BILL ANALYSIS
AB 194
Page 1
Date of Hearing: June 30, 2010
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Norma Torres, Chair
SB 194 (Florez) - As Amended: June 15, 2010
SENATE VOTE : 23-14
SUBJECT : Community Equity Investment Act of 2010
SUMMARY : Requires cities and counties that receive Community
Development Block Grant (CDBG) fund directly from the federal
government to establish a citizen advisory committee (CAC) to
advise the city council or board of supervisors on how to spend
the funds. Specifically, this bill :
1)Makes legislative findings that there are hundreds of
disadvantaged unincorporated communities in the state that may
be isolated geographically, surrounded by the city limits of
large and medium-sized cities. Finds that the conditions
within these disadvantaged unincorporated communities evidence
a distinct lack of public and private investment; present a
threat to the health and safety of residents; and foster
economic, social, and educational inequality.
2)Defines a "small community" as one with less than 2,000
residents.
3)Defines a "targeted income group" as families, households, and
individuals whose income does not exceed 80% of the county
median income.
4)Requires cities and counties that received a direct allocation
of CDBG funds from the federal government to use not less than
75% of all funds to benefit targeted income groups.
5)Requires the city council or county board of supervisors of
each city or county to establish CAC to advise the governing
body on the CDBG program including but not limited to public
health, safety, welfare, and public works and planning.
6)Requires at least one resident of an island or fringe
community to sit on a city's CAC.
7)Requires at least one resident of a disadvantaged
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unincorporated community to sit on a county's CAC.
8)Requires cities and counties to provide all of the following
entities notice of the opening of the application period for
CDBG funding at least 90 days prior to the application
deadline:
a) Participating cities and counties with significant
concentrations of lower-income residents;
b) Residents of a qualified community that does not have a
local special district;
c) All residents of a small community without a local
government;
d) Communities that previously applied for CDBG funding;
and
e) Organizations that work with residents from
disadvantaged communities and island and fringe
communities.
9)Requires that all disadvantaged communities be invited to
public hearings required by the federal CDBG regulations.
10)Requires CDBG hearings to be held at times and locations
accessible and convenient to residents of disadvantaged
communities.
11)Provides that prior to making a decision, the CAC shall be
informed of the city's or county's consolidated plan in
addition to examples of projects.
12)Provides that when a city or county takes action on the CAC's
recommendations, the city or county must make findings on how
the actions are consistent with the city or county's
consolidated plan priorities, reasons for failing to pursue
projects in disadvantaged unincorporated communities, and
steps to address concerns and issues of these communities.
EXISTING LAW Requires cities and counties that receive a
direct allocation of CDBG funds from the federal government to
adopt a citizen participation plan that sets forth the
jurisdiction's policies and procedures for citizen
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participation. The citizen participation plan must provide and
encourage citizen's participation in the development of the
consolidated plan, substantial amendment to the consolidated
plan, and the performance report. Requires that cities and
counties especially encourage participation by low- and
moderate-income persons, particularly those living in slums and
blighted areas, in areas where the CDBG funds are proposed to be
used, and by residents of predominantly low- and moderate-income
neighborhoods. (Code of Federal Regulations 24, Part 91)
FISCAL EFFECT : None.
COMMENTS :
The CDBG program provides money to local governments for
economic and community development. Larger cities and counties,
known as entitlements, receive a direct allocation of CDBG from
the federal government. Entitlements are required to follow
federal guidelines in administering their portion of CDBG,
including establishing a citizen participation plan which must
encourage the participation of low- and moderate-income
residents. Smaller communities, non-entitlements, receive CDBG
funds through the State Community Development Block Grant
program, which is administered through the Department of Housing
and Community Development (HCD). The state program requires that
75% of a community's CDBG grant go to benefit targeted low-and
moderate-income residents.
This bill attempts to direct CDBG funds to "disadvantaged
communities, "fringe communities," and "city islands." The
legislative findings describe a disadvantaged unincorporated
community as being isolated geographically, often surrounded by
the city limits of large and medium-sized cities. According to
the sponsor, these communities are not represented fully in the
CDBG process and may not have the resources to navigate through
the public participation process to elevate their issues and
ultimately receive funding for vital community projects. This
bill attempts to overlay state requirements over the federal
regulations required for public participation to get cities and
counties to prioritize the needs of unincorporated communities
within their jurisdiction.
Dividing resources : The bill also raises the amount of CDBG
funds that entitlements must spend on low- and moderate-income
targeted families, those with an income that does not exceed 80%
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of the median income. Federal regulations require entitlement
cities and counties to spend 51% of their CDBG funds on
low-income targeted populations; this bill increases that
requirement to 75%, which is the same as the State CDBG program
requires for nonentitelement communities.
