BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 1424| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 1424 Author: Wolk (D), et al. Amended: 6/18/14 Vote: 27 SENATE NATURAL RESOURCES AND WATER COMMITTEE : 9-0, 4/22/14 AYES: Pavley, Cannella, Evans, Fuller, Hueso, Jackson, Lara, Monning, Wolk SENATE APPROPRIATIONS COMMITTEE : 7-0, 5/23/14 AYES: De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg SENATE FLOOR : 37-0, 5/29/14 AYES: Anderson, Beall, Berryhill, Block, Cannella, Corbett, Correa, De León, DeSaulnier, Evans, Fuller, Gaines, Galgiani, Hancock, Hernandez, Hill, Hueso, Huff, Jackson, Knight, Lara, Leno, Lieu, Liu, Mitchell, Monning, Morrell, Nielsen, Padilla, Pavley, Roth, Steinberg, Torres, Vidak, Walters, Wolk, Wyland NO VOTE RECORDED: Calderon, Wright, Yee ASSEMBLY FLOOR : 78-0, 8/14/14 (Consent) - See last page for vote SUBJECT : State property: tidelands transfer: City of Martinez SOURCE : City of Martinez DIGEST : This bill grants state trust lands to the City of Martinez (City) in exchange for a revenue-sharing agreement with CONTINUED SB 1424 Page 2 the state. Assembly Amendments delete statement requirements the City must file annually with the California State Lands Commission (SLC) for approval of trust revenues and expenditures; delete the requirement the statement must be received by December 31, of each year; and make clarifying changes. ANALYSIS : Existing law: 1.Defines under the Public Trust Doctrine, sovereign or public trust lands as lands under the ocean and navigable streams owned by the public and held in trust for the people by government. Uses of these trust lands are generally limited to those that are water-dependent or related, and include commerce, fisheries and navigation, and environmental preservation and recreation. Because public trust lands are held in trust for all citizens of California, they must be used to serve statewide, as opposed to purely local, public purposes. 2.Grants the SLC exclusive jurisdiction over all tidelands and submerged lands including public trust lands, and also grants the SLC the authority to grant these lands to local jurisdictions, as specified. 3.Creates under the Land Bank Fund (Fund) in the State Treasury and continuously appropriates monies in the Fund to the SLC for certain public trust purposes. Authorizes the SLC to use monies in the Fund to further state policy, which declares wetlands essential and that facilitating the completion of projects on public trust lands is in the state's interest. The Fund may receive revenues for mitigation, title settlements, or the management and improvement of public trust property held by the SLC. This bill: 1.Repeals the 1976 public land grant to the City and establishes a new 49-year grant for all parcels, including the Martinez Marina. CONTINUED SB 1424 Page 3 2.Authorizes the City to lease trust lands under specified conditions. 3.Requires that the City submit to the SLC a trust lands use plan describing any proposed development, preservation, or other use of the trust lands by January 1, 2020, and a report of its utilization of trust lands by September 30, 2025, and every five years thereafter. 4.Requires that the City to file a statement of all trust revenues, expenditures, and outstanding obligations annually to the SLC. Requires the statement to include a summary explaining how the City is using trust revenues to revitalize the Martinez Marina and prevent its closure. 5.Requires the City to file a specified document for approval with the SLC before spending more than $250,000 on a single project on trust lands. 6.Requires, commencing on June 30, 2015, and at the end of every fiscal year, the remaining 20% of gross revenue shall be transmitted to the SLC for allocation to the Treasurer, 80% of which will be deposited to the General Fund and 20% of which will be deposited in the Fund. 7.Provides that, in recognition of the deteriorated conditions of the Martinez Marina, commencing June 30, 2015, and until June 30, 2021, the SLC may, at its discretion, relieve the City of its obligation to transmit the gross revenues, as specified, so that the City can take action to address those conditions, including the dredging of sediment to restore adequate depth for launching, berthing, and safe navigation at the Martinez Marina. Background Since 1851, the City has held title to state-granted lands in the Straights of Carquinez in Contra Costa County. SB 1876 (Chapter 815, Statutes of 1976) established the current grant of lands to the City, which contains three parcels of tide and submerged lands. Two parcels are used only for marina spoils (materials removed from dredging a marina) spoil removal, and other activities. One parcel is used as a railroad right-of-way. Additionally, all