BILL NUMBER: AB 2618	CHAPTERED
	BILL TEXT

	CHAPTER  796
	FILED WITH SECRETARY OF STATE  SEPTEMBER 29, 2016
	APPROVED BY GOVERNOR  SEPTEMBER 29, 2016
	PASSED THE SENATE  AUGUST 23, 2016
	PASSED THE ASSEMBLY  AUGUST 30, 2016
	AMENDED IN SENATE  AUGUST 19, 2016
	AMENDED IN SENATE  AUGUST 16, 2016
	AMENDED IN ASSEMBLY  MAY 2, 2016
	AMENDED IN ASSEMBLY  MARCH 17, 2016

INTRODUCED BY   Assembly Member Nazarian

                        FEBRUARY 19, 2016

   An act to amend Section 53328.1 of the Government Code, relating
to local government.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2618, Nazarian. Community facilities districts: powers.
   The Mello-Roos Community Facilities Act of 1982 specifies the
requirements for the establishment of a community facilities
district, including, among other things, a petition, a hearing, the
establishment of the boundaries of the community facilities district,
and an election on the question. Existing law authorizes a community
facilities district formed pursuant to an alternative procedure
under which the district initially consists solely of territory
proposed for annexation to the community facilities district in the
future and territory is annexed and subjected to special taxes only
upon unanimous approval of the owners, to finance and refinance the
acquisition, installation, and improvement of energy efficiency,
water conservation, and renewable energy improvements.
   This bill would authorize a community facilities district that is
formed pursuant to the alternative procedure to additionally finance
seismic retrofitting, as specified.
   This bill would incorporate changes to Section 53328.1 of the
Government Code proposed by both this bill and AB 2693, which would
become operative only if both bills are enacted and become effective
on or before January 1, 2017, and this bill is chaptered last.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 53328.1 of the Government Code is amended to
read:
   53328.1.  (a) As an alternate and independent procedure for
forming a community facilities district, the legislative body may
form a community facilities district that initially consists solely
of territory proposed for annexation to the community facilities
district in the future, with the condition that a parcel or parcels
within that territory may be annexed to the community facilities
district and subjected to the special tax only with the unanimous
approval of the owner or owners of the parcel or parcels at the time
that the parcel or parcels are annexed. In that case, the legislative
body shall follow the procedures set forth in this article for the
formation of a community facilities district, with the following
exceptions:
   (1) The legislative body shall not be obligated to specify the
rate or rates of special tax in the resolution of intention or the
resolution of formation, provided that both of the following are met:

