Amended in Assembly August 9, 2016

Amended in Assembly August 1, 2016

Amended in Assembly June 15, 2016

Senate Bill No. 1172

Introduced by Senator Hancock

February 18, 2016

An act to repeal Chapter 211 of the Statutes of 1919, relating to tidelands and submerged lands in the Bay of San Francisco, and making an appropriation therefor.

LEGISLATIVE COUNSEL’S DIGEST

SB 1172, as amended, Hancock. Tidelands and submerged lands: City of Albany.

Existing law grants in trust to the City of Albany certain designated tidelands and submerged lands, both filled and unfilled, for specified uses. The grant, among other things, requires that those lands be used in conformity with the Albany Waterfront Plan and be improved in accordance with the plan on or before January 1, 1988, or title therein shall revert to the state. Existing law imposes various requirements regarding public rights in the granted lands, leasing of lands by the city, management and disposition of revenues from the lands, and the determination of boundaries of the lands granted that are subject to the jurisdiction of the San Francisco Bay Conservation and Development Commission. Existing law requires 85% of excess trust revenues, as specified, to be transmitted to the Treasurer and deposited in the General Fund.

This bill would delete those provisions and instead require that, on and after January 1, 2022, the use of those trust lands, as described, conform to an approved trust lands use plan, prescribed by the bill, and all leases or agreements proposed or entered into by the City of Albany, as trustee of those lands, also be consistent with the public trust doctrine, as defined, and conform to the plan. The bill would require the trustee, on or before September 30, 2022, and on or before September 30 of every succeeding 5th year thereafter, to submit a report to the State Lands Commission. By imposing new duties on a local government with regard to providing for the use and management of those trust lands, the bill would impose a state-mandated local program.

Existing law, the Kapiloff Land Bank Act, creates the Land Bank Fund and continuously appropriates money in the fund, subject to a statutory trust, to the State Lands Commission, acting as the Land Bank Trustee, to acquire real property or any interest in real property for the purposes of public trust settlements.

The bill would require on June 30, 2021, and at the end of every fiscal year thereafter, that 20% of all gross revenue generated from the City of Albany trust lands be transmitted to the commission and, of this amount transmitted, would require the commission to allocate 80% to the Treasurer for deposit in the General Fund and 20% for deposit in the Land Bank Fund for expenditure by the commission pursuant to the act, thereby making an appropriation.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: ²⁄₃. Appropriation: yes. Fiscal committee: yes. State-mandated local program: yes.

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

SECTION 1.  

Chapter 211 of the Statutes of 1919, as amended
by Chapter 1223 of the Statutes of 1977, is repealed.

SEC. 2.  

(a) For the purposes of this act, the following
definitions shall apply:

(1) “Act” means Sections 2 to 10, inclusive, of the act enacting
this section.

(2) “Commission” means the State Lands Commission.

(3) “Public trust doctrine” means the common law doctrine, as
enunciated by the court in begin insert Marks v. Whitney (1971) 6 Cal.3d 251
and end insert National Audubon Society v. Superior Court (1983) 33 Cal.3d
419 and other relevant judicial decisions, specifying the state’s
authority as sovereign to exercise a continuous supervision and
control over the navigable waters of the state, the lands underlying
those waters, and nonnavigable tributaries to navigable waters,
including the begin insert protection of end insert maritime or water dependent commerce,
navigation, and fisheries, and the preservation of lands in their
natural state for scientific study, open space, wildlife habitat, and
water-oriented recreation.

(4) “State” means the State of California.

(5) “Trustee” means the City of Albany, a municipal corporation.

(6) “Trust lands” means Parcel 1, Parcel 2, and Parcel 3, as
described in Section 10 of this act, situated in the County of
Alameda.

(7) “Trust revenues” means all revenues received from trust
lands and trust assets.

(8) “Trust lands use plan” or “plan” means the trust lands use
plan required to be submitted by the trustee to the commission
pursuant to Section 4 of this act.

(9) “Trust lands use report” means the report of the trustee’s
utilization of the trust lands required to be submitted by the trustee
pursuant to Section 5 of this act.

(b) There is hereby granted in trust to the City of Albany, and
to its successors, all of the rights, title, and interest of the state,
held by the state by virtue of its sovereignty, in and to three parcels
of land situated in the County of Alameda as described in Section
10 of this act.

(c) The Legislature finds and declares that the City of Albany
intends that the lands granted in subdivision (b) shall be included
as part of McLaughlin Eastshore State Park.

SEC. 3.  

The trust grant specified in subdivision (b) of Section
2 of this act is subject to all of the following express conditions:

(a) The trust lands shall be held by the trustee in trust for the
benefit of all the people of the state for purposes consistent with
the public trust doctrine, including, but not limited to, maritime
or water-dependent commerce, navigation, and fisheries, and
preservation of the lands in their natural state for scientific study,
open space, wildlife habitat, and water-oriented recreation.

