BILL NUMBER: SB 741 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 24, 2013
AMENDED IN SENATE APRIL 10, 2013
INTRODUCED BY Senator Cannella
(Coauthors: Senators Berryhill, Fuller, Gaines, and
Nielsen)
(Coauthors: Assembly Members Achadjian, Alejo, Bigelow, Dahle,
Gray, Olsen, Perea, V. Manuel Pérez, Salas, and Williams)
FEBRUARY 22, 2013
An act to amend Sections 19606.1, 19614, 19620, and 19620.2 of,
and to repeal Sections 19608.3 and 19620.1 of, the Business and
Professions Code, to amend Sections 3954, 3965, 3965.1, and 3967 of,
to repeal Sections 4051.1, 4051.2, 4057, and 4401.5 of, and to repeal
and add Sections 3200, 4051, and 4053 of, the Food and Agricultural
Code, and to amend Section 11011.2 of the Government Code, relating
to fairs, making an appropriation therefor, and declaring the urgency
thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 741, as amended, Cannella. California fairs: funding.
(1) Existing law regulates horse racing in this state and
provides, among other things, for the payment and distribution of
license fees in connection with horse racing meetings. Existing law
establishes the Fair and Exposition Fund to, among other things,
allocate moneys for the support of the network of California fairs.
Existing law requires certain license fees from satellite wagering to
be deposited into a separate account in the Fair and Exposition
Fund, and continuously appropriates those moneys for specified
purposes, including, among others, the payment of expenses incurred
in establishing and operating satellite wagering facilities at fairs.
This bill would delete the provisions requiring satellite wagering
license fees to be deposited into a separate account in the Fair and
Exposition Fund and to be continuously appropriated for specified
purposes. The bill would instead require certain revenues paid by
racing associations and fairs generated by parimutuel wagering and
certain revenues from live races paid by fair racing associations as
license fees to be deposited into the Fair and Exposition Fund and
would require those funds to be continuously appropriated for various
purposes, including, among others, capital improvements at
fairgrounds. The bill would also require all funds appropriated for
California fairs and expositions to be deposited into the Fair and
Exposition Fund and would continuously appropriate those funds for
various purposes. By continuously appropriating the funds in the Fair
and Exposition Fund, the bill would make an appropriation.
(2) Existing law provides that the Department of Food and
Agriculture is responsible for providing oversight of activities
carried out by each California fair, including, but not limited to,
conducting fiscal and performance audits of county fairs and citrus
fruit fairs that are either requested by the fair or that the
department deems necessary, and conducting, or causing to be
conducted, annual fiscal audits and periodic compliance audits.
This bill would delete the requirement that the department conduct
the audits described above and would instead require the department
to provide that the books and accounts for the prior calendar year of
all fairs receiving money from the Fair and Exposition Fund be
examined and reviewed annually and audited once every 3 years by an
independent certified public accountant or certified public
accountancy firm. The bill would require a summary of the examination
to be appended to the fair's annual statement of operation, and
would provide that the costs of the annual review or audit be the
responsibility of each fair.
(3) Existing law requires the Legislature, from the total revenue
received from the Department of Food and Agriculture, to annually
appropriate moneys to the department as it deems necessary for the
oversight of the network of California fairs and to perform audits.
Existing law continuously appropriates any of those funds that are
unallocated to the Secretary of Food and Agriculture for specified
purposes.
This bill would delete those provisions and instead would
appropriate any unallocated balance in the Fair and Exposition Fund
without regard to fiscal years for allocation by the secretary for
capital outlay to California fairs for specified purposes. The bill
would also specify that no more than 10% of those funds may be used
during any year by the Division of Fairs and Expositions to provide
oversight and administration of the network of fairs. The bill would
require the secretary to annually project the available funds from
the Fair and Exposition Fund and to prepare an annual expenditure
plan for review and approval by the Joint Committee on Fairs,
Allocation, and Classification. The bill would require the secretary'
s recommendations to be deemed approved 30 days after they are
received unless they are rejected by the committee.
(4) Existing law divides the state into agricultural districts and
provides for the management of these districts by district
agricultural associations. Existing law provides for a board of
directors for each district agricultural association, and provides
for the appointment of each director by the Governor.
This bill would authorize the Governor to remove a director for
cause, upon recommendation by the board. The bill would require the
board to adopt a policy and procedure outlining the vote threshold
necessary to recommend the removal of a director.
