BILL ANALYSIS �
AB 2649
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Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
AB 2649 (Ammiano) - As Amended: March 29, 2012
SUBJECT : Tidelands and submerged lands: City and County of San
Francisco: seawall lots.
SUMMARY : Adds Seawall Lot 322-1 to the list of seawall lots no
longer needed for specified trust purposes, authorizes the San
Francisco Port Commission (Port) to lease Seawall Lot 322-1 for
affordable housing purposes, and authorizes the Port to provide
rent credits or other deferrals on either a non-trust lease of
Seawall Lot 322-1 or other port property, as specified.
Specifically, this bill :
1)Declares that seawall lot 322-1 is free from the use
requirements of the public trust, the Burton Act trust, and
the Burton Act transfer agreement for the period between the
effective date of the bill and January 1, 2094, and must be
treated as a designated seawall lot for purposes of the
authority granted to the Port under the same manner as other
designated seawall lots in existing law, as added by SB 815
(Migden), Chapter 660, Statutes of 2007 (known as Chapter
660).
2)Allows the Port to enter into a nontrust lease for all or any
portion of Seawall Lot 322-1, subject to the requirements of
existing law that allow seawall lots to be free from use and
trust requirements if specified conditions are met, and
subject to the provisions of this bill.
3)Requires the Port to obtain a certificate of appropriateness
or a comparable determination of compatibility of the
development with the historic character of the surrounding
areas, as may be provided under the City and County (City) of
San Francisco's Planning Code.
4)Allows the Port to provide a rent credit or other waiver or
deferral of rent in connection with either a nontrust lease of
Seawall Lot 322-1, or, with the approval of the State Lands
Commission (SLC), a lease of any other designated seawall lot
or other port property that is not subject to public trust or
Burton Act trust use restrictions, that results in an
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effective rent to the Port below fair market value, if the SLC
finds that both of the following conditions are met:
a) The nontrust lease is for affordable housing. The lease
may allow other uses, including but not limited to,
commercial uses and market rate housing, provided that no
portion of the rent credit, waiver, or deferral is applied
to the rent for those other uses; and,
b) The Port is entitled to apply the value of the rent
credit, waiver, or deferral as an offset against fees or
other exactions or obligations that would otherwise be
levied or imposed by the city on development projects
located on Pier 70, or on other lands under the Port's
jurisdiction, if approved by the SLC, relating to the
projects' impacts on or demand for affordable housing,
including, but not limited to, fees imposed pursuant to the
city's jobs-housing linkage program.
5)Requires the Port to provide the SLC with documentation
necessary to support the findings required in 4) above at the
time the Port submits the proposed nontrust lease and other
documentation as required under existing law.
6)Provides that nothing in the bill's provisions shall be
construed as limiting the Port's Authority to provide rent
credits, waivers, or deferrals under a nontrust lease in
exchange for other valuable consideration provided by the
lessee that meets the fair market value requirement of Chapter
660.
7)Provides that nothing in the bill's provisions shall be
construed as limiting the Port's authority under the Burton
Act to use or lease the designated seawall lots for uses
permitted by the Burton Act, subject to any applicable
limitations of state law.
8)Sunsets the provisions contained in 1) through 4) above as of
January 1, 2094, and requires, after that date, the use of
designated seawall lots to be consistent with the public
trust, the Burton Act trust, and the Burton Act transfer
agreement.
9)Requires, no later than January 1, 2094, all structures,
buildings, and appurtenances on the designated seawall lots
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not consistent with the purposes of the public trust, the
Burton Act trust and the Burton Act transfer agreement to be
removed or modified, including any necessary restoration or
remediation of the seawall lots, to facilitate public trust
uses.
10)Adds, to the Burton Act, the following:
a) The preservation or restoration of marine resources
consistent with the primary mission of the San Francisco
Harbor may include the sale or transfer by the City and
County
of San Francisco, acting by and through its Port, of the
Port's transferable development rights, as defined in the
city's planning code, in connection with the preservation
of a historic pier or historic structure under port
jurisdiction
b) To the extent authorized by the planning code, the Port
may sell or transfer development rights associated with a
historic pier or historic resource on port property,
provided that
if the affected Port property is subject to the public trust,
the restriction on the Port's development rights following
transfer shall be for a period not exceeding 66 years.
c) The port shall use the proceeds from a transfer of
development rights solely for the furtherance of the
purposes specified in this bill, which include, without
limitation, reimbursement of the costs of rehabilitation of
a historic pier or historic resource undertaken by any
individual, corporation, limited liability company,
partnership, joint venture, business entity, business
trust, association or other private organization or private
entity.
