BILL ANALYSIS Ó
AB 2492
Page 1
ASSEMBLY THIRD READING
AB
2492 (Alejo)
As Amended May 12, 2016
Majority vote
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+---------------------|
|Housing |5-2 |Chiu, Burke, Chau, |Steinorth, Beth |
| | |Lopez, Mullin |Gaines |
| | | | |
|----------------+-----+----------------------+---------------------|
|Local |6-2 |Eggman, Mullin, |Waldron, Linder |
|Government | |Bonilla, Chiu, | |
| | |Cooley, Gordon | |
| | | | |
| | | | |
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SUMMARY: Makes changes to allow greater flexibility for the
creation community revitalization and investment authorities
(CRIA) and allows a CRIA to receive funding from the same
sources as an enhanced infrastructure financing district (EIFD).
Specifically, this bill:
1)Allows a CRIA to use a combination of both the United States
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(US) Census Bureau census track and census block groups data
to identify a project area.
2)Allows a CRIA to use, at their discretion, statewide,
countrywide, or citywide levels of area median income to
identify a project area.
3)Clarifies the source of unemployment data required to identify
a CRIA project area.
4)Allows a CRIA to use the unemployment data from the periodic
American Community Survey published by the US Census Bureau in
addition to the labor market information published by the
Employment Development Department (EDD) in March of the year
the CRIA plan is prepared.
5)Provides that in determining the crime rate of a proposed CRIA
project area the crime rate is based on the area's average
crime rate for violent or property crimes offenses as
documented by the records maintained by the law enforcement
agency in the jurisdiction.
6)Requires the crime rate to be calculated by taking the local
incidents of violent and property crimes or any offences
within those categories for the most recent calendar year for
which the Department of Justice maintains data and dividing it
by the total population of the proposed plan area and
multiplying that amount by 100,000.
7)Provides that 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% then crime rate necessary to qualify as a CRIA project
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area is considered met.
8)Gives a CRIA the same authority as an EIFD, to receive funds
allocated to it pursuant to a resolution adopted by a city,
county, or special district from:
a) The increased property tax revenues that the city,
county, or special district receives from the dissolution
of redevelopment agencies;
b) Property taxes received by a city or county in lieu of
former vehicle license fee funds; or
c) Funds derived from various assessments that may be
imposed by special districts.
1)Makes other technical changes.
FISCAL EFFECT: None
COMMENTS:
Last year, AB 2 (Alejo) Chapter 319, Statues of 2015 authorized
cities and counties to created CRIAs to use tax increment
revenue to improve the infrastructure, assist businesses, and
support affordable housing in disadvantaged communities. A CRIA
can freeze the property taxes at the time the plan for
revitalizing the area is approved, collect all the tax increment
or the increase in property taxes that is generated after that
point and use it on specified activities. Unlike redevelopment
agencies, the taxing entities in the area including the county,
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city, special districts, or a military base must agree to divert
tax increment to the CRIA. Local government entities that
initially participate can opt out by giving the
auditor-controller sixty days' notice; however, the auditor
controller will continue to collect the local government
entities' portions of tax increment until any debts issued up
until then have been repaid. No portion of the local schools'
share of tax increment may go to the authority. CRIA's must
set-aside 25% of revenues for affordable housing and must
replace any existing affordable housing units that are removed
as a result of their activities.
A CRIA may only be created in areas which are predominately
low-income and have a high unemployment and crime rate. At
least 80% of a CRIA project area, based on US Census data must
have an annual median household income that is less than 80% of
the statewide annual median income. In addition, a CRIA must
meet three of the four following conditions:
1) The nonseasonal unemployment must be at least 3% higher
than the statewide median, as defined by a specified labor
market report;
2) The crime rate must be 5% higher than the statewide
median crime rate, as defined by a specified Department of
Justice report;
3) There must be deteriorated or inadequate infrastructure
such as streets, sidewalks, water supply, sewer treatment
or processing, and parks; and
4) There must be deteriorated commercial or residential
structures.
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According to the sponsor, the League of California Cities, this
bill is intended to clarify where CRIAs can be formed. The
sponsor worked with the EDD to update the mechanism for
determining the unemployment rate and the Department of Justice
(DOJ) to revise the means of determining the crime rate
necessary to meet the standard to qualify an area as a CRIA.
To establish a CRIA a city or county must determine that at
least 80% of the project area has an annual median income that
is less than 80% of the statewide average as determined by the
US Census. This bill would give a city or county the option of
using the statewide average or the citywide or countywide
average. This change provides a more precise standard and could
have the effect of expanding the area that could be included in
a CRIA. To establish a CRIA a city or county must also
establish that 80% of the project area meets three of four
conditions: high unemployment, high crime rate, deteriorated
infrastructure, or deteriorated commercial or residential
structures.
In calculating the unemployment rate, in addition to using the
EDD's annual update, the city or county can rely upon the US
Census Data's American Community Survey. The American Community
Survey is a survey conducted by the U.S. Census Bureau. Unlike
the every-10-year census, this survey continues all year, every
year. The Survey is conducted by randomly sampling addresses in
every state, the District of Columbia, and Puerto Rico. Answers
are collected to form up-to-date statistics used by many
federal, state, tribal, and local leaders. To determine the
crime rate for a CRIA project area, existing law require a city
or county to use the statewide median crime rate as determined
by the Criminal Justice Statistics Center within DOJ, when data
is available on the California Attorney General's Internet Web
site. This bill would require a city or county to compare the
local data for violent or property crime offenses and compare
that against the statewide average.
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Access to additional resources: SB 628 (Beall), Chapter, 785,
Statutes of 2014, allowed a city or county to create an EIFD, in
order to finance specified facilities and infrastructure
projects, using tax increment. SB 628 expanded, as compared to
existing EIFD law, the public capital facilities or other
projects of communitywide significance that could be financed by
an EIFD, to include brownfield restoration and other
environmental mitigation, the development of projects on a
former military base, transit priority projects, and projects
that implement a sustainable communities strategy, among other
infrastructure projects.
The city or county that creates an EIFD can choose to transfer
its portion of increased property tax revenues as a result of
redevelopment dissolution, property taxes received by the city
or county in lieu of former vehicle license fee funds, and funds
from various assessments that a special district imposes. This
bill allows a CRIA to also receive funds from these sources if a
city, county, or special district chooses to transfer them.
Prior Legislation:
AB 2 (Alejo) Chapter 319, Statues of 2015, authorized local
governments to create CRIA to use tax increment revenue to
improve the infrastructure, assist businesses, and support
affordable housing in disadvantaged communities.
SB 628 (Beall), Chapter 785, Statutes of 2014, allowed local
agencies to create EIFDs to finance specified infrastructure
projects and facilities
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Analysis Prepared by:
Lisa Engel / H. & C.D. / (916) 319-2085 FN:
0002948