Bill Text: CA SB1151 | 2011-2012 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Sustainable Economic Development and Housing Trust Fund:

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2012-06-19 - Hearing postponed by committee. [SB1151 Detail]

Download: California-2011-SB1151-Introduced.html

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BILL NUMBER: SB 1151	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Steinberg

                        FEBRUARY 21, 2012

   An act to amend Section 34177 of, and to add Section 34177.1 to,
the Health and Safety Code, relating to redevelopment.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1151, as introduced, Steinberg. Redevelopment: long range asset
management plan.
   Existing law dissolved redevelopment agencies and community
development agencies, as of February 1, 2012, and provides for the
designation of successor agencies, as defined. Existing law imposes
various requirements on successor agencies and subjects successor
agency actions to the review of oversight boards. Existing law
requires successor agencies to wind down the affairs of the dissolved
redevelopment agencies and to, among other things, dispose of assets
and properties of the former redevelopment agencies, as directed by
the oversight board. Proceeds from the sale of assets are transferred
to the county auditor-controller for distribution as property tax
proceeds to taxing entities, as prescribed.
   This bill would require the successor agency to prepare a long
range asset management plan that outlines a strategy for maximizing
the long-term value of the real property and assets of the former
redevelopment agency for ongoing economic development and housing
functions. The bill would require the successor agency to submit the
plan to the Department of Finance and the oversight board by December
1, 2012, and would require the approval of the plan by the
department and oversight board by December 31, 2012.
   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.  The Legislature finds and declares that the assets,
properties, contracts, leases, books and records, buildings, and
equipment of former redevelopment agencies constitute a valuable
resource that should be maintained for the purpose of economic
development and housing within the communities served by the former
redevelopment agency.
  SEC. 2.  Section 34177 of the Health and Safety Code is amended to
read:
   34177.  Successor agencies are required to do all of the
following:
   (a) Continue to make payments due for enforceable obligations.
   (1) On and after February 1, 2012, and until a Recognized
Obligation Payment Schedule becomes operative, only payments required
pursuant to an enforceable obligations payment schedule shall be
made. The initial enforceable obligation payment schedule shall be
the last schedule adopted by the redevelopment agency under Section
34169. However, payments associated with obligations excluded from
the definition of enforceable obligations by paragraph (2) of
subdivision (e) of Section 34171 shall be excluded from the
enforceable obligations payment schedule and be removed from the last
schedule adopted by the redevelopment agency under Section 34169
prior to the successor agency adopting it as its enforceable
obligations payment schedule pursuant to this subdivision. The
enforceable obligation payment schedule may be amended by the
successor agency at any public meeting and shall be subject to the
approval of the oversight board as soon as the board has sufficient
members to form a quorum.
   (2) The Department of Finance and the Controller shall each have
the authority to require any documents associated with the
enforceable obligations to be provided to them in a manner of their
choosing. Any taxing entity, the department, and the Controller shall
each have standing to file a judicial action to prevent a violation
under this part and to obtain injunctive or other appropriate relief.

