BILL ANALYSIS Ó
SB 680
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SENATE THIRD READING
SB
680 (Wieckowski)
As Amended June 30, 2016
2/3 vote. Urgency
SENATE VOTE: 33-2
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Accountability |7-0 |Cristina Garcia, | |
| | |Lackey, Burke, | |
| | |Frazier, Irwin, | |
| | |Medina, Rodriguez | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood, | |
| | |Chau | |
| | | | |
SB 680
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| | | | |
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SUMMARY: Authorizes the Director of the Department of General
Services (DGS) to modify the existing terms and conditions
governing the sale and transfer of a parcel of state surplus
property within the City of Santa Clara (City) to the Santa
Clara Housing Authority (SCHA). Specifically, this bill:
1)Allows the Director of DGS to modify the existing terms and
conditions, including, but not limited to, the existing
purchase and sale agreement, the grant deed, the commencement
date for development, and any other applicable transaction
documents (transaction documents), governing the transfer of
an approximately six-acre parcel of state surplus property
(parcel) within the City to the SCHA.
2)Specifies that the parcel may be used for a residential
development that includes both affordable and market rate
units.
3)Requires DGS to determine, as a result of any modification to
the terms and conditions of the transaction documents, the
difference between the actual price paid by the local agency
for the parcel and the fair market value of the parcel.
Directs the SCHA to pay that difference to DGS.
4)Permits the City to amend the transaction documents, as
specified, with the consent of DGS and the SCHA.
5)Holds harmless and indemnifies the state from any legal action
resulting from the residential development proposed for the
parcel.
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EXISTING LAW:
1)Requires the Director of DGS to perform various functions with
respect to state property and provides for the sale, lease, or
transfer of surplus state property.
2)Requires each state agency to annually review and determine if
any lands under their jurisdiction are in excess of
programmatic need and report that information to DGS.
3)Requires DGS to annually report state surplus land to the
Legislature, and request legislative authorization to dispose
of the land by sale or otherwise, subject to specified
conditions.
4)Establishes processes for DGS to dispose of state surplus
property. Generally, local governmental agencies have first
right of refusal of state surplus property, and may acquire
such property below fair market value under certain
circumstances, including when the intended use of the property
is for a qualifying purpose, such as low or moderate income
housing, local schools, parks and recreation, and open space.
5)Declares a 17-acre site, which includes the estimated six-acre
parcel that is the subject of this bill, within the City,
surplus land pursuant to SB 2099 (Vasconcellos), Chapter 631,
Statutes of 2002.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, costs to DGS will be minor and absorbable. Modifying
the terms of the lease, which will allow development of the
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property to include market rate housing, will result in one-time
General Fund revenues of up to several million dollars as the
sale price of the property is adjusted to market rate. (Since
the original sale was related solely to development of
affordable housing, the sale price was discounted by $8.1
million from market rate.)
COMMENTS: This bill seeks to modify the terms and conditions of
part of a 17-acre property in Santa Clara that was declared
surplus by the state via SB 2099 in 2002. The author states
that this bill is needed to allow the sale and purchase
agreement of an estimated six-acre parcel to be revised so that
the City can move forward with a new residential development
plan for the parcel.
Originally, the entire 17-acre site was proposed for development
of a mixture of single family, senior, and affordable housing.
In July 2005, the City's Redevelopment Agency (RDA) agreed to
purchase the parcel from the state to develop up to 165
affordable senior housing units. When RDAs were dissolved as
part of the 2011 State Budget Act, ownership of the parcel was
transferred to the SCHA, the RDA successor agency, in January
2012.
According to the author, the City wishes to move forward with a
new development plan for the parcel. This bill would allow the
sale and purchase agreement of the parcel to be amended to
accommodate the new plan. DGS indicates that it currently lacks
the authority to modify the terms of the agreement to reflect
the changes that the City is requesting with regard to the new
number and type (i.e. affordable and market rate housing) of
units to be developed on the land. The original agreement only
allows up to 165 units of affordable senior housing to be
developed.
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The current developer of the parcel, The Core Companies,
proposes a plan that would consist of 359 total units on the
parcel, with 181 units of affordable housing. Of those units,
165 would be designated for seniors and senior veterans and the
remaining 16 would be designated for low to moderate-income
families. The other 178 units would be offered at market rate.
The author states that this bill is intended to facilitate
development of a critically important housing project by
authorizing the state to revise the terms of the agreement and
include a provision that protects the state from any liability
in the event of any legal action that could result from the
project.
This bill contains an urgency clause, which means it would go
into effect immediately.
PRIOR LEGISLATION: SB 472 (Alquist), Chapter 524, Statutes of
2006, originally would have authorized the Director of DGS to
sell, lease, or exchange the six-acre parcel in this bill under
specified conditions. SB 472 was subsequently amended to
address a different subject matter.
Analysis Prepared by:
Scott Herbstman / A. & A.R. / (916) 319-3600
FN: 0003878
SB 680
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