(5) Existing law specifies the duties and responsibilities of
district agricultural associations, and requires a district
agricultural association to obtain the approval of the Department of
Food and Agriculture prior to exercising certain powers, including,
among others, the power to sue. Existing law also requires a district
agricultural association to obtain the approval of both the
Department of Food and Agriculture and the Department of General
Services in order to exercise certain other powers, including the
power to conduct activities upon the district agricultural
association's property, contract, purchase, or convey an interest in
either real or personal property, or to use or manage its real estate
or personal property.
This bill would revise the duties and responsibilities of the
Department of Food and Agriculture and the Department of General
Services with respect to district agricultural associations, and,
among other things, would delete the requirement that a district
agricultural association obtain the Department of Food and
Agriculture's approval prior to suing. The bill would also delete the
requirement that a district agricultural association obtain prior
approval from both the Department of Food and Agriculture and the
Department of General Services prior to conducting activities upon
the district agricultural association's own property, or entering
into a contract or exercising powers over its own real or personal
property. The bill would require the board of directors of a district
agricultural association to adopt policies and procedures for
contracts, including adopting and publishing competitive bidding
procedures for the award of any procurement or contract involving an
expenditure of more than $100,000, and would require a district
agricultural association to contract in accordance with those
procedures. The bill would also require a district agricultural
association to comply with specified contracting
procedures if the estimated total cost of a project exceeds $25,000,
as specified. The bill would require a district agricultural
association to adopt a fiscal review policy, as specified
policy to conduct audits at regular intervals, as
specified, and would authorize the Department of Food and Agriculture
to require an audit to be conducted at an earlier time if the
department deems it necessary to protect the interests of the
district agricultural association . The bill would specify that
the title, control, and possession of all personal property
acquired, held, managed, or operated by a district agricultural
association vests with the district agricultural association. The
bill would delete a provision requiring the Secretary of Food and
Agriculture to expend up to $100,000 each fiscal year for an exhibit
or exhibits at a fair that demonstrates the process of production and
use of food and fiber, and would also delete a requirement that the
secretary provide for a conference of fair judges to aid the
department Department of Food and Agriculture
in prescribing regulations, and to expend up to $15,000 for that
purpose. The bill would make other conforming and related changes.
(6) This bill would declare that it is to take effect immediately
as an urgency statute.
Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 19606.1 of the Business and Professions Code is
amended to read:
19606.1. (a) All revenues transferred pursuant to Section
19616.52 and subdivision (d) of Section 19614 shall be deposited in
the Fair and Exposition Fund and, notwithstanding Section 13340 of
the Government Code, are continuously appropriated from the fund to
the Department of Food and Agriculture, for allocation by the
Secretary of Food and Agriculture, at his or her discretion, for the
purposes set forth in paragraphs (1) to (6), inclusive. The
concurrence of the Director of Finance shall be required for
allocations pursuant to paragraphs (1) and (2). Allocations pursuant
to paragraphs (3) to (6), inclusive, shall be made with the
concurrence of the Joint Committee on Fairs, Allocation, and
Classification.
(1) For the repayment of the principal of, interest on, and costs
of issuance of, and as security, including any coverage factor,
pledged to the payment of, bonds issued or to be issued by a joint
powers agency or other debt service or expense, including repayment
of any advances made or security required by any provider of credit
enhancement or liquidity for those bonds or other indebtedness or
expenses of maintaining that credit enhancement or liquidity,
incurred for the purpose of constructing or acquiring improvements at
a fair's racetrack inclosure, satellite wagering facilities at
fairs, health and safety repair projects, or handicapped access
compliance projects at fairs or for the purpose of refunding bonds or
other indebtedness incurred for those purposes. As used in this
paragraph, "coverage factor" means revenues in excess of the amount
necessary to pay debt service on the bonds or other indebtedness, up
to an amount equal to 100 percent more than the amount of that debt
service, which a joint powers agency, pursuant to the resolution or
indenture under which the bonds or other indebtedness are or will be
issued, pledges as additional security for the payment of that debt
service or is required to have or maintain as a condition to the
issuance of additional bonds or other indebtedness. Notwithstanding
any other law, the department may also commit any funds available for
allocation under Article 10 (commencing with Section 19620) to
complete projects funded under this paragraph in the priority
described in this paragraph.