   (A) The resolution of intention and the resolution of formation
include a statement that the rate shall be established in an amount
required to finance or refinance the authorized improvements and to
pay the district's administrative expenses.
   (B) The maximum rate of special tax applicable to a parcel or
parcels shall be specified in the unanimous approval described in
this section relating to the parcel or parcels.
   (2) The legislative body shall not be obligated to specify in the
resolution of intention the conditions under which the obligation to
pay the specified special tax may be prepaid and permanently
satisfied. Instead, a prepayment provision may be included in the
unanimous approval of the owner or owners of each parcel or parcels
at the time that the parcel or parcels are annexed to the community
facilities district.
   (3) In lieu of approval pursuant to an election held in accordance
with the procedures set forth in Sections 53326, 53327, 53327.5, and
53328, the appropriations limit for the community facilities
district, the applicable rate of the special tax and the method of
apportionment and manner of collection of that tax, and the
authorization to incur bonded indebtedness for the community
facilities district shall be specified and be approved by the
unanimous approval of the owner or owners of each parcel or parcels
at the time that the parcel or parcels are annexed to the community
facilities district. No additional hearings or procedures are
required, and the unanimous approval shall be deemed to constitute a
unanimous vote in favor of the appropriations limit for the community
facilities district, the authorization to levy the special tax on
the parcel or parcels, and the authorization to incur bonded
indebtedness for the community facilities district.
   (4) Notwithstanding Section 53324, this paragraph establishes the
applicable protest provisions in the event a local agency forms a
community facilities district pursuant to the procedures set forth in
this section. If 50 percent or more of the registered voters, or six
registered voters, whichever is more, residing within the territory
proposed to be annexed to the community facilities district in the
future, or if the owners of one-half or more of the area of land
proposed to be annexed in the future and not exempt from the special
tax, file written protests against establishment of the community
facilities district, and protests are not withdrawn so as to reduce
the protests to less than a majority, no further proceedings to form
the community facilities district shall be undertaken for a period of
one year from the date of decision of the legislative body on the
issues discussed at the hearing. If the majority protests of the
registered voters or of the landowners are only against the
furnishing of a specified type or types of facilities or services
within the district, or against levying a specified special tax,
those types of facilities or services or the specified special tax
shall be eliminated from the resolution of formation.
   (5) The legislative body shall not record a notice of special tax
lien against any parcel or parcels in the community facilities
district until the owner or owners of the parcel or parcels have
given their unanimous approval of the parcel's or parcels' annexation
to the community facilities district, at which time the notice of
special tax lien shall be recorded against the parcel or parcels as
set forth in Section 53328.3.
   (b) Notwithstanding the provisions of Section 53340, after
adoption of the resolution of formation for a community facilities
district described in subdivision (a), the legislative body may, by
ordinance, provide for the levy of the special taxes on parcels that
will annex to the community facilities district at the rate or rates
to be approved unanimously by the owner or owners of each parcel or
parcels to be annexed to the community facilities district and for
apportionment and collection of the special taxes in the manner
specified in the resolution of formation. No further ordinance shall
be required even though no parcels may then have annexed to the
community facilities district.
   (c) The local agency may bring an action to determine the validity
of any special taxes levied pursuant to this chapter and authorized
pursuant to the procedures set forth in this section pursuant to
Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the
Code of Civil Procedure. Notwithstanding Section 53359, if an action
is brought by an interested person pursuant to Section 863 of the
Code of Civil Procedure to determine the validity of any special
taxes levied against a parcel pursuant to this chapter and authorized
pursuant to the procedures set forth in this section, the action
shall be brought pursuant to Chapter 9 (commencing with Section 860)
of Title 10 of Part 2 of the Code of Civil Procedure, but shall,
notwithstanding the time limits specified in Section 860 of the Code
of Civil Procedure, be commenced within 15 days after the date on
which the notice of special tax lien is recorded against the parcel.
Any appeal from a judgment in any action or proceeding described in
this subdivision shall be commenced within 30 days after entry of
judgment.
   (d) A community facilities district formed pursuant to this
section may only finance facilities pursuant to subdivision (i) or
(l) of Section 53313.5.
   (e) In connection with formation of a community facilities
district and annexation of a parcel or parcels to the community
facilities district pursuant to this section, and the conduct of an
election on the proposition to authorize bonded indebtedness pursuant
to the alternate procedures set forth in Section 53355.5, the local
agency may, without additional hearings or procedures, designate a
parcel or parcels as an improvement area within the community
facilities district. After the designation of a parcel or parcels as
an improvement area, all proceedings for approval of the
appropriations limit, the rate and method of apportionment and manner
of collection of special tax and the authorization to incur bonded
indebtedness for the parcel or parcels shall apply only to the
improvement area.
   (f) In connection with a community facilities district formed
under this section, as an alternate and independent procedure for
making the changes described in Section 53330.7, the changes may be
made with the unanimous approval of the owner or owners of the parcel
or parcels that will be affected by the change and with the written
consent of the local agency. No additional hearings or procedures are
required, and the unanimous approval shall be deemed to constitute a
unanimous vote in favor of the proposed changes. If the proceeds of
a special tax are being used to retire any debt incurred pursuant to
this chapter and the unanimous approval relates to the reduction of
the special tax rate, the unanimous approval shall recite that the
reduction or termination of the special tax will not interfere with
the timely retirement of that debt.
  SEC. 1.5.  Section 53328.1 of the Government Code is amended to
read:
   53328.1.  (a) As an alternate and independent procedure for
forming a community facilities district, the legislative body may
form a community facilities district that initially consists solely
of territory proposed for annexation to the community facilities
district in the future, with the condition that a parcel or parcels
within that territory may be annexed to the community facilities
district and subjected to the special tax only with the unanimous
approval of the owner or owners of the parcel or parcels at the time
that the parcel or parcels are annexed. In that case, the legislative
body shall follow the procedures set forth in this article for the
formation of a community facilities district, with the following
exceptions:
   (1) The legislative body shall not be obligated to specify the
rate or rates of special tax in the resolution of intention or the
resolution of formation, provided that both of the following are met:

