BILL NUMBER: AB 2065	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 8, 2010

INTRODUCED BY   Assembly  Member   Charles
Calderon   Members   Charles Calderon 
 and De La Torre 

                        FEBRUARY 18, 2010

    An act to amend Section 64 of the Revenue and Taxation
Code, relating to taxation.   An act to add Section
33320.6 to the Health and Safety Code, relating to redevelopment.




	LEGISLATIVE COUNSEL'S DIGEST


   AB 2065, as amended, Charles Calderon.  Property taxation.
  Redevelopment Agency of the City of Downey: plan
amendment.  
   The Community Redevelopment Law authorizes the establishment of
redevelopment agencies in communities in order to address the effects
of blight, as defined, in those communities and requires those
agencies to prepare, or cause to be prepared, and approve a
redevelopment plan for each project area. Existing law authorizes the
legislative body to amend or modify the plan by ordinance upon the
recommendation of the agency and establishes procedural requirements
and restrictions related to amendment of the plan.  
   Section 16 of Article XVI of the California Constitution
authorizes a redevelopment agency to receive funding through tax
increments attributable to increases in assessed property tax
valuation of property in a project area due to the redevelopment. Not
less than 20% of tax increments generated from a project area are
required to be used by a redevelopment agency to increase and improve
the community's supply of low- and moderate-income housing.
Redevelopment agencies also are required in specified years to remit
an amount of revenue for deposit in various funds for allocation to
school entities.  
   This bill would authorize the redevelopment agency of the City of
Downey to add described territory to a redevelopment project area
within the city upon the adoption of an ordinance adopted by the city
council that contains specified time limitations and restrictions.
The bill would exempt the adoption of the amendment of the
redevelopment plan to add the specified territory of the City of
Downey from various requirements. The bill would authorize the agency
to subordinate to bonded debt the amount required to be paid to an
affected school entity upon a finding that the agency will have
sufficient funds available to pay both the bonded debt payments and
the required payments.  
   The bill would make a legislative declaration regarding the need
for a special statute.  
   Existing law requires the Franchise Tax Board to include specified
questions on the income tax returns of specified entities regarding
changes in ownership of the real property owned by the entity and
requires the Franchise Tax Board to notify the State Board of
Equalization if an entity responds affirmatively to these questions.
 
