BILL ANALYSIS
SB 178
Page 1
SENATE THIRD READING
SB 178 (Aanestad)
As Amended August 31, 2009
2/3 vote. Appropriation
SENATE VOTE : 39-0
BUSINESS & PROFESSIONS 11-0 APPROPRIATIONS 17-0
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|Ayes:|Hayashi, Emmerson, |Ayes:|De Leon, Conway, Ammiano, |
| |Conway, Eng, | |Charles Calderon, Coto, |
| |Hernandez, Nava, Niello, | |Davis, Duvall, Fuentes, |
| |John A. Perez, Ruskin, | |Hall, Harkey, Miller, |
| |Smyth, Monning | |John A. Perez, Skinner, |
| | | |Solorio, Audra |
| | | |Strickland, Torlakson, |
| | | |Hill |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Authorizes the Director of the Department of General
Service (DGS) to sell, lease or exchange approximately three
acres of state-owned real property located at 875 Cypress
Avenue, in the City of Redding (City), that is specifically not
declared surplus to the State's needs and is currently used by
the Department of Forestry and Fire Protection (CAL FIRE) as its
Shasta-Trinity Unit Headquarters, for the purpose of
consolidating operations on or near the Redding Airport.
Specifically, this bill :
1)Authorizes DGS to sell, exchange, and lease for no more than
66 years, or any combination thereof, all or a portion of the
state-owned Cypress Property in the City that is currently
used by CAL FIRE.
2)Requires the Director of the DGS to use the proceeds of any
sale, exchange, lease, or any combination thereof to acquire
the land and facilities as specified.
3)Requires the state to retain ownership of the portion of the
Cypress Property where the telecommunications tower and vault
are located. Prohibits DGS from disposing of that portion of
the Cypress Property unless DGS determines that the
telecommunications tower and vault can be relocated to another
SB 178
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site with equivalent utility as part of the cost of the
relocation authorized.
4)Requires DGS to initially offer the Cypress Property to the
City for purposes of a local government-owned facility, and
under terms and conditions that provide for continuous
operation of the state's facilities at the Cypress Property
until relocation is accomplished. If the City fails to
purchase the property within 120 days after notice from DGS,
DGS may sell, exchange or lease the property to the public, as
specified.
5)Requires any transaction to be for no less than fair market
value, as determined by an independent appraisal approved by
DGS or pursuant to a competitive selection process.
6)Stipulates that compensation for the Cypress Property may
include land, or a combination of land, improvements, and
money.
7)Requires any funds received from the sale, exchange, lease, or
combination thereof of all or a portion of the Cypress
Property to be held in trust and used only for the
acquisition, lease, lease-purchase, lease with option to
purchase, or lease-purchase finance of the land and facilities
and be appropriated to DGS for expenditure for these purposes.
8)Authorizes DGS to enter into one or more agreements,
contracts, or leases to provide a substitute location and
substitute facilities for the Shasta-Trinity Unit
Headquarters, and requires DGS to provide for the continuous
operation of the state's facilities at the Cypress Property
until relocation is accomplished.
9)Requires, upon appropriation by the Legislature, DGS to use
the proceeds of any sale, exchange, or lease explicitly for
consolidation or expansion of the Shasta-Trinity Unit.
10)States that the disposition of the Cypress Property is not
subject to provisions of law requiring the proceeds from the
sale of state surplus property to be used to pay the principal
and interest on the Economic Recovery Bonds or provisions of
law requiring state surplus property to be offered first to
local government agencies and affordable housing interests.
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11)Requires any use or redevelopment of the Cypress Property
awarded to a nongovernmental entity and not involving the
exercise of sovereign activities of the state or another
government agency be subject to the zoning and building code
regulations of the City.
12)Requires DGS to develop the terms and conditions of any
disposition agreement and provide them to the Department of
Finance (DOF) prior to soliciting bids, and requires DGS to
obtain approval from DOF prior to the execution of any
disposition agreement regarding the Cypress Property.
13)Requires the DGS to notify the chairpersons of the
Appropriations Committee in each house of the Legislature and
the Chairperson of the Joint Legislative Budget Committee, or
his/her designee, in writing of the Director's intention to
enter into a lease or an agreement, not less than the minimum
time that the Chairperson of the Joint Legislative Budget
Committee or his/her designee may require.
14)Makes various legislative findings and declarations regarding
the Cypress Property.
FISCAL EFFECT : According to Assembly Appropriations Committee:
1)Minor costs of around $30,000 for DGS to administer the
property disposition through lease, sale, or exchange,
reimbursed from proceeds of a property sale or from CDF in the
case of a lease or exchange.
2)Any net revenue to the state from a sale of the property would
presumably be used to offset the costs of a replacement site
and facilities for a new CDF unit headquarters. DGS does not
have an appraised value of the property.
COMMENTS : In the early 1990s, DGS undertook a program to save
money and make government more accessible to citizens by
rearranging state offices in major urban centers. The plan also
envisioned consolidation in numerous other California
communities where the state leased dispersed office space.
Based on a series of regional plans and facility studies, DGS'
efforts led to office consolidation projects (completed or in
the process of development) in major metropolitan areas (e.g.,
San Francisco, Oakland, Los Angeles, Riverside/San Bernardino,
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Long Beach, San Diego and Sacramento).
Under the provisions of Proposition 60A, the proceeds of the
sale of surplus property must be used to pay the holders of the
state's deficit reduction bonds. These payments are intended to
accelerate the redemption of the state's debt, and reduce future
General Fund payments to the bondholders. This measure avoids
the transfer of the proceeds associated with the disposition of
the property by specifying that the disposition of the Cypress
Property does not constitute a sale or other disposition of
surplus state property that would otherwise be subject to
Section 9 of Article III of the Constitution.
This bill also exempts the disposition of the Cypress Property
from provisions of law requiring DGS to determine if surplus
land is needed by any other state agency prior to making it
available to local agencies.
The ability to get excess properties declared surplus by the
Legislature has been impeded in the past few years by a
disagreement between the Legislature and the Administration
regarding the removal of a statutory exemption for the State's
surplus properties from the requirements of California
Environmental Quality Act (CEQA). This disagreement has been
resolved with enactment of ABX2 8 (Nestande), Chapter 6 of
2009-10 Second Extraordinary Session, which placed within
Section 11011 of the Government Code an ongoing CEQA exemption
for all properties declared surplus by the Legislature.
Analysis Prepared by : Ross Warren / B. & P. / (916) 319-3301
FN: 0002686