Amended in Assembly August 20, 2014

Amended in Senate May 27, 2014

Amended in Senate April 22, 2014

Senate Bill No. 1129

Introduced by Senator Steinberg

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(Principal coauthor: Senator Corbett)

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(Principal coauthors: Senators Corbett and Liu)

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(Principal coauthor: Assembly Member Gatto)

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February 19, 2014

An act to amend Sections 33130, 34167.5, 34171, 34177, 34177.5, begin delete 34178.8 end delete begin insert 34179 end insert , 34180, begin delete 34191.3, end delete 34191.4, and 34191.5 of the Health and Safety Code, relating to redevelopment.

LEGISLATIVE COUNSEL’S DIGEST

SB 1129, as amended, Steinberg. Redevelopment: successor agencies to redevelopment agencies.

(1) Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to wind down the affairs of the dissolved redevelopment agencies, subject to review by oversight boards, and to, among other things, make payments due for enforceable obligations and to perform obligations required pursuant to any enforceable obligation. Existing law requires the Department of Finance to issue a finding of completion to a successor agency upon confirmation by the county auditor-controller that specified payments have been fully made by the successor agency. Existing law prohibits a successor agency from entering into contracts with, incurring obligations or making commitments to, any entity, as specified; or from amending or modifying existing agreements, obligations, or commitments with any entity, for any purpose. Existing law defines “enforceable obligation” for these purposes to generally exclude any agreements, contracts, or arrangements between the city, county, or city and county that created the redevelopment agency and the former redevelopment agency.

This bill would authorize a successor agency, if the successor agency has received a finding of completion, to enter into, or amend existing, contracts and agreements, or otherwise administer projects in connection with enforceable obligations, if the contract, agreement, or project will not commit new property tax funds or otherwise adversely affect the flow of specified tax revenues or payments to the taxing agencies, as specified. begin delete This bill would authorize a successor agency, if it has received a finding of completion, to utilize the proceeds of bonds issued during the 2011 calendar year, upon the approval of the oversight board, if the board, in consultation with the relevant metropolitan planning organization determines that the use of the bond proceeds is consistent with the sustainable communities strategy adopted under law by the metropolitan planning organization. end delete

The bill would specifically include within the definition of “enforceable obligation” an agreement entered into begin delete between end delete begin insert by end insert the redevelopment agency prior to June 30, 2011, if the agreement relates to state highway infrastructure improvements to which the redevelopment agency committed funds pursuant to specified law.

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(2) Existing law requires that loan agreements entered into between the redevelopment agency and the city, county, or city and county that created the redevelopment agency be deemed enforceable obligations if the oversight board makes a specific finding. Existing law requires that, if the loan is an enforceable obligation, the accumulated interest on the remaining principal amount of the loan be recalculated from origination at that interest rate earned by funds deposited into the Local Agency Investment Fund and requires the loan to be repaid in accordance with a defined schedule at an interest rate not to exceed that interest rate.

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This bill would revise those provisions to provide that any accumulated interest on the remaining principal balance of the loan be recalculated from origination using the interest rate earned by funds deposited into the Local Agency Investment Fund in effect on the date of loan origination, and as adjusted quarterly thereafter and that the remaining balance of the loan and the accumulated interest be repaid in accordance with a defined schedule at an interest rate not to exceed that interest rate as the rate is adjusted on a quarterly basis. This bill would state the Legislature’s intent that these revisions be clarifying.

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(2)

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begin insert (3) end insert  Existing law requires a successor agency to prepare a recognized obligation payment schedule, which sets forth the minimum payment amounts and due dates of payments required by enforceable obligations for each begin delete six-month end delete begin insert 6-month end insert fiscal period, that is required to be submitted to, and approved by, the oversight board, and submitted to other entities, including the Department of Finance. Existing law requires the Department of Finance to make its determination of the enforceable obligations and the amounts and funding sources of the enforceable obligations no later than 45 days after the Recognized Obligation Payment Schedule is submitted.

This bill would require the rejection of an enforceable obligation from a recognized obligation payment schedule for a successor agency that has received a finding of completion from the department to be submitted to the oversight board for review and approval, and would provide that the determination of the oversight board is final and conclusive without further review by the department.

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(3)

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begin insert (4) end insert  Existing law provides that, if an enforceable obligation provides for an irrevocable commitment of property tax revenue and the allocation of those revenues is expected to occur over time, the successor agency may petition the Department of Finance to provide written confirmation that its determination of the enforceable obligation as approved in a Recognized Obligation Payment Schedule is final and conclusive, and reflects the department’s approval of subsequent payments made pursuant to the enforceable obligation.

This bill would require the Department of Finance to provide that written confirmation within 45 days.

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(4)

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begin insert (5) end insert  Existing law requires a city, county, or city and county that wishes to retain any properties or other assets for future redevelopment activities, funded from its own funds and under its own auspices, to reach a compensation agreement with the other taxing entities to provide payments to them in proportion to their shares of the base property tax for the value of the property retained, as specified.

This bill would specify that these provisions do not apply to the disposition of properties pursuant to a long-range property management plan.

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(5)

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begin insert (6) end insert  Existing law requires the disposition of assets and properties of the former redevelopment agency as directed by the oversight board, as specified, and suspends these requirements until the Department of Finance has approved a long-range property management plan, as specified. Upon approval of a long-range property management plan, the plan governs and supersedes, all other provisions relating to the disposition and use of the real property assets of the former redevelopment agency. Existing law requires the property of a former redevelopment agency to be disposed of according to law if the department has not approved a long-range property management plan by January 1, begin delete 2015 end delete begin insert 2016 end insert .

This bill would prohibit the department from requiring compensation agreements as part of the approval of a long-range property management plan and would specify the criteria the department may consider in approving a long-range property management plan. The bill would begin delete additionally delete the requirement that the department approve a plan by January 1, 2015, and instead end delete require the department to approve long-range property management plans as expeditiously as possible. This bill would also provide that actions relating to the disposition of property after approval of a long-range property management plan do not require review by the department.

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(6)

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begin insert (7) end insert  Existing law requires the Controller to review the activities of redevelopment agencies in the state to determine whether an asset transfer has occurred after January 1, 2011, between the city or county, or city and county that created a redevelopment agency or any other public agency, and the redevelopment agency.

This bill would require the review to be completed no later than January 1, 2016.

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(7) Existing law requires the Controller to review the activities of successor agencies in the state to determine if an asset transfer has occurred after January 31, 2012, between the successor agency and the city, county, or city and county that created a redevelopment agency, or any other public agency, that was not made pursuant to an enforceable obligation on an approved and valid recognized obligation payment schedule.

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This bill would require the review to be completed no later than January 1, 2016.

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(8) Existing law prohibits an agency or community officer or employee who is required to participate in the formulation of, or to approve plans or policies for, the redevelopment of a project area from acquiring any interest in any property included within a project area within the community.

This bill would provide that an agency or community officer or employee is not prohibited from acquiring an interest in property within a former redevelopment project area of a dissolved redevelopment agency, as specified.

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(9) Existing law requires each successor agency to have an oversight board composed of 7 members and requires each member to be appointed by a specified authority.

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This bill would allow each appointing authority to appoint an alternate representative to serve on the oversight board as may be necessary. This bill would provide that the alternative representative has the same participatory and voting rights as all other attending members of the oversight board, and would require the successor agency to promptly notify the Department of Finance regarding the appointment of any alternate representative.

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(10) This bill would incorporate additional changes to Section 34177 of the Health and Safety Code proposed by AB 1582 that would become operative only if this bill and AB 1582 are both chaptered and this bill is chaptered last.

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(11) This bill would incorporate additional changes to Section 34180 of the Health and Safety Code proposed by SB 1404 that would become operative only if this bill and SB 1404 are both chaptered and this bill is chaptered last.

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(12) This bill would incorporate additional changes to Section 34191.4 of the Health and Safety Code proposed by AB 2493 that would become operative only if this bill and AB 2493 are both chaptered and this bill is chaptered last.

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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 33130 of the Health and Safety Code is
amended to read:

33130.  

(a) No agency or community officer or employee who
in the course of his or her duties is required to participate in the
formulation of, or to approve plans or policies for, the
redevelopment of a project area shall acquire any interest in any
property included within a project area within the community. If
any such officer or employee owns or has any direct or indirect
financial interest in property included within a project area, that
officer or employee shall immediately make a written disclosure
of that financial interest to the agency and the legislative body and
the disclosure shall be entered on the minutes of the agency and
the legislative body. Failure to make the disclosure required by
this subdivision constitutes misconduct in office.

(b) Subdivision (a) does not prohibit any agency or community
officer or employee from acquiring an interest in property within
a former redevelopment project area of a redevelopment agency
dissolved pursuant to Part 1.85 (commencing with Section 34170).

(c) Subdivision (a) does not prohibit any agency or community
officer or employee from acquiring an interest in property within
the project area for the purpose of participating as an owner or
reentering into business pursuant to this part if that officer or
employee has owned a substantially equal interest as that being
acquired for the three years immediately preceding the selection
of the project area.

(d) A rental agreement or lease of property which meets all of
the following conditions is not an interest in property for purposes
of subdivision (a):

(1) The rental or lease agreement contains terms that are
substantially equivalent to the terms of a rental or lease agreement
available to any member of the general public for comparable
property in the project area.

(2) The rental or lease agreement includes a provision which
prohibits any subletting, sublease, or other assignment at a rate in
excess of the rate in the original rental or lease agreement.

(3) The property which is subject to the rental or lease agreement
is used in the pursuit of the principal business, occupation, or
profession of the officer or employee.

(4) The agency or community officer or employee who obtains
the rental or lease agreement immediately makes a written
disclosure of that fact to the agency and the legislative body.

SEC. 2.  

Section 34167.5 of the Health and Safety Code is
amended to read:

34167.5.  

Commencing on the effective date of the act adding
this part, the Controller shall review the activities of redevelopment
agencies in the state to determine whether an asset transfer has
occurred after January 1, 2011, between the city or county, or city
and county that created a redevelopment agency or any other public
agency, and the redevelopment agency. The review required by
this section shall be completed no later than January 1, 2016. If
such an asset transfer did occur during that period and the
government agency that received the assets is not contractually
committed to a third party for the expenditure or encumbrance of
those assets, to the extent not prohibited by state and federal law,
the Controller shall order the available assets to be returned to the
redevelopment agency or, on or after October 1, 2011, to the
successor agency, if a successor agency is established pursuant to
Part 1.85 (commencing with Section 34170). Upon receiving that
order from the Controller, an affected local agency shall, as soon
as practicable, reverse the transfer and return the applicable assets
to the redevelopment agency or, on or after October 1, 2011, to
the successor agency, if a successor agency is established pursuant
to Part 1.85 (commencing with Section 34170). The Legislature
hereby finds that a transfer of assets by a redevelopment agency
during the period covered in this section is deemed not to be in
the furtherance of the Community Redevelopment Law and is
thereby unauthorized.