11)Finds and declares that the bill's provisions set no
precedent for any other location or project in the state
because of the unique circumstances that exist at the San
Francisco waterfront.
12)Includes a map of the San Francisco waterfront, as specified.
13)Makes findings and declarations about the necessity for a
special statute because of the unique circumstances applicable
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only to the lands described in this bill.
14)Specifies that if any provision of this bill, or its
application to any person, property or circumstance, is held
invalid by any court, the invalidity or inapplicability of
such provision shall not affect any other provision of this
bill, as specified.
15)Makes findings and declarations about the need to remove
seawall lot 322-1 from the use requirements of the public
trust, the Burton Act trust, and the Burton Act transfer
agreement in the same manner as other designated seawall lots.
16)Makes findings and declarations about the lack of affordable
housing and declares that Seawall lot 322-1 is well-suited to
support infill affordable housing development.
17)Contains definitions for terms used in the bill.
EXISTING LAW :
1)Establishes the SLC, comprised of the Lieutenant Governor, the
State Controller, and the State Director of Finance.
2)Provides that SLC is the state agency that manages and
protects the state's tide and submerged lands.
3)Requires SLC to carry out its responsibilities consistent with
the Public Trust Doctrine which provides that tide and
submerged lands are reserved for uses associated with
commerce, fishing, navigation, recreation and the environment.
4)Authorizes SLC to administer and control those lands and to
lease, exchange, and otherwise dispose of them as provided by
law, subject to the terms and any considerations established
by SLC for each transfer or exchange of those lands. In most
instances, the Legislature has enacted statutes specifically
authorizing the transfer of particular parcels of state lands
to local jurisdictions for specified public trust uses, such
as navigation improvements, port construction, piers and
wharves, recreation, and public access, and SLC carries out
the transaction and exercises ongoing oversight responsibility
to make sure the grantee complies with the terms of the
transfer and public trust obligations.
5)Grants to the City and County of San Francisco the right,
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title, and interest of the State of California in and to
certain tidelands and submerged lands in trust for specified
purposes.
6)Transferred in trust to the City and County of San Francisco,
the interest of the state in and to the Harbor of San
Francisco, under the provisions of the Burton Act and the
Burton Act transfer agreement.
7)Declares, until January 1, 2094, that certain parcels of real
property denominated as the designated seawall lots are free
from the use requirements of the public trust, the Burton Act
trust, and the Burton Act transfer agreement, and authorizes
the Port to lease all or a portion of the designated seawall
lots, in specified instances.
FISCAL EFFECT : Unknown. This bill is keyed fiscal.
COMMENTS :
1)The common law doctrine of the public trust (Public Trust
Doctrine) protects the public's right to use California's
waterways for commerce, navigation, fishing, boating, natural
habitat protection, and other water-oriented activities. The
Public Trust Doctrine provides that filled and unfilled tide
and submerged lands and the beds of lakes, streams, and other
navigable waterways, known as public trust lands, are to be
held in trust by the state for the benefit of the people of
California.
Under the Burton Act (Chapter 1333, Statutes of 1968), the
state conveyed certain state tidelands along the San Francisco
waterfront, generally extending from Fisherman's Wharf to
Candlestick Point, to the City and County of San Francisco,
through its Port, in 1969 in trust for public trust and Burton
Act trust purposes, subject to the obligation on the part of
the City and County of San Francisco to assume $55 million in
state debt obligations then existing relating to the
waterfront properties. Typically, private uses such as office
space or housing are not allowed for those lands for which the
Burton Act applies.
The San Francisco waterfront includes a number of seawall lots
controlled by the Port, which are triangular lots on the west
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side of the Embarcadero that have been used for decades as
parking lots, a use that is inconsistent with the trust and
does not conform with the surrounding urban landscape. The
Embarcadero cuts these lots off from the water.
SB 815 (Migden), Chapter 660, Statutes of 2007, freed trust
use restrictions from the seawall lots along the Embarcadero,
and allowed the Port to lease these properties at market rates
for non-trust purposes provided that net proceeds are used to
rehabilitate piers or build parks, as required by the Bay
Conservation and Development Commission (BCDC). These
nontrust uses are authorized until January 1, 2094, at which
time the public trust restrictions on the land are restored.
The Legislature justified its actions in SB 815 by finding
that seawall lots had "ceased to be useful for the promotion
of the public trust and the Burton Act trust?"
