BILL NUMBER: AB 1275 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 14, 2011
AMENDED IN ASSEMBLY MARCH 31, 2011
INTRODUCED BY Assembly Member Torres
FEBRUARY 18, 2011
An act to amend Sections 50904 and 50905 of the Health
and Safety Code, relating to housing. An act to add
Section 33137 to the Health and Safety Code, relating to
redevelopment.
LEGISLATIVE COUNSEL'S DIGEST
AB 1275, as amended, Torres. Housing.
Redevelopment: agency contracts.
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
each agency to make and execute contracts and other instruments
necessary or convenient to the exercise of its powers.
This bill would provide that a contract entered into by an agency
may be declared by a court to be null and void if the agency performs
specified actions.
Existing law establishes the California Housing Finance Agency,
which is governed by a board of directors consisting of 11 voting
members and 3 nonvoting ex officio members. Existing law also
authorizes the agency to employ specified persons. Existing law
imposes various conflict-of-interest requirements, including that a
board member with a financial interest in any matter before the board
for a decision must disclose the interest as a matter of official
public record and the board member is prohibited from attempting to
influence, participate in deliberations concerning, or vote as to the
interested matter. Existing law also prohibits an employee of the
agency from being employed by, holding any paid official relation to,
or having any financial interest in, any housing sponsor or any
housing development financed or assisted by the agency.
This bill would specify that the conflict-of-interest provision is
effective notwithstanding a provision of law that prohibits certain
officials from having a financial interest in a contract entered into
by the official in his or her official capacity or by the body or
board of which they are members.
This bill would extend the prohibition against being employed by,
having a paid relation to, or having a financial interest in a
housing sponsor or affordable housing to an officer of the agency,
except for a member of the board of directors who is not an employee
of the agency.
This bill would change the term "housing development" to
"affordable housing" in these provisions.
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. Section 33137 is added to the
Health and Safety Code , to read:
33137. A contract entered into by an agency may be declared by a
court to be null and void if the agency does any of the following:
(a) Exercises the authority that is provided to the agency
pursuant to this part in a manner that constitutes an abuse of
discretion.
(b) Violates any powers or obligations granted to it by this part.
(c) Assumes any other obligations that impairs its ability to meet
existing obligations under this part.
SECTION 1. Section 50904 of the Health and
Safety Code is amended to read:
50904. The representation of varied interest groups on the board
shall be deemed essential to obtain information for the development
of policy and decisions of the board. Notwithstanding Section 1090 of
the Government Code, it shall not be a conflict of interest for an
official of any local public entity or a resident of any affordable
housing, or a director, officer, stockholder, or employee of any
savings and loan institution, investment banking firm, brokerage
firm, commercial bank or trust company, architectural firm, insurance
company, labor union, or any other person, association, or
corporation to serve as a member of the board. If any board member
has a financial interest in any matter before the board for a
decision, that interest shall be disclosed as a matter of official
public record. The board member shall not attempt to influence,
participate in deliberations concerning, or vote as to that matter.
Violation of this section constitutes grounds for disqualification
from office as a board member. Violation of the disclosure
requirements of this section constitutes a misdemeanor under Section
91000 of the Government Code.
SEC. 2. Section 50905 of the Health and Safety
Code is amended to read:
50905. (a) No officer or employee of the agency shall be employed
by, hold any paid official relation to, or have any financial
interest in, any housing sponsor or any affordable housing financed
or assisted under this part, provided that this prohibition shall not
apply to a member of the board of directors who is not an employee
of the agency. No real property to which a member of the board or
employee of the agency holds legal title or in which the person has
any financial interest shall be purchased by the agency or sold by
the member of the board or employee of the agency to a housing
sponsor for affordable housing to be financed under this part.
Any violation of this section shall be a conflict of interest that
shall be grounds for disqualification of the member from the board
or employee of the agency from his or her employment with the board
or agency.
(b) Except as provided by subdivision (c), the following actions
shall be voidable in the discretion of the agency:
(1) Any purchase by the agency of real property in which a member
of the board or employee of the agency has legal title or a financial
interest.
(2) Any commitment by the agency to provide financial assistance
to a housing sponsor in which a member of the board or employee of
the agency is employed, holds any official relation, or has any
financial interest.
(3) Any commitment by the agency to provide financial assistance
to a housing sponsor to which real property has been or is
transferred for affordable housing to be financed under this part, if
a member of the board or employee of the agency has or has had legal
title or any financial interest in the real property.
(c) Any commitment by the agency to provide financial assistance
under the circumstances specified in paragraph (2) or (3) of
subdivision (b) shall not be voidable following release of the funds.
(d) Notwithstanding the provisions of this section and Section
50904, any conflict of interest by a member of the board or employee
of the agency shall not affect the validity of any bonds or insurance
issued pursuant to this division.
(e) Notwithstanding the provisions of this section, an agency
employee or board member may, if not acting as an investor and if
otherwise eligible, participate in owner-occupied single-family
financing and insurance programs operated by the agency.