BILL ANALYSIS Ó
SB 536
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Date of Hearing: July 14, 2015
ASSEMBLY COMMITTEE ON VETERANS AFFAIRS
Jacqui Irwin, Chair
SB
536 (Roth) - As Amended July 8, 2015
SENATE VOTE: 40-0
SUBJECT: Armories.
SUMMARY: Allows the Department of General Services (DGS) with
the approval of the Adjutant General of the California Military
Department (Military Department) to sell seven specified armory
properties and sets terms for how the costs of the sales will be
paid. Specifically, this bill:
1)Defines the term "net" proceeds as specified.
2)Requires the Department of General Services, upon
appropriation by the Legislature, to use funds from the
Property Acquisition Law Money Account for the purposes of
selling armory properties.
3)Authorizes the Director of Finance to approve loans from the
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General Fund to the Property Acquisition Law Money Account.
4)Mandates that the sale of an armory shall be made on an "as
is" basis and is exempt from Division 13 (commencing with
Section 21100) of the Public Resources Code.
5)Mandates that upon vesting title of the armory to the
purchaser or transferee of the armory, the purchaser or
transferee shall be subject to any local governmental land use
entitlement requirements and to Division 13 (commencing with
Section 21100) of the Public Resources Code.
6)Authorizes the Director of General Services, with the approval
of the Adjutant General, to sell any of the following
properties:
a) Approximately 1.53 acres of real property located in
Azusa, California, known as the Azusa-Orange Armory.
b) Approximately 1.78 acres of real property located in
Brawley, California, known as the Brawley Armory.
c) Approximately 3.35 acres of real property located in
Indio, California, known as the Indio Armory.
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d) Approximately 1.03 acres of real property in Lynwood,
California, known as the Lynwood Armory.
e) Approximately .50 acres of real property located in
Pomona, California, known as the Pomona Park Armory.
f) Approximately 3.03 acres of real property located in
Santa Barbara, California, known as the Santa Barbara
Armory.
g) Approximately 1.34 acres of real property located in
Yreka, California, known as the Yreka Armory.
7)Directs that, with respect to the Azusa-Orange Armory, the
Director of DGS, with the approval of the Adjutant General,
shall grant to the City of Azusa an option to purchase the
Azusa-Orange Armory which shall expire on July 1, 2016.
8)Authorizes the purchase agreement for the sale of the
Azusa-Orange Armory to take into consideration the
contributory value of all capital improvements made to the
Azusa-Orange Armory by the City of Azusa less the value of
improvements made in lieu of rents during the term of the use
of the Azusa-Orange Armory by the City of Azusa, and any state
costs incurred in the sale of the Azusa-Orange Armory to the
City of Azusa.
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9)Mandates that on after July 1, 2016, the Azusa-Orange Armory
shall be offered for sale by general bid and that any purchase
agreement shall include terms and conditions determined by the
Director of General Services to be in the best interest of the
state based on the fair market value of the armory as
determined by an appraisal undertaken and approved by the
Department of General Services.
EXISTING LAW: Authorizes the Director of General Services,
with the approval of the Adjutant General, to lease and sell
real property held for armory purposes, subject to legislative
approval. Existing law establishes the Armory Fund and requires
that all proceeds from the sale or lease of armories be
deposited into the fund, for use, upon appropriation by the
Legislature, for specified purposes related to armories.
FISCAL EFFECT: According to Senate Appropriations, there will
be administrative costs of up to $160,000 (General Fund).
The Department of General Services estimates the selling
expenses for each of the eight armories at about $20,000.
The funds will come from the Property Acquisition Law Money
(PAL) Account which will be reimbursed from the sale of each
property. Generally, money is loaned from the General Fund
to the PAL and is then reimbursed upon the sale of the
property. The excess revenue from the sale is deposited
into the Armory Fund.
COMMENTS: According to the author:
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The armories identified in this proposal have reached the end
of their service life and are no longer practical or safe for
the California National Guard (CNG) Soldiers to assemble and
train in. The ongoing maintenance costs required by these
armories deplete the Guard's limited maintenance budget.
Pursuant to Military and Veterans Code Section 435, the CMD
would like to sell these armories and deposit any net proceeds
into the Armory Fund to be used for the future renovation and
repair of operational National Guard Armories.
The sale of CMD properties that are no longer usable
represents a critical source of income for the Armory Fund,
and goes toward fulfilling the State's responsibility of
maintaining the aging inventory of operational armories.
The Military Department, which manages and oversees the CNG,
has separate authority to sell property pursuant to MVC 435.
Armories are not surplus property, but rather assets that the
Military Department must properly manage. When an armory has
reached the end of its service life, there is still a critical
need for that armory space for troops to assemble and train
in; as well as storing the federal equipment assigned to Guard
units. This federal equipment is routinely utilized by the
unit during a state emergency response mission.
According to the Department's 2014 report on "The Status of
all CNG Armories," the California Guard's backlog of needed
repairs and renovation for armories is estimated at over $104
million. During the last few years, the State has
traditionally only appropriated $2 million annually towards
this backlog of armory maintenance and repair. Only a few of
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California's armories meet federal requirements, as set forth
in the Americans with Disabilities Act, and current state
seismic standards. This presents a substantial liability if a
citizen were to be injured or a disabled person could not be
sheltered due to lack of accessibility.
Primary responsibility for providing armory facilities rests
with each individual state. (NGR 405-80). The great majority of
the cost of the California National Guard is borne by the
federal government, including equipment and manpower, however,
housing National Guard units is almost exclusively California's
responsibility.
Recent Amendments :
Recent amendments not previously heard in any policy committee
added the provisions concerning the option to purchase the
Azusa-Orange Armory. Committee Staff contacted the author and
sponsor for further information.
According to the National Guard:
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The Azusa-Orange Armory is the subject of a long-term lease
(approximately five years remain on the term) on the property.
The City of Azusa uses the leased property for a community
center and related functions. The City has made a substantial
capital investment in the property to support the functions of
the community center.
The law and terms of the lease permit the National Guard to
terminate the lease at any time. However, while the need for
sale of the armories impacted by this bill is great, it was
not deemed so urgent as to merit the immediate eviction of a
valuable community asset like a community center. The
provisions of this bill unique to the Azusa-Orange Armory are
an effort to balance the equities and to guarantee that the
state will receive fair market value for the property when it
is sold.
REGISTERED SUPPORT / OPPOSITION:
Support
The Adjutant general- California National Guard/California
Military Department
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Department of Finance
Opposition
None on File.
Analysis Prepared by:John Spangler / V.A. / (916)
319-3550