SEC. 3.  

Section 34171 of the Health and Safety Code is
amended to read:

34171.  

The following terms shall have the following meanings:

(a) “Administrative budget” means the budget for administrative
costs of the successor agencies as provided in Section 34177.

(b) “Administrative cost allowance” means an amount that,
subject to the approval of the oversight board, is payable from
property tax revenues of up to 5 percent of the property tax
allocated to the successor agency on the Recognized Obligation
Payment Schedule covering the period January 1, 2012, through
June 30, 2012, and up to 3 percent of the property tax allocated to
the Redevelopment Obligation Retirement Fund money that is
allocated to the successor agency for each fiscal year thereafter;
provided, however, that the amount shall not be less than two
hundred fifty thousand dollars ($250,000), unless the oversight
board reduces this amount, for any fiscal year or such lesser amount
as agreed to by the successor agency. However, the allowance
amount shall exclude, and shall not apply to, any administrative
costs that can be paid from bond proceeds or from sources other
than property tax. Administrative cost allowances shall exclude
any litigation expenses related to assets or obligations, settlements
and judgments, and the costs of maintaining assets prior to
disposition. Employee costs associated with work on specific
project implementation activities, including, but not limited to,
construction inspection, project management, or actual
construction, shall be considered project-specific costs and shall
not constitute administrative costs.

(c) “Designated local authority” shall mean a public entity
formed pursuant to subdivision (d) of Section 34173.

(d) (1) “Enforceable obligation” means any of the following:

(A) Bonds, as defined by Section 33602 and bonds issued
pursuant to Chapter 10.5 (commencing with Section 5850) of
Division 6 of Title 1 of the Government Code, including the
required debt service, reserve set-asides, and any other payments
required under the indenture or similar documents governing the
issuance of the outstanding bonds of the former redevelopment
agency. A reserve may be held when required by the bond
indenture or when the next property tax allocation will be
insufficient to pay all obligations due under the provisions of the
bond for the next payment due in the following half of the calendar
year.

(B) Loans of moneys borrowed by the redevelopment agency
for a lawful purpose, to the extent they are legally required to be
repaid pursuant to a required repayment schedule or other
mandatory loan terms.

(C) Payments required by the federal government, preexisting
obligations to the state or obligations imposed by state law, other
than passthrough payments that are made by the county
auditor-controller pursuant to Section 34183, or legally enforceable
payments required in connection with the agencies’ employees,
including, but not limited to, pension payments, pension obligation
debt service, unemployment payments, or other obligations
conferred through a collective bargaining agreement. Costs incurred
to fulfill collective bargaining agreements for layoffs or
terminations of city employees who performed work directly on
behalf of the former redevelopment agency shall be considered
enforceable obligations payable from property tax funds. The
obligations to employees specified in this subparagraph shall
remain enforceable obligations payable from property tax funds
for any employee to whom those obligations apply if that employee
is transferred to the entity assuming the housing functions of the
former redevelopment agency pursuant to Section 34176. The
successor agency or designated local authority shall enter into an
agreement with the housing entity to reimburse it for any costs of
the employee obligations.

(D) Judgments or settlements entered by a competent court of
law or binding arbitration decisions against the former
redevelopment agency, other than passthrough payments that are
made by the county auditor-controller pursuant to Section 34183.
Along with the successor agency, the oversight board shall have
the authority and standing to appeal any judgment or to set aside
any settlement or arbitration decision.

(E) Any legally binding and enforceable agreement or contract
that is not otherwise void as violating the debt limit or public
policy. However, nothing in this act shall prohibit either the
successor agency, with the approval or at the direction of the
oversight board, or the oversight board itself from terminating any
existing agreements or contracts and providing any necessary and
required compensation or remediation for such termination. Titles
of or headings used on or in a document shall not be relevant in
determining the existence of an enforceable obligation.

(F) Contracts or agreements necessary for the administration or
operation of the successor agency, in accordance with this part,
including, but not limited to, agreements concerning litigation
expenses related to assets or obligations, settlements and
judgments, and the costs of maintaining assets prior to disposition,
and agreements to purchase or rent office space, equipment and
supplies, and pay-related expenses pursuant to Section 33127 and
for carrying insurance pursuant to Section 33134.

(G) Amounts borrowed from, or payments owing to, the Low
and Moderate Income Housing Fund of a redevelopment agency,
which had been deferred as of the effective date of the act adding
this part; provided, however, that the repayment schedule is
approved by the oversight board. Repayments shall be transferred
to the Low and Moderate Income Housing Asset Fund established
pursuant to subdivision (d) of Section 34176 as a housing asset
and shall be used in a manner consistent with the affordable
housing requirements of the Community Redevelopment Law (Part
1 (commencing with Section 33000)).

(2) For purposes of this part, “enforceable obligation” does not
include any agreements, contracts, or arrangements between the
city, county, or city and county that created the redevelopment
agency and the former redevelopment agency. However, written
agreements entered into (A) at the time of issuance, but in no event
later than December 31, 2010, of indebtedness obligations, and
(B) solely for the purpose of securing or repaying those
indebtedness obligations may be deemed enforceable obligations
for purposes of this part. Notwithstanding this paragraph, loan
agreements entered into between the redevelopment agency and
the city, county, or city and county that created it, within two years
of the date of creation of the redevelopment agency, may be
deemed to be enforceable obligations. Notwithstanding this
paragraph, an agreement entered into begin delete between end delete begin insert by end insert the redevelopment
agency prior to June 30, 2011, is an enforceable obligation if the
agreement relates to state highway infrastructure improvements
to which the redevelopment agency committed funds pursuant to
Section 33445.

(3) Contracts or agreements between the former redevelopment
agency and other public agencies, to perform services or provide
funding for governmental or private services or capital projects
outside of redevelopment project areas that do not provide benefit
to the redevelopment project and thus were not properly authorized
under Part 1 (commencing with Section 33000) shall be deemed
void on the effective date of this part; provided, however, that such
contracts or agreements for the provision of housing properly
authorized under Part 1 (commencing with Section 33000) shall
not be deemed void.

(e) “Indebtedness obligations” means bonds, notes, certificates
of participation, or other evidence of indebtedness, issued or
delivered by the redevelopment agency, or by a joint exercise of
powers authority created by the redevelopment agency, to
third-party investors or bondholders to finance or refinance
redevelopment projects undertaken by the redevelopment agency
in compliance with the Community Redevelopment Law (Part 1
(commencing with Section 33000)).

(f) “Oversight board” shall mean each entity established pursuant
to Section 34179.

(g) “Recognized obligation” means an obligation listed in the
Recognized Obligation Payment Schedule.

(h) “Recognized Obligation Payment Schedule” means the
document setting forth the minimum payment amounts and due
dates of payments required by enforceable obligations for each
six-month fiscal period as provided in subdivision (m) of Section
34177.

(i) “School entity” means any entity defined as such in
subdivision (f) of Section 95 of the Revenue and Taxation Code.

(j) “Successor agency” means the successor entity to the former
redevelopment agency as described in Section 34173.

(k) “Taxing entities” means cities, counties, a city and county,
special districts, and school entities, as defined in subdivision (f)
of Section 95 of the Revenue and Taxation Code, that receive
passthrough payments and distributions of property taxes pursuant
to the provisions of this part.

(l) “Property taxes” include all property tax revenues, including
those from unitary and supplemental and roll corrections applicable
to tax increment.

(m) “Department” means the Department of Finance unless the
context clearly refers to another state agency.

(n) “Sponsoring entity” means the city, county, or city and
county, or other entity that authorized the creation of each
redevelopment agency.

(o) “Final judicial determination” means a final judicial
determination made by any state court that is not appealed, or by
a court of appellate jurisdiction that is not further appealed, in an
action by any party.

(p) From July 1, 2014, to July 1, 2018, inclusive, “housing entity
administrative cost allowance” means an amount of up to 1 percent
of the property tax allocated to the Redevelopment Obligation
Retirement Fund on behalf of the successor agency for each
applicable fiscal year, but not less than one hundred fifty thousand
dollars ($150,000) per fiscal year.

(1) If a local housing authority assumed the housing functions
of the former redevelopment agency pursuant to paragraph (2) or
(3) of subdivision (b) of Section 34176, then the housing entity
administrative cost allowance shall be listed by the successor
agency on the Recognized Obligation Payment Schedule. Upon
approval of the Recognized Obligation Payment Schedule by the
oversight board and the department, the housing entity
administrative cost allowance shall be remitted by the successor
agency on each January 2 and July 1 to the local housing authority
that assumed the housing functions of the former redevelopment
agency pursuant to paragraph (2) or (3) of subdivision (b) of
Section 34176.

(2) If there are insufficient moneys in the Redevelopment
Obligations Retirement Fund in a given fiscal year to make the
payment authorized by this subdivision, the unfunded amount may
be listed on each subsequent Recognized Obligation Payment
Schedule until it has been paid in full. In these cases the five-year
time limit on the payments shall not apply.

SEC. 4.  

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 (d) 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. In recognition
of the fact that the timing of the California Supreme Court’s ruling
in the case California Redevelopment Association v. Matosantos
(2011) 53 Cal.4th 231 delayed the preparation by successor
agencies and the approval by oversight boards of the January 1,
2012, through June 30, 2012, Recognized Obligation Payment
Schedule, a successor agency may amend the Enforceable
Obligation Payment Schedule to authorize the continued payment
of enforceable obligations until the time that the January 1, 2012,
through June 30, 2012, Recognized Obligation Payment Schedule
has been approved by the oversight board and by the Department
of Finance. The successor agency may utilize reasonable estimates
and projections to support payment amounts for enforceable
obligations if the successor agency submits appropriate supporting
documentation of the basis for the estimate or projection to the
Department of Finance and the auditor-controller.

(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 the date the Recognized Obligation Payment
Schedule is valid pursuant to subdivision (l), 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, after it
becomes valid, 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 (Part 1 (commencing with Section 33000)).

(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) 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. The requirements of this subdivision shall
not apply to a successor agency that has been issued a finding of
completion by the Department of Finance pursuant to Section
34179.7.

(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 Recognized Obligation Payment Schedule is prepared
by the successor agency for the enforceable obligations of the
former redevelopment agency. The initial 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 the begin delete a end delete redevelopment agency not been
dissolved.

(B) The Recognized Obligation Payment Schedule is submitted
to and duly approved by the oversight board. The successor agency
shall submit a copy of the Recognized Obligation Payment
Schedule to the county administrative officer, the county
auditor-controller, and the Department of Finance at the same time
that the successor agency submits the Recognized Obligation
Payment Schedule to the oversight board for approval.

(C) A copy of the approved Recognized Obligation Payment
Schedule is submitted to the county auditor-controller, the
Controller’s office, and the Department of Finance, and is 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. This
Recognized Obligation Payment Schedule shall include all
payments made by the former redevelopment agency between
January 1, 2012, through January 31, 2012, and shall include all
payments proposed to be made by the successor agency from
February 1, 2012, through June 30, 2012. 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.

