BILL ANALYSIS �
AB 1793
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1793 (Chau)
As Amended June 17, 2014
Majority vote
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|ASSEMBLY: | |(May 27, 2014) |SENATE: |32-0 |(August 19, 2014) |
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(vote not relevant)
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|COMMITTEE VOTE: |7-0 |(August 27, 2014) |RECOMMENDATION: |concur |
|(H. & C.D.) | | | | |
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Original Committee Reference: H. & C.D.
SUMMARY : Requires a housing successor to include in its annual
report an inventory of homeownership units assisted by the housing
successor or the former redevelopment agency (RDA) that are subject
to covenants, restrictions, or an adopted program.
The Senate amendments delete the Assembly version of this bill, and
instead require a housing successor to include the following
information, regarding homeownership units assisted by the housing
successor or the former RDA that are subject to covenants,
restrictions, or an adopted program, in the existing annual report:
1)The number of such units;
2)In the first report required by this bill, the number of units
lost to the portfolio since February 1, 2012, and the reason for
these losses. For all subsequent reports, the number of units
lost to the portfolio in the last fiscal year and the reason for
these losses;
3)Any funds returned to the housing successor as part of an equity
sharing or similar program; and
4)Whether the housing successor has contracted with any entity for
the management of the units and, if so, the name of the entity.
FISCAL EFFECT : According to the Senate Appropriations Committee,
pursuant to Senate Rule 28.8, this bill has negligible state costs.
AB 1793
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COMMENTS :
Background: In 2011, as a result of serious budget shortfalls, the
Governor proposed eliminating RDAs and creating a Voluntary
Alternative Redevelopment Program (VARP) to replace them. Two
pieces of budget trailer legislation, AB 26 X1 (Blumenfield),
Chapter 5, Statutes of 2011-12 First Extraordinary Session, and AB
27 X1 (Blumenfield), Chapter 6, Statutes of 2011-12 First
Extraordinary Session, were enacted to achieve this goal. AB 26
X1provided for the dissolution of RDAs and for the winding up of
their obligations by successor agencies. AB 27 X1 established
VARP, which would have allowed RDAs to continue operations if their
local city or county made voluntary annual payments benefitting
schools, for the purpose of offsetting state education costs. In
CRA v. Matosantos (2011), the California Supreme Court upheld the
constitutionality of AB 26 X1, but invalidated AB 27 X1. This had
the effect of dissolving RDAs without giving them the option of
continuing operations by offsetting state education costs.
When RDAs were dissolved, successor agencies were established to
wind up the RDAs' obligations. Successor agencies were required to
effectuate the transfer of an RDA's housing functions and assets to
a "housing successor." Cities and counties were given the option
of acting as housing successors and taking over the housing assets
of their jurisdiction's RDA. If they did not wish to take on this
role, the local housing authority was required to act as housing
successor. If there was no local housing authority, the Department
of Housing and Community Development was required to act as housing
successor.
SB 341 (DeSaulnier), Chapter 796, Statutes of 2013, updated
redevelopment laws to revise the rules governing the activities and
expenditures of housing successors to reflect the new situation.
Among other things, SB 341 required housing successors to report
various items of information annually.
Purpose of the bill: RDAs produced tens of thousands of below
market rate (BMR) homeownership units. BMR units are affordable
due to deed restrictions or equity-sharing agreements that must be
monitored and enforced to recapture or retain affordability.
Housing successors to RDAs are currently tasked with enforcing the
affordability deed restrictions on BMR homeownership units.
According to a recent survey of housing successors, a majority of
AB 1793
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responding agencies lost a significant amount of their designated
funding for managing these units, and have laid off over half of
their staff responsible for managing or monitoring affordable
housing programs. One-third of responding agencies have seen
affordable housing lost to foreclosure since the elimination of
RDAs, and two-thirds expect it to happen. This bill requires a
housing successor to include in its annual report an inventory of
homeownership units assisted by the former RDA or the housing
successor that are subject to covenants or restrictions or to an
adopted program that protects the former RDA's investment of moneys
from the Low- and Moderate- Income Housing Fund. In doing so, this
bill seeks to gather better data on the problem so that the
Legislature and stakeholders can develop effective responses.
This bill was substantially amended in the Senate and the
Assembly-approved version of this bill was deleted.
Analysis Prepared by : Rebecca Rabovsky / H. & C.D. / (916)
319-2085
FN: 0005539