BILL ANALYSIS Ó
AB 2144
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Date of Hearing: May 16, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2144 (John A. Pérez) - As Amended: April 16, 2012
Policy Committee: Local
GovernmentVote:6-3
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill expands the powers of an infrastructure financing
district (IFD) and renames IFDs infrastructure and refinancing
districts (IFRD). Specifically, this bill:
1)Expands the types of public capital facilities or projects of
communitywide significance an IRFD can finance.
2)Authorizes an IRFD to utilize the powers under the Polanco
Redevelopment Act in order to finance environmental
remediation and brownfield restoration.
3)Specifies that a city may form an IRFD to finance a project or
projects on a former military base as long as the project is
consistent with the authority reuse plan and is approved by
the military base reuse authority.
4)Removes the voter threshold for the issuance of debt by an
IRFD if the project to be financed is on land of a former
military base that is publicly owned.
5)Reduces the vote threshold for creating an IRFD and issuing
bonds from two-thirds voter approval to 55% voter approval.
FISCAL EFFECT
Negligible state fiscal impact as IRFDs can only divert property
tax increment revenues from other local governments, excluding
school districts.
COMMENTS
AB 2144
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1)Purpose. According to the author, AB 2144 facilitates the
formation and broadens the purposes of I FD in order to make
them more useful local tools, particularly in light of the end
of redevelopment agencies, for economic development,
affordable housing, sustainable communities, military base
re-use and brownfields cleanup and mitigation. The author
states IRFDs will encourage local cooperation and include
appropriate protections for state and local taxpayers.
2)Background . Cities and counties can create IFDs and issue
bonds to pay for community scale public works, including
highways, transit, water systems, sewer projects, flood
control, child care facilities, libraries, parks and solid
waste facilities. To repay the bonds, IFDs divert property
tax increment revenues from other local governments for a
period of 30 years. IFDs, however, are prohibited from
diverting property tax increment revenues from schools.
For several years, local officials were reluctant to form IFDs
because they worried about the constitutionality of using tax
increment revenue from property that was not within the
redevelopment project area. When a 1998 Attorney General
opinion allayed those concerns, the City of Carlsbad formed an
IFD in 1999 to fund the public works for a new hotel located
adjacent to the Legoland theme park. That small project is
the only example of local officials' use of the existing IFD
law.
IFDs have been tailored to meet specific local circumstances.
SB 1085 (Migden), Chapter 213, Statutes of 2005, amended IFD
law to enable the City and County of San Francisco to finance
needed public infrastructure improvements to specified
waterfront properties. This authority was expanded even
further for San Francisco in AB 1199 (Ammiano), Chapter 664,
Statutes of 2010 and AB 644 (Ammiano), Chapter 314, Statutes
of 2011.
3)Opposition. Opposition, including the Howard Jarvis Taxpayers
Association and the California Association of Realtors,
believes that by reducing the voter-approval requirements for
the creation of an IFD and for the issuance of bonds, this
will reduce input or direct voter oversight for matters
affecting their communities.
AB 2144
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Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081