BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 470|
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UNFINISHED BUSINESS
Bill No: SB 470
Author: Wright (D)
Amended: 9/6/13
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
SENATE FLOOR : 36-0, 5/24/13
AYES: Anderson, Beall, Block, Calderon, Cannella, Corbett,
Correa, De Le�n, DeSaulnier, Emmerson, Fuller, Gaines,
Galgiani, Hancock, Hernandez, Hill, Hueso, Huff, Jackson,
Knight, Lara, Leno, Lieu, Monning, Nielsen, Padilla, Pavley,
Price, Roth, Steinberg, Torres, Walters, Wolk, Wright, Wyland,
Yee
NO VOTE RECORDED: Berryhill, Evans, Liu, Vacancy
ASSEMBLY FLOOR : Not available
SUBJECT : Community development: economic opportunity
SOURCE : City of Long Beach
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DIGEST : This bill creates a process for a city, county, or
city and county to sell or lease properties, that are returned
to them as part of the long-range property management plan of a
former redevelopment agency (RDA), for an economic development
purpose.
Assembly Amendments delete the requirement for local governments
to make the report required by this bill available to the public
no late than the time of publication of the first notice of the
hearing required by this bill; delete the proposed changes to
the Polanco Redevelopment Act (Polanco Act); make technical and
clarifying changes; and add a co-author.
ANALYSIS :
Existing law:
1. Dissolved RDAs and community development agencies (CDAs), as
of February 1, 2012, and provides for the designation of a
successor agency, as 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 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
or a Regional Water Quality Control Board. It provided
limited liability protections for RDAs and future purchasers
of properties remediated under the Polanco Act.
This bill:
1. Includes legislative intent language.
2. Defines "economic opportunity" to mean any of the following:
A. Development agreements that create, retain or expend
new jobs that the legislative body finds will create or
retain at least one full-time permanent job for every
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$35,000 of city, county, or city and county investment
in a project.
B. Development agreements that will increase the
property tax revenues to all taxing entities by at
least 15% when the project is at full implementation as
compared to the rate one year prior to the acquisition
by a governmental entity.
C. The creation of affordable housing if there are
demonstrated affordable housing needs as defined in the
approved housing element or regional housing needs
assessment.
D. Projects that meet the goals of SB 375 (Steinberg,
Chapter 728, Statutes of 2008), is included in a
sustainable communities strategy, an alternative
planning strategy or implements the goals of those
adopted plans.
E. Transit priority projects.
3. Creates a process for a city, county, or city and county to
sell or lease properties, which are returned to them as part
of the long-range property management plan of a former RDA,
for an economic development purpose.
4. Requires a legislative body to approve the sale or lease of a
property that is part of the long-range property management
plan for an economic purpose by resolution after a public
hearing that has been noticed for two consecutive weeks in
the newspaper.
5. Requires the city, county or city and county to provide a
report for the public to review and copy that includes the
following:
A. A copy of the proposed sale or lease.
B. The cost of the agreement to the city, county, or
city and county that includes land acquisition costs,
clearance costs, relocation costs, cost of improvements
provided by the local government's interest on any loans
or bonds to finance the agreements.
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C. The estimated value of the property to be sold or
leased as determined by the highest and best uses
permitted under the general plan or zoning.
D. The estimated value of the property to be sold or
leased with the conditions, covenants, and development
costs required by the sale or lease.
E. The purchase price or lease payments that the lessor
will be required to make during the term of the lease.
F. If the sale price or rental amount is less than fair
market value as determined by the highest and best use,
then the legislative body must provide an explanation
for the difference.
G. An explanation of why the sale or lease of the
property will result in the creation of economic
opportunity.
6. Requires the resolution approving the sale or lease of the
property to be approved by a majority vote, or a two-thirds
vote if required by an adopted ordinance, a finding that the
sale or lease of the property will assist in the creation of
economic opportunity, and include one of the following:
A. The consideration is not less that the fair market
reuse value at its highest and best use.
B. The consideration is not less than the fair reuse
value at the use and with the covenants and conditions
and development costs authorized by the sale or lease.
7. Provides that the provisions of this bill are an alternative
to any other authority granted to cities to dispose of
city-owned property.
8. Allows, under Community Redevelopment Law (CRL) for a RDA, a
city, county, or city and county to establish a program to
make loans to owners or tenants to rehabilitate commercial
buildings or structures.
9. Permits, as allowed under the CRL for a RDA, a city, county,
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or city and county to assist with the financing facilities or
capital equipment as part of an agreement with a developer or
rehabilitate a property that will be used for industrial or
manufacturing purposes.
10.Requires, as allowed under the CRL for a RDA, a city, county,
or city and county to make a finding, after a public hearing,
that assisting with the purchase of capital equipment or
facilities is necessary for the economic feasibility of the
development and cannot be achieved through the private
market.
11.States the provisions of this bill are not intended to
authorize the use of eminent domain for economic development
purposes.
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 9/11/13)
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City of Long Beach (source)
California Contract Cities Association
City and County of San Francisco
City of Grass Valley
City of Long Beach Mayor Bob Foster
City of Torrence
City of Whittier
Gateway Cities Council of Governments
League of California Cities
Los Angeles County
Los Angeles Mayor Antonio Villaraigosa
Port of Long Beach
San Francisco Mayor Ed Lee
San Jose Mayor Chuck Reed
Santa Ana Mayor Miguel Pulido
Western Center on Law and Poverty
AGB:JA:d 9/11/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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