(b) On and after January 1, 2022, the use of the trust lands shall
conform to an approved trust lands use plan, as required by Section
4 of this act.

(c) The trustee shall not, at any time, grant, convey, give, or
otherwise alienate or hypothecate the trust lands, or any part of
the trust lands, to any person, firm, entity, or corporation for any
purposes whatsoever.

(d) The trustee may lease the trust lands, or any part of the trust
lands, for limited periods, not exceeding 49 years, for purposes
consistent with the trust upon which those lands are held, as
specified in subdivision (a). The trustee may collect and retain
rents and other trust revenues from those leases, under rules and
regulations adopted in accordance with subdivision (d) of Section
4 of this act, and in accordance with all of the following
requirements:

(1) On and after January 1, 2022, all leases or agreements
proposed or entered into by the trustee shall be consistent with the
trust lands use plan approved by the commission, as required by
Section 4 of this act. Any leases entered into prior to January 1,
2022, shall be consistent with the public trust doctrine and the
terms of subdivision (a).

(2) The lease rental rates shall be for a fair annual rent.

(3) The lease shall be in the best interest of the state.

(e) When managing, conducting, operating, or controlling the
trust lands or an improvement, betterment, or structure on the trust
lands, the trustee or his or her successor shall not discriminate in
rates, tolls, or charges for any use or service in connection with
those actions and shall not discriminate against or unlawfully
segregate any person or group of persons because of race, religious
creed, color, national origin, ancestry, physical disability, mental
disability, medical condition, genetic information, marital status,
sex, gender, gender identity, gender expression, age, sexual
orientation, or military and veteran status, in accordance with
Article 1 (commencing with Section 12940) of Chapter 6 of Part
2.8 of Division 3 of Title 2 of the Government Code and other
state antidiscrimination laws, for any use or service in connection
with those actions.

(f) The state shall have the right to use, without charge, a
transportation, landing, or storage improvement, betterment, or
structure constructed upon the trust lands for a vessel or other
watercraft or railroad owned or operated by, or under contract to,
the state.

(g) The trust lands are subject to the express reservation and
condition that the state may, at any time in the future, use those
lands or any portion of those lands for highway purposes without
compensation to the trustee or a person, firm, or public or private
corporation claiming a right to those lands, except, if improvements
have been placed with legal authority upon the property taken by
the state for highway purposes, compensation shall be made to the
person entitled to the value of the interest in the improvements
taken or the damages to that interest.

(h) There is reserved to the people of the state the right to fish
in the waters over the trust lands, with the right of convenient
access to those waters over the trust lands for this purpose.

(i) There is excepted and reserved to the state all remains or
artifacts of archaeological or historical significance and all deposits
of minerals in the trust lands, including, but not limited to, all
substances specified in Section 6407 of the Public Resources Code,
and the right to prospect for, mine, and remove those deposits from
the lands.

(j) Prior to entering into a lease, franchise, or agreement
concerning the trust lands, the governing body of the trustee shall
first adopt a resolution declaring its intention to take that action.
The resolution shall describe the lands or improvements that are
the subject of the lease, franchise, or agreement in such a manner
as to identify them accurately and shall specify the minimum rental
or other consideration and the other terms and conditions of the
lease, franchise, or agreement. The resolution shall be submitted
to the commission prior to entering into a lease, franchise, or
agreement.

(k) The trustee shall reimburse the commission for all expenses
incurred in the administration of this act, including periodic audits
or investigations.

SEC. 4.  

(a) On or before January 1, 2022, the trustee shall
submit to the commission a trust lands use plan describing any
proposed development, preservation, or other use of the trust lands.
The trustee shall thereafter submit to the commission for approval
all changes or amendments to, or extensions of, the trust lands use
plan. The trustee may apply to the commission for, and the
commission may approve, reasonable extensions of time to meet
this deadline.

(b) The commission shall review with reasonable promptness
the trust lands use plan submitted by the trustee and any changes
or amendments to determine whether they are consistent with the
public trust doctrine and the requirements of this act. Based upon
its review, the commission shall either approve or disapprove the
plan. If the commission disapproves the plan, the commission shall
notify the trustee and the trustee shall submit a revised plan to the
commission no later than 180 days after the date of notice of
disapproval. If the commission determines the revised plan is
inconsistent with the public trust doctrine or the requirements of
this act, all rights, title, and interest of the trustee in and to the trust
lands and improvements on the trust lands shall revert to the state.

(c) The trust lands use plan shall consist of a plan, program, or
other document that includes all of the following:

(1) A general description of the type of uses planned or proposed
for the trust lands. The location of these land uses shall be shown
on a map or aerial photograph.

