Bill Text: CA SB436 | 2011-2012 | Regular Session | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Land use: mitigation lands: nonprofit organizations.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Passed) 2011-10-08 - Chaptered by Secretary of State. Chapter 590, Statutes of 2011. [SB436 Detail]
Download: California-2011-SB436-Amended.html
Bill Title: Land use: mitigation lands: nonprofit organizations.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Passed) 2011-10-08 - Chaptered by Secretary of State. Chapter 590, Statutes of 2011. [SB436 Detail]
Download: California-2011-SB436-Amended.html
BILL NUMBER: SB 436 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 31, 2011
AMENDED IN SENATE MAY 2, 2011
AMENDED IN SENATE MARCH 24, 2011
INTRODUCED BY Senator Kehoe
FEBRUARY 16, 2011
An act to amend, repeal, and add Section 65965 of the Government
Code, relating to land use.
LEGISLATIVE COUNSEL'S DIGEST
SB 436, as amended, Kehoe. Land use: mitigation lands: nonprofit
organizations.
The Planning and Zoning Law authorizes a state or local public
agency, if the agency requires a property owner to transfer to the
agency an interest in real property to mitigate an adverse impact
upon natural resources caused by permitting the development of a
project or facility, to authorize a nonprofit organization to hold
title to and manage that interest in real property, provided that the
nonprofit organization meets specified requirements.
This bill would, until January 1, 2022, authorize a state or local
public agency to provide funds to a nonprofit organization to
acquire land or easements that satisfy the agency's mitigation
obligations, including funds that have been set aside for the
long-term management of any lands or easements conveyed to a
nonprofit organization if the nonprofit organization meets certain
requirements. This bill would require a nonprofit organization
that holds funds on behalf of the Department of Fish and Game for the
long- term management of land to comply with certain
requirements, including certification by the department, and
oversight by the Controller. The bill would also state the
findings and declarations of the Legislature with respect to the
preservation of natural resources through such mitigation, and would
state that it is in the best interest of the public to allow state
and local public agencies and nonprofit organizations to utilize the
tools and strategies they need for improving the effectiveness, cost
efficiency, and durability of mitigation for California's natural
resources.
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 all of the
following:
(a) State and local laws protect a variety of natural resources,
and also require permits to be issued for the development of certain
projects or facilities.
(b) In furtherance of these laws, state or local public agencies
may require a property owner to transfer an interest in real property
to mitigate any adverse impact upon natural resources caused by
permitting the development of a project or facility.
(c) Funds may be simultaneously set aside for the long-term
management of the property transferred for mitigation purposes.
(d) Lands and real property interests transferred to achieve the
mitigation may be held by nonprofit organizations.
(e) Many state and local agencies work with nonprofit
organizations in valuable and cost effective public-private
partnerships to identify properties that meet the mitigation
requirements and to hold and provide long-term management of the real
property interests.
(f) There are tools and strategies available for improving the
effectiveness, cost efficiency, and durability of mitigation for
California's natural resources.
(g) Identifying mitigation needs on a regional basis may expedite
the planning and mitigation processes, as well as result ultimately
in consolidated mitigation areas that can be managed more
cost-effectively.
(h) It is in the interest of the public, project proponents, and
local communities to ensure that the public benefits of mitigation
are achieved.
(i) It is in the best interest of the public to allow state and
local public agencies and nonprofit organizations to utilize the
tools and strategies they need for improving the effectiveness, cost
efficiency, and durability of mitigation for California's natural
resources.
SEC. 2. Section 65965 of the Government Code is amended to read:
65965. (a) For the purposes of this section, the following
definitions apply:
(1) "Department" means the Department of Fish and Game.
(1)
(2) "Direct protection" means the protection and
preservation of natural lands or resources, including, but not
limited to, agricultural lands, wildlife habitat, wetlands,
endangered species habitat, open-space areas, or outdoor recreational
areas.
(2)
(3) "Stewardship" encompasses the range of activities
involved in controlling, monitoring, and managing for conservation
purposes a property, or a conservation or open-space easement, as
defined by the terms of the easement, and its attendant resources.
(b) Notwithstanding any other provision of law to the contrary, if
a state or local public agency requires a property owner to transfer
to the agency an interest in real property to mitigate any adverse
impact upon natural resources caused by permitting the development of
a project or facility, the state or local public agency may
authorize a nonprofit organization to hold title to and manage that
interest in real property, provided that the nonprofit organization
is all of the following:
(1) Exempt from taxation as an organization described in Section
501(c)(3) of the Internal Revenue Code, and qualified to do business
in the state.
(2) A "qualified organization" as defined in Section 170(h)(3) of
the Internal Revenue Code.
(3) An organization that has as its principal purpose and activity
the direct protection or stewardship of natural land or resources,
or cultural or historic resources, including, but not limited to,
agricultural lands, wildlife habitat, wetlands, endangered species
habitat, open-space areas, and outdoor recreational areas.
(c) If a state or local public agency, in the development of its
own project, is required to protect an interest in real property to
mitigate an adverse impact upon natural resources, the agency may do
either of the following:
(1) Transfer the interest to a nonprofit organization that meets
the requirements set forth in subdivision (b).
(2) Provide funds to a nonprofit organization to acquire land or
easements that satisfy the agency's mitigation obligations.
(d) (1) Funds set aside for the long-term
management of lands or easements conveyed to a nonprofit organization
pursuant to subdivisions (b) and (c) may also be conveyed to the
nonprofit organization , subject to the limitations
in paragraph (2) . The nonprofit organization shall hold,
manage, invest, and disburse the funds in furtherance of managing and
stewarding the land or easement for which the funds were set aside.
