BILL ANALYSIS                                                                                                                                                                                                    




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          |SENATE RULES COMMITTEE            |                        SB 141|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |
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                                      CONSENT 


          Bill No:  SB 141
          Author:   McGuire (D), et al.
          Amended:  5/13/15  
          Vote:     21  

           SENATE NATURAL RES. & WATER COMMITTEE:  9-0, 3/24/15
           AYES:  Pavley, Stone, Allen, Fuller, Hertzberg, Hueso, Jackson,  
            Monning, Wolk

          SENATE APPROPRIATIONS COMMITTEE:  Senate Rule 28.8

           SUBJECT:   Humboldt Bay Harbor, Recreation, and Conservation  
                     District Act:  land grants, acquisitions, and  
                     dispositions


          SOURCE:    Author
          
          DIGEST:   This bill (1) clarifies the Humboldt Bay Harbor,  
          Recreation, and Conservation District's (District) ability to  
          dispose of after-acquired property, (2) clarifies the  
          responsibility of the Chief Executive Officer and Treasurer of  
          the board of commissioners of the District; and (3) requires the  
          District to provide the State Lands Commission (Commission) 90  
          days written notice prior to expending trust moneys for the  
          acquisition of real property and prior to the disposition of  
          interest in real property. 

          ANALYSIS:   


          Existing law, under the Humboldt Bay Harbor, Recreation, and  
          Conservation District Act:










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          1)Regulates the use of specified tide and submerged lands within  
            Humboldt Bay and provides for the fill, improvement, and  
            reclamation of those tidelands, as prescribed.


          2)Requires that all grants, franchises, leases, permits, rights  
            or privileges be made in accordance with those rules and  
            regulations as the board of commissioners of the District  
            prescribes by resolution, and prohibits irrevocable grants of  
            fee title from being granted or issued.


          3)Authorizes the District to acquire, hold and enjoy, and lease  
            and dispose of real and personal property of every kind,  
            within the district, necessary to the full or convenient  
            exercise of its powers.


          This bill:


          1)Eliminates the ambiguity in the District's granting statutes  
            and thus allows the District to dispose of after-acquired  
            property by striking the sentence of its granting statutes.

          2)Clarifies the responsibility of the Chief Executive Officer  
            and Treasurer of the board of commissioners of the District.

          3)Requires the District to provide the Commission 90 days  
            written notice prior to expending trust moneys for the  
            acquisition of real property and prior to the disposition of  
            interest in real property. The Commission will have 90 days  
            following the notice of intent to acquire real property with  
            trust moneys to review and approve the acquisition.


          Background


          1)The District is a trustee of sovereign lands granted to it by  
            the Legislature in the 1970s. These lands are considered  
            "granted lands" by the Commission, which maintains oversight  








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            authority. The District is governed by the specific granting  
            statute(s), the common law Public Trust Doctrine and other  
            applicable law. 


          2)Revenues generated by a trustee arising out of the use or  
            operation of its granted lands are public trust assets of the  
            State and must be reinvested back into the trust. These  
            revenues must be kept separate from the general funds of a  
            local government and may not be used for any purpose  
            unconnected with the trust.  Expenditures of trust funds by a  
            trustee must be consistent with the common law Public Trust  
            Doctrine and the statutory trust grant.


          3)While granted public trust lands and assets are managed  
            locally, the Legislature delegated the State's residual and  
            review authority for granted lands to the Commission.   The  
            Commission is responsible for monitoring administration of  
            each statutory grant by the trustee to ensure compliance with  
            provisions of the granting statute and the Public Trust  
            Doctrine. The Commission has the authority to investigate,  
            audit, and review the administration of all statutory trust  
            grants. The Commission also has the authority to investigate  
            specific allegations of maladministration, to seek corrective  
            measures by trustees, and make recommendations to the  
            Legislature; the ultimate trustee of public trust lands.


          4)In the course of conducting a review of a mismanagement  
            allegation against the District (which the Commission did not  
            find), Commission staff discovered an ambiguity in the  
            granting statutes relative to the District's authority to  
            dispose of property acquired after the initial grant  
            ("after-acquired property").  Existing law bars any grantee  
            from transferring, selling or otherwise alienating sovereign  
            tide and submerged lands.  However, the statute governing the  
            District restricts its ability to dispose of any lands  
            ("Irrevocable grants of fee title shall not be granted or  
            issued." (see 23, Chapter 1040, Statutes of 1976)).










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          Comments
          
          Stringent restrictions remain on the District. The District is  
          still restricted in its purchasing and sale of land,  
          particularly in regards to Public Trust property, by the  
          remainder of its granting document, as well as by other existing  
          law. 

          In particular (from Chapter 1283 of the Statutes of 1970):

                 SEC. 28. The district may take by grant, purchase, gift,  
               devise, lease or otherwise acquire, hold and enjoy and  
               lease and dispose of real and personal property of every  
               kind, within the district, necessary to the full or  
               convenient exercise of its powers.

                 SEC. 77(7b). The district or its successors shall not,  
               at any time, grant, convey, give or alienate said lands, or  
               any part thereof, to any individual, firm or corporation  
               for any purposes whatsoever; provided, that said district,  
               or its successors, may grant franchises thereon for limited  
               periods, not exceeding 66 years, for wharves and other  
               public uses and purposes, and may lease said lands, or any  
               part thereof, for limited periods, not exceeding 66 years,  
               for purposes consistent with the trusts upon which said  
               lands are held by the State of California, and with the  
               requirements of commerce and navigation, and collect and  
               retain rents and other revenues from such leases,  
               franchises and privileges. Such lease or leases, franchises  
               and privileges may be for any and all purposes which shall  
               not interfere with commerce, navigation, fisheries, and  
               ecological protection.

          Amendments have been made. Sections 2 and 3 were added by the  
          Senate on May 13, 2015. Section 2 provides clarifying amendments  
          as to the role and responsibility of the District Board Chief  
          Executive Officer and Treasurer. Section 3 specifies that the  
          Board must provide 90 day notice to the Commission prior to the  
          purchase or selling of real property acquired with trust moneys,  
          and the Commission must provide a response to a proposed  
          purchase within 90 days of receiving that notice.









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          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No


          SUPPORT:   (Verified5/19/15)


          Board of Commissioners of the Humboldt Bay Harbor Recreation and  
            Conservation District
          State Lands Commission 
          Humboldt County Board of Supervisors


          OPPOSITION:   (Verified5/19/15)


          None received

          ARGUMENTS IN SUPPORT:      According to the State Lands  
          Commission, "SB 141 eliminates the prohibition on transferring  
          irrevocable grants of fee title as it related to after-acquired  
          lands. Eliminating this restriction is intended to provide  
          helpful clarification and assist the District in managing trust  
          assets of the state. This clarification is beneficial to the  
          District and to the state because the sale of after-acquired  
          lands provides funds that the District can reinvest into  
          administering and improving its trust lands within Humboldt Bay  
          for the statewide public's use and enjoyment."  



          Prepared by:Angee Doerr / N.R. & W. / (916) 651-4116
          5/21/15 12:28:28


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