BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 806


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          ASSEMBLY THIRD READING


          AB  
          806 (Dodd)


          As Amended  May 28, 2015


          Majority vote


           ------------------------------------------------------------------ 
          |Committee       |Votes |Ayes                |Noes                 |
          |                |      |                    |                     |
          |                |      |                    |                     |
          |----------------+------+--------------------+---------------------|
          |Local           |9-0   |Maienschein,        |                     |
          |Government      |      |Gonzalez, Alejo,    |                     |
          |                |      |Chiu, Cooley,       |                     |
          |                |      |Gordon, Holden,     |                     |
          |                |      |Linder, Waldron     |                     |
          |                |      |                    |                     |
          |----------------+------+--------------------+---------------------|
          |Housing         |6-0   |Chau, Steinorth,    |                     |
          |                |      |Burke, Chiu, Beth   |                     |
          |                |      |Gaines, Lopez       |                     |
          |                |      |                    |                     |
          |----------------+------+--------------------+---------------------|
          |Appropriations  |17-0  |Gomez, Bigelow,     |                     |
          |                |      |Bonta, Calderon,    |                     |
          |                |      |Chang, Daly,        |                     |
          |                |      |Eggman, Gallagher,  |                     |
          |                |      |                    |                     |
          |                |      |                    |                     |
          |                |      |Eduardo Garcia,     |                     |
          |                |      |Gordon, Holden,     |                     |
          |                |      |Jones, Quirk,       |                     |








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          |                |      |Rendon, Wagner,     |                     |
          |                |      |Weber, Wood         |                     |
          |                |      |                    |                     |
          |                |      |                    |                     |
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          SUMMARY:  Makes various changes to provisions of law governing  
          former redevelopment agencies (RDAs).  Specifically, this bill:  


          1)Allows, for oversight boards, each appointing authority  
            identified in existing law to appoint alternate representatives  
            to serve on the oversight board as may be necessary to attend  
            any meeting of the oversight board in the event that the  
            appointing authority's primary representative is unable to  
            attend any meeting for any reason.
          2)Provides, if the alternate representative attends any meeting in  
            place of the primary representative, that the alternate  
            representative shall have the same participatory and voting  
            rights as all other attending members of the oversight board.


          3)Requires the successor agency to promptly notify the Department  
            of Finance (DOF) regarding the appointment of any alternate  
            representatives to the oversight board.


          4)Allows, if the successor agency has received a finding of  
            completion, with the approval of the successor agency's  
            oversight board, the successor agency to amend or modify  
            existing, contracts and agreements, or otherwise administer  
            projects in connection with enforceable obligations approved  
            pursuant to existing law related to the Recognized Obligation  
            Payment Schedule (ROPS) approval process, including the  
            substitution of private developer capital in a disposition and  
            development agreement that has been deemed an enforceable  
            obligation, if the contract, agreement, or project will not  
            commit new property tax funds, and will not otherwise directly  








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            or indirectly reduce property tax revenues or payments made to  
            the taxing agencies, as specified.


          5)Allows DOF or an oversight board to require approval of a  
            compensation agreement or agreements, as specified, prior to any  
            transfer of property, provided, however, that a compensation  
            agreement or agreements may be developed and executed subsequent  
            to the approval process of a long-range property management  
            plan.


          6)Specifies that DOF shall only consider whether the long-range  
            property management plan makes a good faith effort to address  
            the requirements set forth in the existing law that specifies  
            what the long-range property management plan shall do.


          7)Requires DOF to approve long-range property management plans as  
            expeditiously as possible.


          8)Provides that actions relating to the disposition of property  
            after approval of a long-range property management plan shall  
            not require review by DOF.


          EXISTING LAW:  


          1)Dissolves RDAs and institutes a process for winding down their  
            activities.


          2)Allows a city or county that authorized the creation of an RDA  
            to elect to retain the housing assets and functions previously  
            performed by the RDA.










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          3)Required the entity assuming the housing functions of the former  
            RDA to submit to DOF by August 1, 2012, a list of all housing  
            assets, as specified.