revenues derived from the lands CONTINUED SB 1424 Page 4 are to be paid to the state to meet the obligations of the grant. Since the 1960s, the City has also been leasing the land containing the Martinez Marina, which consists of a pier and moorings. The lease was renewed in 2010 for 46 years. As of August 1, 2013, the City had five outstanding loans, totaling approximately $4.249 million, with the Division of Boating and Waterways for projects related to the operation and maintenance of the Martinez Marina (repairs to the breakwater, public restrooms, parking area, landscaping, relocation of berths, dredging, etc.). Due to the large amounts of sediment flowing into the area, these issues are persistent and ongoing. In August of 2013, the office of Senator Wolk, the office of Assemblymember Bonilla, the Natural Resources Agency, the Department of Finance, the Department of Parks and Recreation, the SLC, and the City (locals and the mayor) met to discuss the future of operations at the Martinez Marina. This small working group determined that the best way to resolve the financial issues would involve transferring title of the Martinez Marina to the City. The City wishes to use the area to pursue land and water-based commercial redevelopment projects. SB 551 (DeSaulnier, Chapter 422, Statutes of 2011) repealed a 2006 public land grant to the City of Pittsburg in Contra Costa County, enacted a new land grant to the city, and introduced a novel funding scheme. This funding scheme allowed the city to keep 80% of revenues generated from the trust lands and required the city to transmit the remaining 20% to the SLC for allocation by the State Treasurer. Of the monies allocated by the Treasurer, 80% would be deposited in the General Fund and 20% to the Fund for management of the SLC's granted lands program. The bill also required the City of Pittsburg to submit to the SLC a trust lands use plan and a report by September 30, 2022, and every five years thereafter on uses of trust lands, trust revenues, and expenditures. FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes Local: Yes According to the Senate Appropriations Committee: CONTINUED SB 1424 Page 5 Unknown costs, likely a maximum of $15,000 annually from the General Fund and the Fund for forgone revenue-sharing and lease revenue until 2021. Unknown revenues to the General Fund and the Fund after 2021 as a result of the revenue-sharing agreement. Annual costs, likely minor, to the General Fund to the SLC for administrative and oversight duties. These costs are to be reimbursed by the City. SUPPORT : (Verified 8/15/14) City of Martinez (source) California State Lands Commission City Council for the City of Martinez Contra Costa County Board of Supervisors ARGUMENTS IN SUPPORT : The City Council for the City of Martinez and the Contra Costa County Board of Supervisors contend that the Martinez Marina has "long been an icon representing Martinez' rich history in the fishing industry." The Marina serves local and outlying communities as the only one of two entry points to the San Francisco Bay and Delta in Contra Costa County. According to the city council, uses include: Serving as the entry point for the U.S. Department of Fish and Game, academic, and industrial research. Aiding environmental safety responses to oil refinery activities through 11 reserved slips for the National Response Center, CalBay Response Team, and Marina Spill Response Corporation. Providing an access point for the U.S. Coast Guard, the Contra Costa County Sheriff's Department, and the California Highway Patrol. Providing a learning opportunity for the Martinez Unified School District Environmental Studies Academy and Diablo Valley College Maritime Biology Studies. The SLC reports that silt flowing through gaps in the eastern breakwater wall has rendered the eastern portion of the Marina CONTINUED SB 1424 Page 6 unusable and significantly decreased revenue. These conditions have "hampered the City's ability to revitalize the Marina and prevent its closure." The SLC staff supports granting to the City the Martinez Marina in addition to updating and restructuring the City's existing grants. ASSEMBLY FLOOR : 78-0, 8/14/14 AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom, Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley, Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox, Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray, Grove, Hagman, Hall, Harkey, Holden, Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal, Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson, Perea, John A. Pérez, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, Atkins NO VOTE RECORDED: Roger Hernández, Vacancy RM:e 8/15/14 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED