BILL NUMBER: SB 1335 AMENDED
BILL TEXT
AMENDED IN SENATE MARCH 29, 2012
INTRODUCED BY Senator Pavley
FEBRUARY 24, 2012
An act to add Section 34177.1 to amend
Sections 34177, 34180, and 34181 of the Health and Safety Code,
relating to redevelopment.
LEGISLATIVE COUNSEL'S DIGEST
SB 1335, as amended, Pavley. Redevelopment: brownfield sites.
Existing law dissolved redevelopment agencies and community
development agencies, as of February 1, 2012, and provides for the
designation of successor agencies, as defined. Existing law imposes
various requirements on successor agencies and subjects successor
agency actions to the review of oversight boards. Existing law
requires successor agencies to wind down the affairs of the dissolved
redevelopment agencies and to, among other things, dispose of assets
and properties of the former redevelopment agencies, as directed by
the oversight board. Existing law requires proceeds from the sale of
assets that are no longer needed to be transferred to the county
auditor-controller for distribution as property tax proceeds to
taxing entities, as prescribed.
This bill would , notwithstanding the above provisions,
authorize a successor agency to retain land of the former
redevelopment agency that is a brownfield site , as defined,
and is either on or immediately adjacent to land previously
developed for qualified urban uses, as defined. The bill would, upon
appropriation by the Legislature, authorize the successor agency to
develop the land if the associated development project meets
specified requirements. for specified remediation or
removal purposes using available financing, funds, and grants. Upon
completion of remediation, the bill would require the successor
agency to dispose of the land pursuant to existing asset disposition
provisions. The bill would make conforming changes.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 34177 of the Health
and Safety Code is amended to read:
34177. Successor agencies are required to do all of the
following:
(a) Continue to make payments due for enforceable obligations.
(1) On and after February 1, 2012, and until a Recognized
Obligation Payment Schedule becomes operative, only payments required
pursuant to an enforceable obligations payment schedule shall be
made. The initial enforceable obligation payment schedule shall be
the last schedule adopted by the redevelopment agency under Section
34169. However, payments associated with obligations excluded from
the definition of enforceable obligations by paragraph (2) of
subdivision (e) of Section 34171 shall be excluded from the
enforceable obligations payment schedule and be removed from the last
schedule adopted by the redevelopment agency under Section 34169
prior to the successor agency adopting it as its enforceable
obligations payment schedule pursuant to this subdivision. The
enforceable obligation payment schedule may be amended by the
successor agency at any public meeting and shall be subject to the
approval of the oversight board as soon as the board has sufficient
members to form a quorum.
(2) The Department of Finance and the Controller shall each have
the authority to require any documents associated with the
enforceable obligations to be provided to them in a manner of their
choosing. Any taxing entity, the department, and the Controller shall
each have standing to file a judicial action to prevent a violation
under this part and to obtain injunctive or other appropriate relief.
(3) Commencing on May 1, 2012, only those payments listed in the
Recognized Obligation Payment Schedule may be made by the successor
agency from the funds specified in the Recognized Obligation Payment
Schedule. In addition, commencing May 1, 2012, the Recognized
Obligation Payment Schedule shall supersede the Statement of
Indebtedness, which shall no longer be prepared nor have any effect
under the Community Redevelopment Law.
(4) Nothing in the act adding this part is to be construed as
preventing a successor agency, with the prior approval of the
oversight board, as described in Section 34179, from making payments
for enforceable obligations from sources other than those listed in
the Recognized Obligation Payment Schedule.
(5) From February 1, 2012, to July 1, 2012, a successor agency
shall have no authority and is hereby prohibited from accelerating
payment or making any lump-sum payments that are intended to prepay
loans unless such accelerated repayments were required prior to the
effective date of this part.
(b) Maintain reserves in the amount required by indentures, trust
indentures, or similar documents governing the issuance of
outstanding redevelopment agency bonds.
(c) Perform obligations required pursuant to any enforceable
obligation.
(d) Remit unencumbered balances of redevelopment agency funds to
the county auditor-controller for distribution to the taxing
entities, including, but not limited to, the unencumbered balance of
the Low and Moderate Income Housing Fund of a former redevelopment
agency. In making the distribution, the county auditor-controller
shall utilize the same methodology for allocation and distribution of
property tax revenues provided in Section 34188.
(e) (1) Dispose of assets and properties of
the former redevelopment agency as directed by the oversight board;
provided, however, that the oversight board may instead direct the
successor agency to transfer ownership of certain assets pursuant to
subdivision (a) of Section 34181. The disposal is to be done
expeditiously and in a manner aimed at maximizing value. Proceeds
from asset sales and related funds that are no longer needed for
approved development projects or to otherwise wind down the affairs
of the agency, each as determined by the oversight board, shall be
transferred to the county auditor-controller for distribution as
property tax proceeds under Section 34188.
