Amended in Senate April 14, 2015

Senate Bill No. 562

Introduced by Senator Lara

February 26, 2015

An act to add Chapter 15 (commencing with Section 5975) to Division 6 of Title 1 of the Government Code, relating to infrastructure financing.

LEGISLATIVE COUNSEL’S DIGEST

SB 562, as amended, Lara. Infrastructure financing: City of Long Beach Civic Center.

The Local Agency Public Construction Act prescribes procedures for contracting by local public agencies, including specific provisions for cities.

Existing law permits a governmental agency to solicit proposals and enter into agreements with private entities for the design, construction, or reconstruction by, and may lease to, private entities, for specified types of fee-producing infrastructure projects. Existing law permits these agreements to provide for the lease of, or ownership of, infrastructure facilities owned by a governmental entity, but constructed by a private entity, to that private entity for a period of up to 35 years.

This bill, notwithstanding the act and any other law, would authorize the City of Long Beach to contract and procure a project for the revitalization and redevelopment of the Long Beach Civic Center, as defined, in accordance with prescribed procedures for begin delete qualification, solicitation, end delete proposal evaluation, and contract award. The bill would authorize the lease of begin insert all or a portion of end insert the project to, or ownership by, a private entity or entities, for a term of up to begin delete 65 end delete begin insert 50 end insert years. The bill would make a statement that a special law is necessary and that a general law cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique and special circumstances surrounding the existing Long Beach Civic Center, and the need to immediately, quickly, and efficiently develop the project, and to resolve property issues potentially delaying the project.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

The Legislature finds and declares all of the
following:

(a) The City of Long Beach has experienced an increasing
demand to fund infrastructure repairs, replacements, and new
improvements.

(b) The existing civic center is nearing the end of its useful life
and contains significant seismic deficiencies that the City of Long
Beach seeks to address as soon as feasibly possible to ensure the
public’s health and safety.

(c) The City Council of the City of Long Beach seeks to address
public health and safety in the earliest possible timeframe and
understands that the development of a new Long Beach Civic
Center using the public-private partnership procurement process
presents the most expedient route to protecting the safety of its
employees in and visitors to the civic center.

(d) The public-private partnership procurement process has
demonstrated precedence for the expedient, efficient, and
economical delivery of projects, through the delivery of the Long
Beach Courthouse, which was completed under budget and ahead
of schedule.

(e) The ability to utilize private sector investment capital is
essential to the begin insert timely end insert development of a cost-effective and
begin delete time-sensitive end delete begin insert long-lasting end insert Long Beach Civic Center.

(f) A public-private partnership procurement method provides
the City of Long Beach with an alternative and optional procedure
for developing a new civic center that can provide a cost-effective
benefit to the City of Long Beach by shifting the liability and risk
for cost containment, project completion, and life-cycle
maintenance to a private entity.

SEC. 2.  

Chapter 15 (commencing with Section 5975) is added
to Division 6 of Title 1 of the Government Code, to read:

 

Chapter  15. Long Beach Civic Center

 

5975.  

As used in this chapter:

(a) “Best interests of the city” means a procurement process
that is determined by the city to begin delete reduce the project delivery
schedule and total cost of the project end delete begin insert provide the best value and
an expedited delivery schedule end insert while maintaining a high level of
quality workmanship and materials.

(b) “Best value” means a value determined by objective criteria
that begin delete may include, but are not limited to, end delete begin insert shall include a combination
of end insert price, begin insert financing costs, end insert features, functions, performance, life-cycle
begin delete costs, experience, and other criteria deemed appropriate by the
city. end delete begin insert maintenance costs and abatement offsets, and development
experience. end insert

(c) “Business entity” means a partnership, corporation, or other
legal entity that is able to provide appropriately licensed
contracting, architectural, engineering, financial, operations,
management, facilities maintenance, and other services for
development of a new begin insert Long Beach end insert Civic Center.

(d) “City” means the City of Long begin delete Beach. end delete begin insert Beach and its
departments, including, without limitation, the Harbor Department. end insert

begin insert

(e) “Long Beach Civic Center” means the area bounded by
Broadway, Pacific Avenue, Ocean Boulevard, and Magnolia
Avenue, containing approximately 14.98 acres, and the parcel on
the south side of 3rd Street between Pacific Avenue and Cedar
Avenue, containing approximately 0.89 acres.

end insert begin delete

(e)

end delete

begin insert (f) end insert  “Private entity” means an individual, business entity, or
combination of individuals and business entities.

begin insert

(g) “Private portion of the project” means those parcels of land
within the Long Beach Civic Center to be conveyed to a private
entity and developed as residential, retail, hospitality, institutional,
or industrial facilities.

end insert begin delete

(f)

end delete

begin insert (h) end insert  “Project” means the revitalization and redevelopment of the
Long Beach Civic begin delete Center, which is bounded by Broadway, Pacific
Avenue, Ocean Boulevard, and Magnolia Avenue, containing
approximately 15.87 acres, and may include additional property
as deemed necessary by the city for the project. end delete begin insert Center with a new
city hall, port headquarters, public library, and public park, and
residential, retail, hospitality, institutional, and industrial facilities. end insert

begin insert

(i) “Public portion of the project” means those parcels of land
within the Long Beach Civic Center to be developed as a city hall,
port headquarters, public park, public library, or other government
facilities.

end insert begin delete

(g)

end delete

begin insert (j) end insert  “Public-private partnership” means a cooperative arrangement
between the public and private sectors, built on the expertise of
each partner, that best meets the city’s needs through the
appropriate allocation of resources, risks, and rewards for the
purposes of, and, including, but not limited to, studying, planning,
designing, constructing, developing, financing, operating,
maintaining, or any combination thereof, the project.

