BILL ANALYSIS
AB 853
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 853 (Arambula)
As Amended August 18, 2010
Majority vote
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|ASSEMBLY: |47-30|(May 26, 2009) |SENATE: |22-14|(August 23, |
| | | | | |2010) |
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Original Committee Reference: L. GOV.
SUMMARY : Establishes a process for the identification of
service deficiencies in unincorporated disadvantaged communities
through the Local Agency Formation Commission (LAFCO) planning
process.
The Senate amendments :
1)Define a "disadvantaged inhabited community" as a populated
area in which the median household income is less than 80 % of
the statewide average.
2)Require a LAFCO, when preparing municipal service reviews
(MSRs), to include a written statement determining the
location and characteristics, including infrastructure needs
and deficiencies in disadvantaged inhabited communities.
3)Require a LAFCO, when reviewing and updated a city or special
district sphere of influence that occurs on or after July 1,
2011, to include the needs for public facilities and services
in disadvantaged inhabited communities, specifically for a
city or special district that provides sewer, nonagricultural
water, or structural fire protection services or facilities.
4)Require a county board of supervisors to adopt a resolution
for a city annexation, as specified, if a county receives a
qualifying petition requesting that annexation of the
territory that constitutes a disadvantaged inhabited
community, and the territory is inhabited, within the city's
sphere of influence, and is contiguous to the city.
5)Provide that no reimbursement is required by this bill because
local agencies have the authority to levy service charges,
fees, or assessments sufficient to pay for the program or
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level of service mandated by the bill.
6)Provide that a county may apply for community development
block grant funding to offset some or all of county costs
related to the bill, unless prohibited by federal law.
7)Delete other provisions of the bill as heard by the Assembly.
EXISTING LAW :
1)Establishes the procedures for the organization and
reorganization of cities, counties, and special districts
under the Cortese-Knox-Hertzberg Local Reorganization Act of
2000.
2)Provides that a LAFCO shall determine the sphere of influence
of each local governmental agency within the county and enact
policies designed to promote the logical and orderly
development of areas within the sphere, and provides that a
LAFCO shall, as necessary, review and update each sphere of
influence every five years.
3)Provides for the process of determining the sphere of
influence, and specifies the different factors that a LAFCO
shall consider and prepare in a written statement of its
determinations.
4)Provides, in order to prepare and to update spheres of
influence, that a LAFCO shall conduct a service review (MSR)
of the municipal services provided in the county or other
appropriate area as designated by the LAFCO, and requires that
a written statement of its determinations include all of the
following:
a) Growth and population projections for the affected area;
b) Present and planned capacity of public facilities and
adequacy of public services, including infrastructure needs
or deficiencies;
c) Financial ability of agencies to provide services;
d) Status of, and opportunities for, shared facilities;
e) Accountability for community service needs, including
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governmental structure and operational efficiencies; and,
f) Any other matter related to effective of efficient
service delivery, as require by commission policy.
AS PASSED BY THE ASSEMBLY , this bill:
1)Defined "unincorporated fringe community" to mean any
inhabited unincorporated territory that is within a city's
sphere of influence.
2)Defined "unincorporated island community" to mean any
inhabited unincorporated territory that is surrounded or
substantially surrounded by one or more cities or by one or
more cities and a county boundary or the Pacific Ocean.
3)Provided that a board of supervisors (board) shall petition
the LAFCO in the board's county to approve the annexation to a
city of any island or fringe community after notice and
hearing if all of the following conditions exist:
a) 25% of the registered voters or landowners in the
unincorporated island or fringe community file a petition
with the board to initiate an annexation of that community
to a municipality;
b) The territory contained in the annexation petition
constitutes an island or constitutes an unincorporated
fringe community that lacks wastewater, drinking water
services, storm drainage, paved streets, sidewalks, or
streetlights, or there exists a serious
infrastructure-related health hazard; and,
c) The territory that is the subject of the annexation
petition constitutes a disadvantaged community, meaning a
community with an annual median-household income that is
less than 80% of the statewide annual median-household
income.
4)Provided that within 180 days of the board mailing the
petition, a separate property tax transfer agreement shall be
agreed to between the annexing city and the county pursuant to
Revenue and Taxation Code Section 99.
5)Provided, if a property tax transfer agreement is not reached
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within 180 days, the agreement shall be determined pursuant to
an alternative means as provided [see 11-18 below].
6)Specified that a property tax transfer agreement shall not
affect any existing master tax sharing agreement between the
city and county.
7)Provided that LAFCO shall approve, after notice and hearing,
the annexation, and as needed, the change of organization or
reorganization of a city, unless the commission finds, based
on the preponderance of evidence, that the change of
reorganization will not result in a net benefit to the public
health of the affected communities.
