Amended in Senate June 30, 2016

Amended in Assembly May 12, 2016

Amended in Assembly April 14, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2492

Introduced by Assembly Members Alejo and Eduardo Garcia

February 19, 2016

An act to amend Sections 62001, 62002, and 62004 of the Government Code, relating to economic development.

LEGISLATIVE COUNSEL’S DIGEST

AB 2492, as amended, Alejo. Community revitalization.

The Community Redevelopment Law authorizes the establishment of redevelopment agencies in communities to address the effects of blight, as defined, by means of redevelopment projects financed by the issuance of bonds serviced by tax increment revenues derived from the project area. Existing law dissolved redevelopment agencies and community development agencies, as of February 1, 2012, and provides for the designation of successor agencies to wind down the affairs of the dissolved agencies and to fulfill the enforceable obligations of those agencies. Existing law also provides for various economic development programs that foster community sustainability and community and economic development initiatives throughout the state.

Existing law authorizes certain local agencies to form a community revitalization and investment authority (authority) within a community revitalization and investment area, as defined, to carry out provisions of the Community Redevelopment Law in that area for purposes related to, among other things, infrastructure, affordable housing, and economic revitalization. Existing law requires not less than 80% of the land calculated by census tracts or census block groups, as defined by the United States Census Bureau, within the area to be characterized by several conditions, including a condition that the land has an annual median household income of less than 80% of the statewide annual median income. begin insert The bill would also authorize an authority to carry out a community revitalization plan if the census tract or census block groups within the community revitalization and investment area are within a disadvantage community, as prescribed. end insert

This bill would authorize the calculation to be made with a combination of census tracts and census block groups. The bill would also revise the conditions to require, among other things, an annual median household income that is less than 80% of the statewide, countywide, or citywide annual median household income.

Existing law authorizes certain entities that receive ad valorem property taxes to adopt a resolution in a specified manner to allocate their share of tax increment funds within the area covered by a community revitalization plan to the authority.

Existing law authorizes an authority to borrow money, receive grants, or accept financial or other assistance or investment from the state or any other public agency for any project within its area of operation.

This bill would authorize an authority to also receive funds allocated to it pursuant to a resolution adopted by a city, county, or special district to transfer these funds from certain tax and assessment revenues, subject to specified requirements as to the use of those funds.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 62001 of the Government Code is
amended to read:

62001.  

(a) A community revitalization and investment
authority is a public body, corporate and politic, with jurisdiction
to carry out a community revitalization plan within a community
revitalization and investment area. The authority shall be deemed
to be the “agency” described in subdivision (b) of Section 16 of
Article XVI of the California Constitution for purposes of receiving
tax increment revenues. The authority shall have only those powers
and duties specifically set forth in Section 62002.

(b) (1) An authority may be created in any one of the following
ways:

(A) A city, county, or city and county may adopt a resolution
creating an authority. The composition of the governing board
shall be comprised as set forth in subdivision (c).

(B) A city, county, city and county, and special district, as
special district is defined in subdivision (m) of Section 95 of the
Revenue and Taxation Code, or any combination thereof, may
create an authority by entering into a joint powers agreement
pursuant to Chapter 5 (commencing with Section 6500) of Division
7 of Title 1.

(2) (A) A school entity, as defined in subdivision (f) of Section
95 of the Revenue and Taxation Code, may not participate in an
authority created pursuant to this part.

(B) A successor agency, as defined in subdivision (j) of Section
34171 of the Health and Safety Code, may not participate in an
authority created pursuant to this part, and an entity created
pursuant to this part shall not receive any portion of the property
tax revenues or other moneys distributed pursuant to Section 34188
of the Health and Safety Code.

(3) An authority formed by a city or county that created a
redevelopment agency that was dissolved pursuant to Part 1.85
(commencing with Section 34170) of Division 24 of the Health
and Safety Code shall not become effective until the successor
agency or designated local authority for the former redevelopment
agency has adopted findings of fact stating all of the following:

(A) The agency has received a finding of completion from the
Department of Finance pursuant to Section 34179.7 of the Health
and Safety Code.

(B) Former redevelopment agency assets which are the subject
of litigation against the state, where the city or county or its
successor agency or designated local authority are a named
plaintiff, have not been or will not be used to benefit any efforts
of an authority formed under this part unless the litigation has been
resolved by entry of a final judgment by any court of competent
jurisdiction and any appeals have been exhausted.

(C) The agency has complied with all orders of the Controller
pursuant to Section 34167.5 of the Health and Safety Code.

(c) (1) The governing board of an authority created pursuant
to subparagraph (A) of paragraph (1) of subdivision (b) shall be
appointed by the legislative body of the city, county, or city and
county that created the authority and shall include three members
of the legislative body of the city, county, or city and county that
created the authority and two public members. The appointment
of the two public members shall be subject to Section 54974. The
two public members shall live or work within the community
revitalization and investment area.

(2) The governing body of the authority created pursuant to
subparagraph (B) of paragraph (1) of subdivision (b) shall be
comprised of a majority of members from the legislative bodies
of the public agencies that created the authority and a minimum
of two public members who live or work within the community
revitalization and investment area. The majority of the board shall
appoint the public members to the governing body. The
appointment of the public members shall be subject to Section
54974.