5976.  

(a)  begin delete Notwithstanding any provision of the Public Contract
Code or any other law, the end delete begin insert The end insert city may contract and procure the
project pursuant to this chapter.

begin delete

(b) The city may use a request for qualifications process to
prequalify and shortlist the number of private entities that will be
allowed to submit proposals. The request for qualifications shall
generally describe the project, the private entity’s necessary
qualifications and responsibilities, and the procurement process.

(c) The city shall gather information and prepare a solicitation
package for a public-private partnership, which shall generally
describe an approved process for methods of project delivery,
including a project description and requirements, process and
submission requirements, evaluation criteria, or any other
information deemed necessary by the city to describe adequately
the project requirements and procurement process.

end delete begin delete

(d)

end delete

begin insert (b) end insert  The city shall evaluate the begin insert project end insert proposals begin insert it solicits and
receives end insert and begin delete make its determination by choosing end delete begin insert choose end insert the private
entity or entities whose proposal is, or proposals are, judged as
providing the best value in meeting the best interests of the begin delete city
and meeting the objectives of the project. The city retains the right
to hold and enter into a negotiation process with selected private
entities in performing the evaluation and making its determination. end delete
begin insert city. end insert The city may enter into a public-private partnership through
a begin delete lease-purchase, end delete begin insert concession agreement, design-build agreement,
design-build-finance agreement, project agreement, end insert
lease-leaseback, or other appropriate begin delete agreements, with one or more
private entities for delivery of the project. The city may retain the
right to select all or any portion of any proposal or reject any or
all proposals as determined in the best interests of the city. end delete
begin insert agreements combining one or more major elements of the forgoing
agreements, with one or more private entities for delivery of the
project. The city shall retain the right to terminate the project prior
to project award should the city determine that the project is not
in the best interests of the city or should the negotiations with the
private entity or entities otherwise fail. end insert

begin delete

(e)

end delete

begin insert (c) end insert  The contract award for the project shall be made to the
private entity or entities whose proposal or proposals are
determined by the city, in writing, to be the most advantageous by
providing the best value in meeting the best interests of the begin delete city
and meeting the objectives of the project. end delete begin insert city. end insert

begin delete

(f)

end delete

begin insert (d) end insert  The negotiation process shall specifically prohibit practices
that may result in unlawful activity, including, but not limited to,
rebates, kickbacks, or other unlawful consideration, and shall
specifically prohibit city employees from participating in the
selection process when those employees have a relationship with
a person or business entity seeking a contract under this chapter
that would subject those employees to the prohibition of Section
87100. begin delete Other than these criteria, the city is not subject to any other
provisions of the Public Contract Code or this code that relates to
procurement for the project. end delete

begin delete

(g) Notwithstanding any provision of this code, upon issuance
of an award for the project, the city shall publicly announce its
award, identifying the private entity or entities to whom the award
is made, along with a written decision supporting its award and
stating the basis of the award. All

end delete

begin insert (e) end insert begin insert   end insert begin insert All end insert documents related to the project shall be subject to
disclosure under the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7), except those
exempted from disclosure under that act.

5977.  

(a) The project is subject to compliance with the
California Environmental Quality Act (Division 13 (commencing
with Section 21000) of the Public Resources Code). Neither the
act of selecting a private entity, nor the execution of an agreement
with the private entity, shall require prior compliance with the act.
However, appropriate compliance with the act shall thereafter
occur before project construction commences.

(b) The public portion of the project, at all times, shall be owned
by the city, unless the city, in its discretion, elects to provide for
ownership of the project by the private entity through a separate
lease begin delete agreement during the term of the end delete agreement. Notwithstanding
Section 5956.6 or any other provision of this code, the agreement
shall provide for the lease of begin insert all or a portion of end insert the project to, or
ownership by, the private entity or entities, for a term up to begin delete 65 end delete begin insert 50 end insert
years. In consideration therefor, the agreement shall provide for
complete reversion of the begin insert public portion of the end insert project to the city
at the expiration of the lease or transfer term.

begin insert

(c) The private portion of the project shall not be financed or
developed by the public-private partnership or otherwise using
public or tax-exempt financing.

end insert begin delete

(c)

end delete

begin insert (d) end insert  The plans and specifications for the project shall comply
with all applicable governmental design standards for that particular
infrastructure project. The private entity studying, planning,
designing, constructing, developing, financing, operating,
maintaining, or any combination thereof, the project shall utilize
private sector firms for studying, planning, designing, constructing,
developing, financing, operating, maintaining, or any combination
thereof, the project. However, a facility subject to this chapter and
leased to a private entity, during the term of the lease, shall be
deemed to be public property for purposes of identification,
maintenance, enforcement of laws, and for purposes of Division
3.6 (commencing with Section 810). All public works constructed
pursuant to this chapter shall comply with Chapter 1 (commencing
with Section 1720) of Part 7 of Division 2 of the Labor Code.

5978.  

The provisions of this chapter are severable. If any
provision of this chapter or its application is held invalid, that
invalidity shall not affect other provisions or applications that can
be given effect without the invalid provision or application.

5979.  

The Legislature finds and declares that a special law is
necessary and that a general law cannot be made applicable within
the meaning of Section 16 of Article IV of the California
Constitution because of the unique and special circumstances
surrounding the existing Long Beach Civic Center, and the need
to immediately, quickly and efficiently develop the project, and
to resolve property issues potentially delaying the project.