BILL ANALYSIS Ó
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Date of Hearing: August 25, 2016
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Susan Talamantes Eggman, Chair
AB 806
(Dodd) - As Amended August 8, 2016
SUBJECT: Community development: economic opportunity
SUMMARY: Allows counties and cities to acquire, sell, or lease
county-owned or city-owned real property to promote economic
development, subject to specified requirements.
The Senate amendments strike the existing contents of the bill,
and instead:
1)Specify that loan agreements, sale agreements, and lease
agreements that meet specified criteria are included in the
statutory definition of "economic opportunity."
2)Prohibit, for the purposes of specified statutes authorizing
the sale, lease, or transfer of property for the creation of
an economic opportunity, a city, county, or city and county
from selling, leasing, or otherwise transferring, at a price
that is less than fair market value, any real property that
was acquired through eminent domain. Exempt from this
prohibition any property that is:
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a) Governed by a long-range property management plan
pursuant to redevelopment law; and,
b) A housing asset of a former redevelopment agency that is
transferred to a city, county, or city and county, provided
that the successor agency or designated local authority in
the affected jurisdiction has received a finding of
completion from the Department of Finance.
1)Require that the creation of an economic opportunity shall be
subject to statute that requires public agencies to disclose
specified information, hold hearings and produce reports
relating to economic development subsidies.
2)Specify that the provisions of the bill shall be an
alternative to any authority of a city, county, or city and
county to create an economic opportunity or to acquire, sell,
or lease property for economic development, found in the
Constitution, state law, local ordinance, or charter, as
specified.
3)Allow a city, county, or city and county to acquire property
in furtherance of the creation of an economic opportunity, and
may sell or lease property to create an economic opportunity.
4)Delete statutory language that limits the authority to sell or
lease city-owned or county-owned property for economic
development purposes to property that is governed by a
long-range property management plan, thereby allowing a city,
county, or city and county to sell or lease any county-owned
or city-owned property to create an economic opportunity, as
defined.
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5)Require that a loan provided by a city or county to owners or
tenants for the purpose of rehabilitating commercial buildings
or structures must be in the form of a written loan agreement
that includes specified elements.
6)Require that, before entering into a loan agreement, a city,
county, or city and county, must find, after a public hearing,
that the assistance is necessary for the economic feasibility
of the development and that the assistance cannot be obtained
on economically feasible terms in the private market.
7)Make findings and declarations and additional clarifying and
conforming changes to state law.
EXISTING LAW:
1)Prohibits counties and general law cities from making a gift
of public funds.
2)Allows, generally, a city to dispose of real property in any
way it chooses if doing so is for the common benefit. Allows
a city to sell or lease real property for less than fair
market value, without violating the constitutional prohibition
against making a gift of public funds, if the sale or lease
serves a public purpose.
3)Requires a county to sell or lease property using a
competitive sealed-bid process, as specified:
a) A county board of supervisors must, by a two-thirds
vote, adopt a resolution in a regular open meeting
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declaring its intention to sell or lease the property;
b) The resolution must describe the property and the terms
upon which it will be sold or leased; and,
c) At least three weeks after adopting the resolution, the
board must hold a public meeting at which sealed proposals
to purchase or lease the property must be considered.
4)Exempts a county from these requirements and allows it to sell
real property at less than fair market value to provide
housing that is affordable to low and moderate income
residents.
AS PASSED BY THE ASSEMBLY, this bill made various changes to
provisions of law governing former redevelopment agencies
(RDAs).
FISCAL EFFECT: None
COMMENTS:
1)Bill Summary. This bill clarifies that a city or county may
acquire, sell and lease property in furtherance of the
creation of an economic opportunity, and that such authority
extends to any property and not just property that the city or
county acquired from the successor agency to the redevelopment
agency under the long range property management plan.
This bill is sponsored by the City of Fairfield and the League
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of California Cities.
2)Author's Statement. According to the author, "In 2011 the
Governor and Legislature eliminated redevelopment agencies in
order to provide more property tax revenues to local taxing
agencies. All redevelopment agencies in the State were
dissolved as of February 1, 2012.
"In 2013, the Legislature adopted SB 470 to promote economic
development on a local level, to give local governments tools,
at no cost to the state, that allow local governments to use
their funds in a manner that promotes economic opportunity,
and to provide cities, counties, and cities and counties
certain powers previously afforded to redevelopment agencies
that were critical to economic development.
"SB 470 declared that it is the policy of the State of
California to protect and promote the sound development of
economic opportunity in cities and counties. That whenever the
creation of economic opportunity in cities and counties cannot
be accomplished by private enterprise alone, without public
participation and assistance in the acquisition of land, in
planning and in the financing of land assembly, in the work of
clearance, and in the making of improvements necessary
therefor, it is in the public interest to advance or expend
public funds for these purposes. That the creation of economic
opportunity and the provisions for appropriate continuing land
use and construction policies with respect to property
acquired, in whole or in part, for economic opportunity
constitute public uses and purposes for which public money may
be advanced or expended and private property acquired, and are
governmental functions of state concern in the interest of
health, safety, and welfare of the people of the state and
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cities and counties.
3)Support Arguments. Supporters argue that this bill offers
communities additional tools that can be used to rehabilitate
deteriorated areas, attract and retain jobs, and improve local
quality of life.
4)Opposition Arguments. None on file.
REGISTERED SUPPORT / OPPOSITION:
Support
City of Fairfield [SPONSOR]
League of California Cities [SPONSOR]
California Association for Local Economic Development
Cities of:
Azusa, Camarillo, Commerce, Fountain Valley, Industry, Los
Alamitos, Napa, Norwalk, Redding, and Vacaville
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Fairfield-Suisun Chamber of Commerce
Lystek International, Ltd.
Opposition
None on file
Analysis Prepared by:Debbie Michel / L. GOV. / (916) 319-3958