BILL ANALYSIS Ó AB 1105 Page 1 Date of Hearing: April 8, 2015 ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT Brian Maienschein, Chair AB 1105 (Daly) - As Introduced February 27, 2015 SUBJECT: Subdivided lands: release of performance security. SUMMARY: Repeals the sunset date in the statute governing the timeframe and procedures for releasing subdivision performance securities. Specifically, this bill: 1)Repeals the January 1, 2016, sunset date relating to the procedures for releasing a performance security, thereby extending the statute indefinitely. EXISTING LAW: 1)Requires, pursuant to the Subdivision Map Act, the furnishing of specified types of security with respect to the performance of various acts or agreements subject to the Act. 2)Requires, until January 1, 2016, the specific procedures imposed on a local agency for the complete or partial release of a performance security furnished by a subdivider. AB 1105 Page 2 FISCAL EFFECT: This bill is keyed fiscal and contains a state-mandated local program. COMMENTS: 1)Bill Summary and Background. This bill repeals the sunset date in the statute governing the timeframe and procedures for releasing subdivision performance securities. Counties and cities commonly impose conditions when they approve proposed subdivisions, often requiring the subdividers to install public works such as street lights, curbs, and sewers. Sometimes subdividers must provide assurances that the work will be completed, including performance bonds, deposits, credit instruments, liens, or other property interests. Until 2006, counties and cities followed their own procedures in deciding when to release these securities. At the request of builders, the Legislature adopted uniform procedures and time limits by which counties and cities must either release the securities provided for subdivision conditions or tell the subdividers about the incomplete performance or unsatisfactory work pursuant to AB 1460 (Umberg), Chapter 411, Statutes of 2005, which contained a five-year sunset date. In 2010, the Legislature extended the sunset date another five years, until January 1, 2016, pursuant to SB 1019 (Correa), Chapter 174, Statutes of 2010. This bill is sponsored by the California Building Industry Association. 2)Author's Statement. According to the author, "Without action the timeframes and procedures for the release of performance securities established via SB 1019 (and its predecessor, AB 1460 (Umberg)), will expire. SB 1019 and AB 1460 have AB 1105 Page 3 provided 10 years of operating experience under the established timeframes and procedures and it is now appropriate to make permanent." 3)Arguments in Support. The California Building Industry Association, in support, notes that in 2005, homebuilders worked closely with local governments to establish the process through AB 1460 (Umberg) and that action is needed this year to ensure the existing procedures are maintained beyond the existing sunset date. 4)Arguments in Opposition. None on file. REGISTERED SUPPORT / OPPOSITION: Support California Building Industry Association [SPONSOR] Opposition None on file. AB 1105 Page 4 Analysis Prepared by:Debbie Michel / L. GOV. / (916) 319-3958