The legal significance of the Legislature finding that a
filled tideland parcel ceases to be useful for the promotion
of the public trust is that, according to the California
Supreme Court in Long Beach v. Mansell (1970) 3 Cal. 3d 462,
the Legislature can then constitutionally terminate the public
trust from the land and transfer it into absolute private
ownership - the Mansell case actually requires that the land
be "valueless for trust purposes." Without such a finding,
filled tidelands must be held in trust for the people of the
California and subject to the California Constitution's
prohibition on the grant or sale of tidelands to any private
persons, partnerships, or corporations if the lands are within
two miles of an incorporated city or town.
2)According to the Port, Seawall Lot 322-1 is a 37,823 square
foot rectangular parcel bounded by Broadway, Front and Vallejo
Streets, located in the Northeast Waterfront Historic
District. Any new non-trust development must meet design
standards of Article 10 of the San Francisco Planning Code.
The Waterfront Land Use Plan considers residential, open
space/public access, general office, hotels, parking and
retail to be acceptable uses of Seawall Lot 322-1.
Previously, the lot was part of a Port hotel development
offering that included Seawall Lot 324, however, the selected
hotel proposal was not approved. The Port currently earns
$47,152 a month (approximately $570,000 annually) from monthly
and daily parking at Seawall Lot 322-1.
3)The San Francisco Planning Code provides for the imposition of
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Jobs-Housing Linkage Program fees on development of most types
of commercial development to offset the new demand for
affordable housing produced by new employment. Current fees
range from $14.70 per square foot for new research and
development space to $22.06 per square foot for new office
space. Most types of commercial/institutional development on
Port property are subject to fees in the Planning Code,
including Jobs-Housing Linkage fees.
This bill, sponsored by the Port, would free Seawall 322-1
from trust use restrictions, authorize affordable housing at
that site, and permit the City and County of San Francisco to
lease the site below market rate in exchange for Jobs-Housing
Linkage fee credits at another waterfront site. The proposal
would be subject to an agreement by the SLC, and the Port
would offer the site below market rate to the San Francisco
Mayor's Office of Housing.
According to the author, the Port is currently pursuing market
rate housing at several seawall lots that are no longer needed
for trust purposes. The Port has directed staff to explore
the feasibility of developing affordable housing on seawall
lots no longer required for trust purposes as well. For
affordable housing to be feasible on a seawall lot, the Port
would need legislative authorization to lease the site for
affordable housing at a below market rate.
4)The Port's Pier 70 Master Plan calls for retention of the ship
repair use at Pier 70, environmental remediation of the site,
approximately 20 acres of parks and open space, development of
more than 3 million square feet of new commercial uses and
nomination of the Pier 70's numerous historic buildings as a
district to the National Register of Historic Places. The
economic analysis demonstrated that the plan has a deficit of
more than $50 million in 2009 dollars. The Port believes that
increased public financing is required to realize the vision
of Pier 70. The Port expects that the Pier 70 project is
likely to owe $30 million in affordable housing fees at Pier
70 under San Francisco's Jobs-Housing Linkage Program.
This bill allows the Port, subject to approval by the SLC, to
lease a seawall lot that is no longer needed for trust
purposes for affordable housing at a below-market rate, in
exchange for credits equal to the difference between the
below-market rate and market rate, which would offset
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affordable housing fees arising from redevelopment of Pier 70
on a dollar-for-dollar basis.
In addition to this bill, the Port is also currently seeking
legislation to amend the City's Jobs-Housing Linkage ordinance
to provide for an alternative means of allowing the Port to
meet affordable housing obligations with provision of land for
affordable housing purposes.
5)According to the author and sponsor, the "purpose of this act
is to reduce the costs associated with development that will
revitalize the waterfront and benefit the public trust, while
also encouraging affordable housing development on port lands
no longer needed for trust purposes, by authorizing the Port
to grant rent credits or similar incentives for affordable
housing development on Seawall Lot 322-1 or other Port
property where housing is permitted, provided the Port can
apply those credits to reduce the affordable housing fees or
other obligations imposed on development within the Pier 708
area or on other Port lands and subject to specified
conditions."
6)This bill is double-referred to the Committee on Natural
Resources.
7)Support arguments : Supporters argue the need for additional
affordable housing and believe that this bill will help create
more opportunities to build affordable housing in San
Francisco.
Opposition arguments : The Committee may wish to consider the
implications of authorizing the Port to grant rent credits or
incentives on other Port property besides Seawall Lot 322-1.
REGISTERED SUPPORT / OPPOSITION :
Support
San Francisco Port Commission �SPONSOR]
Opposition
None on file
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958
AB 2649
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