(m) The Recognized Obligation Payment Schedule for the period
of January 1, 2013, to June 30, 2013, shall be submitted by the
successor agency, after approval by the oversight board, no later
than September 1, 2012. Commencing with the Recognized
Obligation Payment Schedule covering the period July 1, 2013,
through December 31, 2013, successor agencies shall submit an
oversight board-approved Recognized Obligation Payment
Schedule to the Department of Finance and to the county
auditor-controller no fewer than 90 days before the date of property
tax distribution. The Department of Finance shall make its
determination of the enforceable obligations and the amounts and
funding sources of the enforceable obligations no later than 45
days after the Recognized Obligation Payment Schedule is
submitted. Within five business days of the department’s
determination, a successor agency may request additional review
by the department and an opportunity to meet and confer on
disputed items. The meet and confer period may vary; an untimely
submittal of a Recognized Obligation Payment Schedule may result
in a meet and confer period of less than 30 days. The department
shall notify the successor agency and the county auditor-controllers
as to the outcome of its review at least 15 days before the date of
property tax distribution.

(1) The successor agency shall submit a copy of the Recognized
Obligation Payment Schedule to the Department of Finance
electronically, and the successor agency shall complete the
Recognized Obligation Payment Schedule in the manner provided
for by the department. A successor agency shall be in
noncompliance with this paragraph if it only submits to the
department an electronic message or a letter stating that the
oversight board has approved a Recognized Obligation Payment
Schedule.

(2) If a successor agency does not submit a Recognized
Obligation Payment Schedule by the deadlines provided in this
subdivision, the city, county, or city and county that created the
redevelopment agency shall be subject to a civil penalty equal to
ten thousand dollars ($10,000) per day for every day the schedule
is not submitted to the department. The civil penalty shall be paid
to the county auditor-controller for allocation to the taxing entities
under Section 34183. If a successor agency fails to submit a
Recognized Obligation Payment Schedule by the deadline, any
creditor of the successor agency or the Department of Finance or
any affected taxing entity shall have standing to and may request
a writ of mandate to require the successor agency to immediately
perform this duty. Those actions may be filed only in the County
of Sacramento and shall have priority over other civil matters.
Additionally, if an agency does not submit a Recognized Obligation
Payment Schedule within 10 days of the deadline, the maximum
administrative cost allowance for that period shall be reduced by
25 percent.

(3) If a successor agency fails to submit to the department an
oversight board-approved Recognized Obligation Payment
Schedule that complies with all requirements of this subdivision
within five business days of the date upon which the Recognized
Obligation Payment Schedule is to be used to determine the amount
of property tax allocations, the department may determine if any
amount should be withheld by the county auditor-controller for
payments for enforceable obligations from distribution to taxing
entities, pending approval of a Recognized Obligation Payment
Schedule. The county auditor-controller shall distribute the portion
of any of the sums withheld pursuant to this paragraph to the
affected taxing entities in accordance with paragraph (4) of
subdivision (a) of Section 34183 upon notice by the department
that a portion of the withheld balances are in excess of the amount
of enforceable obligations. The county auditor-controller shall
distribute withheld funds to the successor agency only in
accordance with a Recognized Obligation Payment Schedule
approved by the department. County auditor-controllers shall lack
the authority to withhold any other amounts from the allocations
provided for under Section 34183 or 34188 unless required by a
court order.

(4) (A) The Recognized Obligation Payment Schedule payments
required pursuant to this subdivision may be scheduled beyond
the existing Recognized Obligation Payment Schedule cycle upon
a showing that a lender requires cash on hand beyond the
Recognized Obligation Payment Schedule cycle.

(B) When a payment is shown to be due during the Recognized
Obligation Payment Schedule period, but an invoice or other billing
document has not yet been received, the successor agency may
utilize reasonable estimates and projections to support payment
amounts for enforceable obligations if the successor agency submits
appropriate supporting documentation of the basis for the estimate
or projection to the department and the auditor-controller.

(C) A Recognized Obligation Payment Schedule may also
include appropriation of moneys from bonds subject to passage
during the Recognized Obligation Payment Schedule cycle when
an enforceable obligation requires the agency to issue the bonds
and use the proceeds to pay for project expenditures.

(5) Prior to the rejection of an enforceable obligation from a
recognized obligation payment schedule for a successor agency
that has received a finding of completion from the Department of
Finance under Section 34179.7, the Department of Finance shall
submit the proposed rejection to the oversight board for review
and approval, whose determination shall be final and conclusive
without further review by the Department of Finance.

(n) Cause a postaudit of the financial transactions and records
of the successor agency to be made at least annually by a certified
public accountant.

begin insert

begin insert SEC. 4.5. end insert   

end insert

begin insert Section 34177 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

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 (d) 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. In recognition
of the fact that the timing of the California Supreme Court’s ruling
in the case California Redevelopment Association v. Matosantos
(2011) 53 Cal.4th 231 delayed the preparation by successor
agencies and the approval by oversight boards of the January 1,
2012, through June 30, 2012, Recognized Obligation Payment
Schedule, a successor agency may amend the Enforceable
Obligation Payment Schedule to authorize the continued payment
of enforceable obligations until the time that the January 1, 2012,
through June 30, 2012, Recognized Obligation Payment Schedule
has been approved by the oversight board and by the Department
of Finance. The successor agency may utilize reasonable estimates
and projections to support payment amounts for enforceable
obligations if the successor agency submits appropriate supporting
documentation of the basis for the estimate or projection to the
Department of Finance and the auditor-controller.

(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 the date the Recognized Obligation Payment
Schedule is valid pursuant to subdivision (l), 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, after it
becomes valid, 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 (Part 1 (commencing with Section 33000)).

(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) 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. The requirements of this subdivision shall
not apply to a successor agency that has been issued a finding of
completion by the Department of Finance pursuant to Section
34179.7.

(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 Recognized Obligation Payment Schedule is prepared
by the successor agency for the enforceable obligations of the
former redevelopment agency. The initial 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 the a redevelopment agency not been
dissolved.

(B) The Recognized Obligation Payment Schedule is submitted
to and duly approved by the oversight board. The successor agency
shall submit a copy of the Recognized Obligation Payment
Schedule to the county administrative officer, the county
auditor-controller, and the Department of Finance at the same time
that the successor agency submits the Recognized Obligation
Payment Schedule to the oversight board for approval.

(C) A copy of the approved Recognized Obligation Payment
Schedule is submitted to the county auditor-controller, the
Controller’s office, and the Department of Finance, and is 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. This
Recognized Obligation Payment Schedule shall include all
payments made by the former redevelopment agency between
January 1, 2012, through January 31, 2012, and shall include all
payments proposed to be made by the successor agency from
February 1, 2012, through June 30, 2012. 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.

(m) The Recognized Obligation Payment Schedule for the period
of January 1, 2013, to June 30, 2013, shall be submitted by the
successor agency, after approval by the oversight board, no later
than September 1, 2012. Commencing with the Recognized
Obligation Payment Schedule covering the period July 1, 2013,
through December 31, 2013, successor agencies shall submit an
oversight board-approved Recognized Obligation Payment
Schedule to the Department of Finance and to the county
auditor-controller no fewer than 90 days before the date of property
tax distribution. The Department of Finance shall make its
determination of the enforceable obligations and the amounts and
funding sources of the enforceable obligations no later than 45
days after the Recognized Obligation Payment Schedule is
submitted. Within five business days of the department’s
determination, a successor agency may request additional review
by the department and an opportunity to meet and confer on
disputed items. The meet and confer period may vary; an untimely
submittal of a Recognized Obligation Payment Schedule may result
in a meet and confer period of less than 30 days. The department
shall notify the successor agency and the county auditor-controllers
as to the outcome of its review at least 15 days before the date of
property tax distribution.

(1) The successor agency shall submit a copy of the Recognized
Obligation Payment Schedule to the Department of Finance
electronically, and the successor agency shall complete the
Recognized Obligation Payment Schedule in the manner provided
for by the department. A successor agency shall be in
noncompliance with this paragraph if it only submits to the
department an electronic message or a letter stating that the
oversight board has approved a Recognized Obligation Payment
Schedule.

(2) If a successor agency does not submit a Recognized
Obligation Payment Schedule by the deadlines provided in this
subdivision, the city, county, or city and county that created the
redevelopment agency shall be subject to a civil penalty equal to
ten thousand dollars ($10,000) per day for every day the schedule
is not submitted to the department. The civil penalty shall be paid
to the county auditor-controller for allocation to the taxing entities
under Section 34183. If a successor agency fails to submit a
Recognized Obligation Payment Schedule by the deadline, any
creditor of the successor agency or the Department of Finance or
any affected taxing entity shall have standing to and may request
a writ of mandate to require the successor agency to immediately
perform this duty. Those actions may be filed only in the County
of Sacramento and shall have priority over other civil matters.
Additionally, if an agency does not submit a Recognized Obligation
Payment Schedule within 10 days of the deadline, the maximum
administrative cost allowance for that period shall be reduced by
25 percent.

(3) If a successor agency fails to submit to the department an
oversight board-approved Recognized Obligation Payment
Schedule that complies with all requirements of this subdivision
within five business days of the date upon which the Recognized
Obligation Payment Schedule is to be used to determine the amount
of property tax allocations, the department may determine if any
amount should be withheld by the county auditor-controller for
payments for enforceable obligations from distribution to taxing
entities, pending approval of a Recognized Obligation Payment
Schedule. The county auditor-controller shall distribute the portion
of any of the sums withheld pursuant to this paragraph to the
affected taxing entities in accordance with paragraph (4) of
subdivision (a) of Section 34183 upon notice by the department
that a portion of the withheld balances are in excess of the amount
of enforceable obligations. The county auditor-controller shall
distribute withheld funds to the successor agency only in
accordance with a Recognized Obligation Payment Schedule
approved by the department. County auditor-controllers shall lack
the authority to withhold any other amounts from the allocations
provided for under Section 34183 or 34188 unless required by a
court order.

(4) (A) The Recognized Obligation Payment Schedule payments
required pursuant to this subdivision may be scheduled beyond
the existing Recognized Obligation Payment Schedule cycle upon
a showing that a lender requires cash on hand beyond the
Recognized Obligation Payment Schedule cycle.

(B) When a payment is shown to be due during the Recognized
Obligation Payment Schedule period, but an invoice or other billing
document has not yet been received, the successor agency may
utilize reasonable estimates and projections to support payment
amounts for enforceable obligations if the successor agency submits
appropriate supporting documentation of the basis for the estimate
or projection to the department and the auditor-controller.