(2) For payment to the State Race Track Leasing Commission to be
pledged for the repayment of debt necessary to construct a racetrack
grandstand at the 22nd District Agricultural Association fairgrounds.
This payment shall be made only if the secretary determines,
annually, that all other pledged revenues have been applied to the
repayment of that debt and have been determined by the secretary to
be inadequate for that purpose.
(3) For the general support of the network of California fairs
pursuant to the provisions of this chapter.
(4) For health and safety repair projects at fairs, including fire
and life safety improvement projects, regulatory compliance
projects, and long-term deferred maintenance projects.
(5) For capital improvements at fairgrounds. In making
determinations to fund capital improvements pursuant to this
paragraph, the secretary may grant priority status to renewable
energy generation projects.
(6) For the payment of expenses incurred in developing and
operating revenue generating projects at fairs, or which directly
benefit fairs, including the payment of expenses incurred in
establishing and operating horse racing facilities, industry
training, the establishment of pilot projects to restructure the
current fair system, and for projects realizing a cost savings for
more efficient utilization of existing fair resources.
(b) The secretary may not make an allocation for purposes of
paragraphs (2) to (6), inclusive, of subdivision (a) until the
payments required in any fiscal year pursuant to paragraph (1) of
subdivision (a) have been funded.
(c) Pursuant to subdivision (a), the Joint Committee on Fairs,
Allocation, and Classification shall review and concur, or not
concur, with the secretary's determination of the allocations to be
made pursuant to paragraphs (3) to (6), inclusive, of subdivision (a)
in total, and the committee may not add to, or delete projects or
line items from, the proposed allocations.
(d) The secretary's recommendations to the Joint Committee on
Fairs, Allocation, and Classification shall be deemed approved 30
days after they are received unless they are rejected by the
committee.
(e) If the Joint Committee on Fairs, Allocation, and
Classification does not concur with the secretary's recommendations,
the secretary may submit another set of recommendations to the
committee pursuant to this section.
(f) The payments required in any fiscal year for the purposes of
paragraphs (1) and (2) of subdivision (a) shall be made before the
secretary may utilize any moneys pursuant to subdivision (g).
(g) Except as otherwise provided in subdivision (f), when the
revenues deposited in the Fair and Exposition Fund exceed the amount
necessary to satisfy the purposes of paragraphs (1) and (2) of
subdivision (a), the secretary may utilize the excess amounts plus
the amounts deposited to the credit of the Fair and Exposition Fund
pursuant to revenues deposited to the credit of the fund to make
allocations from the fund for the purposes of Section 19620.2.
SEC. 2. Section 19608.3 of the Business and Professions Code is
repealed.
SEC. 3. Section 19614 of the Business and Professions Code is
amended to read:
19614. (a) Notwithstanding Sections 19611 and 19612, and except
for an association that qualifies pursuant to Section 19612.6, for a
fair conducting a live racing meeting, 1 percent of the total amount
handled on live races, excluding wagering at a satellite facility,
shall be retained by the fair association for payment to the state as
a license fee.
(b) Additionally, 0.48 percent of the total amount handled on live
racing, excluding wagering at a satellite facility, shall be
deposited with the official registering agency pursuant to
subdivision (a) of Section 19617.2, and shall thereafter be
distributed in accordance with subdivisions (b), (c), and (d) of
Section 19617.2.
(c) (1) After distribution of the applicable amounts as set forth
in subdivisions (a) and (b) and the payments made pursuant to other
relevant sections of this chapter, all funds remaining from the
deductions provided in Section 19610 shall be distributed 47.5
percent as commissions and 52.5 percent as purses. From the amount
distributed as thoroughbred purses, a sum equal to 0.07 percent of
the total handle shall be held by the association to be deposited
with the official registering agency pursuant to subdivision (a) of
Section 19617.2, and shall thereafter be distributed in accordance
with subdivisions (b), (c), and (d) of Section 19617.2.
(2) Any additional amount generated for purses and not distributed
during the previous corresponding meeting shall be added to the
purses at the current meeting.
(d) In addition to the amounts deducted pursuant to Section 19610,
any fair racing association shall deduct 1 percent from the total
amount handled in its daily conventional and exotic parimutuel pools.
The additional 1 percent shall be deposited in the Fair and
Exposition Fund and is hereby appropriated for the purposes specified
in paragraph (6) of subdivision (a) of Section 19606.1.