(d) An authority may carry out a community revitalization plan
within a community revitalization and investment area. Not less
than 80 percent of the land calculated by census tracts, census
block groups, as defined by the United States Census Bureau, or
any combination of both within the area shall be characterized by
both of the following conditions:

(1) An annual median household income that is less than, at the
option of the authority, 80 percent of the statewide, countywide,
or citywide annual median income.

(2) Three of the following four conditions:

(A) An unemployment rate that is at least 3 percentage points
higher than the statewide average annual unemployment rate, as
defined by the report on labor market information published by
the Employment Development Department in March of the year
in which the community revitalization plan is prepared. In
determining the unemployment rate within the community
revitalization and investment area, an authority may use
unemployment data from the periodic American Community
Survey published by the United States Census Bureau.

(B) Crime rates, as documented by records maintained by the
law enforcement agency that has jurisdiction in the proposed plan
area for violent or property crime offenses, that are at least 5
percent higher than the statewide average crime rate for violent or
property crime offenses, as defined by the most recent annual
report of the Criminal Justice Statistics Center within the
Department of Justice, when data is available on the Attorney
General’s Internet Web site. The crime rate shall be calculated by
taking the local crime incidents for violent or property crimes, or
any offense within those categories, for the most recent calendar
year for which the Department of Justice maintains data, divided
by the total population of the proposed plan area, multiplied by
100,000. If the local crime rate for the proposed plan area exceeds
the statewide average rate for either violent or property crime, or
any offense within these categories, by more than 5 percent, then
the condition described in this subparagraph shall be met.

(C) Deteriorated or inadequate infrastructure, including streets,
sidewalks, water supply, sewer treatment or processing, and parks.

(D) Deteriorated commercial or residential structures.

(e) As an alternative to subdivision (d), an authority may also
carry out a community revitalization plan within a community
revitalization and investment area begin delete established end delete begin insert if it meets either of
the following conditions: end insert

begin insert (1) end insert begin insert   end insert begin insert The area is established end insert within a former military base that is
principally characterized by deteriorated or inadequate
infrastructure and structures. Notwithstanding subdivision (c), the
governing board of an authority established within a former
military base shall include a member of the military base closure
commission as a public member.

begin insert

(2) The census tracts or census block groups, as defined by the
United States Census Bureau, within the area are situated within
a disadvantaged community as described in Section 39711 of the
Health and Safety Code.

end insert

(f) An authority created pursuant to this part shall be a local
public agency subject to the Ralph M. Brown Act (Chapter 9
(commencing with Section 54950) of Part 1 of Division 2 of Title
5), the California Public Records Act (Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1), and the Political
Reform Act of 1974 (Title 9 (commencing with Section 81000)).

(g) (1) At any time after the authority is authorized to transact
business and exercise its powers, the legislative body or bodies of
the local government or governments that created the authority
may appropriate the amounts the legislative body or bodies deem
necessary for the administrative expenses and overhead of the
authority.

(2) The money appropriated may be paid to the authority as a
grant to defray the expenses and overhead, or as a loan to be repaid
upon the terms and conditions as the legislative body may provide.
If appropriated as a loan, the property owners and residents within
the plan area shall be made third-party beneficiaries of the
repayment of the loan. In addition to the common understanding
and usual interpretation of the term, “administrative expense”
includes, but is not limited to, expenses of planning and
dissemination of information.

SEC. 2.  

Section 62002 of the Government Code is amended
to read:

62002.  

An authority may do all of the following:

(a) Provide funding to rehabilitate, repair, upgrade, or construct
infrastructure.

(b) Provide for low- and moderate-income housing in accordance
with Part 2 (commencing with Section 62100).

(c) Remedy or remove a release of hazardous substances
pursuant to the Polanco Redevelopment Act (Article 12.5
(commencing with Section 33459) begin delete of Part 1 end delete of Chapter 4 begin insert of Part
1 end insert of Division 24) or Chapter 6.10 (commencing with Section
25403) of Division 20 of the Health and Safety Code.

(d) Provide for seismic retrofits of existing buildings in
accordance with all applicable laws and regulations.

(e) Acquire and transfer real property in accordance with Part
3 (commencing with Section 62200). The authority shall retain
controls and establish restrictions or covenants running with the
land sold or leased for private use for the periods of time and under
the conditions as are provided in the plan. The establishment of
these controls is a public purpose under this part.

(f) Issue bonds in conformity with Article 4.5 (commencing
with Section 53506) and Article 5 (commencing with Section
53510) of Chapter 3 of Part 1 of Division 2 of Title 5.

(g) (1) Borrow money, receive grants, or accept financial or
other assistance or investment from the state or the federal
government or any other public agency or private lending
institution for any project within its area of operation, and may
comply with any conditions of the loan or grant. An authority may
qualify for funding as a disadvantaged community pursuant to
Section 79505.5 of the Water Code or as defined by Section
56033.5. An authority may also enter into an agreement with a
qualified community development entity, as defined by Section
45D(c) of the Internal Revenue Code, to coordinate investments
of funds derived from the New Markets Tax Credit with those of
the authority in instances where coordination offers opportunities
for greater efficiency of investments to improve conditions
described in subdivisions (d) and (e) within the territorial
jurisdiction of the authority.