   This bill would make technical, nonsubstantive changes to that
provision. 
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    (a) It is the intent of the Legislature
to encourage and allow the redevelopment of certain property in the
City of Downey for job creation and the increase of the community and
region's economic base adjacent to that property.  
   (b) The Legislature finds and declares that extraordinary measures
are required in order to address the current economic recession and
the unusually high unemployment rate. The amendment of the territory
specified in this act to a project area of the City of Downey will
create 1,200 new clean-tech and career-ladder jobs, encourage green
technology production, and further stimulate economic revitalization
in the region. 
   SEC. 2.    Section 33320.6 is added to the  
Health and Safety Code   , to read:  
   33320.6.  (a) (1) The redevelopment agency within the City of
Downey may add the following territory consisting of two parcels to a
redevelopment project area within the city:
   (A) Those portions of Lot 2 and Lot 3 of fractional Section 10,
Township 3 South, Range 12 West, in the Rancho Santa Gertrudes,
together with a portion of the southwest quarter of said fractional
Section 10, in the City of Downey, County of Los Angeles, State of
California as recorded in book 1, page 502 of miscellaneous records,
recorded in the office of the county recorder of said county,
described as follows:
   Beginning at a point in the northerly line of said Lot 2 in the
northwest quarter of fractional Section 10, said line also being the
northerly line of Stewart and Gray Road, 80 feet wide, distant
thereon south 89*52'14" west 646.51 feet from the northeast corner of
said Lot 2; thence on a line between said point of beginning and the
southwest corner of the southeast quarter of the northeast quarter
of the southwest quarter of fractional Section 10, south 00*13'16"
west 1011.24 feet to the true Point of Beginning; thence south 89*48'
11" west 1194.23 feet to a point in a line that is parallel with and
distant southeasterly 40.00 feet, measured at right angles, from the
centerline of Lakewood Boulevard, as shown on county Surveyors B
Series Map No. 1147, on file in the office of the county engineer of
said county; thence south 3141'38" west, along said parallel line, a
distance of 1437.27 feet to a point in a line that is parallel with
and distant easterly 40.00 feet, measured at right angles, from the
centerline of Clark Avenue as shown on said county Surveyors B Series
Map No. 1147; thence south 00*03'38" west, along last said parallel
line, a distance of 485.49 feet; thence north 90*00'00" east 859.79
feet to the beginning of a tangent curve concave northwesterly and
having a radius of 600.00 feet; thence northeasterly along said curve
through a central angle of 18*48'42", a distance of 197.00 feet to
the beginning of a compound curve concave northwesterly and having a
radius of 82.00 feet; thence northeasterly along said curve through a
central angle of 59*12'23", a distance of 84.73 feet to the
beginning of a reverse curve concave southeasterly and having a
radius of 398.00 feet; thence northeasterly along said curve through
a central angle of 78*01'06", a distance of 541.95 feet; thence north
90*00'00" east 321.62 feet to the beginning of a tangent curve
concave southwesterly and having a radius of 418.00 feet; thence
southeasterly along said curve through a central angle of 17*39'05",
a distance of 128.78 feet to said line between the point of beginning
and the southwest corner of the southeast quarter of the northeast
quarter of the southwest quarter of fractional Section 10; thence
north 00*13'16" east, along said line, a distance of 1324.18 feet to
the true Point of Beginning.
   Containing an area of 2,550,976 square feet, more or less.
   (B) That portion of Lot 2 in the northwest quarter of fractional
Section 10, Township 3 South, Range 12 West, in the Rancho Santa
Gertrudes, together with a portion of the southwest quarter of said
fractional Section 10, in the City of Downey, County of Los Angeles,
State of California as recorded in book 1, page 502 of miscellaneous
records, recorded in the office of the county recorder of said
county, described as follows:
   Beginning at a point in the northerly line of said Lot 2 in the
northwest quarter of fractional Section 10, said line also being the
northerly line of Stewart and Gray Road, 80 feet wide, distant
thereon south 89*52'14" west 646.51 feet from the northeast corner of
said Lot 2; thence on a line between said point of beginning and the
southwest corner of the southeast quarter of the northeast quarter
of the southwest quarter of fractional Section 10, south 00*13'16"
west 1100.59 feet to the true Point of Beginning; thence at right
angles to the easterly line of said Lot 2, said easterly line also
being the centerline of Bellflower Boulevard, north 89*52'23" east
613.20 feet to a point in a line that is parallel with and distant
westerly 40.00 feet, measured at right angles, from said easterly
line of Lot 2; thence south 00*07΄37" east, along said parallel
line, a distance of 222.54 feet to the intersection of said parallel
line, with a line that is parallel with and distant westerly 40.00
feet, measured at right angles, from the easterly line of said
southwest quarter of said fractional Section 10; thence south 00*04'
17" east, along last said parallel line, a distance of 1225.63 feet
to a line that is parallel with and distant northerly 96.00 feet,
measured at right angles, from the southerly line of said northeast
quarter of the southwest quarter of fractional Section 10; thence
south 89*51'04˝ west, along last said parallel line, a distance
of 238.81 feet to the beginning of a tangent curve concave
northeasterly and having a radius of 252.00 feet; thence
northwesterly along said curve through a central angle 49*21'31", a