SEC. 4. Section 19620 of the Business and Professions Code is
amended to read:
19620. (a) The Legislature finds and declares that the Department
of Food and Agriculture is responsible for ensuring the integrity of
the Fair and Exposition Fund, administering allocations from the
fund to the network of California fairs, as defined in Sections 19418
to 19418.3, inclusive, and providing oversight of activities carried
out by each California fair.
(b) Oversight shall include, but not be limited to, the following:
(1) Monitoring the solvency of the Fair and Exposition Fund.
(2) Distributing available state resources to the network of
California fairs based on criteria for state allocations approved by
the Secretary of Food and Agriculture. The criteria for the
distribution of available state resources to the network of
California fairs shall not include a consideration of the structure
that governs the fair.
(3) Creating a framework for administration of the network of
California fairs allowing for maximum autonomy and local
decisionmaking authority, and conducting, or causing to be conducted,
annual fiscal reviews.
(4) Requiring books and accounts for the prior calendar year of
all fairs receiving money from the fund to be examined and reviewed
annually and audited once every three years by an independent
certified public accountant or certified public accountancy firm
selected by the fair. A summary of this examination, certified by the
selected certified public accountant or certified public accountancy
firm, shall be appended to the fair's annual statement of
operations, along with the accountant or accounting firm's
recommendations, for the approval of the secretary. The cost of a
fair's annual review or audit shall be the responsibility of each
fair. With the approval of the secretary, two or more fairs may
conduct or contract for a joint review or audit.
(5) Guiding and providing incentives to fairs to seek matching
funds and generate new revenue from a variety of sources.
(6) Supporting continuous improvement of fair programming to
ensure that California fairs remain highly relevant community
institutions.
SEC. 5. Section 19620.1 of the Business and Professions Code is
repealed.
SEC. 6. Section 19620.2 of the Business and Professions Code is
amended to read:
19620.2. (a) Any unallocated balance in the Fair and Exposition
Fund is hereby appropriated without regard to fiscal years for
allocation by the Secretary of Food and Agriculture for capital
outlay to California fairs for fair projects involving public health
and safety, for fair projects involving major and deferred
maintenance, for fair projects necessary due to any emergency, for
projects that are required by physical changes to the fair site, for
projects that are required to protect the fair property or
installation, such as fencing and flood protection, and for the
acquisition or improvement of any property or facility that will
serve to enhance the operation of the fair.
(b) A portion of the funds subject to allocation pursuant to
subdivision (a) may be allocated to California fairs for general
operational support. It is the intent of the Legislature that these
moneys be used primarily for those fairs whose sources of revenue may
be limited for purposes specified in this section.
(c) Not more than 10 percent of the funds specified in subdivision
(a) may be used during any year by the Division of Fairs and
Expositions to provide oversight and administration of the network of
California fairs pursuant to this chapter.
(d) The secretary shall annually project the available funds from
the Fair and Exposition Fund and shall advise the Joint Committee on
Fairs, Allocation, and Classification of the administrative budget of
the Division of Fairs and Expositions and the additional staff and
contracts necessary to develop and administer an operational and
policy framework to oversee the network of California fairs and
include that amount in the annual expenditure plan described in
subdivision (e).
(e) The secretary shall prepare an annual expenditure plan for use
of the moneys available from the Fair and Exposition Fund for review
and approval by the Joint Committee on Fairs, Allocation, and
Classification. The Joint Committee on Fairs Allocation and
Classification shall review and concur, or not concur, with the
spending plan in total, and shall not add to, or delete projects or
line items from, the proposed allocation.
(f) The secretary's recommendations to the Joint Committee on
Fairs, Allocation, and Classification shall be deemed approved 30
days after they are received unless they are rejected by the
committee.
(g) If the Joint Committee on Fairs, Allocation, and
Classification does not concur with the secretary's recommendations,
the secretary may submit another set of recommendations to the
committee.
SEC. 7. Section 3200 of the Food and Agricultural Code is
repealed.
SEC. 8. Section 3200 is added to the Food and Agricultural Code,
to read:
3200. (a) The Legislature finds and declares that funding for the
network of California fairs is a cooperative venture and is
anticipated to be generated from multiple sources, public and
private. Because of the benefits that accrue to the state and to its
residents by virtue of having the fair industry participate
cooperatively with the state for the purpose of effectively
overseeing and promoting fairs within the state, the Legislature
finds and declares that the fairs shall work collectively to identify
and designate new funding sources for fairs to be utilized for the
benefit of all fairs in the network.