(C) A Recognized Obligation Payment Schedule may also
include appropriation of moneys from bonds subject to passage
during the Recognized Obligation Payment Schedule cycle when
an enforceable obligation requires the agency to issue the bonds
and use the proceeds to pay for project expenditures.

begin insert

(5) Prior to the rejection of an enforceable obligation from a
recognized obligation payment schedule for a successor agency
that has received a finding of completion from the Department of
Finance under Section 34179.7, the Department of Finance shall
submit the proposed rejection to the oversight board for review
and approval, whose determination shall be final and conclusive
without further review by the Department of Finance.

end insert

(n) Cause a postaudit of the financial transactions and records
of the successor agency to be made at least annually by a certified
public accountant.

begin insert

(o) This section shall remain in effect only until July 1, 2016,
and as of that date is repealed.

end insert

begin insert

begin insert SEC. 4.7. end insert   

end insert

begin insert Section 34177 is added to the end insert begin insert Health and Safety
Code end insert begin insert , to read: end insert

begin insert

begin insert 34177. end insert   

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 (d) 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. In recognition of
the fact that the timing of the California Supreme Court’s ruling
in the case California Redevelopment Association v. Matosantos
(2011) 53 Cal.4th 231 delayed the preparation by successor
agencies and the approval by oversight boards of the January 1,
2012, through June 30, 2012, Recognized Obligation Payment
Schedule, a successor agency may amend the Enforceable
Obligation Payment Schedule to authorize the continued payment
of enforceable obligations until the time that the January 1, 2012,
through June 30, 2012, Recognized Obligation Payment Schedule
has been approved by the oversight board and by the Department
of Finance. The successor agency may utilize reasonable estimates
and projections to support payment amounts for enforceable
obligations if the successor agency submits appropriate supporting
documentation of the basis for the estimate or projection to the
Department of Finance and the auditor-controller.

(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 the date the Recognized Obligation Payment
Schedule is valid pursuant to subdivision (l), 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, after it
becomes valid, 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 (Part 1 (commencing with Section 33000)).

(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 the 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) 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. The requirements of
this subdivision shall not apply to a successor agency that has
been issued a finding of completion by the Department of Finance
pursuant to Section 34179.7.

(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 12-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 12-month fiscal period.

(l) (1) Before each 12-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 Recognized Obligation Payment Schedule is prepared by
the successor agency for the enforceable obligations of the former
redevelopment agency. The initial 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 the redevelopment agency not been
dissolved.

(B) The Recognized Obligation Payment Schedule is submitted
to and duly approved by the oversight board. The successor agency
shall submit a copy of the Recognized Obligation Payment
Schedule to the county administrative officer, the county
auditor-controller, and the Department of Finance at the same
time that the successor agency submits the Recognized Obligation
Payment Schedule to the oversight board for approval.

(C) A copy of the approved Recognized Obligation Payment
Schedule is submitted to the county auditor-controller, the
Controller’s office, and the Department of Finance, and is posted
on the successor agency’s Internet Web site.

(3) The Recognized Obligation Payment Schedule shall be
forward looking to the next 12-month fiscal period, for the first
12-month fiscal period commencing after January 1, 2016. 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. This Recognized Obligation Payment Schedule shall
include all payments made by the former redevelopment agency
between January 1, 2012, through January 31, 2012, and shall
include all payments proposed to be made by the successor agency
from February 1, 2012, through June 30, 2012. 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.

(4) The Recognized Obligation Payment Schedule may be
amended by the oversight board during a 12-month fiscal period
as long as the amendment is approved at least 90 days before the
date of the next property tax distribution.

(m) The Recognized Obligation Payment Schedule for the period
of January 1, 2013, to June 30, 2013, shall be submitted by the
successor agency, after approval by the oversight board, no later
than September 1, 2012. Commencing with the Recognized
Obligation Payment Schedule covering the period of July 1, 2013,
through December 31, 2013, successor agencies shall submit an
oversight board-approved Recognized Obligation Payment
Schedule to the Department of Finance and to the county
auditor-controller no fewer than 90 days before the date of
property tax distribution. The Department of Finance shall make
its determination of the enforceable obligations and the amounts
and funding sources of the enforceable obligations no later than
45 days after the Recognized Obligation Payment Schedule is
submitted. Within five business days of the department’s
determination, a successor agency may request additional review
by the department and an opportunity to meet and confer on
disputed items. The meet and confer period may vary; an untimely
submittal of a Recognized Obligation Payment Schedule may result
in a meet and confer period of less than 30 days. The department
shall notify the successor agency and the county auditor-controllers
as to the outcome of its review at least 15 days before the date of
property tax distribution.

(1) The successor agency shall submit a copy of the Recognized
Obligation Payment Schedule to the Department of Finance
electronically, and the successor agency shall complete the
Recognized Obligation Payment Schedule in the manner provided
for by the department. A successor agency shall be in
noncompliance with this paragraph if it only submits to the
department an electronic message or a letter stating that the
oversight board has approved a Recognized Obligation Payment
Schedule.

(2) If a successor agency does not submit a Recognized
Obligation Payment Schedule by the deadlines provided in this
subdivision, the city, county, or city and county that created the
redevelopment agency shall be subject to a civil penalty equal to
ten thousand dollars ($10,000) per day for every day the schedule
is not submitted to the department. The civil penalty shall be paid
to the county auditor-controller for allocation to the taxing entities
under Section 34183. If a successor agency fails to submit a
Recognized Obligation Payment Schedule by the deadline, any
creditor of the successor agency or the Department of Finance or
any affected taxing entity shall have standing to and may request
a writ of mandate to require the successor agency to immediately
perform this duty. Those actions may be filed only in the County
of Sacramento and shall have priority over other civil matters.
Additionally, if an agency does not submit a Recognized Obligation
Payment Schedule within 10 days of the deadline, the maximum
administrative cost allowance for that period shall be reduced by
25 percent.

(3) If a successor agency fails to submit to the department an
oversight board-approved Recognized Obligation Payment
Schedule that complies with all requirements of this subdivision
within five business days of the date upon which the Recognized
Obligation Payment Schedule is to be used to determine the amount
of property tax allocations, the department may determine if any
amount should be withheld by the county auditor-controller for
payments for enforceable obligations from distribution to taxing
entities, pending approval of a Recognized Obligation Payment
Schedule. The county auditor-controller shall distribute the portion
of any of the sums withheld pursuant to this paragraph to the
affected taxing entities in accordance with paragraph (4) of
subdivision (a) of Section 34183 upon notice by the department
that a portion of the withheld balances are in excess of the amount
of enforceable obligations. The county auditor-controller shall
distribute withheld funds to the successor agency only in
accordance with a Recognized Obligation Payment Schedule
approved by the department. County auditor-controllers shall lack
the authority to withhold any other amounts from the allocations
provided for under Section 34183 or 34188 unless required by a
court order.

(4) (A) The Recognized Obligation Payment Schedule payments
required pursuant to this subdivision may be scheduled beyond
the existing Recognized Obligation Payment Schedule cycle upon
a showing that a lender requires cash on hand beyond the
Recognized Obligation Payment Schedule cycle.

(B) When a payment is shown to be due during the Recognized
Obligation Payment Schedule period, but an invoice or other
billing document has not yet been received, the successor agency
may utilize reasonable estimates and projections to support
payment amounts for enforceable obligations if the successor
agency submits appropriate supporting documentation of the basis
for the estimate or projection to the department and the
auditor-controller.

(C) A Recognized Obligation Payment Schedule may also
include appropriation of moneys from bonds subject to passage
during the Recognized Obligation Payment Schedule cycle when
an enforceable obligation requires the agency to issue the bonds
and use the proceeds to pay for project expenditures.

(5) Prior to the rejection of an enforceable obligation from a
recognized obligation payment schedule for a successor agency
that has received a finding of completion from the Department of
Finance under Section 34179.7, the Department of Finance shall
submit the proposed rejection to the oversight board for review
and approval, whose determination shall be final and conclusive
without further review by the Department of Finance.

(n) Cause a postaudit of the financial transactions and records
of the successor agency to be made at least annually by a certified
public accountant.

(o) The 12-month fiscal period specified in subdivisions (j), (k),
and (l) shall correspond to the period from July 1 through June
30, inclusive, unless an oversight board and the Department of
Finance approve a successor agency’s request for the 12-month
fiscal period to correspond with a different fiscal year used by the
city, county, or city and county that created the former
redevelopment agency.

(p) This section shall not be construed to alter the semiannual
distribution of Redevelopment Property Tax Trust Fund payments
made in accordance with the projected payment schedule of the
approved Recognized Obligation Payment Schedule.

(q) This section shall become operative on January 1, 2016.

end insert

SEC. 5.  

Section 34177.5 of the Health and Safety Code is
amended to read:

34177.5.  

(a) In addition to the powers granted to each
successor agency, and notwithstanding anything in the act adding
this part, including, but not limited to, Sections 34162 and 34189,
a successor agency shall have the authority, rights, and powers of
the redevelopment agency to which it succeeded solely for the
following purposes:

(1) For the purpose of issuing bonds or incurring other
indebtedness to refund the bonds or other indebtedness of its former
redevelopment agency or of the successor agency to provide
savings to the successor agency, provided that (A) the total interest
cost to maturity on the refunding bonds or other indebtedness plus
the principal amount of the refunding bonds or other indebtedness
shall not exceed the total remaining interest cost to maturity on
the bonds or other indebtedness to be refunded plus the remaining
principal of the bonds or other indebtedness to be refunded, and
(B) the principal amount of the refunding bonds or other
indebtedness shall not exceed the amount required to defease the
refunded bonds or other indebtedness, to establish customary debt
service reserves, and to pay related costs of issuance. If the
foregoing conditions are satisfied, the initial principal amount of
the refunding bonds or other indebtedness may be greater than the
outstanding principal amount of the bonds or other indebtedness
to be refunded. The successor agency may pledge to the refunding
bonds or other indebtedness the revenues pledged to the bonds or
other indebtedness being refunded, and that pledge, when made
in connection with the issuance of such refunding bonds or other
indebtedness, shall have the same lien priority as the pledge of the
bonds or other obligations to be refunded, and shall be valid,
binding, and enforceable in accordance with its terms.

(2) For the purpose of issuing bonds or other indebtedness to
finance debt service spikes, including balloon maturities, provided
that (A) the existing indebtedness is not accelerated, except to the
extent necessary to achieve substantially level debt service, and
(B) the principal amount of the bonds or other indebtedness shall
not exceed the amount required to finance the debt service spikes,
including establishing customary debt service reserves and paying
related costs of issuance.