          4)Allows the entity that assumed the housing functions to  
            designate the use of and commit indebtedness obligation proceeds  
            that remain after the satisfaction of enforceable obligations  
            that have been approved in a ROPS and that are consistent with  
            the indebtedness obligation covenants.


          5)Requires the proceeds to be derived from indebtedness  
            obligations that were issued for the purposes of affordable  
            housing prior to January 1, 2011, and were backed by the Low-  
            and Moderate-Income Housing Fund.


          6)Requires DOF to issue a finding of completion to the successor  
            agency, within five business days, once the following conditions  
            have been met and verified:


             a)   The successor agency has paid the full amount as  
               determined during the due diligence reviews and the county  
               auditor-controller has reported those payments to DOF; and,
             b)   The successor agency has paid the full amount as  
               determined during the July True-up process; or,


             c)   The successor agency has paid the full amount upon a final  
               judicial determination of the amounts due and confirmation  
               that those amounts have been paid by the county  
               auditor-controller.


          7)Allows the successor agency, upon receiving the finding of  
            completion, to:
             a)   Retain dissolved RDA assets;








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             b)   Place loan agreements between the former RDA and  
               sponsoring entity on the ROPS, as an enforceable obligation,  
               provided the oversight board makes a finding that the loan  
               was for legitimate redevelopment purposes; and,


             c)   Utilize proceeds derived from bonds issued prior to  
               January 1, 2011, in a manner consistent with the original  
               bond covenants.


          8)Requires, after DOF issues a finding of completion, the  
            successor agency to prepare a long-range property management  
            plan that addresses the disposition and use of the real  
            properties of the former RDA, and requires the report to be  
            submitted to the oversight board and DOF for approval no later  
            than six months following the issuance to the successor agency  
            of the finding of completion.
          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, this bill contains negligible state costs.


          COMMENTS:  


          1)Bill Summary.  This bill makes a number of changes to provisions  
            of law governing former RDAs, and is an author-sponsored bill. 


          2)Author's Statement.  According to the author, "Each year since  
            the dissolution of local redevelopment agencies, 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, but do not change the policies  
            established when the Legislature eliminated redevelopment  
            agencies in the first place.


            "Cleanup issues have been identified in the following areas:  1)  








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            Appointments to local dissolution oversight boards; 2) Minor  
            modifications or amendments to existing agreements or contracts  
            in connection with enforceable obligations; and, 3) Approval of  
            long-range property management plans.


            "This bill allows existing oversight board members to appoint  
            alternates to the board, and allows those alternates to  
            participate in the same manner as the primary appointee.  This  
            provision will help oversight boards to avoid unnecessary delays  
            in their activities. AB 806 also permits amendments and changes  
            to existing agreements and contracts after a finding of  
            completion has been issued provided that such changes and  
            amendments do not commit the expenditure of additional property  
            tax revenues or reduce the distribution of such revenues to the  
            taxing entities.  This provision will permit change orders to  
            projects currently underway without impacting the availability  
            and distribution of property tax revenue to taxing  
            jurisdictions.


            "Finally, the bill will allow DOF to approve long-range property  
            management plans without the consummation of compensation  
            agreements provided that the plan addresses specified  
            requirements relative to compiling data about the property and  
            estimating its value.  This provision will allow successor  
            agencies to move forward with the disposition of property assets  
            that have otherwise been held in limbo to the detriment of the  
            taxing entities."


          3)Previous Legislation.  This bill is similar to SB 1129  
            (Steinberg) of 2014; however, SB 1129 was much broader in scope  
            and contained several other sections that are not in this bill.   
            SB 1129 was vetoed by Governor Brown.

          4)Arguments in Support.  According to the County of Santa Clara,  
            this bill makes clarifications to the Dissolution Law in a  
            manner that will avoid ambiguity and support the interests of  








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            all parties, including the state, local governments, and  
            successor agencies.  

          5)Arguments in Opposition. None on file.



          Analysis Prepared by:                        Debbie Michel / L.  
                          GOV. / (916) 319-3958                               
                                                                              
              FN: 0000581