BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 580|
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UNFINISHED BUSINESS
Bill No: SB 580
Author: Liu (D), et al.
Amended: 9/4/15
Vote: 21
SENATE TRANS. & HOUSING COMMITTEE: 10-0, 4/21/15
AYES: Beall, Cannella, Allen, Bates, Galgiani, Leyva, McGuire,
Mendoza, Roth, Wieckowski
NO VOTE RECORDED: Gaines
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/4/15
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SENATE FLOOR: 36-0, 5/18/15
AYES: Allen, Anderson, Bates, Beall, Block, Cannella, De León,
Fuller, Gaines, Galgiani, Hancock, Hernandez, Hertzberg, Hill,
Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire,
Mendoza, Mitchell, Monning, Moorlach, Morrell, Nguyen,
Nielsen, Pan, Roth, Runner, Stone, Vidak, Wieckowski, Wolk
NO VOTE RECORDED: Berryhill, Hall, Pavley
ASSEMBLY FLOOR: 77-1, 9/8/15 - See last page for vote
SUBJECT: Surplus residential property: affordable housing:
historic buildings
SOURCE: Author
DIGEST: This bill makes changes to the Roberti Act (Act)
governing the sale of surplus properties in the State Route (SR)
710 corridor.
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Assembly Amendments create the Affordable Housing Trust Account
within the Housing Finance Fund. Net proceeds from a subsequent
market sale of surplus residential property sold pursuant to
regulations implementing the Roberti Act at an affordable or
reasonable price must be deposited into the Affordable Housing
Trust Account. The moneys in this account shall, upon
appropriation by the Legislature, be made available to the
California Housing Finance Agency (CalHFA) to carry out any
authorized activities for the benefit of persons and families of
low and moderate income residing exclusively in the SR 710
corridor.
ANALYSIS:
Existing law:
1) Identifies the California state highway system through a
description of segments of the state's regional and
interregional roads that the Department of Transportation
(Caltrans) owns and operates. Under current law, whenever
Caltrans determines that any real property acquired for
highway purposes is no longer necessary, it may sell or
exchange the property upon terms, standards, and conditions
established by the California Transportation Commission.
Proceeds from the sale are returned to the State Highway
Account.
For decades, Caltrans has proposed extending SR 710 to close a
roughly
4.5-mile unconstructed gap in the freeway between SR 10 in Los
Angeles and SR 710 in Pasadena. This gap affects the cities
of Alhambra, Pasadena, South Pasadena, and a portion of Los
Angeles. The project has been in the planning stage since
1953 for a variety of reasons related to the federal
environmental review process. Caltrans currently owns over
460 homes within the original surface route corridor, 97 of
which are declared to be of federal or state historical
significance. More than 400 homes are occupied by tenants for
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whom Caltrans serves as landlord.
2) Establishes, pursuant to the Act, priorities and procedures
for the disposition of surplus residential properties in the
SR 710 corridor. Under the Act, Caltrans must offer surplus
property in the following priority order:
a) First, at fair-market value (market rate) to all
single-family residences presently occupied by the former
owners.
b) Second, at an affordable price to current low- or
moderate-income occupants who meet minimum
length-of-occupancy standards.
c) Third, to public or private housing-related entities at
a price necessary to make the housing affordable to present
tenants and households of low or moderate income. The sale
is conditioned upon the entity rehabilitating and
developing the property as a limited-equity cooperative
housing with first right of occupancy to present tenants.
If cooperative housing is not feasible, the purchasing
agency shall use the property for low- and moderate-income
rental or owner-occupied housing, with the first right of
occupancy to present tenants.
d) Fourth, at market rate to present occupants in good
standing, next to former tenants, and lastly to persons who
intend to be owner-occupants.
3) Expedites, pursuant to SB 416 (Liu, Chapter 468, Statutes of
2013), the sale of surplus residential properties in the
cities of Los Angeles, South Pasadena, and Pasadena that do
not fall within the boundaries of any alternate route being
considered in the North Route 710 Project Draft Environmental
Impact Report/Environmental Impact Statement. SB 416 also
removed the originally proposed surface route from further
consideration and increased opportunities for current and
former tenants to purchase surplus properties owned by
Caltrans. Caltrans recently published and is presently
receiving public comments on draft regulations that set forth
procedures to dispose of surplus residential properties
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originally acquired for the SR 710 extension in accordance
with the Act.
This bill makes changes to the Act governing the sale of surplus
properties in the SR 710 corridor. Specifically, this bill:
1)Requires all non-historic surplus residential properties that
are not purchased by former owners or the present occupants to
be offered to a public or private housing-related entity at a
reasonable price to allow the property to be used as
affordable housing for low- and moderate-income individuals.