(3) For the purpose of amending an existing enforceable
obligation under which the successor agency is obligated to
reimburse a political subdivision of the state for the payment of
debt service on a bond or other obligation of the political
subdivision, or to pay all or a portion of the debt service on the
bond or other obligation of the political subdivision to provide
savings to the successor agency, provided that (A) the enforceable
obligation is amended in connection with a refunding of the bonds
or other obligations of the political subdivision so that the
enforceable obligation will apply to the refunding bonds or other
refunding indebtedness of the political subdivision, (B) the total
interest cost to maturity on the refunding bonds or other
indebtedness plus the principal amount of the refunding bonds or
other indebtedness shall not exceed the total remaining interest
cost to maturity on the bonds or other indebtedness to be refunded
plus the remaining principal of the bonds or other indebtedness to
be refunded, and (C) the principal amount of the refunding bonds
or other indebtedness shall not exceed the amount required to
defease the refunded bonds or other indebtedness, to establish
customary debt service reserves and to pay related costs of
issuance. The pledge set forth in that amended enforceable
obligation, when made in connection with the execution of the
amendment of the enforceable obligation, shall have the same lien
priority as the pledge in the enforceable obligation prior to its
amendment and shall be valid, binding, and enforceable in
accordance with its terms.

(4) For the purpose of issuing bonds or incurring other
indebtedness to make payments under enforceable obligations
when the enforceable obligations include the irrevocable pledge
of property tax increment, formerly tax increment revenues prior
to the effective date of this part, or other funds and the obligation
to issue bonds secured by that pledge. The successor agency may
pledge to the bonds or other indebtedness the property tax revenues
and other funds described in the enforceable obligation, and that
pledge, when made in connection with the issuance of the bonds
or the incurring of other indebtedness, shall be valid, binding, and
enforceable in accordance with its terms. This paragraph shall not
be deemed to authorize a successor agency to increase the amount
of property tax revenues pledged under an enforceable obligation
or to pledge any property tax revenue not already pledged pursuant
to an enforceable obligation. This paragraph does not constitute a
change in, but is declaratory of, the existing law.

(b) The refunding bonds authorized under this section may be
issued under the authority of Article 11 (commencing with Section
53580) of Chapter 3 of Part 1 of Division 2 of Title 5 of the
Government Code, and the refunding bonds may be sold at public
or private sale, or to a joint powers authority pursuant to the
Marks-Roos Local Bond Pooling Act begin insert of 1985 end insert (Article 4
(commencing with Section 6584) of Chapter 5 of Division 7 of
Title 1 of the Government Code).

(c) (1) Prior to incurring any bonds or other indebtedness
pursuant to this section, the successor agency may subordinate to
the bonds or other indebtedness the amount required to be paid to
an affected taxing entity pursuant to paragraph (1) of subdivision
(a) of Section 34183, provided that the affected taxing entity has
approved the subordinations pursuant to this subdivision.

(2) At the time the successor agency requests an affected taxing
entity to subordinate the amount to be paid to it, the successor
agency shall provide the affected taxing entity with substantial
evidence that sufficient funds will be available to pay both the debt
service on the bonds or other indebtedness and the payments
required by paragraph (1) of subdivision (a) of Section 34183,
when due.

(3) Within 45 days after receipt of the agency’s request, the
affected taxing entity shall approve or disapprove the request for
subordination. An affected taxing entity may disapprove a request
for subordination only if it finds, based upon substantial evidence,
that the successor agency will not be able to pay the debt service
payments and the amount required to be paid to the affected taxing
entity. If the affected taxing entity does not act within 45 days after
receipt of the agency’s request, the request to subordinate shall be
deemed approved and shall be final and conclusive.

(d) An action may be brought pursuant to Chapter 9
(commencing with Section 860) of Title 10 of Part 2 of the Code
of Civil Procedure to determine the validity of bonds or other
obligations authorized by this section, the pledge of revenues to
those bonds or other obligations authorized by this section, the
legality and validity of all proceedings theretofore taken and, as
provided in the resolution of the legislative body of the successor
agency authorizing the bonds or other obligations authorized by
this section, proposed to be taken for the authorization, execution,
issuance, sale, and delivery of the bonds or other obligations
authorized by this section, and for the payment of debt service on
the bonds or the payment of amounts under other obligations
authorized by this section. Subdivision (c) of Section 33501 shall
not apply to any such action. The Department of Finance shall be
notified of the filing of any action as an affected party.

(e) Notwithstanding any other law, including, but not limited
to, Section 33501, an action to challenge the issuance of bonds,
the incurrence of indebtedness, the amendment of an enforceable
obligation, or the execution of a financing agreement by a successor
agency shall be brought within 30 days after the date on which the
oversight board approves the resolution of the successor agency
approving the issuance of bonds, the incurrence of indebtedness,
the amendment of an enforceable obligation, or the execution of
a financing agreement authorized under this section.

(f) The actions authorized in this section shall be subject to the
approval of the oversight board, as provided in Section 34180.
Additionally, an oversight board may direct the successor agency
to commence any of the transactions described in subdivision (a)
so long as the successor agency is able to recover its related costs
in connection with the transaction. After a successor agency, with
approval of the oversight board, issues any bonds, incurs any
indebtedness, or executes an amended enforceable obligation
pursuant to subdivision (a), the oversight board shall not
unilaterally approve any amendments to or early termination of
the bonds, indebtedness, or enforceable obligation. If, under the
authority granted to it by subdivision (h) of Section 34179, the
Department of Finance either reviews and approves or fails to
request review within five business days of an oversight board
approval of an action authorized by this section, the scheduled
payments on the bonds or other indebtedness shall be listed in the
Recognized Obligation Payment Schedule and shall not be subject
to further review and approval by the department or the Controller.
The department may extend its review time to 60 days for actions
authorized in this section and may seek the assistance of the
Treasurer in evaluating proposed actions under this section.

(g) Any bonds, indebtedness, or amended enforceable obligation
authorized by this section shall be considered indebtedness incurred
by the dissolved redevelopment agency, with the same legal effect
as if the bonds, indebtedness, financing agreement, or amended
enforceable obligation had been issued, incurred, or entered into
prior to June 29, 2011, in full conformity with the applicable
provisions of the Community Redevelopment Law that existed
prior to that date, shall be included in the successor agency’s
Recognized Obligation Payment Schedule, and shall be secured
by a pledge of, and lien on, and shall be repaid from moneys
deposited from time to time in the Redevelopment Property Tax
Trust Fund established pursuant to subdivision (c) of Section
34172, as provided in paragraph (2) of subdivision (a) of Section
34183. Property tax revenues pledged to any bonds, indebtedness,
or amended enforceable obligations authorized by this section are
taxes allocated to the successor agency pursuant to subdivision (b)
of Section 33670 and Section 16 of Article XVI of the California
Constitution.

(h) The successor agency shall make diligent efforts to ensure
that the lowest long-term cost financing is obtained. The financing
shall not provide for any bullets or spikes and shall not use variable
rates. The successor agency shall make use of an independent
financial advisor in developing financing proposals and shall make
the work products of the financial advisor available to the
Department of Finance at its request.

(i) If an enforceable obligation provides for an irrevocable
commitment of property tax revenue and where allocation of such
revenues is expected to occur over time, the successor agency may
petition the Department of Finance to provide written confirmation
within 45 days that its determination of such enforceable obligation
as approved in a Recognized Obligation Payment Schedule is final
and conclusive, and reflects the department’s approval of
subsequent payments made pursuant to the enforceable obligation.
If the confirmation is granted, then the department’s review of
such payments in future Recognized Obligation Payment Schedules
shall be limited to confirming that they are required by the prior
enforceable obligation.

(j) The successor agency may request that the department
provide a written determination to waive the two-year statute of
limitations on an action to review the validity of the adoption or
amendment of a redevelopment plan pursuant to subdivision (c)
of Section 33500 or on any findings or determinations made by
the agency pursuant to subdivision (d) of Section 33500. The
department at its discretion may provide a waiver if it determines
it is necessary for the agency to fulfill an enforceable obligation.

begin delete

SEC. 6.  

Section 34178.8 of the Health and Safety Code is
amended to read:

34178.8.  

Commencing on the effective date of the act adding
this section, the Controller shall review the activities of successor
agencies in the state to determine if an asset transfer has occurred
after January 31, 2012, between the successor agency and the city,
county, or city and county that created a redevelopment agency,
or any other public agency, that was not made pursuant to an
enforceable obligation on an approved and valid Recognized
Obligation Payment Schedule. The review required by this section
shall be completed no later than January 1, 2016. If such an asset
transfer did occur, to the extent not prohibited by state and federal
law, the Controller shall order the available assets to be returned
to the successor agency. Upon receiving that order from the
Controller, an affected local agency shall, as soon as practicable,
reverse the transfer and return the applicable assets to the successor
agency. This section shall not apply to housing assets as defined
in subdivision (e) of Section 34176.

end delete

begin insert

begin insert SEC. 6. end insert   

end insert

begin insert Section 34179 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

34179.  

(a) Each successor agency shall have an oversight
board composed of seven members. The members shall elect one
of their members as the chairperson and shall report the name of
the chairperson and other members to the Department of Finance
on or before May 1, 2012. Members shall be selected as follows:

(1) One member appointed by the county board of supervisors.

(2) One member appointed by the mayor for the city that formed
the redevelopment agency.

(3) (A) One member appointed by the largest special district,
by property tax share, with territory in the territorial jurisdiction
of the former redevelopment agency, which is of the type of special
district that is eligible to receive property tax revenues pursuant
to Section 34188.

(B)  On or after the effective date of this subparagraph, the
county auditor-controller may determine which is the largest special
district for purposes of this section.

(4) One member appointed by the county superintendent of
education to represent schools if the superintendent is elected. If
the county superintendent of education is appointed, then the
appointment made pursuant to this paragraph shall be made by the
county board of education.

(5) One member appointed by the Chancellor of the California
Community Colleges to represent community college districts in
the county.

(6) One member of the public appointed by the county board
of supervisors.

(7) One member representing the employees of the former
redevelopment agency appointed by the mayor or chair of the
board of supervisors, as the case may be, from the recognized
employee organization representing the largest number of former
redevelopment agency employees employed by the successor
agency at that time. In the case where city or county employees
performed administrative duties of the former redevelopment
agency, the appointment shall be made from the recognized
employee organization representing those employees. If a
recognized employee organization does not exist for either the
employees of the former redevelopment agency or the city or
county employees performing administrative duties of the former
redevelopment agency, the appointment shall be made from among
the employees of the successor agency. In voting to approve a
contract as an enforceable obligation, a member appointed pursuant
to this paragraph shall not be deemed to be interested in the contract
by virtue of being an employee of the successor agency or
community for purposes of Section 1090 of the Government Code.

(8) If the county or a joint powers agency formed the
redevelopment agency, then the largest city by acreage in the
territorial jurisdiction of the former redevelopment agency may
select one member. If there are no cities with territory in a project
area of the redevelopment agency, the county superintendent of
education may appoint an additional member to represent the
public.

(9) If there are no special districts of the type that are eligible
to receive property tax pursuant to Section 34188, within the
territorial jurisdiction of the former redevelopment agency, then
the county may appoint one member to represent the public.

