BILL ANALYSIS Ó
AB 806
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
806 (Dodd) - As Amended April 6, 2015
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|Policy |Local Government |Vote:|9 - 0 |
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| |Housing and Community | |6 - 0 |
| |Development | | |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill specifies that agreements entered into by a former
redevelopment agency (RDA) prior to June 30, 2011, to fund state
highway infrastructure improvements are enforceable obligations.
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The bill also makes various technical changes to redevelopment
dissolution law regarding appointments to local oversight
boards, modifications to existing contracts, and compensation
agreements as part of the approval of long-range property
management plans.
FISCAL EFFECT:
Unknown, General Fund losses, perhaps in the hundreds of
thousands of dollars, from specifying that RDA agreements
entered into prior to June 30, 2011, that include highway
improvements are enforceable obligations. Absent this bill,
these revenues would be distributed to local taxing entities,
including schools. Under Proposition 98, the General Fund would
be required to backfill the resulting property tax losses to
schools. The number of projects affected is unknown, but likely
small.
COMMENTS:
1)Purpose. This bill continues a multi-year process to clean up
lingering issues and resolve disputes regarding the
redevelopment dissolution process. According to the author,
"Each year, since the dissolution of local RDAs, the
Legislature identifies relatively minor issues that require
some adjustment in the dissolution statute that allows the
dissolution process and its aftermath to work better."
2)Background. In 2011, the Legislature approved and governor
signed two measures, ABX1 26 and ABX1 27 that together
dissolved redevelopment agencies as they existed and created a
voluntary redevelopment program on a smaller scale. In
response, the California Redevelopment Association, the League
of California Cities and other partied, filed suit challenging
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the two measures. The Supreme Court denied the petition for
peremptory writ of mandate with respect to ABX1 26 and granted
the petition with respect to ABX1 27. As a result of the
court's decision, all redevelopment agencies were required to
dissolve as of February 1. 2012 and there was no authority for
any new redevelopment program.
In 2012, AB 1484 (Blumenfield), Chapter 26, made the statutory
changes needed to achieve budget savings related to the
dissolution of redevelopment agencies. AB 1484 clarified the
process for dissolving all redevelopment agencies, made
various statutory changes associated with the dissolution of
redevelopment agencies, and addressed a number of substantive
issues related to administrative processes, affordable housing
activities, repayment of loans from communities, use of
existing bond proceeds, and the disposition or retention of
former redevelopment agency assets. AB 1484 specified all
proceeds from bonds issued in 2011 must be defeased, the
exception being if the redevelopment agency has enforceable
obligations with third parties to spend the proceeds.
3)Addressing the Governor's Veto. This bill is similar to SB
1129 (Steinberg) of 2014, which was vetoed by Governor Brown.
Some of the provisions the Governor objected to have been
removed from this bill. Others have been modified to address
his concerns, including allowing the modification of existing
contracts with the approval of the oversight board, and not
eliminating compensation agreements altogether, but rather
allowing them to be developed and executed after the approval
of a long-range management plan.
However, a provision to allow the spending of 2011 bond
proceeds remains in this bill. In his veto message the
Governor stated, in part, "This bill allows Successor Agencies
to expend revenues from bonds issues after December
2010,...Furthermore, I have already vetoed AB 2493, and this
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bill contains a similar provision to allow 2011 bond proceeds
to be spent."
4)Related Current Legislation. There are four additional bills
regarding redevelopment pending in this Committee:
a) AB 654 (Brown) would prohibit revenues derived from a
property tax rate approved by voters in a city, county, or
special district to pay for the State Water Project to be
allocated to the Redevelopment Property Tax Trust Fund.
b) AB 974 (Bloom) would allow redevelopment successor
agencies, and entities performing the housing functions of
former redevelopment agencies (RDAs), to spend bond
proceeds from bonds issued by former RDAs in 2011.
c) AB 1009 (Garcia) would allow revenues from a
voter-approved pension property tax to be allocated to the
city or county whose voters approved the tax.
d) AB 1412 (Perea) would allow for an expedited loan
repayment schedule between a former RDA and a city or
county, under specified conditions.
1)Related Prior Legislation. There have been numerous bills
seeking to amend the statutes governing redevelopment
dissolution. Among the most recent:
a) AB 1963 (Atkins) Chapter 146, Statutes of 2014, extends
the date by which DOF must approve a redevelopment
successor agency's long-range management plan until January
1, 2016.
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Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081