8)Specified that the financial impact of the annexation shall
not be a factor in the determination of the net benefit.
9)Specified that subject to LAFCO's approval of an annexation,
no affected special district shall have the authority to
terminate the annexation.
10)Specified that subject to LAFCO's approval of an annexation,
the city shall amend its general plan to ensure that the
annexation conforms to the municipality's general plan.
11)Specified that LAFCO shall determine a revenue neutrality
agreement, including the amount of property tax revenue to be
exchanged by the affected local agency.
12)Provided that LAFCO shall notify the county auditor of the
proposal and the services that the annexing city will assume
within the territory to be annexed and identify for the
auditor the existing service providers with the area subject
to the proposal.
13)Provided for a method of calculation if the proposal would
not transfer all of an affected agency's service
responsibilities to the proposed city; the method of
calculation involves the county auditor's determination of the
proportion that the amount of property tax derives bears to
the total amount of revenue from all sources available for
general purposes.
14)Defined "total amount of revenue from all sources available
for general purposes" as the total amount of revenue which an
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affected local agency may use on a discretionary bases for any
purpose, and does not include revenue that is required to be
used for a specific purpose, revenue from fees, charges, or
assessments which are levied to specifically offset the cost
of particular services, or revenue that is received from the
federal government for a specific purpose.
15)Provided that LAFCO shall determine, based on information
submitted by each affected local agency, an amount equal to
the total net cost to each affected local agency during the
prior fiscal year of providing those services that the
annexing city will assume within the area subject to the
proposal, including the cost of connecting residents to
wastewater or drinking water services.
16)Defined "total net cost" to mean the total direct and
indirect costs that were funded by general purpose revenues of
the affected local agency and excludes any portion of the
total cost that was funded by any revenues of that agency that
are listed in 14) above.
17)Provided for calculations on how to derive the amount of
property tax revenue used to provide services by each affected
local agency during the prior fiscal year within the area
subject to the proposal, and provides for the county auditor
to adjust this amount.
18)Provided that a LAFCO may transfer to the annexing city an
amount of property taxes if a separate fund or funds were
established consisting of revenues derived from the
unincorporated area of the county and from which fund or fund
services rendered in the unincorporated area have been paid;
and provides for a timeline and considerations on how the
timeline will be applied.
19)Specified that an action brought by a city or district to
contest any determinations of the county auditor or LAFCO with
regard to the amount of property tax revenue to be exchanged
by the affected local agency pursuant to this section, shall
be commenced within three years of the effective date of the
annexation.
FISCAL EFFECT : According to the Senate Appropriations
Committee, this bill contains mandates for counties and LAFCOs,
which will result in likely substantial local costs that are
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non-reimbursable.
COMMENTS : This bill establishes a process for the
identification of service deficiencies in unincorporated
disadvantaged communities through the LAFCO planning process,
therefore adding new duties to LAFCOs in the preparation of MSRs
and when reviewing and updating a city or a special district's
sphere of influence. Provisions in the bill require a LAFCO,
when preparing an MSR, to include a written statement
determining the location and characteristics, including
infrastructure needs and deficiencies in disadvantaged inhabited
communities. Additionally, any update to a sphere of influence
occurring on or after July 1, 2011, must include the needs for
public facilities and services in disadvantaged inhabited
communities as defined, if that city or special district
provides sewer, nonagricultural water, or structural fire
protection services or facilities.
The bill also sets up a process requiring a county board of
supervisors to adopt a resolution for city annexation o
reorganization, if that county receives a qualifying petition
requesting that annexation of territory that constitutes a
disadvantaged inhabited community, and the territory is
inhabited, within the city's sphere of influence, and is
contiguous to the city. The bill provides that the petition
requesting the board of supervisors shall be signed by either:
1) not less than 25% of the registered voters residing in the
territory proposed to be annexed; or, 2) not less than 25% of
the number of owners of land within the territory proposed to be
annexed who also own 25% of the assessed value of land within
the territory as shown on the last equalized assessment role.
In this petition process, the county board of supervisors would
serve as the applicant for the petition for annexation or
reorganization that would go before the LAFCO. The author
argues that this is necessary because residents of disadvantaged
communities often are not able to advocate for themselves to
ensure that they have access to clean drinking water, adequate
sewer service, street lighting and sidewalks.
Support arguments: This bill places disadvantaged inhabited
communities squarely within the existing review processes that
guide land use and infrastructure decision-making process. This
inclusion, coupled with the ability to pursue annexation under
narrow circumstances, will move the residents closer to residing
in communities with acceptable standards of living.
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Opposition arguments: According to the Coalition of California
Local Agency Formation Commissions, this bill contains an
unfunded mandate for LAFCOs and may discourage annexation, as
well as impose additional costs at a time when funding is tight.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958
FN: 0006345