(2) Receive funds allocated to it pursuant to a resolution adopted
by a city, county, or special district to transfer these funds from a
source described in subdivision (d), (e), or (f) of Section 53398.75,
subject to any requirements upon, or imposed by, the city, county,
or special district as to the use of these funds.

(h) Adopt a community revitalization and investment plan
pursuant to Sections 62003 and 62004.

(i) Make loans or grants for owners or tenants to improve,
rehabilitate, or retrofit buildings or structures within the plan area.

(j) Construct foundations, platforms, and other like structural
forms necessary for the provision or utilization of air rights sites
for buildings to be used for residential, commercial industrial, or
other uses contemplated by the revitalization plan.

(k) Provide direct assistance to businesses within the plan area
in connection with new or existing facilities for industrial or
manufacturing uses, except as specified in this division.

SEC. 3.  

Section 62004 of the Government Code is amended
to read:

62004.  

(a) The authority shall consider adoption of the plan
at three public hearings that shall take place at least 30 days apart.
At the first public hearing, the authority shall hear all written and
oral comments but take no action. At the second public hearing,
the authority shall consider any additional written and oral
comments and take action to modify or reject the plan. If the plan
is not rejected at the second public hearing, then the authority shall
conduct a protest proceeding at the third public hearing to consider
whether the property owners and residents within the plan area
wish to present oral or written protests against the adoption of the
plan.

(b) The draft plan shall be made available to the public and to
each property owner within the area at a meeting held at least 30
days prior to the notice given for the first public hearing. The
purposes of the meeting shall be to allow the staff of the authority
to present the draft plan, answer questions about the plan, and
consider comments about the plan.

(c) (1) Notice of the meeting required by subdivision (b) and
the public hearings required by this subdivision shall be given in
accordance with subdivision (j). The notice shall do all of the
following, as applicable:

(A) Describe specifically the boundaries of the proposed area.

(B) Describe the purpose of the plan.

(C) State the day, hour, and place when and where any and all
persons having any comments on the proposed plan may appear
to provide written or oral comments to the authority.

(D) Notice of second public hearing shall include a summary
of the changes made to the plan as a result of the oral and written
testimony received at or before the public hearing and shall identify
a location accessible to the public where the plan proposed to be
presented and adopted at the second public hearing can be
reviewed.

(E) Notice of the third public hearing to consider any written
or oral protests shall contain a copy of the final plan adopted
pursuant to subdivision (a), and shall inform the property owner
and resident of his or her right to submit an oral or written protest
before the close of the public hearing. The protest may state that
the property owner or resident objects to the authority taking action
to implement the plan.

(2) At the third public hearing, the authority shall consider all
written and oral protests received prior to the close of the public
hearing and shall terminate the proceedings or adopt the plan
subject to confirmation by the voters at an election called for that
purpose. The authority shall terminate the proceedings if there is
a majority protest. A majority protest exists if protests have been
filed representing over 50 percent of the combined number of
property owners and residents in the area who are at least 18 years
of age. An election shall be called if between 25 percent and 50
percent of the combined number of property owners and residents
in the area who are at least 18 years of age file a protest.

(d) An election required pursuant to paragraph (2) of subdivision
(c) shall be held within 90 days of the public hearing and may be
held by mail-in ballot. The authority shall adopt, at a duly noticed
public hearing, procedures for this election.

(e) If a majority of the property owners and residents vote
against the plan, then the authority shall not take any further action
to implement the proposed plan. The authority shall not propose
a new or revised plan to the affected property owners and residents
for at least one year following the date of an election in which the
plan was rejected.

(f) At the hour set in the notice required by subdivision (a), the
authority shall consider all written and oral comments.

(g) If less than 25 percent of the combined number of property
owners and residents in the area who are at least 18 years of age
file a protest, the authority may adopt the plan at the conclusion
of the third public hearing by ordinance. The ordinance adopting
the plan shall be subject to referendum as prescribed by law.

(h) For the purposes of Section 62005, the plan shall be the plan
adopted pursuant to this section.

(i) The authority shall consider and adopt an amendment or
amendments to a plan in accordance with the provisions of this
section.

(j) The authority shall post notice of each meeting or public
hearing required by this section in an easily identifiable and
accessible location on the authority’s Internet Web site and shall
mail a written notice of the meeting or public hearing to each owner
of land and each resident at least 10 days prior to the meeting or
public hearing.

(1) Notice of the first public hearing shall also be published not
less than once a week for four successive weeks prior to the first
public hearing in a newspaper of general circulation published in
the county in which the area lies.

(2) Notice of the second public hearing shall also be published
not less than 10 days prior to the second public hearing in a
newspaper of general circulation in the county in which the area
lies.

(3) Notice of the third public hearing shall also be published
not less than 10 days prior to the third public hearing in a
newspaper of general circulation in the county in which the area
lies.