   (3) Commencing on May 1, 2012, only those payments listed in the
Recognized Obligation Payment Schedule may be made by the successor
agency from the funds specified in the Recognized Obligation Payment
Schedule. In addition, commencing May 1, 2012, the Recognized
Obligation Payment Schedule shall supersede the Statement of
Indebtedness, which shall no longer be prepared nor have any effect
under the Community Redevelopment Law.
   (4) Nothing in the act adding this part is to be construed as
preventing a successor agency, with the prior approval of the
oversight board, as described in Section 34179, from making payments
for enforceable obligations from sources other than those listed in
the Recognized Obligation Payment Schedule.
   (5) From February 1, 2012, to July 1, 2012, a successor agency
shall have no authority and is hereby prohibited from accelerating
payment or making any lump-sum payments that are intended to prepay
loans unless such accelerated repayments were required prior to the
effective date of this part.
   (b) Maintain reserves in the amount required by indentures, trust
indentures, or similar documents governing the issuance of
outstanding redevelopment agency bonds.
   (c) Perform obligations required pursuant to any enforceable
obligation.
   (d) Remit unencumbered balances of redevelopment agency funds to
the county auditor-controller for distribution to the taxing
entities, including, but not limited to, the unencumbered balance of
the Low and Moderate Income Housing Fund of a former redevelopment
agency. In making the distribution, the county auditor-controller
shall utilize the same methodology for allocation and distribution of
property tax revenues provided in Section 34188.
   (e)  (1)    Dispose of assets and properties of
the former redevelopment agency as directed by the oversight board
 ;   ,  provided, however, that the
oversight board may instead direct the successor agency to transfer
ownership of certain assets pursuant to subdivision (a) of Section
34181  , and in accordance with the long range asset management
plan   specified in Section 34177.1  . The disposal
 is to   shall  be done expeditiously
 and   ,  in a manner aimed at maximizing
value  ,   but shall not be done until the long range
asset management plan is approved  . Proceeds from asset sales
and related funds that are no longer needed for approved development
projects or to otherwise wind down the affairs of the agency, each as
determined by the oversight board, shall be transferred to the
county auditor-controller for distribution as property tax proceeds
under Section 34188. 
   (2) Prior to the disposal of any real property pursuant to this
subdivision, the successor agency shall comply with all relevant
provisions of the Government Code, Public Contract Code, and other
codes, relating to the rules and disclosure requirements for the fair
market valuation of assets, competitive bidding, and conflicts of
interest. 
   (f) Enforce all former redevelopment agency rights for the benefit
of the taxing entities, including, but not limited to, continuing to
collect loans, rents, and other revenues that were due to the
redevelopment agency.
   (g) Effectuate transfer of housing functions and assets to the
appropriate entity designated pursuant to Section 34176.
   (h) Expeditiously wind down the affairs of the redevelopment
agency pursuant to the provisions of this part and in accordance with
the direction of the oversight board.
   (i) Continue to oversee development of properties until the
contracted work has been completed or the contractual obligations of
the former redevelopment agency can be transferred to other parties.
Bond proceeds shall be used for the purposes for which bonds were
sold unless the purposes can no longer be achieved, in which case,
the proceeds may be used to defease the bonds.
   (j) Prepare a proposed administrative budget and submit it to the
oversight board for its approval. The proposed administrative budget
shall include all of the following:
   (1) Estimated amounts for successor agency administrative costs
for the upcoming six-month fiscal period.
   (2) Proposed sources of payment for the costs identified in
paragraph (1).
   (3) Proposals for arrangements for administrative and operations
services provided by a city, county, city and county, or other
entity.
   (k) Provide administrative cost estimates, from its approved
administrative budget that are to be paid from property tax revenues
deposited in the Redevelopment Property Tax Trust Fund, to the county
auditor-controller for each six-month fiscal period.
   (l) (1) Before each six-month fiscal period, prepare a Recognized
Obligation Payment Schedule in accordance with the requirements of
this paragraph. For each recognized obligation, the Recognized
Obligation Payment Schedule shall identify one or more of the
following sources of payment:
   (A) Low and Moderate Income Housing Fund.
   (B) Bond proceeds.
   (C) Reserve balances.
   (D) Administrative cost allowance.
   (E) The Redevelopment Property Tax Trust Fund, but only to the
extent no other funding source is available or when payment from
property tax revenues is required by an enforceable obligation or by
the provisions of this part.
   (F) Other revenue sources, including rents, concessions, asset
sale proceeds, interest earnings, and any other revenues derived from
the former redevelopment agency, as approved by the oversight board
in accordance with this part.
   (2) A Recognized Obligation Payment Schedule shall not be deemed
valid unless all of the following conditions have been met:
   (A) A draft Recognized Obligation Payment Schedule is prepared by
the successor agency for the enforceable obligations of the former
redevelopment agency by March 1, 2012. From October 1, 2011, to July
1, 2012, the initial draft of that schedule shall project the dates
and amounts of scheduled payments for each enforceable obligation for
the remainder of the time period during which the redevelopment
agency would have been authorized to obligate property tax increment
had such a redevelopment agency not been dissolved, and shall be
reviewed and certified, as to its accuracy, by an external auditor
designated pursuant to Section 34182.
   (B) The certified Recognized Obligation Payment Schedule is
submitted to and duly approved by the oversight board.
   (C) A copy of the approved Recognized Obligation Payment Schedule
is submitted to the county auditor-controller and both the Controller'
s office and the Department of Finance and be posted on the successor
agency's Internet Web site.
   (3) The Recognized Obligation Payment Schedule shall be forward
looking to the next six months. The first Recognized Obligation
Payment Schedule shall be submitted to the Controller's office and
the Department of Finance by April 15, 2012, for the period of
January 1, 2012, to June 30, 2012, inclusive. Former redevelopment
agency enforceable obligation payments due, and reasonable or
necessary administrative costs due or incurred, prior to January 1,
2012, shall be made from property tax revenues received in the spring
of 2011 property tax distribution, and from other revenues and
balances transferred to the successor agency.
  SEC. 3.  Section 34177.1 is added to the Health and Safety Code, to
read:
   34177.1.  (a) The successor agency shall prepare a long range
asset management plan that outlines a strategy for maximizing the
long-term value of the real property and assets of the former
redevelopment agency for ongoing economic development and housing
functions.
   (b) The plan shall do all of the following:
   (1) Address the use or disposition of all of the assets of the
former redevelopment agency identified by the county
auditor-controller in the audit conducted pursuant to subdivision (a)
of Section 34182.
   (2) Include an inventory of all assets identified by the
auditor-controller consisting of an estimate of the market value of
the asset and a description of the highest and best use of the asset
for the community. Permissible uses include the retention of the
asset for governmental use pursuant to subdivision (a) of Section
34181, the sale of the asset, and the retention of the asset in a
governmental trust for the purpose of maximizing the value of the
asset for ongoing economic development activity.
   (c) The successor agency shall submit the plan to the department
and the oversight board by December 1, 2012. The plan shall be
approved by both the oversight board and the department by December
31, 2012. The department, in consultation with the oversight board,
may object to and modify any provision of the plan.