(2) The projected statewide benefit to be derived from the
planned or proposed uses of the trust lands, including, but not
limited to, financial benefit.

(3) The proposed method of financing the planned or proposed
uses of the trust lands, including estimated capital costs, annual
operating costs, and anticipated annual trust revenues.

(4) An estimated timetable for the implementation of the trust
lands use plan or each phase of the plan.

(5) A description of how the trustee proposes to protect and
preserve natural and manmade resources and facilities located on
trust lands and operated in connection with the use of the trust
lands, including, but not limited to, addressing impacts from sea
level rise.

(d) The governing body of the trustee shall also submit to the
commission, as part of the trust lands use plan, for its approval
procedures, rules, and regulations to govern the use of or
development of the trust lands. These rules and regulations shall
include, but are not limited to, lease rates, the basis upon which
the rates are established, lease terms and conditions, provisions
for renegotiation of rates and terms and assignments, and any other
information as may be required by the commission.

(e) Upon request, the trustee shall submit to the commission a
copy of all leases and agreements entered into, renewed, or
renegotiated.

SEC. 5.  

(a) On or before September 30, 2022, and on or before
September 30 of every succeeding fifth year, the trustee shall
submit a report of its utilization of the trust lands for each
immediately preceding five-calendar-year period ending with June
30 of the calendar year in which the report is required to be
submitted.

(b) The report required by this section shall include all of the
following:

(1) A general description of the uses to which the trust lands
have been placed during the period covered by the report.

(2) A list of the holders of leases or permits that have been
granted or issued by the trustee. The list shall specify all of the
following, as to each holder:

(A) The use to which the trust lands have been placed by the
owner or holder.

(B) The consideration provided for in each lease or permit and
the consideration actually received by the trustee for the lease or
permit granted or issued.

(C) An enumeration of the restrictions that the trustee has placed
on the use of the trust lands, and each area of the trust lands, for
the period covered by the report.

(c) A report shall not be required if the utilization of the trust
lands within the immediately preceding five-calendar-year period
is identical to the utilization of the trust lands as stated in a
previously submitted report. If a new report is not submitted, the
trustee shall submit a letter to the commission stating that its
utilization of the trust lands has not changed during the immediately
preceding five-calendar-year period. The letter required in this
section shall also include the name and date of the utilization report
that contains the applicable uses of the trust lands.

SEC. 6.  

(a) The trustee shall demonstrate good faith in carrying
out the provisions of its trust lands use plan and amending it when
necessary in accordance with subdivision (a) of Section 4 of this
act.

(b) If the commission determines that the trustee has
substantially failed to improve, restore, preserve, or maintain the
trust lands, as required by the trust lands use plan, or has
unreasonably delayed implementation of the trust lands use plan,
all rights, title, and interest of the trustee in and to the trust lands
and improvements on the trust lands shall revert to the state.

SEC. 7.  

(a) (1) The trustee shall establish and maintain
accounting procedures, in accordance with generally accepted
accounting principles, providing accurate records of all revenues
received from the trust lands and trust assets and of all expenditures
of those revenues.

(2) All trust revenues received from trust lands and trust assets
shall be expended only for those uses and purposes consistent with
this act. The trustee shall provide for the segregation of the
revenues derived from the use of the trust lands by the trustee from
other city municipal funds, so as to ensure that trust revenues are
only expended to enhance or maintain the trust lands in accordance
with the uses and purposes for which the trust lands are held.

(3) Trust revenues may be expended to acquire appropriate
upland properties to benefit and enhance the trust, subject to a
determination by the commission that this acquisition is consistent
with this act and in the best interests of the state. Property acquired
with these trust revenues shall be considered an asset of the trust
and subject to the terms and conditions of this act.

(b) The trustee shall comply with Section 6306 of the Public
Resources Code.

(c) (1) Before expending trust revenues for any single capital
improvement on the trust lands involving an amount in excess of
two hundred fifty thousand dollars ($250,000) in the aggregate,
the trustee shall file with the commission a detailed description of
the capital improvement not less than 120 days prior to the time
of any disbursement of trust revenues for, or in connection with,
that capital improvement.

(2) Within 120 days after the time of a filing specified in
paragraph (1), the commission shall determine whether the capital
improvement is in the statewide interest and benefit and, if the
filing is made on or before December 1, 2021, whether it is
consistent with subdivision (a) of Section 3 of this act or, if the
filing is made on or after January 1, 2022, whether it is consistent
with the trust lands use plan. The commission may request the
opinion of the Attorney General on the matter, and if the
commission makes this request, the Attorney General shall deliver
a copy of the opinion to the trustee with the notice of its
determination.

(3) If the commission notifies the trustee that the capital
improvement is not authorized, the trustee shall not disburse any
trust revenues for, or in connection with, the capital improvement,
unless it is determined to be authorized by a final order or judgment
of a court of competent jurisdiction.

