BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON GOVERNANCE AND FINANCE
                         Senator Robert M. Hertzberg, Chair
                                2015 - 2016  Regular 

                              
          
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          |Bill No:  |SB 1266                          |Hearing    |4/6/16   |
          |          |                                 |Date:      |         |
          |----------+---------------------------------+-----------+---------|
          |Author:   |McGuire                          |Tax Levy:  |No       |
          |----------+---------------------------------+-----------+---------|
          |Version:  |3/28/16    Amended               |Fiscal:    |Yes      |
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          |Consultant|Weinberger                                            |
          |:         |                                                      |
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                   Joint Exercise of Powers Act: agreements: filings



          Requires joint powers agencies and joint powers authorities that  
          provide municipal services to file copies of specified documents  
          with local agency formation commissions.


           Background 

           The Cortese-Knox-Hertzberg Local Government Reorganization Act  
          of 2000 sets forth the powers and duties of local agency  
          formation commissions (LAFCOs).  Located in every county, LAFCOs  
          are responsible for coordinating changes in governmental  
          boundaries and conducting studies that review ways to  
          reorganize, simplify, and streamline governmental structures to  
          ensure that services are provided efficiently and economically.   
          A LAFCO must make its studies available to public agencies and  
          any interested person. 

          The Joint Exercise of Powers Act allows two or more public  
          agencies to use their powers in common if they sign a joint  
          powers agreement.  Sometimes an agreement creates a new,  
          separate government called a joint powers agency or joint powers  
          authority (JPA).  State law requires a JPA to file a notice of  
          its joint powers agreement, or any amendment to the agreement,  
          with the Secretary of State's Office within 30 days after the  
          agreement or amendment takes effect.  State law requires that  
          whenever a JPA is required to submit a notice of a joint powers  







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          agreement or amendment to the Secretary of State's Office, the  
          JPA must also file a copy of the full text of the original joint  
          powers agreement, and any amendments to the agreement, with the  
          State Controller.

          State law requires LAFCOs to conduct studies of existing  
          governmental agencies, including studies to inventory those  
          agencies and determine their maximum service area and service  
          capacities. To support those studies government agencies must  
          comply with a LAFCO's request for information.  The Legislature  
          recently included JPAs that provide municipal services in the  
          list of agencies from which a LAFCO can request information and  
          added joint powers agreements to the list of documents that a  
          LAFCO may request (AB 2156, Achadjian, 2014).  Despite this new  
          statutory authority, some LAFCO officials still find it  
          difficult to obtain sufficient information about the activities  
          of JPAs that provide municipal services.  In some cases, they  
          are not even aware of the existence of these JPAs and have no  
          knowledge of amendments that are made to existing agreements.   
          Despite the fact that JPAs are submitting information to the  
          State Controller, LAFCOs can't request this information if they  
          don't know when new JPAs are formed or when existing agreements  
          are amended.  LAFCO officials want the Legislature to require  
          JPAs to provide LAFCOs with information that is similar to what  
          JPAs already must submit to the State Controller under current  
          law.


           Proposed Law

           Senate Bill 1266 requires that whenever current law requires a  
          JPA to file a copy of the full text of its joint powers  
          agreement, and any amendments to the agreement, with the State  
          Controller, it must also file those same documents with a LAFCO,  
          if the JPA:
                 Meets a specified statutory definition of a JPA formed  
               for the purposes of providing municipal services, and

                 Includes a local agency member that is a city, county,  
               or district.
          Within 90 days after the agreement or amendment takes effect,  
          any JPA that meets these conditions must file a copy of the  
          agreement or amendment with the LAFCO in each county within  
          which all or any part of a local agency member's territory is  








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          located.

          SB 1266 also applies retroactively to qualifying JPAs that were  
          formed before January 1, 2017.  Specifically, the bill requires  
          that a JPA must, by July 1, 2017, file a copy of its agreement  
          or amendment with the LAFCO in each county within which all or  
          any part of a local agency member's territory is located, if the  
          JPA:
                 Was formed for the purposes of providing municipal  
               services before January 1, 2017,

                 Meets a specified statutory definition of a JPA formed  
               for the purposes of providing municipal services, 

                 Includes a local agency member that is a city, county,  
               or district.

           State Revenue Impact

           No estimate.


           Comments

           1.  Purpose of the bill  . Many existing JPAs provide municipal  
          services to communities throughout California.  However, LAFCO  
          officials frequently possess no information about the existence  
          and activities of some JPAs that provide municipal services.   
          This lack of information about municipal service-providing JPAs  
          makes it difficult for LAFCOs to fulfill their statutory  
          responsibility to plan and oversee the responsive, efficient and  
          effective delivery local government services.  A 2011 report  
          produced by the Legislative Analyst's Office noted that LAFCOs  
          lack the legal authority to ensure that JPAs are providing  
          services and using public funds efficiently and in a manner  
          consistent with current law.  The LAO suggested that JPAs should  
          be subject to a higher level of LAFCO oversight and identified  
          "provid[ing] LAFCOs with copies of all JPA agreements, including  
          amendments" as a policy option.   SB 1266 does not grant LAFCOs  
          any authority over JPAs' formation, boundaries, organization, or  
          services, fully preserving the flexibility and autonomy that  
          JPAs enjoy under current law.  The bill helps LAFCOs provide  
          better oversight of municipal service delivery by providing them  
          with crucial information about JPAs that provide those services.








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          2.   Truth or consequences  .  SB 1266 requires JPAs to submit  
          documents that will help LAFCO officials learn more about JPAs'  
          true role in providing municipal services to communities  
          throughout California.  The bill does not, however, impose any  
          consequences on JPAs that fail to provide LAFCOs with the  
          required information.  Existing law prohibits any JPA that fails  
          to provide notice to the Secretary of State's office within the  
          required time period from issuing bond or other indebtedness  
          until the required notice is filed with the Secretary of State.   
          To encourage compliance with SB 1266's provisions, the Committee  
          may wish to consider amending the bill to impose the same  
          consequences on JPAs that fail to provide required information  
          to LAFCOs that current law imposes on JPAs that fail to provide  
          notice to the Secretary of State.

          3.   Timing  .  SB 1266 requires a JPA to submit specified  
          information to a LAFCO within 90 days of the effective date of a  
          joint powers agreement or amendment.  However, state law already  
          requires a JPA to submit the same information to the State  
          Controller's Office within 30 days of the effective date of a  
          joint powers agreement or amendment. It's unclear what purpose  
          is served by having a longer filing period for submitting  
          information to LAFCOs.  To avoid confusion and conform SB 1266's  
          provisions to deadlines in existing state law, the Committee may  
          wish to consider amending SB 1266 to require that JPAs must  
          submit information to LAFCOs within 30 days of the effective  
          date of a joint powers agreement or amendment.

          4.   Mandate  .  The California Constitution requires the state to  
          reimburse local governments for the costs of new or expanded  
          state mandated local programs.  Because SB 1266 imposes new  
          filing duties on joint powers agency officials, Legislative  
          Counsel says that it imposes a new state mandate.  SB 1266  
          requires the state to reimburse local agencies if the Commission  
          on State Mandates determines that the bill imposes a  
          reimbursable mandate.


           Support and  
          Opposition   (3/31/16)


           Support  :  California Association of Local Agency Formation  








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          Commissions; Alameda County LAFCO; California Association of  
          Joint Powers Authorities; Contra Costa County LAFCO; Imperial  
          County LAFCO; Marin County LAFCO; San Mateo County LAFCO; Yolo  
          County LAFCO.


           Opposition  :  Unknown.



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