The city, county, or city and county must submit  
                for approval a cleanup or remedial action plan to DTSC  
                or RWQCB before taking action to remedy or remove a  
                release.  DTSC or RWQCB must respond to the requests for  
                guidelines and approvals within a reasonable period of  
                time.

             C.    Identifies the conditions under which a city, county,  

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                or city and county can designate a local agency, in lieu  
                of DTSC or RWQCB, to review and approve a cleanup or  
                remedial action plan and to oversee the remediation or  
                removal of hazardous substances from a specific  
                hazardous substance release site.  This bill allows a  
                local agency to withdraw from its designation and allows  
                DTSC or RWQCB to require, under specified conditions, a  
                local agency to withdraw from the designation.

             D.    Requires a city, county, or city and county to notify  
                DTSC, RWQCB, and local health and building departments  
                of cleanup activity at least 30 days before the activity  
                begins.  With specified exceptions, the bill allows DTSC  
                or RWQCB to require a city, county, or city and county  
                to remedy or remove a release of a hazardous substance  
                pursuant to state law if the city, county, city and  
                county, or a responsible party's action to remedy or  
                remove a release of a hazardous substance is  
                inconsistent with an approved plan.   

             E.    Imposes specified conditions on a city, county, or  
                city and county's authority to remedy or remove a  
                release of hazardous substances.

             F.    Allows a city, county, or city and county to require  
                the owner or operator of any site within a project area  
                to provide the city, county, or city and county with all  
                existing environmental information pertaining to the  
                site, except for information which is determined to be  
                privileged.  A person can only be requested to furnish  
                information that is within their possession or control,  
                including actual knowledge of information within the  
                possession or control of any other party.  If  
                environmental assessment information is not available,  
                the city, county, or city and county can require the  
                owner of the property to conduct an assessment in  
                accordance with standard real estate practices for  
                conducting phase I or phase II environmental  
                assessments.

             G.    Provides that a city, county, or city and county is  
                not liable under specified state and local liability  
                laws if it undertakes and completes an action, or causes  
                another person to undertake and complete an action, to  

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                remedy or remove a hazardous substance release in  
                accordance with a cleanup or remedial action plan that  
                meets specified criteria.   

             H.    Requires that a city, county, or city and county must  
                receive written acknowledgement from DTSC, RWQCB, or  
                local agency that it will receive specified immunity  
                from liability upon proper completion of a remedial or  
                removal action in accordance with an approved plan.

             I.    Specifies the manner in which DTSC, RWQCB, or local  
                agency must make a determination that a remedial or  
                removal action has been properly completed and notify  
                the city, county, or city and county in writing that the  
                immunity provided by this bill is in effect.  A city,  
                county, or city and county must reimburse DTSC, RWQCB,  
                and local agency for costs incurred in reviewing or  
                approving cleanup or remedial action plans.

             J.    Requires that a local agency's approval of a cleanup  
                or remedial action also must be subject to the  
                concurrent approval by DTSC or RWQCB, under specified  
                conditions.

             K.    Identifies the people and entities to which it  
                extends immunity from specified liability upon proper  
                completion of a remedial or removal action.  The bill  
                also identifies people and entities to which it does not  
                extend immunity.

             L.    States that this bill:

                (1)      Provides immunity that is in addition to any  
                   other immunity of a city, county, or city and county  
                   provided by law.

                (2)      Does not impair specified causes of action  
                   against the person, firm, or entity responsible for  
                   the hazardous substance release that is the subject  
                   of a removal or remedial action.

                (3)      Does not apply to, or limit, alter, or  
                   restrict, any action for personal injury, property  
                   damage, or wrongful death.

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                (4)      Does not limit liability under a specified  
                   provision of federal law.

                (5)      Does not establish, limit, or affect the  
                   liability of a city, county, or city and county for  
                   any release of a hazardous substance that is not  
                   investigated or remediated pursuant to state laws.

             M.    Requires any responsible parties to be liable to a  
                city, county, or city and county that remedies or removes,  
                or requires others to remedy or remove, a release of a  
                hazardous substance.  The bill prohibits a city, county,  
                or city and county from recovering the costs of goods and  
                services that were not procured in accordance with  
                applicable procurement procedures.  The amount of the  
                costs must include the interest, calculated according to a  
                specific formula, on the costs accrued from the date of  
                expenditure and reasonable attorney's fees.  The costs can  
                be recovered in a civil action.  

             O.    Identifies the defenses that are available to a  
                responsible party under state law.

             P.    Allows a city, county, or city and county to recover  
                costs for developing and implementing an approved cleanup  
                or remedial action plan to the same extent DTSC is  
                authorized to recover those costs.  The bill defines the  
                scope and standard of liability for recovering a city,  
                county, or city and county's costs.

             Q.    Requires a city, county, or city and county to begin an  
                action to recover costs of a remedy or removal within  
                three years after completion of the remedy or removal.   
                The bill states that the cost recovery authority it grants  
                is in addition to, and is not to be construed as  
                restricting, any other cause of action available to a  
                city, county, or city and county.

             R.    With specified exceptions, requires that a city,  
                county, or city and county that undertakes and completes a  
                remedial action, or otherwise causes a remedial action to  
                be undertaken and completed, shall not be liable, based on  
                its ownership of property after a release occurred, for  

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                any costs that any responsible party incurs to investigate  
                or remediate the release or to compensate others for the  
                effects of that release.

             S.    With specified exceptions, states that its provisions  
                do not limit the powers of the State Water Resources  
                Control Board or a RWQCB to enforce specified provisions  
                of state law.

             T.    Replicates the Polanco Act's definitions for numerous  
                terms.

           Comments
           
          According to the author's office, the ability to sell land based  
          upon "fair reuse value", rather than "fair market value" enables  
          local governments to negotiate for the use that best fits the  
          community.  The city can engage in a process to identify the  
          community need, and then sell land to a private party who will  
          create a development that fits those needs.  Redevelopment  
          agencies functioned for very many years using this process.  It  
          was a tool that was key to their success.  This authority should  
          be reinstated for the benefit of local communities, with the  
          local government absorbing any costs that may be incurred.  This  
          power will only be used for land owned by cities, and no tax  
          increment will be utilized, so there will be no fiscal impact on  
          the State, school districts, or other taxing entities.

           Related legislation
           
          AB 440 (Gatto) allows local agencies to clean up hazardous  
          substance releases and receive liability immunity under  
          provision that are similar to those in the Polanco Redevelopment  
          Act.  

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

           SUPPORT  :   (Verified  5/20/13)

          City of Long Beach (source)
          California Contract Cities Association
          City of Long Beach Mayor Bob Foster
          City of Whittier

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          Gateway Cities Council of Governments
          League of California Cities
          Los Angeles Mayor Antonio Villaraigosa
          San Francisco Mayor Ed Lee
          San Jose Mayor Chuck Reed
          Santa Ana Mayor Miguel Pulido
          Western Center on Law and Poverty



          AGB:d  5/21/13   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

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