BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1656|
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THIRD READING
Bill No: AB 1656
Author: Dickinson (D)
Amended: 8/22/14 in Senate
Vote: 21
SENATE GOVERNMENTAL ORGANIZATION COMMITTEE : 10-0, 6/24/14
AYES: Correa, Berryhill, Cannella, De Le�n, Galgiani,
Hernandez, Lieu, Padilla, Torres, Vidak
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 79-0, 5/29/14 - See last page for vote
SUBJECT : Department of General Services: Board of
Equalization
headquarters
SOURCE : Board of Equalization
DIGEST : This bill requires, by July 1, 2015, the Department
of General Services (DGS) to complete a long-range planning
study of the state-controlled and owned office buildings in the
County of Sacramento and the City of West Sacramento, including
the headquarters of the Board of Equalization (BOE), for the
management of the state's space needs in the Sacramento region,
as specified; and requires the Director of DGS to issue one or
more requests for proposals for the planning, design,
construction, and acquisition of facilities recommended by the
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Legislature based on the planning study.
Senate Floor Amendments of 8/22/14 strike the contents of the
current bill and add new findings and declarations relating to
DGS; add legislative intent language that DGS perform a study
developing a long-range plan for the Sacramento Region; and
require DGS, by July 1, 2015, to complete a long-range planning
study of the state-controlled and owned office buildings in the
County of Sacramento and the City of West Sacramento, including
BOE's headquarters.
ANALYSIS :
Existing law:
1.Authorizes DGS to acquire, construct, lease, or transfer state
property, as specified, and when specifically authorized by
the Legislature.
2.Authorizes DGS to hire, lease, lease-purchase, or lease with
an option to purchase any real or personal property for the
use of any state agency if DGS deems the hiring or leasing is
in the state's best interest, and DGS is specifically
authorized to do so by the Legislature.
3.Provides a mechanism by which DGS can dispose of surplus
property upon approval by the Legislature, under any terms and
conditions and subject to any reservations and exceptions that
DGS deems to be in the best interests of the state, with right
of first refusal going to local agencies or nonprofit
affordable housing sponsors prior to it being offered for sale
to private entities or individuals.
4.Requires each state agency to annually review proprietary
state lands under its jurisdiction to determine what lands are
in excess of the agency's foreseeable needs and to report
their findings to DGS.
This bill:
1.Makes legislative findings and declarations relating to DGS.
2.Adds legislative intent language that DGS perform a study
developing a long-range plan for the Sacramento Region, with
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monies ($2.5 million) that were appropriated in the 2014
Budget for this purpose, to determine the best course of
action to address the state's infrastructure deficiencies and
space needs. The study will also serve as the framework to
develop recommendations and detailed cost and scope
information necessary for future budget proposals.
3.Requires DGS, by July 1, 2015, to complete a long-range
planning study of the state-controlled and owned office
buildings in the County of Sacramento and the City of West
Sacramento, including BOE's headquarters, for the management
of the state's space needs in the region.
4.Stipulates that the planning must contain, but is not limited
to, the following:
A. Evaluation of the overall state facility needs in the
Sacramento region, including currently owned and leased
space.
B. Evaluation of each building (e.g., age, condition, use,
etc.) and the extent that it meets the business needs and
location of the entity occupying the space.
C. The impact the building has on potential reconfiguration
and consolidation needs.
D. The viability of antiquated building infrastructure
systems.
E. Evaluation of office buildings in need of major repairs
or renovations including estimated costs for fire and life
safety, accessibility, seismic safety and other building
code compliance issues.
F. Other considerations deemed appropriate by DGS, in
consultation with the state entity occupying the building,
may be included.
G. Development of a logical sequencing plan for renovation,
replacement, or both, of existing state office buildings
and new office development in the Sacramento region to
guide the state over the next 25 years.
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1.Provides that the findings in this long-range study will be
used as the basis for recommendations and developing detailed
cost and scope information to be considered in future budget
proposals.
2.Provides that, beginning with three buildings with the most
significant and immediate renovation and replace needs,
including highest cost of total maintenance and repair to
usable space, and other related costs identified in the
long-range planning study, DGS must issue one or more requests
for proposals (RFPs) for the planning, design, construction,
and acquisition of facilities that have been recommended by
the Legislature based on the planning study required by this
bill.
3.Requires DGS to submit the RFP's within 12 months of the
Legislature making the recommendations.
Background
Since 2007, the state has spent approximately $60 million to
make repairs to the BOE headquarters, located at 450 N Street in
Sacramento. The state is planning to spend $64-115 million more
to make additional repairs/upgrades to the building. The state
purchased the building from the California Public Employees'
Retirement System in 2006, with a loan from the Pooled Money
Investment Board (PMIB) for $81 million. In 2011, the state
issued Lease Revenue Bonds in the amount of $92 million to repay
the PMIB loan (principal and interest.)
The author, the BOE, and other stakeholders are concerned that
the state is throwing precious dollars after a bad building.
According to the author's office, after consultation with the
State Treasurer's Office, DGS determined that the state could
satisfy the bonds prior to their 10-year maturity in 2021, a
concern raised by the previous Administration to facilitating a
move from the current building.
AB 151 (Jones, 2009-2010 Session) would have required DGS to
conduct a study as to whether it is in the best interest of the
state to sell, lease, or exchange the BOE headquarters. It
authorized the sale, lease, or exchange thereof, based upon the
director's findings. It required DGS to investigate new land
and facilities for a BOE headquarters using the net proceeds of
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the initial agreement. Furthermore, the bill granted BOE
independent real estate authority without DGS involvement. The
bill was vetoed by Governor Schwarzenegger who wrote:
While I am sympathetic with this bill's objective of
ultimately locating most or all Board of Equalization (BOE)
headquarters units in a single location, the fiscal
condition of the state precludes relocating BOE's
headquarters or field offices for the foreseeable future.
Permanently relocating the BOE headquarters would result in
costs exceeding $100 million. Furthermore, this bill would
complicate the sale of bonds to retire the existing Pooled
Money Investment Board loan on the property, resulting in
additional costs to the state.
Lastly, this bill would unacceptably remove all
Administration oversight from BOE's real estate
transactions, and would require BOE to develop and maintain
a separate competency in that field. Those activities
would redirect resources and focus from BOE's core mission
as a revenue agency.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
Unknown with latest amendments.
SUPPORT : (Verified 8/25/14)
Board of Equalization (source)
Jerome Horton, Chairman, Board of Equalization
California Taxpayers Association
Cities of Elk Grove and Sacramento
SEIU Local 1000
ARGUMENTS IN SUPPORT : According to the author's office, this
bill allows the state to address the infrastructure issues of
other buildings in the Capitol area in a way that addresses the
most urgent issues first, including the BOE.
ASSEMBLY FLOOR : 79-0, 5/29/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
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Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Ch�vez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon,
Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger Hern�ndez,
Holden, Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,
Nazarian, Nestande, Olsen, Pan, Patterson, Perea, John A.
P�rez, V. Manuel P�rez, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,
Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Vacancy
MW:nl 8/25/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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