BILL ANALYSIS                                                                                                                                                                                                    Ó




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                                UNFINISHED BUSINESS 


          Bill No:  SB 580
          Author:   Liu (D), et al.
          Amended:  8/15/16  
          Vote:     27 - Urgency

           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:  79-0, 8/18/16 - See last page for vote

           SUBJECT:   Surplus residential property:  affordable housing:   
                     historic buildings


          SOURCE:    Author


          DIGEST:  This bill makes changes to the Roberti Act governing  
          the sale of surplus properties in the State Route (SR) 710  
          corridor.










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          Assembly Amendments state that the net proceeds from a  
          subsequent sale of surplus residential property shall be  
          deposited into an Affordable Housing Trust Account to benefit  
          families of low and moderate income residing exclusively in  
          Pasadena, South Pasadena, Alhambra, La Canada Flintridge, and  
          the 90032 postal ZIP code and add an urgency clause. 


          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 (CTC).  
             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  
            whom Caltrans serves as landlord. 

          2)  Establishes, pursuant to the Roberti 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  








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               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  
            originally acquired for the SR 710 extension in accordance  
            with the Roberti Act.

          This bill makes changes to the Roberti 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  








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            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 may  
            resell the property, and the profits realized from the sale  
            must be used for the construction of affordable housing within  
            its jurisdiction.  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)Requires the net proceeds from a subsequent sale of surplus  
            residential property shall be deposited into an Affordable  
            Housing Trust Account to benefit families of low and moderate  
            income residing exclusively in Pasadena, South Pasadena,  
            Alhambra, La Canada Flintridge, and the 90032 postal ZIP code.


          Comments


          1)Purpose.  According to the author, the purpose of the Roberti  
            Act was to preserve thousands of mostly low- to  
            moderate-income homes.  Caltrans published regulations in  
            April 2014 to implement the amended Roberti Act (pursuant to  
            SB 416, Chapter 468, Statutes of 2013) 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.   








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            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.

          2)Priority of sale for non-historic homes.  The Roberti 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 allows a public  
            housing-related entity to resell the property and requires  
            profits realized from that sale to fund the construction of  
            affordable housing within its jurisdiction.   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 Roberti  
            Act by preserving and creating affordable housing for low- and  
            moderate-income individuals.  The changes to the Roberti Act  
            will allow a public housing entity to purchase, rehabilitate,  
            and resell a home and requires the profits from that sale to  
            be used for building affordable housing in the same area.  

          3)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.  The bill requires  








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            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 Roberti Act.  Many of these historical homes are in  
            such a state of disrepair that rehabilitation of the existing  
            structure may not be economically feasible.  Where possible,  
            the 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, the  
            bill will allow nonprofit entities to purchase and convert an  
            otherwise dilapidated home into a community park or other  
            neighborhood use.  

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


          According to the Assembly 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)




          SUPPORT:   (Verified8/18/16)


          None received


          OPPOSITION:   (Verified8/18/16)


          None received

           ASSEMBLY FLOOR:  79-0, 8/18/16
           AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,  
            Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,  








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            Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley,  
            Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth  
            Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto,  
            Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper,  
            Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine,  
            Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty,  
            Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell,  
            Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas,  
            Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner,  
            Waldron, Weber, Wilk, Williams, Wood, Rendon
           NO VOTE RECORDED: Roger Hernández



          Prepared by:Alison Dinmore / T. & H. / (916) 651-4121
          8/19/16 19:21:45


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