BILL ANALYSIS Ó
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| SENATE COMMITTEE ON NATURAL RESOURCES AND WATER |
| Senator Fran Pavley, Chair |
| 2013-2014 Regular Session |
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BILL NO: SB 695 HEARING DATE: April 23, 2013
AUTHOR: Wright URGENCY: Yes
VERSION: April 1, 2013 CONSULTANT: Bill Craven
DUAL REFERRAL: No FISCAL: Yes
SUBJECT: California Science Center: parking facilities.
BACKGROUND AND EXISTING LAW
The California Science Center (CSC), located at Exposition Park
in Los Angeles, is also properly identified in state law as the
Sixth District Agricultural Association. The CSC is an entity
within the California Natural Resources Agency. Exposition Park
is a 160-acre complex that includes the Los Angeles Memorial
Coliseum, the Natural History Museum of Los Angeles County, the
Los Angeles Memorial Sports Arena, the California
African-American Museum, a rose garden, a handful of businesses
and administrative offices, and several parking lots.
Existing law requires the CSC to manage or operate its parking
facilities in a manner that preserves and protects the interests
of itself and the California African-American Museum and
recognizes the cultural and educational character of Exposition
Park.
The CSC, the city of Los Angeles, and the county of Los Angeles
have formed a joint powers authority, the Los Angeles Memorial
Coliseum Commission (Commission). The CSC has leased the
Coliseum and Sports Arena to the Commission. The University of
Southern California (USC) operates the coliseum and the sports
arena pursuant to a sublease from the commission that was
entered in 2008. USC uses the coliseum and has access to some
parking for various events (primarily football games) in
exchange for various payments pursuant to the sublease.
According to the USC lease, for every sports event it pays to
the commission rent in the form of 8 percent of ticket sales, 8
percent of broadcasting revenues, and a specified portion of the
costs of conducting each event. USC has the option to extend the
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lease in five year increments to 2054.
The commission became embroiled in scandal. Several financial
irregularities were alleged and publicized and criminal charges
were filed against 8 individuals, 5 of whom were former managers
and employees. An additional concern is that the commission has
not paid its rent that was due at the end of 2012, according to
the author.
The new chair of the commission is Fabian Wesson who has
appointed a negotiating team of CSC board members to work with
USC to try to negotiate the parking issues.
The CSC and USC, having endured various financial issues with
the commission, entered a "non-disturbance" agreement through
which CSC would assume the role of the commission if the
commission's role was terminated, including the responsibility
to perform the capital improvements, valued at approximately $70
million.
The Commission is obligated to make various capital improvements
to the coliseum and all parties seem to agree that the
Commission does not have adequate funding and has not completed
those improvements.
Late in 2012, USC and CSC released a tentative agreement that
was approved earlier that year. It provides that USC would
assume the obligation to construct the capital improvements,
exercise operational responsibility over the coliseum and the
sports arena, manage certain parking lots owned by the CSC and
receive some funding from parking revenues.
In February, CSC and USC proposed an amendment to the
non-disturbance agreement under which USC would pay CSC the
identical base lease that the commission paid, plus amounts to
fund the CSC operations, and a schedule for paying CSC a share
of coliseum events.
Legislative Counsel Opinion . Senator Wright sought and obtained
a written opinion from Legislative Counsel that concluded that
CSC may enter into a lease to manage any real property that is
owned by it and that the CSC had authority to enter into the
"non-disturbance" agreement. That opinion also concluded that
the lease payments to the CSC by UCS were adequate to defeat an
argument that USC was benefiting from a gift of public funds.
The opinion did not reach any conclusion about the proposed
amendments to the non-disturbance agreement because Legislative
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Counsel did not have adequate information about those proposed
amendments.
As for the parking issue, Legislative Counsel stated that the
provision of existing law, noted earlier, is a legislative
reaction to the fact that events at the coliseum sometimes made
parking impossible for patrons of the CSC or other entities at
the park. The opinion concluded that because of the special
circumstances that should be considered by the CSC in operating
the parking lots, that the CSC may not delegate their operation
to a private entity.
PROPOSED LAW
This bill contains two provisions: The first prohibits the CSC
from delegating to USC the power to manage and operate its
parking facilities. The bill states that this provision is
declaratory of existing law. The second provision would prohibit
the CSC or the director of General Services from approving a
sale or lease for a term of greater than 10 years the use of the
coliseum the sports arena, or the CSC parking facilities without
legislative approval.
ARGUMENTS IN SUPPORT
According to the author (who has been deeply involved with this
issue for many years) the CSC has no statutory authority to
delegate control of the parking lots to USC. The author relies
on the Legislative Counsel opinion for this conclusion and to
support the provision in the bill that this lack of authority
declaratory of existing law. That opinion concluded that the CSC
is required to exercise its power in accordance with the manner
prescribed by statute. In this case, existing law requires the
CSC to exercise discretion regarding the parking lots and the
management of the parking lots which Legislative Counsel
believes is a responsibility in the nature of a non-delegable
public trust responsibility.
The author believes that the proposed agreement released in
December 2012 should be subject to legislative oversight prior
to its implementation and to ensure that the state does not lose
money from parking that would otherwise be dedicated to
improvements at Exposition Park.
ARGUMENTS IN OPPOSITION
USC favors the provisions in the 2012 proposed lease agreement
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because in its view the guaranteed income matches the highest
amount of revenue ever received by the commission or CSC from
the parking lots. It also contends that the ongoing process
initiated by Fabian Wesson should go forward without any pending
legislation.
One USC grad commented that the coliseum and sports arena would
be best-served by USC management and is the only option to save
further deterioration and financial ruin of those structures.
COMMENTS
1. It is important for the committee to know that this bill is a
work in progress that may be changed depending on the result of
ongoing discussions between the parties. The author has agreed
to keep the Committee informed of any discussions and the
Committee reserves the right to re-hear the bill. USC and the
author have indicated to the committee that they believe a
resolution is possible.
SUPPORT
None Received
OPPOSITION
University of Southern California
One individual
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