BILL ANALYSIS Ó
SB 141
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Date of Hearing: July 1, 2015
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Brian Maienschein, Chair
SB
141 (McGuire) - As Amended June 22, 2015
SENATE VOTE: 38-0
SUBJECT: Humboldt Bay Harbor, Recreation, and Conservation
District Act: land grants, acquisitions, and dispositions.
SUMMARY: Clarifies that the Humboldt Bay Harbor, Recreation,
and Conservation District (District) is authorized to sell or
transfer certain property, and makes several other changes to
the District's Act. Specifically, this bill:
1)Enacts several changes to the District's Act, including the
following:
a) Deletes language requiring that irrevocable grants of
fee title be granted or issued, thereby deleting an
inconsistency in the District's Act;
b) Clarifies the responsibilities of the chief executive
officer (CEO) and the Treasurer of the District;
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c) Prohibits the District from making an expenditure of
trust moneys from the Humboldt Bay, Harbor, Recreation, and
Conservation District Fund (Fund) to purchase or otherwise
acquire real property without first having provided at
least 90 days' written notice of the proposed expenditure
to the State Lands Commission (SLC);
d) Requires the notice to include the total amount of the
proposed expenditure from the Fund, the location of the
real property, the purpose of the purchase or acquisition,
and an explanation of how the purchase or acquisition is
consistent with the terms of the trust grant;
e) Provides, in the event that the SLC does not object
within 90 days of receipt of the notice, the District, may
proceed with the purchase or acquisition; and,
f) Requires the District to give the SLC at least 90 days'
written notice of a proposed disposition of any interest in
real property if the interest was acquired by the District
with revenue generated from the granted lands, and requires
the notice to include the proposed consideration to be
received by the District, the location of the real
property, and the purpose of the disposal.
EXISTING LAW:
1)Establishes the District, and provides, through the District's
Act, for the District's powers and authority, the territory of
the District, the jurisdiction of the District, the conduct of
the District's hearings, election of the Board of
Commissioners (Board), and the powers and duties of the Board
and of the District.
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2)Requires, for the District, that all grants, franchises,
leases, permits, rights, or privileges must be made in
accordance with such rules and regulations as the Board shall
prescribe by resolution, and requires irrevocable grants of
fee title to be granted or issued.
3)Allows the Board to employ engineers, attorneys and any other
officers and employees necessary in the work of the District.
4)Requires the CEO to appoint a treasurer whose duty it shall be
to receive and safely keep all moneys of the District, and
requires the CEO to comply with all provisions of law
governing the deposit and securing of public funds. Requires
the CEO to pay out moneys only as authorized by the Board and
not otherwise, provided, however, that no authorization shall
be necessary for the payment of principal and interest on
bonds of the District. Requires the CEO, at regular
intervals, at least once each month, to submit to the
secretary of the District a written report and accounting of
all receipts and disbursements and fund balances, a copy of
which report the CEO shall file with the Board. Requires the
treasurer to execute a bond covering the faithful performance
by him of the duties of his office and his duties with respect
to all moneys coming into his hands as treasurer in such an
amount as shall be fixed by resolution of said Board.
Requires the surety bond to be executed only by a surety
company authorized to do business in California and the
premium therefor to be paid by the District. Requires the
bond to be approved by the Board and filed with the secretary
of the District. Requires the treasurer, before entering upon
the duties of the office, to take and file with the secretary
of the District the oath of office required by the California
Constitution.
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5)Allows the District to 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.
FISCAL EFFECT: According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, this bill contains
negligible state costs.
COMMENTS:
1)Bill Summary. This bill clarifies that the District is
authorized to sell or transfer certain property, and makes
several other changes to the District's Act. This bill is
sponsored by the SLC.
2)Background. 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 SLC which maintains
oversight authority. The District is governed by the specific
granting statute(s), the common law Public Trust Doctrine and
other applicable law.
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.
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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 SLC. The SLC 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 SLC
has the authority to investigate, audit, and review the
administration of all statutory trust grants. The SLC 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.
In the course of conducting a review of a mismanagement
allegation against the District (which the SLC did not find),
SLC 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, c. 1040,
Statutes of 1976)).
3)Author's Statement. According to the author, "The Humboldt
Bay Harbor, Recreation and Conservation District (District) is
trustee of lands granted to it by the Legislature when
California became a state. SB 141 seeks to clarify that the
District is authorized to sell or transfer property that has
been acquired or deeded to it since the original land grant.
"California acquired ownership of submerged lands, tidelands
and waterways (sovereign lands) in 1850, and made the District
the trustee for these lands. The District and state manage
these lands for the benefit of the public for the use of
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aquaculture such as oysters and clams, fisheries, navigation,
visitor-serving facilities, water related recreation, open
space and habitat preservation. The state constitution
prevents these lands from being sold, and the District is not
looking to sell any of these lands.
"In 1970, the Legislature passed a law (Chapter 1283, Statutes
of 1970, Section 28) that authorized the District to acquire
and dispose of other property, referred to as "after acquired
lands." While the 1970 law intended to give the District
permission to buy, own and sell "after acquired lands"
(non-sovereign lands), it appears that was not written
precisely enough to allow the District to actually sell these
lands.
"SB 141 simply deletes this prohibition relating to the
transfer of irrevocable grants of fee title, specific to after
acquired lands. This solution was suggested by the State
Lands Commission. By eliminating this restriction it will
provide much needed clarification of the District's ability to
manage lands it is entrusted to oversee by the state. This is
necessary so that the District can dispose of after-acquired
lands. The funds can then be used by the District to reinvest
into improving and administering its trust lands within the
Humboldt Bay Harbor, Recreation, and Conservation District for
the public's benefit, use and enjoyment."
4)Arguments in Support. Supporters argue that the District's
Act has a vague provision that has the potential to restrict
the District's ability to sell or transfer after-acquired
property, which is typically allowed because these lands do
not have the restrictions on alienation that exist with
sovereign tide and submerged lands, and that this bill
eliminates the prohibition on transferring irrevocable grants
of fee title as it related to after-acquired lands.
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5)Arguments in Opposition. None on file.
REGISTERED SUPPORT / OPPOSITION:
Support
State Lands Commission [SPONSOR]
California Special Districts Association
Humboldt Bay Harbor, Recreation, and Conservation District
Humboldt County Board of Supervisors
Opposition
None on file
Analysis Prepared by:Debbie Michel / L. GOV. / (916)
319-3958
SB 141
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