distance of 217.09 feet to the beginning of a reverse curve concave
southwesterly and having a radius of 418.00 feet; thence
northwesterly along said curve through a central angle of 31*33'30",
a distance of 230.23 feet to said line between the point of beginning
and the southwest corner of the southeast quarter of the northeast
quarter of the southwest quarter of fractional Section 10; thence
north 00*13'16" east, along said line, a distance of 1234.83 feet to
the true Point of Beginning.
   Containing an area of 857,497 square feet, more or less.
   (2) The Legislature hereby finds and conclusively determines that
the area described in paragraph (1) is predominantly urbanized and
blighted territory, as defined in Sections 33030 and 33031.
   (3) Notwithstanding any other law, if the agency exercises the
authority specified in paragraph (1), the amendment of the
redevelopment plan to add the above described territory shall not be
subject to the legal requirements of this chapter and shall only be
subject to the procedures as provided in this section.
   (b) The agency may exercise its authority pursuant to subdivision
(a) upon an ordinance adopted by the city council that contains all
of the following:
   (1) A limitation on the number of dollars of taxes that may be
divided and allocated for the added area to the redevelopment agency.
Taxes shall not be divided and shall not be allocated to the
redevelopment agency beyond this limitation, except by amendment of
the redevelopment plan pursuant to Section 33354.6, or as necessary
to comply with subdivision (a) of Section 33333.8.
   (2) (A) A time limitation on the establishing of loans, advances,
and indebtedness to be paid with the proceeds of property taxes
received pursuant to Section 33670 to finance in whole or in part the
redevelopment in the added area, which may not exceed 20 years from
the effective date of the ordinance specified in subdivision (b),
except by amendment of the redevelopment plan as authorized by
subparagraph (B). The loans, advances, or indebtedness may be repaid
over a period of time longer than the time limit as provided in this
section. No loans, advances, or indebtedness to be repaid from the
allocation of taxes shall be established or incurred by the agency
beyond this time limitation, except as necessary to comply with
subdivision (a) of Section 33333.8.
   (B) The time limitation established by subparagraph (A) may be
extended only by amendment of the redevelopment plan after the agency
finds, based on substantial evidence, that: (i) substantial blight
remains within the project area, (ii) the blight cannot be eliminated
without the establishment of additional debt, and (iii) the
elimination of blight cannot reasonably be accomplished by private
enterprise acting alone or by the legislative body's use of financing
alternatives other than tax increment financing. However, this
amended time limitation may not exceed 30 years from the effective
date of the ordinance specified in subdivision (b), except as
necessary to comply with subdivision (a) of Section 33333.8.
   (3) A time limit, not to exceed 30 years from the effective date
of the ordinance specified in subdivision (b), on the effectiveness
of the redevelopment plan with respect to the added area. After the
time limit on the effectiveness of the redevelopment plan, the agency
shall have no authority to act pursuant to the redevelopment plan
except to pay previously incurred indebtedness, comply with
subdivision (a) of Section 33333.8, and enforce existing covenants or
contracts.
   (4) A time limit, not to exceed 45 years from the effective date
of the ordinance specified in subdivision (b), to repay indebtedness
with the proceeds of property taxes received pursuant to Section
33670. After the time limit established pursuant to this paragraph,
an agency may not receive property taxes pursuant to Section 33670,
except as necessary to comply with subdivision (a) of Section
33333.8.
   (5) The limitations contained in a redevelopment plan adopted
pursuant to this section shall not be applied to limit allocation of
taxes to an agency to the extent required to comply with Section
33333.8. In the event of a conflict between these limitations and the
obligations under Section 33333.8 the limitation established in the
ordinance shall be suspended pursuant to Section 33333.8.
   (6) Provide for conformity with the community's general plan, as
may be amended from time to time.
   (7) The requirements of Section 33333 shall be met by conformance
with the Downey Landing specific plan, as may be amended from time to
time.
   (c) (1) The amendment of the redevelopment plan to add the
territory described in paragraph (1) of subdivision (a) shall not be
subject to the requirements of Section 33333.11.
   (2) The ordinance adopted by the city council pursuant to
subdivision (b) shall not be subject to referendum and shall be
deemed exempt from the provisions of Sections 33450 and 33378.
   (d) Notwithstanding subdivision (k) of Section 33352, the
California Environmental Quality Act (Division 13 (commencing with
Section 21000) of the Public Resources Code) shall not apply to the
adoption of the amendment of the redevelopment plan to add the
territory described in paragraph (1) of subdivision (a). All
projects, as defined in the act, that implement the amended
redevelopment plan shall be subject to the act, including, but not
limited to, specific plans and rezonings.
   (e) Notwithstanding any other law, from the first year that the
agency receives tax increment revenue and prior to incurring any
bonded indebtedness, the agency administering a project area pursuant
to this section may subordinate to the bonded debt the amount
required to be paid to an affected school district or community
college district pursuant to this section upon a finding, based upon
substantial evidence, that the agency will have sufficient funds