(2) Notwithstanding paragraph (1), a successor agency may retain
land of the former redevelopment agency that is a brownfield site for
the purpose of the remediation or removal of the release of
hazardous substances, as defined in Section 33459, on, under, or from
the property, using available financing, funds obtained from a
responsible party, existing state or federal grants, or any other
funds at the disposal of the successor agency in order to maximize
value of the asset. Upon completion of the remediation or removal of
hazardous substances from the brownfield site, the successor agency
shall dispose of the property pursuant to paragraph (1).
(f) Enforce all former redevelopment agency rights for the benefit
of the taxing entities, including, but not limited to, continuing to
collect loans, rents, and other revenues that were due to the
redevelopment agency.
(g) Effectuate transfer of housing functions and assets to the
appropriate entity designated pursuant to Section 34176.
(h) Expeditiously wind down the affairs of the redevelopment
agency pursuant to the provisions of this part and in accordance with
the direction of the oversight board.
(i) Continue to oversee development of properties until the
contracted work has been completed or the contractual obligations of
the former redevelopment agency can be transferred to other parties.
Bond proceeds shall be used for the purposes for which bonds were
sold unless the purposes can no longer be achieved, in which case,
the proceeds may be used to defease the bonds.
(j) Prepare a proposed administrative budget and submit it to the
oversight board for its approval. The proposed administrative budget
shall include all of the following:
(1) Estimated amounts for successor agency administrative costs
for the upcoming six-month fiscal period.
(2) Proposed sources of payment for the costs identified in
paragraph (1).
(3) Proposals for arrangements for administrative and operations
services provided by a city, county, city and county, or other
entity.
(k) Provide administrative cost estimates, from its approved
administrative budget that are to be paid from property tax revenues
deposited in the Redevelopment Property Tax Trust Fund, to the county
auditor-controller for each six-month fiscal period.
(l) (1) Before each six-month fiscal period, prepare a Recognized
Obligation Payment Schedule in accordance with the requirements of
this paragraph. For each recognized obligation, the Recognized
Obligation Payment Schedule shall identify one or more of the
following sources of payment:
(A) Low and Moderate Income Housing Fund.
(B) Bond proceeds.
(C) Reserve balances.
(D) Administrative cost allowance.
(E) The Redevelopment Property Tax Trust Fund, but only to the
extent no other funding source is available or when payment from
property tax revenues is required by an enforceable obligation or by
the provisions of this part.
(F) Other revenue sources, including rents, concessions, asset
sale proceeds, interest earnings, and any other revenues derived from
the former redevelopment agency, as approved by the oversight board
in accordance with this part.
(2) A Recognized Obligation Payment Schedule shall not be deemed
valid unless all of the following conditions have been met:
(A) A draft Recognized Obligation Payment Schedule is prepared by
the successor agency for the enforceable obligations of the former
redevelopment agency by March 1, 2012. From October 1, 2011, to July
1, 2012, the initial draft of that schedule shall project the dates
and amounts of scheduled payments for each enforceable obligation for
the remainder of the time period during which the redevelopment
agency would have been authorized to obligate property tax increment
had such a redevelopment agency not been dissolved, and shall be
reviewed and certified, as to its accuracy, by an external auditor
designated pursuant to Section 34182.
(B) The certified Recognized Obligation Payment Schedule is
submitted to and duly approved by the oversight board.
(C) A copy of the approved Recognized Obligation Payment Schedule
is submitted to the county auditor-controller and both the Controller'
s office and the Department of Finance and be posted on the successor
agency's Internet Web site.
(3) The Recognized Obligation Payment Schedule shall be forward
looking to the next six months. The first Recognized Obligation
Payment Schedule shall be submitted to the Controller's office and
the Department of Finance by April 15, 2012, for the period of
January 1, 2012, to June 30, 2012, inclusive. Former redevelopment
agency enforceable obligation payments due, and reasonable or
necessary administrative costs due or incurred, prior to January 1,
2012, shall be made from property tax revenues received in the spring
of 2011 property tax distribution, and from other revenues and
balances transferred to the successor agency.
SEC. 2. Section 34180 of the Health and
Safety Code is amended to read:
34180. All of the following successor agency actions shall first
be approved by the oversight board:
(a) The establishment of new repayment terms for outstanding loans
where the terms have not been specified prior to the date of this
part.
(b) Refunding of outstanding bonds or other debt of the former
redevelopment agency by successor agencies in order to provide for
savings or to finance debt service spikes; provided, however, that no
additional debt is created and debt service is not accelerated.
