BILL ANALYSIS
Bill No: AB
600
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2009-2010 Regular Session
Staff Analysis
AB 600 Author: Hall
As Amended: April 2, 2009
Hearing Date: July 8, 2009
Consultant: Art Terzakis
SUBJECT
State Surplus Property: Compton Armory
DESCRIPTION
AB 600 is an urgency measure that grants the Director of
General Services (DGS) the authority to lease the Compton
Armory to the City of Compton at fair market value.
Specifically, this measure:
1. Authorizes DGS, until January 1, 2012, with the
approval of the Adjutant General, to lease the Compton
Armory, consisting of approximately 4.5 acres of land
located at 2320 Parmelee Avenue, Compton, Los Angeles
County, to the City of Compton at fair market value and
for a period of five years.
2. Permits DGS, with the approval of the Adjutant General,
to either renew the initial lease, or make lease
agreements with other parties at fair market value, of
the Compton Armory and provides that the term of the
leases, separately or cumulatively, shall not exceed 25
years.
3. Requires the City of Compton to submit any proposals
for improvements, including modifications and
refurbishments, to DGS and the Adjutant General for
approval.
4. Permits DGS to reduce the amount of the annual lease
payment in accordance with the cost of improvements, as
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determined by the Adjutant General.
5. Requires that proceeds from the lease be deposited into
the Armory Discretionary Improvement Fund.
6. Requires the City of Compton to reimburse DGS for its
actual costs in drafting, negotiating, and executing the
lease documents.
EXISTING LAW
Existing law generally requires the Director of General
Services (DGS) to perform various functions with respect to
state property and provides for the sale, lease, or
transfer of surplus state property.
Existing law (Government Code Section 11011) requires the
Director of DGS to request authorization by the Legislature
prior to the disposition by sale or otherwise of state land
reported to it by a state agency as being in excess of its
foreseeable needs. Each state agency is required to
annually review proprietary state lands under its
jurisdiction to determine what lands are in excess of the
agency's foreseeable needs and to report to DGS.
This annual review of proprietary state lands does not
apply to tax-deeded land, land held for highway purposes,
lands under the jurisdiction of the State Lands Commission,
land that has escheated to the state or that has been
distributed to the state by a court decree in estates of
deceased persons, and lands under the jurisdiction of the
State Coastal Conservancy. Jurisdiction of all land
reported as excess is transferred to DGS, when requested by
the Director of DGS, for sale or disposition under Section
11011 or as may otherwise be authorized by law.
Section 11011 of the Government Code provides criteria for
state agencies to use in determining and reporting to DGS
lands in excess of the agency's foreseeable needs. A state
agency is to include land not currently being utilized, or
currently being underutilized, for any existing or ongoing
program; land for which the agency has not identified any
specific utilization relative to future needs; and land not
identified by the agency within its master plan for
facility development.
Where applicable within its jurisdiction under Section
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11011, DGS is responsible for determining if surplus land
is needed by any other state agency. Section 11011.1
requires the state to first offer surplus state real
property to local agencies, and next, to offer the property
to nonprofit affordable housing sponsors, as defined, prior
to offering the property to private entities. This section
of law also prescribes the procedure for local agencies and
nonprofit affordable housing sponsors to use to obtain the
surplus state
real property.
Existing law authorizes the Director of DGS, with the
consent of the state agency concerned, to let for a period
not to exceed 5 years, any real or personal property
belonging to the state, if the director deems the letting
is not expressly prohibited by law and is in the state's
best interest. Legislative authority is required for
leases of state land for periods exceeding 5 years.
Existing law provides exemptions to the 5 year limit for
specified parcels.
Existing law authorizes DGS, with the approval of the
Adjutant General, to lease for fair market value (up to 99
years) any real property held for armory purposes, subject
to approval in statute by the Legislature. Existing law
also requires that the proceeds from the sale or lease of
armories be used for maintenance of existing armories and
acquisition or construction of new armories.
Proposition 60A of November 2004 (SCA 18, Johnson,
Resolution Chapter 103/04) which was adopted by the
electorate (73% margin) requires, among other things, that
the proceeds from the sale of surplus state property, with
specified exceptions, be used to pay the principal and
interest on the Economic Recovery Bond Act of 2004.
BACKGROUND
As noted above, existing law limits the length for which
the state may lease its own real property to private or
other entities to not more than five years. Any lease for
longer than five years requires specific statutory
authority.
Various individual statutes have been enacted over the
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years to allow the state to lease specific parcels of state
property in excess of five years. These include varying
durations ranging from ten years to 66 years. For the most
part, these leases require the state to review the terms
and conditions every five years to ensure the state's
interests are protected.
