BILL ANALYSIS
SB 1023
Page 1
Date of Hearing: June 16, 2010
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
SB 1023 (Wiggins) - As Amended: April 27, 2010
SENATE VOTE : 31-0
SUBJECT : Special districts: consolidation and reorganization.
SUMMARY : Creates an expedited procedure for converting resort
improvement districts (RIDs) and specified municipal improvement
districts (MIDs) into community services districts (CSDs), and
creates a specific procedure for converting the Tahoe Paradise
Resort Improvement District into a recreation and park district.
Specifically, this bill :
1)Provides that a local agency formation commission (LAFCO) may
approve, disapprove, or conditionally approve an expedited
reorganization unless the governing body of the subject agency
files a resolution of objection with the LAFCO before the
close of the hearing.
2)Defines "expedited reorganization" to mean a reorganization
that consists solely of the formation of a CSD and the
dissolution of any of the following:
a) A RID formed pursuant to the Resort Improvement District
Law;
b) The Montalvo MID formed pursuant to Chapter 549 of the
Statutes of 1955;
c) The Bethel Island MID formed pursuant to Chapter 22 of
the Statutes of 1960; or,
d) The Embarcadero MID formed pursuant to Chapter 81 of the
Statutes of 1960.
3)Provides that if the LAFCO approves or conditionally approves
the expedited reorganization, the LAFCO shall order the
expedited reorganization without an election.
4)Provides that if the governing body of the subject agency
files a resolution of objection with the LAFCO before the
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close the hearing, the LAFCO shall disapprove the proposed
expedited reorganization.
5)Allows the LAFCO to order any material change to the terms and
conditions of the expedited reorganization set forth in the
proposal, and provides that the LAFCO shall direct the
executive officer to give the subject agency mailed notice of
any change prior to ordering a change.
6)Provides that the LAFCO shall not, without the written consent
of the subject agency, take any further action on the
expedited reorganization for 30 days following the mailed
notice.
7)Requires that the proposal for an expedited reorganization
include proposed terms and conditions that address all of the
following:
a) The proposed CSD is declared to be, and shall be deemed
a CSD as if the district had been formed pursuant to CSD
Law, and the exterior boundary and sphere of influence
of the proposed CSD shall be the exterior boundary and the
sphere of influence of the district proposed to be
dissolved;
b) The proposed CSD succeeds to, and is vested with, the
same powers, duties, responsibilities, obligations,
liabilities and jurisdiction of the district proposed to be
dissolved;
c) The status, position, and rights of any officer or
employee of the district proposed to be dissolved shall not
be affected by the transfer and shall be retained by the
person as an officer or employees of the proposed CSD;
d) The proposed CSD shall have ownership, possession, and
control of all books, records, papers, offices, equipment,
supplies, moneys, funds, appropriations, licenses, permits,
entitlements, agreements, contracts, claims, judgments,
land, and other assets and property, real or personal,
owned or leased by, connected with the administration of,
or hold for the benefit or use of, the district proposed to
be dissolved;
e) The unexpended balance as of the effective date of the
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expedited reorganization of any funds available for use by
the district proposed to be dissolved shall be available
for use by the proposed CSD;
f) No payment for the use, or right of use, of any
property, real or personal, acquired or constructed by the
district proposed to be dissolved shall be required by
reason of the succession pursuant to the expedited
reorganization, nor shall any payment for the proposed
CSD's acquisition of the powers, duties, responsibilities,
obligations, liabilities, and jurisdiction be required by
reason of that succession;
g) All ordinances, rules, and regulations adopted by the
district proposed to be dissolved in effect immediately
preceding the effective date of the expedited
reorganization, shall remain in effect and shall be fully
enforceable unless amended or repealed by the proposed CSD,
or until they expire by their own terms; and any statute,
law, rule, or regulation in force as of the effective date
of the expedited reorganization, or that may be enacted or
adopted with reference to the district proposed to be
dissolved shall mean the proposed CSD;
h) All allocations of shares of property tax revenue, or
any other impositions of the district proposed to be
dissolved shall remain in effect unless amended or repealed
by the proposed CSD, or they expire by their own terms;
i) The appropriations limit established pursuant to
Division 9 (commencing with Section 7900) of Title 1 of the
district proposed to be dissolved shall be the
appropriations limit of the proposed CSD;
j) Any action by or against the district proposed to be
dissolved shall not abate, but continue in the name of the
proposed CSD, and the proposed CSD shall be substituted for
the district proposed to be dissolved by the court in which
the action is pending, and the substitution shall not in
any way affect the rights of the parties to the action;
aa) No contract, lease, license, permit, entitlement, bond,
or any other agreement to which the district proposed to be
dissolved is a party shall be void or voidable by reason of
the enactment of the expedited reorganization, but shall
continue in effect, with the proposed CSD assuming all of
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the rights, obligations, liabilities, and duties of the
district proposed to be dissolved; and,
bb) Any obligations, including but not limited to, bonds and
other indebtedness, of the district proposed to be
dissolved shall be the obligations of the proposed CSD.