If that housing entity is a public entity, the entity shall
dedicate profits realized from a subsequent sale to the
construction of affordable housing with Pasadena, South
Pasadena, Alhambra, La Cañada Flintridge, and the 90032 postal
ZIP code. If the housing entity is a private entity, the
property must be developed as limited-equity cooperative
housing, with first right of occupancy to present occupants.
If development of a cooperative is not feasible, the
purchasing entity shall use the property for low- and
moderate-income rental or owner-occupied housing, with first
right of occupancy to the present tenants.
2)Requires all historic surplus residential properties that are
not purchased by former owners or the present occupants to be
offered first to a housing-related public entity or a
nonprofit private entity dedicated to rehabilitating and
maintaining the home for public and community access and use.
3)Creates the Affordable Housing Trust Account within the
Housing Finance Fund. Net proceeds from a subsequent market
sale of surplus residential property sold pursuant to
regulations implementing the Roberti Act at an affordable or
reasonable price must be deposited into the Affordable Housing
Trust Account. The moneys in this account shall, upon
appropriation by the Legislature, be made available to CalHFA
to carry out any authorized activities for the benefit of
persons and families of low and moderate income residing
exclusively in Pasadena, South Pasadena, Alhambra, La Cañada
Flintridge, and the 90032 postal ZIP Code. The priority for
distribution of proceeds from subsequent sales will be
established pursuant to regulations adopted by the Department.
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Comments
Purpose. According to the author, the purpose of the Act was to
preserve thousands of mostly low- to moderate-income homes.
Caltrans published regulations in April 2014 to implement the
amended Act (pursuant to SB 416) and expedite the sale of homes
in the SR 710 corridor. After substantial input from current
tenants and the impacted cities, stakeholders, and elected
officials, earlier this year Caltrans issued revised
regulations. The revised regulations address major concerns
with the originally proposed regulations. One issue remains,
however, that requires legislative action to resolve:
disposition and preservation of designated historical homes.
Many of these historical homes remained vacant and boarded up
for decades and require substantial restoration. Even then,
they may be too large and costly for conversion into affordable
housing or for an affordable-housing owner to maintain.
Amending the bill to allow cities to buy and sell homes, both
historical and otherwise, will provide a financial incentive to
generate more affordable housing and preserve neighborhoods and
community historical assets.
Priority of sale for non-historic homes. The Act establishes a
priority of sales for the disposal of surplus rental property
within the SR 710 corridor. The Act states that after a
non-historic surplus property has been offered to former owners
and present occupants, it shall then be offered to a public or
private housing-related entity at a reasonable price to
establish affordable housing for low- and moderate-income
people. This bill also requires a public entity to dedicate
profits realized from a subsequent sale to the construction of
affordable housing within Pasadena, South Pasadena, Alhambra, La
Cañada Flintridge, and the 90032 postal ZIP code. If the
housing entity is a private entity, this bill states that the
property shall be developed as a cooperative with first right of
occupancy to the present tenants. If the development of a
cooperative is not feasible, the private entity shall use the
property for low- and moderate-income rental or owner-occupied
housing with first right of occupancy to the present tenants.
This bill seeks to realize the original intent of the Act by
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preserving and creating affordable housing for low- and
moderate-income individuals. The changes to the Act will allow
a public housing entity to purchase, rehabilitate, and resell a
home and requires the profits from that sale to be u sed for
building affordable housing in the same area.
Historic home sales. This bill establishes a priority of sale
of surplus historic homes in the SR 710 corridor. After
historic surplus property has been offered to former owners and
present occupants, that property shall be offered first to a
public housing-related public entity or other public entity at a
reasonable price for purposes of rehabilitating and reselling
the home at fair market value. This bill requires profits from
that sale to be dedicated to the construction of affordable
housing in that area. Next, the home will be offered to a
non-profit dedicated to rehabilitating and maintaining the home
for public and community access.
As noted above, this bill seeks to realize the original intent
of the Act. Many of these historic homes are in such a state of
disrepair that rehabilitation of the existing structure may not
be economically feasible. Where possible, this bill gives
priority to public entities to rehabilitate the home for resale
and use the profits to construct affordable housing in the
entities' jurisdiction. Alternatively, this bill will allow
nonprofit entities to purchase and convert an otherwise
dilapidated home into a community park or other neighborhood
use.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee:
Minor one-time costs to Caltrans to update regulations
regarding the sale of surplus property in the SR 710 corridor.
(State Highway Account)
Unknown secondary fiscal impacts related to the authority for
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public housing-related entities to resell properties purchased
at less than fair market value.
SUPPORT: (Verified9/8/15)
None received
OPPOSITION: (Verified9/8/15)
None received
ASSEMBLY FLOOR: 77-1, 9/08/15
AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,
Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd,
Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Hadley, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer,
Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis,
Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte,
O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon,
Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark
Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,
Wood, Atkins
NOES: Harper
NO VOTE RECORDED: Chávez, Grove
Prepared by:Alison Dinmore / T. & H. / (916) 651-4121
9/9/15 9:55:11
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