available to pay both the bonded debt payments and the payments
required by this section. 
   SEC. 3.    The Legislature finds and declares that,
because of the unique circumstances applicable only to the
redevelopment agency of the City of Downey, a statute of general
applicability cannot be enacted within the meaning of subdivision (b)
of Section 16 of Article IV of the California Constitution.
Therefore, this special statute is necessary.  
  SECTION 1.    Section 64 of the Revenue and
Taxation Code is amended to read:
   64.  (a) Except as provided in subdivision (i) of Section 61 and
subdivisions (c) and (d) of this section, the purchase or transfer of
ownership interests in legal entities, such as corporate stock or
partnership or limited liability company interests, shall not be
deemed to constitute a transfer of the real property of the legal
entity. This subdivision is applicable to the purchase or transfer of
ownership interests in a partnership without regard to whether it is
a continuing or a dissolved partnership.
   (b) Any corporate reorganization, where all of the corporations
involved are members of an affiliated group, and that qualifies as a
reorganization under Section 368 of the United States Internal
Revenue Code and that is accepted as a nontaxable event by similar
California statutes, or any transfer of real property among members
of an affiliated group, or any reorganization of farm credit
institutions pursuant to the federal Farm Credit Act of 1971 (Public
Law 92-181), as amended, shall not be a change of ownership. The
taxpayer shall furnish proof, under penalty of perjury, to the
assessor that the transfer meets the requirements of this
subdivision.
   For purposes of this subdivision, "affiliated group" means one or
more chains of corporations connected through stock ownership with a
common parent corporation if both of the following conditions are
met:
   (1) One hundred percent of the voting stock, exclusive of any
share owned by directors, of each of the corporations, except the
parent corporation, is owned by one or more of the other
corporations.
   (2) The common parent corporation owns, directly, 100 percent of
the voting stock, exclusive of any shares owned by directors, of at
least one of the other corporations.
   (c) (1) When a corporation, partnership, limited liability
company, other legal entity, or any other person obtains control
through direct or indirect ownership or control of more than 50
percent of the voting stock of any corporation, or obtains a majority
ownership interest in any partnership, limited liability company, or
other legal entity through the purchase or transfer of corporate
stock, partnership, or limited liability company interest, or
ownership interests in other legal entities, including any purchase
or transfer of 50 percent or less of the ownership interest through
which control or a majority ownership interest is obtained, the
purchase or transfer of that stock or other interest shall be a
change of ownership of the real property owned by the corporation,
partnership, limited liability company, or other legal entity in
which the controlling interest is obtained.
   (2) On or after January 1, 1996, when an owner of a majority
ownership interest in any partnership obtains all of the remaining
ownership interests in that partnership or otherwise becomes the sole
partner, the purchase or transfer of the minority interests, subject
to the appropriate application of the step-transaction doctrine,
shall not be a change in ownership of the real property owned by the
partnership.
   (d) If property is transferred on or after March 1, 1975, to a
legal entity in a transaction excluded from change in ownership by
paragraph (2) of subdivision (a) of Section 62, then the persons
holding ownership interests in that legal entity immediately after
the transfer shall be considered the "original coowners." Whenever
shares or other ownership interests representing cumulatively more
than 50 percent of the total interests in the entity are transferred
by any of the original coowners in one or more transactions, a change
in ownership of that real property owned by the legal entity shall
have occurred, and the property that was previously excluded from
change in ownership under the provisions of paragraph (2) of
subdivision (a) of Section 62 shall be reappraised.
   The date of reappraisal shall be the date of the transfer of the
ownership interest representing individually or cumulatively more
than 50 percent of the interests in the entity.
   A transfer of shares or other ownership interests that results in
a change in control of a corporation, partnership, limited liability
company, or any other legal entity is subject to reappraisal as
provided in subdivision (c) rather than this subdivision.
   (e) To assist in the determining of whether a change of ownership
has occurred under subdivisions (c) and (d), the Franchise Tax Board
shall include a question in substantially the following form on
returns for partnerships, banks, and corporations (except tax-exempt
organizations):

   If the corporation (or partnership or limited liability company)
owns real property in California, has cumulatively more than 50
percent of the voting stock (or more than 50 percent of total
interest in both partnership or limited liability company capital and
partnership or limited liability company profits) (1) been
transferred by the corporation (or partnership or limited liability
company) since March 1, 1975, or (2) been acquired by another legal
entity or person during the year? (See instructions.)

   If the entity answers "yes" to (1) or (2) in the above question,
the Franchise Tax Board shall furnish the names and addresses of that
entity and of the stock or partnership or limited liability company
ownership interest transferees to the State Board of Equalization.