   (A) The resolution of intention and the resolution of formation
include a statement that the rate shall be established in an amount
required to finance or refinance the authorized improvements and to
pay the district's administrative expenses.
   (B) The maximum rate of special tax applicable to a parcel or
parcels shall be specified in the unanimous approval described in
this section relating to the parcel or parcels.
   (2) The legislative body shall not be obligated to specify in the
resolution of intention the conditions under which the obligation to
pay the specified special tax may be prepaid and permanently
satisfied. Instead, a prepayment provision may be included in the
unanimous approval of the owner or owners of each parcel or parcels
at the time that the parcel or parcels are annexed to the community
facilities district.
   (3) In lieu of approval pursuant to an election held in accordance
with the procedures set forth in Sections 53326, 53327, 53327.5, and
53328, the appropriations limit for the community facilities
district, the applicable rate of the special tax and the method of
apportionment and manner of collection of that tax, and the
authorization to incur bonded indebtedness for the community
facilities district shall be specified and be approved by the
unanimous approval of the owner or owners of each parcel or parcels
at the time that the parcel or parcels are annexed to the community
facilities district. No additional hearings or procedures are
required, and the unanimous approval shall be deemed to constitute a
unanimous vote in favor of the appropriations limit for the community
facilities district, the authorization to levy the special tax on
the parcel or parcels, and the authorization to incur bonded
indebtedness for the community facilities district.
   (4) Notwithstanding Section 53324, this paragraph establishes the
applicable protest provisions in the event a local agency forms a
community facilities district pursuant to the procedures set forth in
this section. If 50 percent or more of the registered voters, or six
registered voters, whichever is more, residing within the territory
proposed to be annexed to the community facilities district in the
future, or if the owners of one-half or more of the area of land
proposed to be annexed in the future and not exempt from the special
tax, file written protests against establishment of the community
facilities district, and protests are not withdrawn so as to reduce
the protests to less than a majority, no further proceedings to form
the community facilities district shall be undertaken for a period of
one year from the date of decision of the legislative body on the
issues discussed at the hearing. If the majority protests of the
registered voters or of the landowners are only against the
furnishing of a specified type or types of facilities or services
within the district, or against levying a specified special tax,
those types of facilities or services or the specified special tax
shall be eliminated from the resolution of formation.
   (5) The legislative body shall not record a notice of special tax
lien against any parcel or parcels in the community facilities
district until the owner or owners of the parcel or parcels have
given their unanimous approval of the parcel's or parcels' annexation
to the community facilities district, at which time the notice of
special tax lien shall be recorded against the parcel or parcels as
set forth in Section 53328.3.
   (b) Notwithstanding the provisions of Section 53340, after
adoption of the resolution of formation for a community facilities
district described in subdivision (a), the legislative body may, by
ordinance, provide for the levy of the special taxes on parcels that
will annex to the community facilities district at the rate or rates
to be approved unanimously by the owner or owners of each parcel or
parcels to be annexed to the community facilities district and for
apportionment and collection of the special taxes in the manner
specified in the resolution of formation. No further ordinance shall
be required even though no parcels may then have annexed to the
community facilities district.
   (c) The local agency may bring an action to determine the validity
of any special taxes levied pursuant to this chapter and authorized
pursuant to the procedures set forth in this section pursuant to
Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the
Code of Civil Procedure. Notwithstanding Section 53359, if an action
is brought by an interested person pursuant to Section 863 of the
Code of Civil Procedure to determine the validity of any special
taxes levied against a parcel pursuant to this chapter and authorized
pursuant to the procedures set forth in this section, the action
shall be brought pursuant to Chapter 9 (commencing with Section 860)
of Title 10 of Part 2 of the Code of Civil Procedure, but shall,
notwithstanding the time limits specified in Section 860 of the Code
of Civil Procedure, be commenced within 15 days after the date on
which the notice of special tax lien is recorded against the parcel.
Any appeal from a judgment in any action or proceeding described in
this subdivision shall be commenced within 30 days after entry of
judgment.
   (d) A community facilities district formed pursuant to this
section may only finance facilities pursuant to subdivision (i) or
(l) of Section 53313.5.
   (e)  (1) The legislative body shall comply with the requirements
specified in Sections 5898.16 and 5898.17 of the Streets and Highways
Code prior to the annexation of a parcel or parcels to a community
facilities district formed pursuant to this section.
   (2) A parcel or parcels shall not be annexed to a community
facilities district formed pursuant to this section if the parcel
owner or owners are seeking financing for improvement on a
residential property with four or fewer units, unless the parcel
complies with the conditions specified in paragraphs (1) to (5),
inclusive, and paragraph (8), and, in addition, for properties with
energy efficiency improvements specified under subdivision (l) of
Section 53313.5, paragraph (7), of subdivision (a) of Section 26063
of the Public Resources Code.
   (f) In connection with formation of a community facilities
district and annexation of a parcel or parcels to the community
facilities district pursuant to this section, and the conduct of an
election on the proposition to authorize bonded indebtedness pursuant
to the alternate procedures set forth in Section 53355.5, the local
agency may, without additional hearings or procedures, designate a
parcel or parcels as an improvement area within the community
facilities district. After the designation of a parcel or parcels as
an improvement area, all proceedings for approval of the
appropriations limit, the rate and method of apportionment and manner
of collection of special tax and the authorization to incur bonded
indebtedness for the parcel or parcels shall apply only to the
improvement area.
   (g) In connection with a community facilities district formed
under this section, as an alternate and independent procedure for
making the changes described in Section 53330.7, the changes may be
made with the unanimous approval of the owner or owners of the parcel
or parcels that will be affected by the change and with the written
consent of the local agency. No additional hearings or procedures are
required, and the unanimous approval shall be deemed to constitute a
unanimous vote in favor of the proposed changes. If the proceeds of
a special tax are being used to retire any debt incurred pursuant to
this chapter and the unanimous approval relates to the reduction of
the special tax rate, the unanimous approval shall recite that the
reduction or termination of the special tax will not interfere with
the timely retirement of that debt.
  SEC. 2.  Section 1.5 of this bill incorporates amendments to
Section 53328.1 of the Government Code proposed by both this bill and
Assembly Bill 2693. It shall only become operative if (1) both bills
are enacted and become effective on or before January 1, 2017, (2)
each bill amends Section 53328.1 of the Government Code, and (3) this
bill is enacted after Assembly Bill 2693, in which case Section 1 of
this bill shall not become operative.