BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           1085 (Runner)
          
          Hearing Date:  5/10/2010        Amended: 4/27/2010
          Consultant:  Bob Franzoia       Policy Vote: F&A  4-0
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          BILL SUMMARY: SB 1085 would permit a nonprofit organization to  
          hold an annual fair in lieu of the annual fair by the 50th  
          District Agricultural Association (DAA), with the consent of the  
          Department of Food and Agriculture.  This bill would permit the  
          Department of General Services (DGS) to lease to the nonprofit  
          organization, for less than market value, the premises known as  
          the Antelope Valley Fair for a period not to exceed 99 years.   
          During the period the lease is in effect, the 50th DAA would be  
          required to be inactive and not have any powers or duties.  This  
          bill would permit employees of the 50th DAA to make an election  
          concerning employment with the nonprofit lessee of those  
          premises.  This bill would provide that the nonprofit  
          organization may elect to be a member of the network of  
          California fairs on terms and conditions mutually agreed upon by  
          the Department of Food and Agriculture and the nonprofit  
          organization.
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                            Fiscal Impact (in thousands)

           Major Provisions         2010-11      2011-12       2012-13     Fund
           Long term lease of state          Unknown loss of revenue from  
          leasing                Special*
          property               at less than market value            

          Lease negotiation                           Likely minor cost,  
          one time                           Special*

          * Fair and Exposition Fund
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          STAFF COMMENTS: This bill meets the criteria for referral to the  
          Suspense File.
          
          This bill would permit DGS to lease to the nonprofit  
          organization, for less than market value, the premises known as  










          the Antelope Valley Fair for a period not to exceed 99 years.   
          At this time, a market value has not been determined.   
          (Government Code 11011.1 (4) (g) provides that fair market value  
          is established by an appraisal and economic evaluation conducted  
          by the department and approved by the department.)
           
          This bill provides that the state is not liable for any debts,  
          liabilities, settlements, liens, or any other obligations  
          incurred by or imposed upon the nonprofit organization.  The  
          lease shall expressly provide that the General Fund and the Fair  
          and Exposition Fund shall be held harmless, as well.  It is  
          unclear if the nonprofit would eligible to receive state funding  
          (approximately $20,000 from the Fair and Exposition Fund)  
          currently being received annually by the 50th DAA.

          Staff recommends this bill be amended to authorize DGS to be  
          reimbursed for any reasonable costs or expenses incurred in  
          conducting a transaction pursuant to this bill.