(b) Notwithstanding any other law, all funds appropriated for
California fairs and expositions pursuant to this chapter or any
other law shall be deposited in the Fair and Exposition Fund and are
continuously appropriated as specified in Sections 19606.1 and
19620.2 of the Business and Professions Code.
(c) Notwithstanding Article 2 (commencing with Section 11270) of
Chapter 3 of Part 1 of Division 3 of Title 2 of the Government Code
relating to administrative costs, the California Exposition and State
Fair and the fairs specified in Sections 19418.1, 19418.2, and
19418.3 of the Business and Professions Code shall only be assessed
and pay a share of those costs directly related to personnel
administration and no other administrative costs for services from
other state agencies except costs for services rendered pursuant to
specific contracts entered into with other state agencies.
SEC. 9. Section 3954 of the Food and Agricultural Code is amended
to read:
3954. Each association by its name has perpetual succession. It
may have a seal. An association may be sued and may sue, and may do
any and all things necessary to carry out the powers and the objects
and purposes for which the association is formed.
SEC. 10. Section 3965 of the Food and Agricultural Code is amended
to read:
3965. The board may, with the approval of the department:
(a) Fix the term of office, the amount of bond, salary, and
prescribe the duties of the secretary and of the treasurer.
(b) Manage the affairs of the association.
(c) Make all necessary bylaws, rules, and regulations for the
government of the association.
(d) Delegate, as it may deem advisable, to its officers or
employees any of the powers that are vested in the board under
subdivision (b). Any delegation of power may be revoked at any time.
SEC. 11. Section 3965.1 of the Food and Agricultural Code is
amended to read:
3965.1. (a) Notwithstanding Section 3965 or 4051, the board may
arrange for and conduct, or cause to be conducted, or by contract
permit to be conducted, by any other individual, institution,
corporation, or association, upon its property at a time as it may be
deemed advisable, any activity.
(b) Notwithstanding subdivision (a), revenue generating contracts
involving hazardous activities shall not be approved by the board
unless adequate insurance coverage is provided, as determined by the
department in consultation with the Department of General Services.
SEC. 12. Section 3967 of the Food and Agricultural Code is amended
to read:
3967. (a) Any director who misses three consecutive regular
meetings of the board without the permission of the board is deemed
to have resigned from the board.
(b) (1) A director may be removed for cause by the Governor, upon
recommendation by the board.
(2) The board shall adopt a policy and procedure outlining the
vote threshold necessary to remove a director pursuant paragraph (1).
SEC. 13. Section 4051 of the Food and Agricultural Code is
repealed.
SEC. 14. Section 4051 is added to the Food and Agricultural Code,
to read:
4051. (a) Subject only to the conditions specified in this
chapter, an association may do any of the following:
(1) Contract in accordance with all of the following:
(A) The association shall develop, maintain, and comply with its
own written policies and procedures for contracting.
(B) Notwithstanding any other law, in developing the policies and
procedures referenced in subparagraph (A), the board shall
incorporate the following to apply to contracts entered into or
procurement by a district agricultural association:
(i) To ensure the fullest competition, the board shall adopt and
publish competitive bidding procedures for the award of any
procurement or contract involving an expenditure of more than one
hundred thousand dollars ($100,000). The competitive bidding
procedures shall include, but not be limited to, requirements for
submission of bids and accompanying documentation, guidelines for the
use of requests for proposals, invitations to bid, or other methods
of bidding, and a bid protest procedure. The general manager on
behalf of the district agricultural association shall determine
whether the goods or services subject to this
paragraph are available through existing contracts or price schedules
of the Department of General Services. The Legislature finds and
declares that fairs are a valuable community resource and recognizes
that local businesses and local communities make valuable
contributions to fairs that include direct and indirect support of
fair programs. The Legislature further finds and declares that local
businesses often provide opportunity purchases to local fairs that,
for similar things available through the state purchasing program,
may be purchased locally at a price equivalent to or less than that
available through the state purchasing program. As used in this
paragraph, "opportunity purchases" means purchases made locally,
either individually or cooperatively, at a price equal to or less
than the price available through the state purchasing program on or
off state contract.