Citizen Advisory Committee (CAC) : Under existing federal
regulations, a grantee must develop and follow a detailed plan
which provides for, and encourages, citizen participation and
which emphasizes participation by persons of low- or
moderate-income, particularly residents of predominantly low-
and moderate-income neighborhoods, slum or blighted areas, and
areas in which the grantee proposes to use CDBG funds. The plan
must:
n Provide citizens with reasonable and timely access to local
meetings, information, and records related to the grantee's
proposed and actual use of funds;
n Provide for public hearings to obtain citizen views and to
respond to proposals and questions at all stages of the
community development program, including at least the
development of needs, the review of proposed activities, and
review of program performance;
n Provide for timely written answers to written complaints and
grievances; and
n Identify how the needs of non-English speaking residents will
be met in the case of public hearings where a significant
number of non-English speaking residents can be reasonably
expected to participate.
This bill would require entitlement cities and counties to
establish a CAC that would include a seat for a resident from
all disadvantaged communities in counties and island and fringe
communities in cities. A city or county would be required to
make findings when determining how to spend CDBG funds if its
final decision does not reflect the recommendations of the CAC.
Arguments in support: According to the sponsor, the California
Rural Legal Assistance Foundation, over one million Californians
live in disadvantaged, unincorporated
communities. Residents of these areas often live without the
most basic features of a safe and healthy environment-services
like clean water, sewage lines, storm drains, streetlights,
sidewalks, and safe housing. Dependent on county governance for
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urban needs, these communities are systematically underserved in
the overall allocation of public resources and are frequently
left out of local planning processes. SB 194 will help ensure
that all California communities are able to realize their
potential as livable, healthy, and economically viable places.
By requiring cities and counties to (1) include representation
from disadvantaged
unincorporated communities in their citizen advisory committees;
(2) properly outreach to these communities; (3) provide them
technical assistance; and (4) make findings on how their actions
are consistent with their consolidated plan's priorities, these
communities will have a greater opportunity to be part of the
CDBG process.
Arguments in opposition : The League of California Cities is
opposed to the state conditioning funds that are received
directly from the federal government to entitlement communities
by requiring that 75% of all funds be directed to targeted
income groups. The League believes allocating 75% of funds to
targeted groups are contrary to the economic development goals
of CDBG. "The current economic conditions suggest that now is
not the appropriate time to add further conditions to this
source of federal funding." SB 194 would create additional
notification requirements beyond what is required by federal
regulations which would require spending limited funding for a
program that would otherwise be invested in programs to create
jobs.
Committee amendments:
The committee may wish to consider the following amendments to
require entitlements to provide a means of including residents
from unincorporated disadvantaged communities in their existing
citizen participation process while deleting the notification
requirements and the requirement that 75% of funds be used
toward low- and moderate-income residents. The amendments also
require the local government to prioritize disadvantaged
communities when considering how to distribute CDBG technical
assistance funds.
Delete the contents of the bill and add the following:
SECTION 1. (a) This act shall be known and may be cited as
the Community Equity Investment Act of 2010.
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(b) The Legislature finds and declares both of the
following:
(1) There exist in California hundreds of disadvantaged
unincorporated communities. There are more than 200 of these
communities in the San Joaquin Valley alone. Many of these
communities are geographically isolated islands, surrounded by
the city limits of large and medium-sized cities.
(2) The conditions within these disadvantaged
unincorporated communities evidence a distinct lack of public
and private investment that presents a threat to the health
and safety of the residents and fosters economic, social, and
educational inequality. Many of these communities lack basic
infrastructure, including, but not limited to, streets,
sidewalks, storm drainage, clean drinking water, and adequate
sewer service.
SEC. 2. Section 50834.5 is added to the Health and Safety
Code, to read:
50834.5. (a) Unless prohibited by federal law, where a federal
entitlement exists under the Community Development Block Grant
Program (24 C.F.R. Part 570), a local government shall comply
with all of the following requirements with the funds made
available pursuant to this chapter:
(1) If a local government has a citizen advisory committee
(CAC) to advise the council or board on Community Development
Block Grant program matters that relate, but are not limited,
to public health, safety, welfare, public works, or planning,
the local government shall include representation from
disadvantaged unincorporated communities within its
jurisdiction.
.
(2) Local governments shall provide proper notice, in
compliance with federal Community Development Block Grant
regulations, to ensure that citizens from disadvantaged
unincorporated communities are given reasonable and timely
access to information about the Community Development Block
Grant program, the application process, and of technical
assistance that may be available to their communities.
(3) In determining how to distribute CDBG funds for
technical assistance a local government shall prioritize the
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needs of residents of disadvantaged unincorporated communities
within its jurisdiction with no local governing board to the
extent necessary to permit residents to prepare and submit an
application for funding.
(b) For the purposes of this section, the term "targeted
income group" means families, households, and individuals
whose income does not exceed 80 percent of the county median
income, with adjustments for family and household size.
REGISTERED SUPPORT / OPPOSITION :
Support
California Rural Legal Assistance Foundation (CRLA)
Opposition
City of Downey
City of Lakewood
City of Roseville
City of Sacramento
League of California Cities
Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085