BILL ANALYSIS Ó
AB 2797
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Date of Hearing: May 11, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2797 (Chiu) - As Amended April 13, 2016
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|Policy |Natural Resources |Vote:|9 - 0 |
|Committee: | | | |
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| |Local Government | |8 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill authorizes the Port of San Francisco (Port) to loan
specified non-trust lease revenues for infrastructure costs for
the development of the Mission Rock Project (Seawall Lot 337),
and expands its boundaries, as specified. Additionally, this
bill:
1)Requires the State Lands Commission (SLC) to approve or deny
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Port advances within 75 days after the San Francisco Board of
Supervisors approves the project, as specified.
2)Requires the Port to pay for any study or investigation SLC
undertakes, as specified.
3)Requires the Port to repay advances with interest within 50
years, unless the time period is extended by SLC.
FISCAL EFFECT:
Increased, reimbursable costs for SLC to review, and approve or
deny the trust revenue advances.
Potential significant temporary losses of local trust revenue,
in the tens of millions of dollars range, during the period
between the advance and repayment of the loan (up to 50 years,
or more). The Port estimates the infrastructure costs at
Seawall Lot 337 will exceed $150 million dollars.
COMMENTS:
1)Purpose. According to the author, following the enactment of
SB 815, the Port initiated a planning process for Seawall Lot
337. In 2009, the Port selected a development team led by the
San Francisco Giants for exclusive negotiations with the Port
for the development of Seawall Lot 337.
The proposed development at Seawall Lot 337 and Pier 48 is 28
acres and includes former tidelands lying between Mission Bay
to the south, and China Basin and the Giants ballpark to the
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north. This bill provides the infrastructure financing
necessary to develop the Mission Rock project.
2)Background. The San Francisco waterfront includes a number of
seawall lots controlled by the Port, that have been used for
decades as parking lots, a use that is inconsistent with the
trust and does not conform with the surrounding urban
landscape. SB 815 (Migden), Chapter 660, Statutes of 2007,
freed trust use restrictions from the seawall lots along the
Embarcadero, and allowed the Port to lease these properties at
market rates for non-trust purposes provided specified
conditions were met.
Revenues from these non-trust leases are required to be
deposited into a separate account and used for the
preservation of historic piers and construction or the
construction and maintenance of waterfront plazas and open
space, as specified.
Before using any revenues for any pier or structure subject to
public trust restrictions, the SLC's executive officer is
required to approve the proposed uses. The port is also
authorized to use part of the non-trust lease revenues for
purposes consistent with the existing public trust law. SB
815 authorized leases for nontrust uses to have 75-year terms
until January 1, 2094, at which time the public trust
restrictions on the land are restored.
3)Public Trust and Granted Lands. The Public Trust Doctrine
protects the public's right to use California's waterways for
commerce, navigation, fishing, boating, natural habitat
protection, and other water-oriented activities.
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The Public Trust Doctrine requires filled and unfilled tide
and submerged lands and the beds of lakes, streams, and other
navigable waterways to be held in trust by the state for the
benefit of the people of California.
The Legislature has granted public trust lands to local
trustees so the lands can be managed locally for the benefit
of the people of California. There are over 80 trustees in
the state, including the ports of Los Angeles, Long Beach, San
Diego, San Francisco, Oakland, Richmond, Benicia, and Eureka.
While these trust lands are managed locally, SLC has oversight
authority to ensure those local trustees are complying with
the public trust doctrine and the applicable granting
statutes.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081