(ii) The contracting standards, procedures, and rules contained in
this subdivision shall also apply to any subcontract involving an
expenditure of more than one hundred thousand dollars ($100,000). The
board shall establish, as part of the bidding procedures for general
contracts, subcontracting guidelines that implement this
requirement.
(iii) The board is subject to the Small Business Procurement and
Contract Act (Chapter 6.5 (commencing with Section 14835) of Part 5.5
of Division 3 of Title 2 of the Government Code).
(iv) Notwithstanding clauses (i) and (ii), in contracting
for construction contracts involving an expenditure of more than
twenty-five thousand dollars ($25,000), the board is subject to the
Public Contract Code. if the estimated total cost of
any construction project or similar work carried out under this
section exceeds twenty-five thousand dollars ($25,000),
the district agricultural association shall solicit bids in writing
and shall award the work to the lowest responsible bidder or reject
all bids. The district agricultural association is subject to all
applicable provisions of the Public Contract Code.
(v) A district agricultural association may elect to become
subject to the provisions of the Uniform Public Construction Cost
Accounting Act (Chapter 2 (commencing with Section 22000) of Part 3
of Division 2 of the Public Contract Code).
(2) Accept funds or gifts of value from the United States or any
person to aid in carrying out the purposes of this part.
(3) Conduct or contract for programs, and contract for the
purchase or lease of goods and services as are
necessary for effectuating the purposes of this chapter, either
independently or in cooperation with any individual, public or
private organization, or federal, state, or local governmental
agency.
(4) Establish and maintain a bank checking account or other
financial institution account, approved by the Director of Finance in
accordance with Sections 16506 and 16605 of the Government Code, for
depositing funds received by the district agricultural association.
Notwithstanding Section 13340 of the Government Code, all funds
maintained in an account authorized by this paragraph are
continuously appropriated to the board, without regard to fiscal
year, to carry out this part.
(5) Approve the annual budget of the association and establish a
program for paying vendors who contract with the district
agricultural association.
(6) Contract with any county or county fair association for
holding a fair jointly with the county or county fair association.
The joint fair is a district fair of the association.
(7) Make or adopt all necessary orders, rules, or regulations for
governing the activities of the district agricultural association.
Notwithstanding Section 14, any orders, rules, or regulations adopted
by the board are exempt from Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code. For
informational purposes only, however, any order, rule, or regulation
adopted by the board may be transmitted to the Office of
Administrative Law for filing with the Secretary of State pursuant to
Section 11343 of the Government Code.
(8) Operate a payroll system for paying employees, and a system
for accounting for vacation and sick leave credits of employees.
(9) Delegate to the officers and employees of the district
agricultural association the exercise of powers vested in the board
as the board may deem desirable for the orderly management and
operation of the association.
(10) Except as provided in paragraph (12), with the approval of
the Department of General Services, purchase, acquire, hold, sell, or
exchange, or convey any interest in real property for a period in
excess of 20 years. Any acquisition of land or other real property
shall be subject to the Property Acquisition Law (Part 11 (commencing
with Section 15850) of Division 3 of Title 2 of the Government
Code).
(11) Make permanent improvements upon publicly owned real property
adjacent to, or near the vicinity of, the real property of the
district agricultural association when the improvements materially
benefit the property of the association.
(12) Lease, let, or grant licenses for the use of its real
property or any portion of that property, to any person or public
body for whatever purpose as may be approved by the board. Any lease
of real property for a period in excess of 20 years shall be subject
to the approval of the Department of General Services as provided in
paragraph (10).
(13) Use or manage any of its property jointly or in connection
with any lessee or sublessee, for any purpose approved by the board.
(14) With the approval of the Department of General Services,
pledge any and all revenues, moneys, accounts, accounts receivable,
contract rights, and other rights to payment of whatever kind,
pursuant to such terms and conditions as are approved by the board.
The revenues, moneys, accounts, accounts receivable, contract rights,
and other rights to payment of whatever kind pledged by the
association or its assignees constitute a lien or security interest
that immediately attaches to the property pledged, and is effective,
binding, and enforceable against the association, its successors,
purchasers of the property so pledged, creditors, and all others
asserting rights therein, to the extent set forth, and in accordance
with, the terms and conditions of the pledge, irrespective of whether
those persons have notice of the pledge and without the need for any
physical delivery, recordation, filing, or further action.