(10) If a redevelopment agency was formed by an entity that is
both a charter city and a county, the oversight board shall be
composed of seven members selected as follows: three members
appointed by the mayor of the city, if that appointment is subject
to confirmation by the county board of supervisors, one member
appointed by the largest special district, by property tax share, with
territory in the territorial jurisdiction of the former redevelopment
agency, which is the type of special district that is eligible to
receive property tax revenues pursuant to Section 34188, one
member appointed by the county superintendent of education to
represent schools, one member appointed by the Chancellor of the
California Community Colleges to represent community college
districts, and one member representing employees of the former
redevelopment agency appointed by the mayor of the city if that
appointment is subject to confirmation by the county board of
supervisors, to represent the largest number of former
redevelopment agency employees employed by the successor
agency at that time.

begin insert

(11) Each appointing authority identified in this subdivision
may, but is not required to, appoint an alternate representative to
serve on the oversight board as may be necessary to attend any
meeting of the oversight board in the event that the appointing
authority’s primary representative is unable to attend any meeting
for any reason. If the alternate representative attends any meeting
in place of the primary representative, the alternative
representative shall have the same participatory and voting rights
as all other attending members of the oversight board. The
successor agency shall promptly notify the department regarding
the appointment of any alternate representative to the oversight
board.

end insert

(b) The Governor may appoint individuals to fill any oversight
board member position described in subdivision (a) that has not
been filled by May 15, 2012, or any member position that remains
vacant for more than 60 days.

(c) The oversight board may direct the staff of the successor
agency to perform work in furtherance of the oversight board’s
duties and responsibilities under this part. The successor agency
shall pay for all of the costs of meetings of the oversight board
and may include such costs in its administrative budget. Oversight
board members shall serve without compensation or reimbursement
for expenses.

(d) Oversight board members are protected by the immunities
applicable to public entities and public employees governed by
Part 1 (commencing with Section 810) and Part 2 (commencing
with Section 814) of Division 3.6 of Title 1 of the Government
Code.

(e) A majority of the total membership of the oversight board
shall constitute a quorum for the transaction of business. A majority
vote of the total membership of the oversight board is required for
the oversight board to take action. The oversight board shall be
deemed to be a local entity for purposes of the Ralph M. Brown
Act, the California Public Records Act, and the Political Reform
Act of 1974. All actions taken by the oversight board shall be
adopted by resolution.

(f) All notices required by law for proposed oversight board
actions shall also be posted on the successor agency’s Internet
Web site or the oversight board’s Internet Web site.

(g) Each member of an oversight board shall serve at the
pleasure of the entity that appointed such member.

(h) The Department of Finance may review an oversight board
action taken pursuant to this part. Written notice and information
about all actions taken by an oversight board shall be provided to
the department by electronic means and in a manner of the
department’s choosing. An action shall become effective five
business days after notice in the manner specified by the
department is provided unless the department requests a review.
Each oversight board shall designate an official to whom the
department may make those requests and who shall provide the
department with the telephone number and e-mail contact
information for the purpose of communicating with the department
pursuant to this subdivision. Except as otherwise provided in this
part, in the event that the department requests a review of a given
oversight board action, it shall have 40 days from the date of its
request to approve the oversight board action or return it to the
oversight board for reconsideration and the oversight board action
shall not be effective until approved by the department. In the
event that the department returns the oversight board action to the
oversight board for reconsideration, the oversight board shall
resubmit the modified action for department approval and the
modified oversight board action shall not become effective until
approved by the department. If the department reviews a
Recognized Obligation Payment Schedule, the department may
eliminate or modify any item on that schedule prior to its approval.
The county auditor-controller shall reflect the actions of the
department in determining the amount of property tax revenues to
allocate to the successor agency. The department shall provide
notice to the successor agency and the county auditor-controller
as to the reasons for its actions. To the extent that an oversight
board continues to dispute a determination with the department,
one or more future recognized obligation schedules may reflect
any resolution of that dispute. The department may also agree to
an amendment to a Recognized Obligation Payment Schedule to
reflect a resolution of a disputed item; however, this shall not affect
a past allocation of property tax or create a liability for any affected
taxing entity.

(i) Oversight boards shall have fiduciary responsibilities to
holders of enforceable obligations and the taxing entities that
benefit from distributions of property tax and other revenues
pursuant to Section 34188. Further, the provisions of Division 4
(commencing with Section 1000) of the Government Code shall
apply to oversight boards. Notwithstanding Section 1099 of the
Government Code, or any other law, any individual may
simultaneously be appointed to up to five oversight boards and
may hold an office in a city, county, city and county, special
district, school district, or community college district.

(j) Commencing on and after July 1, 2016, in each county where
more than one oversight board was created by operation of the act
adding this part, there shall be only one oversight board appointed
as follows:

(1) One member may be appointed by the county board of
supervisors.

(2) One member may be appointed by the city selection
committee established pursuant to Section 50270 of the
Government Code. In a city and county, the mayor may appoint
one member.

(3) One member may be appointed by the independent special
district selection committee established pursuant to Section 56332
of the Government Code, for the types of special districts that are
eligible to receive property tax revenues pursuant to Section 34188.

(4) One member may be appointed by the county superintendent
of education to represent schools if the superintendent is elected.
If the county superintendent of education is appointed, then the
appointment made pursuant to this paragraph shall be made by the
county board of education.

(5) One member may be appointed by the Chancellor of the
California Community Colleges to represent community college
districts in the county.

(6) One member of the public may be appointed by the county
board of supervisors.

(7) One member may be appointed by the recognized employee
organization representing the largest number of successor agency
employees in the county.

(k) The Governor may appoint individuals to fill any oversight
board member position described in subdivision (j) that has not
been filled by July 15, 2016, or any member position that remains
vacant for more than 60 days.

(l) Commencing on and after July 1, 2016, in each county where
only one oversight board was created by operation of the act adding
this part, then there will be no change to the composition of that
oversight board as a result of the operation of subdivision (b).

(m) Any oversight board for a given successor agency shall
cease to exist when all of the indebtedness of the dissolved
redevelopment agency has been repaid.

(n) An oversight board may direct a successor agency to provide
additional legal or financial advice than what was given by agency
staff.

(o) An oversight board is authorized to contract with the county
or other public or private agencies for administrative support.

(p) On matters within the purview of the oversight board,
decisions made by the oversight board supersede those made by
the successor agency or the staff of the successor agency.

SEC. 7.  

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. An oversight board shall not have the authority to
reestablish loan agreements between the successor agency and the
city, county, or city and county that formed the redevelopment
agency except as provided in Chapter 9 (commencing with Section
34191.1).

(b) The issuance of bonds or other indebtedness or the pledge
or agreement for the pledge of property tax revenues (formerly tax
increment prior to the effective date of this part) pursuant to
subdivision (a) of Section 34177.5.

(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,
if that 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 an independent appraiser
approved by the oversight board.

(3) This subdivision does not apply to the disposition of
properties pursuant to a long-range property management plan.

(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. An oversight board
shall not have the authority to reestablish loan agreements between
the successor agency and the city, county, or city and county that
formed the redevelopment agency except as provided in Chapter
9 (commencing with Section 34191.1). Any actions to reestablish
any other agreements that are in furtherance of enforceable
obligations, with the city, county, or city and county that formed
the redevelopment agency are invalid until they are included in an
approved and valid Recognized Obligation Payment Schedule.

(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) Any document submitted by a successor agency to an
oversight board for approval by any provision of this part shall
also be submitted to the county administrative officer, the county
auditor-controller, and the Department of Finance at the same time
that the successor agency submits the document to the oversight
board.

begin delete

SEC. 8.  

Section 34191.3 of the Health and Safety Code is
amended to read:

34191.3.  

Notwithstanding Section 34191.1, the requirements
specified in subdivision (e) of Section 34177 and subdivision (a)
of Section 34181 shall be suspended, except as those provisions
apply to the transfers for governmental use, until the Department
of Finance has approved a long-range property management plan
pursuant to subdivision (b) of Section 34191.5, at which point the
plan shall govern, and supersede all other provisions relating to,
the disposition and use of the real property assets of the former
redevelopment agency, including, but not limited to, subdivision
(f) of Section 34180.

SEC. 9.  

Section 34191.4 of the Health and Safety Code is
amended to read:

34191.4.  

The following provisions shall apply to any successor
agency that has been issued a finding of completion by the
Department of Finance:

(a) All real property and interests in real property identified in
subparagraph (C) of paragraph (5) of subdivision (c) of Section
34179.5 shall be transferred to the Community Redevelopment
Property Trust Fund of the successor agency upon approval by the
Department of Finance of the long-range property management
plan submitted by the successor agency pursuant to subdivision
(b) of Section 34191.5 unless that property is subject to the
requirements of any existing enforceable obligation.

(b) (1) Notwithstanding subdivision (d) of Section 34171, upon
application by the successor agency and approval by the oversight
board, loan agreements entered into between the redevelopment
agency and the city, county, or city and county that created the
redevelopment agency shall be deemed to be enforceable
obligations provided that the oversight board makes a finding that
the loan was for legitimate redevelopment purposes.

(2) If the oversight board finds that the loan is an enforceable
obligation, the accumulated interest on the remaining principal
amount of the loan shall be recalculated from origination at the
interest rate earned by funds deposited into the Local Agency
Investment Fund. The loan shall be repaid to the city, county, or
city and county in accordance with a defined schedule over a
reasonable term of years at an interest rate not to exceed the interest
rate earned by funds deposited into the Local Agency Investment
Fund. The annual loan repayments provided for in the recognized
obligation payment schedules shall be subject to all of the following
limitations:

(A) Loan repayments shall not be made prior to the 2013-14
fiscal year. Beginning in the 2013-14 fiscal year, the maximum
repayment amount authorized each fiscal year for repayments
made pursuant to this subdivision and paragraph (7) of subdivision
(e) of Section 34176 combined shall be equal to one-half of the
increase between the amount distributed to the taxing entities
pursuant to paragraph (4) of subdivision (a) of Section 34183 in
that fiscal year and the amount distributed to taxing entities
pursuant to that paragraph in the 2012-13 base year, provided,
however, that calculation of the amount distributed to taxing
entities during the 2012-13 base year shall not include any amounts
distributed to taxing entities pursuant to the due diligence review
process established in Sections 34179.5 to 34179.8, inclusive.
Loan or deferral repayments made pursuant to this subdivision
shall be second in priority to amounts to be repaid pursuant to
paragraph (7) of subdivision (e) of Section 34176.

(B) Repayments received by the city, county, or city and county
that formed the redevelopment agency shall first be used to retire
any outstanding amounts borrowed and owed to the Low and
Moderate Income Housing Fund of the former redevelopment
agency for purposes of the Supplemental Educational Revenue
Augmentation Fund and shall be distributed to the Low and
Moderate Income Housing Asset Fund established by subdivision
(d) of Section 34176.