(4) The trustee may bring suit against the state to secure an order
or judgment for purposes of paragraph (3). The suit shall have
priority over all other civil matters. Service shall be made upon
the executive officer of the commission and the Attorney General,
and the Attorney General shall defend the state in that suit. If
judgment is given against the state in the suit, no costs may be
recovered.

(d) On June 30, 2021, and at the end of every fiscal year
thereafter, 20 percent of all gross revenue generated from the trust
lands shall be transmitted to the commission. Of this amount
transmitted, the commission shall allocate 80 percent to the
Treasurer for deposit in the General Fund and 20 percent to the
Treasurer for deposit in the Land Bank Fund, created pursuant to
Section 8610 of the Public Resources Code, for expenditure
pursuant to the Kapiloff Land Bank Act (Division 7 (commencing
with Section 8600) of the Public Resources Code) for management
of the commission’s granted lands program.

(e) The commission may, from time to time, institute a formal
inquiry to determine that the terms and conditions of this act, and
amendments to this act, have been complied with and that all other
applicable provisions of law concerning the trust lands are being
complied with in good faith.

(f) The commission shall approve in advance of expenditure
any reimbursement for expenditures of nontrust revenues for
improvements made to the trust or, if not approved, those
expenditures shall be deemed a gift to the trust.

SEC. 8.  

(a) If the commission finds that the trustee has violated
or is about to violate the terms of its trust grant or any other
principle of law relating to its obligation under the public trust
doctrine or under this act, the commission shall notify the trustee
of the violation.

(b) The trustee shall have 30 days from the receipt of a notice
of violation to conform to the terms of its grant and the principles
of law under the public trust doctrine. If the trustee fails or refuses
to take those actions, the commission may bring an action to
enforce the rights of the state and people as settlor beneficiary of
the public trust doctrine.

(c) The Attorney General shall represent the state in all actions
or proceedings taken pursuant to this section. If the judgment is
given against the state in the action or proceeding, no costs shall
be recovered from the state and people.

SEC. 9.  

The requirements of Section 6359 of the Public
Resources Code do not apply to the trust lands granted pursuant
to this act.

SEC. 10.  

The trust lands granted in Section 3 are three parcels
of tide and submerged lands situated in and adjacent to the bed of
San Francisco Bay, Alameda County, State of California, more
particularly described as follows:

PARCEL 1

COMMENCING at point “A” as shown on the Map of the Grant
to the City of Albany, recorded July 24, 1963, in Book 43 of Maps,
page 12A, Alameda County Records, said point “A” having
California Zone 2 coordinates of x = 1,469,703.82 feet and y =
511,851.40 feet, thence along the northerly boundary of said Grant
S 74° 21’ 53” E, 2573.92 feet to point “B” as shown on said map
and being the TRUE POINT OF BEGINNING, thence continuing
along the boundary of said grant the following ten courses:

(1) N 01° 08’ 07” E, 661.08 feet;

(2) S 88° 51’ 53” E, 661.58 feet;

(3) N 01° 08’ 07” E, 876.29 feet;

(4) N 75° 19’ 34” E, 1636.95 feet;

(5) S 88° 51’ 53” E, 409.57 feet;

(6) S 01° 08’ 07” W, 1321.66 feet;

(7) N 88° 51’ 53” W, 661.05 feet;

(8) S 01° 08’ 07” W, 1322.17 feet;

(9) N 88° 51’ 53” W, 1550.05 feet;

(10) S 32° 12’ 53” E, 1582.80 feet;

thence N 88° 51’ 53” W, 1305.22 feet; thence N 01° 08’ 07” E,
1983.26 feet to the True Point of Beginning.

Coordinates, bearings, and distances used in the above
description are based on the California Coordinate System, Zone
2.

PARCEL 2

BEGINNING at Point “J” as shown on said Map of Grant to the
City of Albany, recorded July 24, 1963, said point “J” having
California Zone 2 coordinates of x = 1,474,154.14 feet and y =
510,458.00 feet, thence along the boundary of said grant the
following two courses:

(1) N 88° 51’ 53” W, 1550.05 feet;

(2) S 32° 12’ 53” E, 1582.80 feet;

thence N 28° 20’ 17” E, 1487.26 feet to the point of beginning.
Coordinates, bearings, and distances used in the above description
are based on the California Coordinate System, Zone 2.

PARCEL 3

All of that certain parcel of land described as Parcel 1 in deed
to the City of Albany, recorded January 15, 1942, in Liber 4159,
page 296, Alameda County Records.

SEC. 11.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district are the result of a program for which legislative authority
was requested by that local agency or school district, within the
meaning of Section 17556 of the Government Code and Section
6 of Article XIII B of the California Constitution.