8)Provides that if the board of supervisors is the governing
body of a RID, the proposed terms and conditions may provide
for the election of an initial board of directors of a CSD.
9)Provides that the El Dorado County LAFCO may approve,
disapprove, or conditionally approve, the accelerated
reorganization, unless the governing body of the Tahoe
Paradise RID files a resolution of objection with the El
Dorado County LAFCO before the close of the hearing.
10)Defines "accelerated reorganization" to mean a reorganization
that consists solely of the dissolution of the Tahoe Paradise
RID and the formation of a recreation and park district.
11)Provides that if the governing body of the Tahoe Paradise RID
files a resolution of objection with the El Dorado LAFCO
before the close of the hearing, the El Dorado LAFCO shall
disapprove the proposed accelerated reorganization.
12)Provides, in the case of an accelerated reorganization of the
Tahoe Paradise RID, that the proposal for an expedited
reorganization must include proposed terms and conditions as
specified in #7 above.
13)Provides that the two sections that create an expedited
reorganization process for specified MIDs and RIDs and an
accelerated reorganization for the Tahoe Paradise RID shall
remain in effect only until January 1, 2018, and as of that
date the two sections shall be repealed, unless a later
statute which is enacted before January 1, 2018, deletes or
extends that date.
14)Finds and declares that a special law is necessary because of
the unique circumstances of the El Dorado County LAFCO and the
Tahoe Paradise RID.
EXISTING LAW :
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1)Establishes the procedures for the organization and
reorganization of cities, counties, and special districts.
2)Provides, if a majority of the members of each of the
legislative bodies of two or more local agencies adopt
substantially similar resolutions of application making
proposals either for the consolidation of districts or for the
reorganization of all or any part of the districts into a
single local agency, that a LAFCO shall approve or
conditionally approve the proposal without an election, as
specified.
3)Authorizes the organization of a CSD for various purposes,
including, among others, the collection, treatment, or
disposal of sewage, wastewater, recycled water and stormwater,
providing fire protection services, and providing public
library services, as specified in CSD Law.
FISCAL EFFECT : None
COMMENTS :
1)The Legislature passed the Resort Improvement District Law in
1961 and a few years later the Assembly held hearings
investigating abuses by special districts. The outcome of
those hearings was to stop the formation of more RIDs, leaving
several RIDs still in place today. Another type of special
district called MIDs were created by the Legislature in the
mid-1950s until 1960, and were used to deliver public services
to certain communities. There are currently five MIDs still
in existence.
The statutes governing both types of improvement districts are
outdated, lack clear links to the Ralph M. Brown Act, Public
Records Act, the Planning and Zoning Law, and to several
propositions including, Propositions 13, 62 and 218.
2)SB 1023 creates a new boundary change procedure, called an
"expedited reorganization," and allows LAFCOs to convert RIDs
and three specified MIDs into CSDs. The conversion process as
defined in this bill would not affect a district's assets,
liabilities, boundaries, services, finances, or other duties.
Additionally, the bill sets up a similar conversion process
explicitly for the Tahoe Paradise RID, in order for that
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district to be converted into a recreation and park district
if specific conditions are met. The bill provides that if the
affected improvement district files a resolution of objection
with the LAFCO, then the LAFCO must disapprove the proposed
expedited reorganization. Both sections of the bill that
authorize the expedited reorganization and accelerated
reorganization would sunset on January 1, 2018.
3)According to the author, the process of converting RIDs and
MIDs into CSDs is complicated and time consuming, involving
potentially a year-long process that will require
majority-voter approval. The author notes that SB 1023
creates a simpler way to convert these outdated special
districts, while allowing the involved local agencies to take
it upon themselves to initiate such a conversion as the bill's
provisions are voluntary.
4)Support Arguments : Supporters note that the expedited
procedures in SB 1023 promote accountability and transparency
without imposing fiscal burdens on taxpayers and other local
governments. Additionally, the procedures will allow for the
conversion of these districts into a more contemporary model
of governance.
Opposition Arguments : The Legislature created MIDs and RIDs.
Rather than set up a voluntary process to dissolve these
outdated special districts, the Legislature may want to retain
control and have direct oversight in dissolving and converting
these districts by way of special statute.
REGISTERED SUPPORT / OPPOSITION :
Support
County of Napa [SPONSOR]
Ad Hoc NBRID Residents' Committee
California Association of Local Agency Formation Commissions
California Special Districts Association
El Dorado Local Agency Formation Commission
Lake Berryessa Resort Improvement District
Montalvo Municipal Improvement District
Napa Berryessa Resort Improvement District
Napa Local Agency Formation Commission
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Regional Council of Rural Counties
Ventura Local Agency Formation Commission
Opposition
Individual letters (4)
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958