(c) Setting aside of amounts in reserves as required by
indentures, trust indentures, or similar documents governing the
issuance of outstanding redevelopment agency bonds.
(d) Merging of project areas.
(e) Continuing the acceptance of federal or state grants, or other
forms of financial assistance from either public or private sources,
where assistance is conditioned upon the provision of matching
funds, by the successor entity as successor to the former
redevelopment agency, in an amount greater than 5 percent.
(f) (1) If a city, county, or city and county wishes to retain any
properties or other assets for future redevelopment activities,
funded from its own funds and under its own auspices, it must reach a
compensation agreement with the other taxing entities to provide
payments to them in proportion to their shares of the base property
tax, as determined pursuant to Section 34188, for the value of the
property retained.
(2) If no other agreement is reached on valuation of the retained
assets, the value will be the fair market value as of the 2011
property tax lien date as determined by the county assessor.
(g) Establishment of the Recognized Obligation Payment Schedule.
(h) A request by the successor agency to enter into an agreement
with the city, county, or city and county that formed the
redevelopment agency that it is succeeding.
(i) A request by a successor agency or taxing entity to pledge, or
to enter into an agreement for the pledge of, property tax revenues
pursuant to subdivision (b) of Section 34178.
(j) The retention of land of the former redevelopment agency that
is a brownfield site for purposes of remediation or removal, pursuant
to paragraph (2) of subdivision (e) of Section 34177.
SEC. 3. Section 34181 of the Health and
Safety Code is amended to read:
34181. The oversight board shall direct the successor agency to
do all of the following:
(a) Dispose of all assets and properties of the former
redevelopment agency that were funded by tax increment revenues of
the dissolved redevelopment agency; provided, however, that the
oversight board may instead direct the successor agency to transfer
ownership of those assets that were constructed and used for a
governmental purpose, such as roads, school buildings, parks, and
fire stations, to the appropriate public jurisdiction pursuant to any
existing agreements relating to the construction or use of such an
asset or to retain land of the former redevelopment agency that
is a brownfield site for purposes of remediation or
removal, consistent with paragraph (2) of subdivision (e) of Section
34177 . Any compensation to be provided to the successor agency
for the transfer of the asset shall be governed by the agreements
relating to the construction or use of that asset. Disposal shall be
done expeditiously and in a manner aimed at maximizing value.
(b) Cease performance in connection with and terminate all
existing agreements that do not qualify as enforceable obligations.
(c) Transfer housing responsibilities and all rights, powers,
duties, and obligations along with any amounts on deposit in the Low
and Moderate Income Housing Fund to the appropriate entity pursuant
to Section 34176.
(d) Terminate any agreement, between the dissolved redevelopment
agency and any public entity located in the same county, obligating
the redevelopment agency to provide funding for any debt service
obligations of the public entity or for the construction, or
operation of facilities owned or operated by such public entity, in
any instance where the oversight board has found that early
termination would be in the best interests of the taxing entities.
(e) Determine whether any contracts, agreements, or other
arrangements between the dissolved redevelopment agency and any
private parties should be terminated or renegotiated to reduce
liabilities and increase net revenues to the taxing entities, and
present proposed termination or amendment agreements to the oversight
board for its approval. The board may approve any amendments to or
early termination of such agreements where it finds that amendments
or early termination would be in the best interests of the taxing
entities.
SECTION 1. Section 34177.1 is added to the
Health and Safety Code, to read:
34177.1. (a) Notwithstanding Section 34177, a successor agency
may retain land of the former redevelopment agency that is a
brownfield site, as defined in Section 9601 of Title 42 of the United
States Code, and is either on or immediately adjacent to land
previously developed for qualified urban uses as defined in Section
21072 of the Public Resources Code.
(b) Upon appropriation by the Legislature, notwithstanding Section
34164, a successor agency may develop the land if the associated
development project meets one or more of the following requirements:
(1) The project has been declared a sustainable communities
project, pursuant to Section 21155.1 of the Public Resources Code.
(2) The project is consistent with a transit village plan, as
described in Section 65460.2 of the Government Code.
(3) The project shall be located in an infill opportunity zone, as
defined in Section 65088.1 of the Government Code.
(4) The project meets the requirements of Section 21159.21,
21159.23, or 21159.24 of the Public Resources Code.
(5) The project promotes higher density infill housing. A project
with a density of at least 20 units per acre shall be conclusively
presumed to promote higher density infill housing. A project with a
density of at least 10 units per acre and a density greater than the
average density of the residential properties within 1,500 feet shall
be presumed to promote higher density housing unless the
preponderance of the evidence demonstrates otherwise.
(6) The project is within one-half mile of a major transit stop,
as defined in Section 21064.3 of the Public Resources Code.