(C) Twenty percent of any loan repayment shall be deducted
from the loan repayment amount and shall be transferred to the
Low and Moderate Income Housing Asset Fund, after all
outstanding loans from the Low and Moderate Income Housing
Fund for purposes of the Supplemental Educational Revenue
Augmentation Fund have been paid.

(c) (1) Bond proceeds derived from bonds issued on or before
December 31, 2010, shall be used for the purposes for which the
bonds were sold. Bond proceeds derived from bonds issued during
the year 2011 may be used for the purposes for which the bonds
were issued upon approval of the oversight board, if the oversight
board, in consultation with the appropriate metropolitan planning
organization, determines that the use of the bond proceeds is
consistent with the substainable communities strategy adopted by
the metropolitan planning organization in accordance with Section
65080 of the Government Code.

(2) (A) Notwithstanding Section 34177.3 or any other
conflicting provision of law, bond proceeds in excess of the
amounts needed to satisfy approved enforceable obligations shall
thereafter be expended in a manner consistent with the original
bond covenants. Enforceable obligations may be satisfied by the
creation of reserves for projects that are the subject of the
enforceable obligation and that are consistent with the contractual
obligations for those projects, or by expending funds to complete
the projects. An expenditure made pursuant to this paragraph shall
constitute the creation of excess bond proceeds obligations to be
paid from the excess proceeds. Excess bond proceeds obligations
shall be listed separately on the Recognized Obligation Payment
Schedule submitted by the successor agency.

(B) If remaining bond proceeds cannot be spent in a manner
consistent with the bond covenants pursuant to subparagraph (A),
the proceeds shall be used to defease the bonds or to purchase
those same outstanding bonds on the open market for cancellation.

(d) In addition to any other authority granted by this part, the
successor agency may enter into, or amend existing, contracts and
agreements, or otherwise administer projects in connection with
enforceable obligations approved pursuant to subdivision (m) of
Section 34177, including the substitution of private developer
capital in a disposition and development agreement that has been
deemed an enforceable obligation, if the contract, agreement, or
project will not commit new property tax funds, and will not
otherwise reduce property tax revenues or payments made pursuant
to paragraph (4) of subdivision (a) of Section 34183 to the taxing
agencies.

end delete

begin insert

begin insert SEC. 7.5. end insert   

end insert

begin insert Section 34180 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

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. An oversight board shall not have the authority to
reestablish loan agreements between the successor agency and the
city, county, or city and county that formed the redevelopment
agency except as provided in Chapter 9 (commencing with Section
34191.1).

(b) The issuance of bonds or other indebtedness or the pledge
or agreement for the pledge of property tax revenues (formerly tax
increment prior to the effective date of this part) pursuant to begin insert Section
33333.7 and end insert subdivision (a) of Section 34177.5.

(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,
if that 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 an independent appraiser
approved by the oversight board.

begin insert

(3) This subdivision does not apply to the disposition of
properties pursuant to a long-range property management plan.

end insert

(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. An oversight board
shall not have the authority to reestablish loan agreements between
the successor agency and the city, county, or city and county that
formed the redevelopment agency except as provided in Chapter
9 (commencing with Section 34191.1). Any actions to reestablish
any other agreements that are in furtherance of enforceable
obligations, with the city, county, or city and county that formed
the redevelopment agency are invalid until they are included in an
approved and valid Recognized Obligation Payment Schedule.

(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) Any document submitted by a successor agency to an
oversight board for approval by any provision of this part shall
also be submitted to the county administrative officer, the county
auditor-controller, and the Department of Finance at the same time
that the successor agency submits the document to the oversight
board.

begin insert

begin insert SEC. 8. end insert   

end insert

begin insert Section 34191.4 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

34191.4.  

The following provisions shall apply to any successor
agency that has been issued a finding of completion by the
Department of Finance:

(a) All real property and interests in real property identified in
subparagraph (C) of paragraph (5) of subdivision (c) of Section
34179.5 shall be transferred to the Community Redevelopment
Property Trust Fund of the successor agency upon approval by the
Department of Finance of the long-range property management
plan submitted by the successor agency pursuant to subdivision
(b) of Section 34191.5 unless that property is subject to the
requirements of any existing enforceable obligation.

(b) (1) Notwithstanding subdivision (d) of Section 34171, upon
application by the successor agency and approval by the oversight
board, begin delete loan agreements entered into between the end delete begin insert loans made to a end insert
redevelopment agency begin delete and end delete begin insert by end insert the city, county, or city and county
that created the redevelopment agency shall be deemed to be
enforceable obligations provided that the oversight board makes
a finding that the begin delete loan was end delete begin insert loans were end insert for legitimate redevelopment
purposes.

(2) If the oversight board finds that begin delete the end delete begin insert a end insert loan is an enforceable
obligation, the accumulated interest on the remaining principal
begin delete amount end delete begin insert balance end insert of the loan shall be recalculated from origination
begin delete at end delete begin insert using end insert the interest rate earned by funds deposited into the Local
Agency Investment Fund begin insert in effect on the date of loan origination,
and as adjusted quarterly thereafter end insert . The begin insert remaining balance of
the end insert loan begin insert and the accumulated interest end insert shall be repaid to the city,
county, or city and county in accordance with a defined schedule
over a reasonable term of years at an interest rate not to exceed
the interest rate earned by funds deposited into the Local Agency
Investment Fund begin insert as the rate is adjusted on a quarterly basis end insert . The
annual loan repayments provided for in the recognized obligation
payment schedules shall be subject to all of the following
limitations:

(A) Loan repayments shall not be made prior to the 2013-14
fiscal year. Beginning in the 2013-14 fiscal year, the maximum
repayment amount authorized each fiscal year for repayments
made pursuant to this subdivision and paragraph (7) of subdivision
(e) of Section 34176 combined shall be equal to one-half of the
increase between the amount distributed to the taxing entities
pursuant to paragraph (4) of subdivision (a) of Section 34183 in
that fiscal year and the amount distributed to taxing entities
pursuant to that paragraph in the 2012-13 base year, provided,
however, that calculation of the amount distributed to taxing
entities during the 2012-13 base year shall not include any amounts
distributed to taxing entities pursuant to the due diligence review
process established in Sections 34179.5 to 34179.8, inclusive.
Loan or deferral repayments made pursuant to this subdivision
shall be second in priority to amounts to be repaid pursuant to
paragraph (7) of subdivision (e) of Section 34176.

(B) Repayments received by the city, county, or city and county
that formed the redevelopment agency shall first be used to retire
any outstanding amounts borrowed and owed to the Low and
Moderate Income Housing Fund of the former redevelopment
agency for purposes of the Supplemental Educational Revenue
Augmentation Fund and shall be distributed to the Low and
Moderate Income Housing Asset Fund established by subdivision
(d) of Section 34176.

(C) Twenty percent of any loan repayment shall be deducted
from the loan repayment amount and shall be transferred to the
Low and Moderate Income Housing Asset Fund, after all
outstanding loans from the Low and Moderate Income Housing
Fund for purposes of the Supplemental Educational Revenue
Augmentation Fund have been paid.

begin insert

(3) It is the intent of the Legislature that the amendments to this
subdivision made by the act adding this paragraph be clarifying.

end insert

(c) (1) Bond proceeds derived from bonds issued on or before
December 31, 2010, shall be used for the purposes for which the
bonds were sold.

(2) (A) Notwithstanding Section 34177.3 or any other
conflicting provision of law, bond proceeds in excess of the
amounts needed to satisfy approved enforceable obligations shall
thereafter be expended in a manner consistent with the original
bond covenants. Enforceable obligations may be satisfied by the
creation of reserves for projects that are the subject of the
enforceable obligation and that are consistent with the contractual
obligations for those projects, or by expending funds to complete
the projects. An expenditure made pursuant to this paragraph shall
constitute the creation of excess bond proceeds obligations to be
paid from the excess proceeds. Excess bond proceeds obligations
shall be listed separately on the Recognized Obligation Payment
Schedule submitted by the successor agency.

(B) If remaining bond proceeds cannot be spent in a manner
consistent with the bond covenants pursuant to subparagraph (A),
the proceeds shall be used to defease the bonds or to purchase
those same outstanding bonds on the open market for cancellation.

begin insert

(d) Notwithstanding subdivision (b) of Section 34163, if a
successor agency has received a finding of completion, the
successor agency may enter into, or amend existing, contracts and
agreements, or otherwise administer projects in connection with
enforceable obligations approved pursuant to subdivision (m) of
Section 34177, including the substitution of private developer
capital in a disposition and development agreement that has been
deemed an enforceable obligation, if the contract, agreement, or
project will not commit new property tax funds, and will not
otherwise reduce property tax revenues or payments made pursuant
to paragraph (4) of subdivision (a) of Section 34183 to the taxing
agencies.

end insert

begin insert

begin insert SEC. 8.5. end insert   

end insert

begin insert Section 34191.4 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

34191.4.  

The following provisions shall apply to any successor
agency that has been issued a finding of completion by the
Department of Finance:

(a) All real property and interests in real property identified in
subparagraph (C) of paragraph (5) of subdivision (c) of Section
34179.5 shall be transferred to the Community Redevelopment
Property Trust Fund of the successor agency upon approval by the
Department of Finance of the long-range property management
plan submitted by the successor agency pursuant to subdivision
(b) of Section 34191.5 unless that property is subject to the
requirements of any existing enforceable obligation.

(b) (1) Notwithstanding subdivision (d) of Section 34171, upon
application by the successor agency and approval by the oversight
board, begin delete loan agreements entered into between the end delete begin insert loans made to a end insert
redevelopment agency begin delete and end delete begin insert by end insert the city, county, or city and county
that created the redevelopment agency shall be deemed to be
enforceable obligations provided that the oversight board makes
a finding that the begin delete loan was end delete begin insert loans were end insert for legitimate redevelopment
purposes.

(2) If the oversight board finds that begin delete the end delete begin insert a end insert loan is an enforceable
obligation, the accumulated interest on the remaining principal
begin delete amount end delete begin insert balance end insert of the loan shall be recalculated from origination
begin delete at end delete begin insert using end insert the interest rate earned by funds deposited into the Local
Agency Investment Fund begin insert in effect on the date of loan origination,
and as adjusted quarterly thereafter end insert . The begin insert remaining principal
balance of the end insert loan begin insert and the accumulated interest end insert shall be repaid
to the city, county, or city and county in accordance with a defined
schedule over a reasonable term of years at an interest rate not to
exceed the interest rate earned by funds deposited into the Local
Agency Investment Fund begin insert as the rate is adjusted on a quarterly
basis end insert . The annual loan repayments provided for in the recognized
obligation payment schedules shall be subject to all of the following
limitations:

(A) Loan repayments shall not be made prior to the 2013-14
fiscal year. Beginning in the 2013-14 fiscal year, the maximum
repayment amount authorized each fiscal year for repayments
made pursuant to this subdivision and paragraph (7) of subdivision
(e) of Section 34176 combined shall be equal to one-half of the
increase between the amount distributed to the taxing entities
pursuant to paragraph (4) of subdivision (a) of Section 34183 in
that fiscal year and the amount distributed to taxing entities
pursuant to that paragraph in the 2012-13 base year, provided,
however, that calculation of the amount distributed to taxing
entities during the 2012-13 base year shall not include any amounts
distributed to taxing entities pursuant to the due diligence review
process established in Sections 34179.5 to 34179.8, inclusive.
Loan or deferral repayments made pursuant to this subdivision
shall be second in priority to amounts to be repaid pursuant to
paragraph (7) of subdivision (e) of Section 34176.