Additionally, current law authorizes DGS, with the approval
of the Adjutant General, to lease for fair market value (up
to 99 years) any real property held for armory purposes,
subject to legislative approval. Proceeds from such leases
must be used for the maintenance of existing armories and
for the acquisition or construction of new armories.
Purpose of AB 600: According to the author's office, the
California National Guard vacated the 60-year-old armory in
Compton in November 2006. The 4.5-acre site has remained
underutilized and in a state of disrepair for nearly three
years. The City is interested in using the property to
further serve its residents and would thus like the option
of leasing the site for a longer term than the five year
limit under current law. The City believes that without a
longer lease period it would be unlikely that the City
could realize a return on the investment needed to renovate
the armory.
PRIOR/RELATED LEGISLATION
AB 8xx (Nestande) Chapter 6, Statutes of 2009-10 Second
Extraordinary Session. Among other things, exempted the
sale of surplus state real property made on an "as is"
basis from designated provisions of CEQA. The bill also
exempted from those provisions of CEQA the execution of the
purchase and sale agreement or the exchange agreement for
surplus state real property if the disposition is not made
on an "as is" basis and the close of escrow is contingent
on a specified requirement or compliance with CEQA. AB 8xx
also provided expedited environmental permitting and CEQA
exemption for a list of 11 critical transportation
projects, as specified.
SB 760 (Aanestad) 2009-10 Session. Would authorize DGS to
sell, lease, exchange, or any combination thereof,
approximately 3.14 acres of real property in the City of
Red Bluff that is specifically declared not to be surplus
to the needs of the state, and, in return, to acquire up to
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Page 5
40,000 net square feet of usable office and related space
for consolidated state administrative operations. (Pending
in Assembly Appropriations Committee)
SB 586 (Yee) 2009-10 Session. Would direct DGS, in
consultation with the Department of Food and Agriculture,
to enter into negotiations to sell, to any interested
party, at fair market value, with certain restrictions, a
13-acre parking lot portion of the state-owned Cow Palace
property, located in the County of San Mateo and the City
and County of San Francisco. (Pending in Assembly policy
committee)
SB 256 (Aanestad) 2009-10 Session. Would authorize DGS to
sell, lease, exchange, or any combination thereof
approximately 1.69 acres of real property in the City of
Chico, currently used by the California Highway Patrol as
its Chico area office, which is specifically declared not
to be surplus to the needs of the state. (Pending in
Assembly policy committee)
SB 178 (Aanestad) 2009-10 Session. Would authorize DGS to
sell, lease, exchange, or any combination thereof,
approximately 3 acres of real property in the City of
Redding, currently used by the Department of Forestry and
Fire Protection as its Shasta-Trinity Unit Headquarters,
that is specifically declared not to be surplus to the
needs of the state. (Pending in Assembly policy committee)
SB 136 (Huff) 2009-10 Session. Annual DGS surplus property
bill that authorizes DGS to dispose of specified parcels.
(Pending in Assembly policy committee)
SB 30 (Denham) 2009-10 Session. Would require DGS to
identify not less than $1 billion worth of state property
that can be sold immediately to pay for the retirement of
outstanding general obligation bonds issued by the state,
thereby helping to close the state's budget deficit. (Held
in this committee at author's request)
SB 29 (Denham) 2009-10 Session. Would mandate the sale of
land that the Los Angeles Memorial Coliseum and the Los
Angeles Memorial Sports Arena occupy, including the state's
share of the Sports Arena structure, and abolishes the Los
Angeles Memorial Coliseum Commission upon completion of
that sale. (Held in this committee at author's request)
AB 600 (Hall) continued
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SB 28 (Denham) 2009-10 Session. Among other things, would
require that the San Quentin Prison site be sold, the
proceeds shall be exempt from the provisions of Proposition
60A of 2004, and the monies shall go to building a new
death row at another prison. (Held in Senate Public Safety
Committee)
AB 1444 (Garrick) 2009-10 Session. Would allow DGS to
establish lists of pre-qualified external consultants who
can perform the various services DGS typically utilizes as
part of its real property disposition program. (Pending in
this committee)
AB 240 (Monning) 2009-10 Session. Would revise the terms
of a previously authorized exchange of DeLaveaga Park
parcels, currently owned by the State of California and the
City of Santa Cruz (City) respectively, in accordance with
the current needs of the State and City. (Pending in this
committee)
AB 887 (De La Torre) Chapter 651, Statutes of 2008.
Granted DGS the authority to lease the Lynwood Armory to
the City of Lynwood at fair market value for 5 years.
AB 1123 (Berg) Chapter 625, Statutes of 2007. Granted DGS
the authority to lease the Healdsburg Armory to the City of
Healdsburg for up to 30 years at fair market value.
SUPPORT: City of Compton
OPPOSE: None on file as of July 3, 2009.
FISCAL COMMITTEE: Senate Appropriations Committee