(b) (1) Notwithstanding any other law, an
association shall adopt a fiscal review policy as follows:
(1)
(A) An association with an annual budget exceeding
ten five million dollars
($10,000,000) ($5,000,000) shall conduct an
annual audit by an independent certified public accountant or
certified public accountancy firm selected by the board.
(2)
(B) An association with an annual budget of less than
ten five million dollars
($10,000,000) ($5,000,000) shall have its books
and accounts examined and reviewed annually and audited once every
three years by an independent certified public accountant or
certified public accountancy firm selected by the board.
(2) Notwithstanding paragraph (1), the department may require an
audit to be conducted before the times specified in subparagraphs (A)
and (B) of paragraph (1) if the department deems the audit is
necessary to protect the interests of the association.
SEC. 15. Section 4051.1 of the Food and Agricultural Code is
repealed.
SEC. 16. Section 4051.2 of the Food and Agricultural Code is
repealed.
SEC. 17. Section 4053 of the Food and Agricultural Code is
repealed.
SEC. 18. Section 4053 is added to the Food and Agricultural Code,
to read:
4053. Notwithstanding Section 14660.5 of the Government Code, the
title, control, and possession of all personal property acquired,
held, managed, or operated by a district agricultural association,
including property controlled or possessed by the association before
the enactment of this section, vests with the association.
SEC. 19. Section 4057 of the Food and Agricultural Code is
repealed.
SEC. 20. Section 4401.5 of the Food and Agricultural Code is
repealed.
SEC. 21. Section 11011.2 of the Government Code is amended to
read:
11011.2. (a) (1) Notwithstanding any other law, including, but
not limited to, Sections 11011 and 14670, except as provided in this
section, the Department of General Services may lease real property
under the jurisdiction of a state agency or department, if the
Director of General Services determines that the real property is of
no immediate need to the state but may have some potential future use
to the program needs of the agency or department.
(2) The Director of General Services may not lease any of the
following real property pursuant to this section:
(A) Tax-deeded land or lands under the jurisdiction of the State
Lands Commission.
(B) Land that has escheated to the state or that has been
distributed to the state by court decree in estates of deceased
persons.
(C) Lands under the jurisdiction of the State Coastal
Conservancy or another state conservancy.
(D) Lands under the jurisdiction of the Department of
Transportation or the California State University system, or land
owned by the Regents of the University of California.
(E) Lands under the jurisdiction of the Department of Parks and
Recreation.
(F) Lands under the jurisdiction of the Department of Fish and
Wildlife.
(3) A lease entered into pursuant to this section shall be set at
the amount of the lease's fair market value, as determined by the
Director of General Services. The Director of General Services may
determine the length of term or a use of the lease, and specify any
other terms and conditions that are determined to be in the best
interest of the state.
(b) The Department of General Services may enter into a long-term
lease of real property pursuant to this section that has outstanding
lease revenue bonds and for which the real property cannot be
disencumbered from the bonds, only if the issuer and trustee for the
bonds approves the lease transaction, and this approval takes into
consideration, among other things, that the proposed lease
transaction does not breach a covenant or obligation of the issuer or
trustee.
(c) (1) All issuer- and trustee-related costs for reviewing a
proposed lease transaction pursuant to this section, and all other
costs of the lease transaction related to the defeasance or other
retirement of any bonds, including the cost of nationally recognized
bond counsel, shall be paid from the proceeds of that lease.
(2) The Department of General Services shall be reimbursed for any
reasonable costs or expenses incurred in conducting a transaction
pursuant to this section.
(3) Notwithstanding subdivision (g) of Section 11011, the
Department of General Services shall deposit into the General Fund
the net proceeds of a lease entered into pursuant to this section,
after deducting the amount of the reimbursement of costs incurred
pursuant to this section or the reimbursement of adjustments to the
General Fund loan made pursuant to Section 8 of Chapter 20 of the
2009-10 Fourth Extraordinary Session from the lease.
(d) The Department of General Services shall transmit a report to
each house of the Legislature on or before June 30, 2011, and on or
before June 30 each year thereafter, listing every new lease that
exceeds a period of five years entered into under the authority of
this section and the following information regarding each listed
lease:
(1) Lease payments.
(2) Length of the lease.
(3) Identification of the leasing parties.
(4) Identification of the leased property.
(5) Any other information the Director of General Services
determines should be included in the report to adequately describe
the material provisions of the lease.
SEC. 22. This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:
In order to restore the viability of California fairs as soon as
possible, it is necessary that this act take effect immediately.