(B) Repayments received by the city, county, or city and county
that formed the redevelopment agency shall first be used to retire
any outstanding amounts borrowed and owed to the Low and
Moderate Income Housing Fund of the former redevelopment
agency for purposes of the Supplemental Educational Revenue
Augmentation Fund and shall be distributed to the Low and
Moderate Income Housing Asset Fund established by subdivision
(d) of Section 34176.

(C) Twenty percent of any loan repayment shall be deducted
from the loan repayment amount and shall be transferred to the
Low and Moderate Income Housing Asset Fund, after all
outstanding loans from the Low and Moderate Income Housing
Fund for purposes of the Supplemental Educational Revenue
Augmentation Fund have been paid.

begin insert

(3) It is the intent of the Legislature that the amendments to this
subdivision made by the act adding this paragraph be clarifying.

end insert

(c) (1) Bond proceeds derived from bonds issued on or before
begin delete December 31, 2010, end delete begin insert June 28, 2011, end insert shall be used for the purposes
for which the bonds were sold.

begin insert

(A) Bond proceeds derived from bonds issued between January
1, 2011, and June 28, 2011, shall only be used for projects which
meet the following criteria, as determined by a resolution issued
by the oversight board:

end insert begin insert

(i) The project shall be consistent with the applicable regional
sustainable communities strategy or alternative planning strategy
adopted pursuant to Section 65080 of the Government Code that
the State Air Resources Board has determined would, if
implemented, achieve the greenhouse gas emission reduction
targets established by the board or, if a sustainable communities
strategy is not required for a region by law, a regional
transportation plan that includes programs and policies to reduce
greenhouse gas emissions.

end insert begin insert

(ii) Two or more significant planning or implementation actions
shall have occurred on or before December 31, 2010. The term
“significant planning and implementation actions” means any of
the following:

end insert begin insert

(I) An action approved by the governing body of the city, county,
city and county, the board of the former redevelopment agency,
or the planning commission directly related to the planning or
implementation of the project.

end insert begin insert

(II) The project is included within an approved city, county, city
and county, or redevelopment agency planning document,
including, but not limited to, a redevelopment agency five-year
implementation plan, capital improvement plan, master plan, or
other planning document.

end insert begin insert

(III) The expenditure by the city, county, city and county, or
project sponsor, of more than twenty-five thousand dollars
($25,000) on planning related activities for the project within one
fiscal year, or fifty thousand dollars ($50,000) in total, over
multiple fiscal years.

end insert begin insert

(iii) Documentation dated on or before December 31, 2010,
shall be provided indicating the intention to finance all or a portion
of the project with the future issuance of long-term debt, or
documentation showing that the issuance of long-term
redevelopment agency debt was being planned on or before
December 31, 2010.

end insert begin insert

(iv) Each construction contract over one hundred thousand
dollars ($100,000) shall include a provision that prevailing wage
will be paid by the contractor and all of that contractor’s
subcontractors.

end insert begin insert

(v) For each construction contract over two hundred fifty
thousand dollars ($250,000), the successor agency shall require
prospective contractors to submit a standardized questionnaire
and financial statements as part of their bid package, to establish
the contractor’s financial ability and experience in performing
large construction projects.

end insert begin insert

(B) Any city, county, or city and county that funded an eligible
project, meeting the criteria listed in clauses (i) to (iii), inclusive,
of subparagraph (A) with funds other than redevelopment funds,
between June 28, 2011, and the effective date of the act adding
this paragraph, shall be eligible to be reimbursed utilizing 2011
bond proceeds, if the project meets the purpose for which the bonds
were issued.

end insert begin insert

(C) Any successor agency requesting the use of bond proceeds
derived from bonds issued between January 1, 2011, and June 28,
2011, in accordance with subparagraphs (A) and (B), shall place
that request on its Recognized Obligation Payment Schedule. The
successor agency shall place each project on a separate
Recognized Obligation Payment Schedule line item. The successor
agency shall detail in the resolution adopting the Recognized
Obligation Payment Schedule how each project will meet the
requirement in subparagraphs (A) and (B), and all documentation
showing how the project meets those criteria shall be attached to
the resolution. The resolution adopting the Recognized Obligation
Payment Schedule, including the supporting documentation, shall
be forwarded to the department for review and approval or denial.
Pursuant to subdivision (h) of Section 34179, the department may
review and deny any action by the oversight board.

end insert

(2) (A) Notwithstanding Section 34177.3 or any other
conflicting provision of law, bond proceeds in excess of the
amounts needed to satisfy approved enforceable obligations shall
thereafter be expended in a manner consistent with the original
bond covenants. Enforceable obligations may be satisfied by the
creation of reserves for projects that are the subject of the
enforceable obligation and that are consistent with the contractual
obligations for those projects, or by expending funds to complete
the projects. An expenditure made pursuant to this paragraph shall
constitute the creation of excess bond proceeds obligations to be
paid from the excess proceeds. Excess bond proceeds obligations
shall be listed separately on the Recognized Obligation Payment
Schedule submitted by the successor agency.

(B) If remaining bond proceeds cannot be spent in a manner
consistent with the bond covenants pursuant to subparagraph (A),
the proceeds shall be used to defease the bonds or to purchase
those same outstanding bonds on the open market for cancellation.

begin insert

(d) Notwithstanding subdivision (b) of Section 34163, if a
successor agency has received a finding of completion, the
successor agency may enter into, or amend existing, contracts and
agreements, or otherwise administer projects in connection with
enforceable obligations approved pursuant to subdivision (m) of
Section 34177, including the substitution of private developer
capital in a disposition and development agreement that has been
deemed an enforceable obligation, if the contract, agreement, or
project will not commit new property tax funds, and will not
otherwise reduce property tax revenues or payments made pursuant
to paragraph (4) of subdivision (a) of Section 34183 to the taxing
agencies.

end insert

begin delete SEC. 10. end delete
begin insert SEC. 9. end insert   

Section 34191.5 of the Health and Safety Code is
amended to read:

34191.5.  

(a) There is hereby established a Community
Redevelopment Property Trust Fund, administered by the successor
agency, to serve as the repository of the former redevelopment
agency’s real properties identified in subparagraph (C) of paragraph
(5) of subdivision (c) of Section 34179.5.

(b) The successor agency shall prepare a long-range property
management plan that addresses the disposition and use of the real
properties of the former redevelopment agency. The report shall
be submitted to the oversight board and the Department of Finance
for approval no later than six months following the issuance to the
successor agency of the finding of completion.

(c) The long-range property management plan shall do all of
the following:

(1) Include an inventory of all properties in the trust. The
inventory shall consist of all of the following information:

(A) The date of the acquisition of the property and the value of
the property at that time, and an estimate of the current value of
the property.

(B) The purpose for which the property was acquired.

(C) Parcel data, including address, lot size, and current zoning
in the former agency redevelopment plan or specific, community,
or general plan.

(D) An estimate of the current value of the parcel including, if
available, any appraisal information.

(E) An estimate of any lease, rental, or any other revenues
generated by the property, and a description of the contractual
requirements for the disposition of those funds.

(F) The history of environmental contamination, including
designation as a brownfield site, any related environmental studies,
and history of any remediation efforts.

(G) A description of the property’s potential for transit-oriented
development and the advancement of the planning objectives of
the successor agency.

(H) A brief history of previous development proposals and
activity, including the rental or lease of property.

(2) Address the use or disposition of all of the properties in the
trust. Permissible uses include the retention of the property for
governmental use pursuant to subdivision (a) of Section 34181,
the retention of the property for future development, the sale of
the property, or the use of the property to fulfill an enforceable
obligation. The plan shall separately identify and list properties in
the trust dedicated to governmental use purposes and properties
retained for purposes of fulfilling an enforceable obligation. With
respect to the use or disposition of all other properties, all of the
following shall apply:

(A) (i) If the plan directs the use or liquidation of the property
for a project identified in an approved redevelopment plan, the
property shall transfer to the city, county, or city and county.

(ii) For purposes of this subparagraph, the term “identified in
an approved redevelopment plan” includes properties listed in a
community plan or a five-year implementation plan.

(B) If the plan directs the liquidation of the property or the use
of revenues generated from the property, such as lease or parking
revenues, for any purpose other than to fulfill an enforceable
obligation or other than that specified in subparagraph (A), the
proceeds from the sale shall be distributed as property tax to the
taxing entities.

(C) Property shall not be transferred to a successor agency, city,
county, or city and county, unless the long-range property
management plan has been approved by the oversight board and
the Department of Finance.

(d) The department shall not require a compensation agreement
or agreements as described in subdivision (f) of Section 34180 as
part of the approval of a long-range property management plan.

(e) The department shall only consider whether the long-range
property management plan makes a good faith effort to address
the requirements set forth in subdivision (c).

(f) The department shall approve long-range property
management plans as expeditiously as possible.

(g) Actions relating to the disposition of property after approval
of a long-range property management plan shall not require review
by the department.

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert Sections 4.5 and 4.7 of this bill incorporates
amendments to Section 34177 of the Health and Safety Code
proposed by both this bill and Assembly Bill 1582. Sections 4.5
and 4.7 of this bill shall only become operative if (1) both bills are
enacted and become effective on or before January 1, 2015, (2)
each bill amends Section 34177 of the Health and Safety Code,
and (3) this bill is enacted after Assembly Bill 1582, in which case
Section 4 of this bill shall not become operative. end insert

begin insert

begin insert SEC. 11. end insert   

end insert

begin insert Section 7.5 of this bill incorporates amendments to
Section 34180 of the Health and Safety Code proposed by both
this bill and Senate Bill 1404. It shall only become operative if (1)
both bills are enacted and become effective on or before January
1, 2015, (2) each bill amends Section 34180 of the Health and
Safety Code, and (3) this bill is enacted after Senate Bill 1404, in
which case Section 7 of this bill shall not become operative. end insert

begin insert

begin insert SEC. 12. end insert   

end insert begin insert

Section 8.5 of this bill incorporates amendments to
Section 34191.4 of the Health and Safety Code proposed by both
this bill and Assembly Bill 2493. It shall only become operative if
(1) both bills are enacted and become effective on or before
January 1, 2015, (2) each bill amends Section 34191.4 of the
Health and Safety Code, and (3) this bill is enacted after Assembly
Bill 2493, in which case Section 8 of this bill shall not become
operative.

end insert