(2) (A) A nonprofit organization may not hold funds on behalf of
the department for the long-term management of lands unless that
nonprofit organization is certified by the department. The department
shall adopt regulations for a process to certify nonprofit
organizations to hold funds on behalf of the department for the
long-term management of land. The department shall certify no more
than 10 nonprofits to hold funds for the long-term management of
mitigation lands under this section.
(B) A nonprofit organization that holds funds on the behalf of the
department for the long-term management of land shall be subject to
oversight by the Controller. The Controller shall annually review
independent audit statements, tax filings, or any other documents or
reports the Controller determines necessary to verify the sound
financial management of funds held by a nonprofit organization on
behalf of the department for the long-term management of land. All
costs incurred by the department or the Controller under this
subdivision shall be reimbursed by the nonprofit organization.
(e) (1) The state or local public agency may require the nonprofit
organization to submit a report not more than every 12 months and
for a specified number of years, that details the management and
condition of the property or easement and the accompanying funds. The
mitigation or funding agreement shall specify the reporting due
dates and the elements of the report.
(2) The funds of a nonprofit organization holding funds for the
long-term management of property shall revert to the state or local
public agency that required the mitigation if the nonprofit
organization does any of the following:
(A) Ceases operation.
(B) Is dissolved.
(C) Becomes bankrupt or insolvent.
(D) Fails to perform its duties for any reason, as determined by
the state or local public agency.
(f) The recorded instrument that places title with a nonprofit
organization pursuant to subdivision (b) shall include, at a minimum,
a provision that if the state or local public agency that authorized
the nonprofit organization to hold the title, or its successor
agency, determines that the interest in real property that is held by
the nonprofit organization is not being held, monitored, or managed
for conservation purposes in the manner specified in that instrument
or in the mitigation agreement between the state or local public
agency and the nonprofit organization, the interest in real property
shall revert to the state or that local public agency, or to another
public agency or nonprofit organization qualified pursuant to
subdivision (b), approved by the state or local public agency.
(g) (1) A state or local public agency shall exercise due
diligence in reviewing the qualifications of a nonprofit organization
to effectively manage and steward natural land or resources, as well
as the accompanying funds. The state or local public agency may
adopt guidelines to assist the agency in that review process, which
may include guidelines or standards established by a qualified
entity.
(2) The state or local public agency shall determine that the
holder of accompanying funds meets all of the following requirements:
(A) The holder has the capacity to effectively manage the
mitigation funds.
(B) The holder has the capacity to achieve reasonable rates of
return on investment of those funds similar to those of other prudent
investors over the life of the agreement.
(C) The holder utilizes generally accepted accounting practices,
and will be able to ensure that funds are accounted for, and tied to,
a specific property or project.
(D) The holder has an adopted investment policy that is consistent
with the Uniform Management of Institutional Funds Act (Part 7
(commencing with Section 18501) of Division 9 of the Probate Code)
with regard to endowment funds and that is consistent with Sections
18505 and 18506 of the Probate Code with regard to nonendowment
funds.
(3) The department may contract with the Controller to provide
fiscal expertise for the evaluation of nonprofit organizations that
hold funds on behalf of the department for the long-term management
of mitigation lands.
(h) The state or local public agency may contract with or
designate an independent third party to do any of the following:
(1) Review the qualifications of a nonprofit organization to
effectively manage and steward natural land or resources.
(2) Review the qualifications of a nonprofit organization to hold
and manage the funds set aside for long-term management associated
with the property.
(3) Determine whether the holder of the funds meets the
requirements set forth in paragraph (2) of subdivision (f).
(4) Review reports or other performance indicators to evaluate the
management of lands, resources, or funds.
(i) (1) If a state or local agency authorizes nonprofit
organizations to hold lands or natural resources created for
mitigation purposes, the state or local agency may require an
administrative endowment from the project proponent for costs
associated with reviewing qualifications, approving holders, and
regular oversight of compliance and performance.
(2) The state or local public agency may also require project
proponents to provide a separate account that will provide for
initial management costs while the endowment matures.
(j) This section shall not apply retroactively to endowment funds
held by the state in the Pooled Money Investment Account as of
January 1, 2012.
(k) A property that has been previously protected for conservation
purposes, including the placement of a conservation easement on the
property, may not be used for mitigation purposes.
(l) This section is not intended to interfere with or prevent the
existing authority of an agency or department to carry out its
programs, projects, or responsibilities to identify, review, approve,
deny, or implement any mitigation requirements, and nothing in this
section shall be construed as a limitation on mitigation requirements
for the project, or a limitation on compliance with requirements
under this division or any other provision of law.
(m) This section shall remain in effect only until January 1,
2022, and as of that date is repealed, unless a later enacted
statute, which is enacted before January 1, 2022, deletes or extends
that date.
SEC. 3. Section 65965 is added to the Government Code, to read:
65965. (a) For the purposes of this section, the following
definitions apply:
(1) "Direct protection" means the protection and preservation of
natural lands or resources, including, but not limited to,
agricultural lands, wildlife habitat, wetlands, endangered species
habitat, open-space areas, or outdoor recreational areas.
(2) "Stewardship" encompasses the range of activities involved in
controlling, monitoring, and managing for conservation purposes a
property, or a conservation or open-space easement, as defined by the
terms of the easement, and its attendant resources.
(b) Notwithstanding any other provision of law to the contrary, if
a state or local public agency requires a property owner to transfer
to the agency an interest in real property to mitigate any adverse
impact upon natural resources caused by permitting the development of
a project or facility, the state or local public agency may
authorize a nonprofit organization to hold title to and manage that
interest in real property, provided that the nonprofit organization
is all of the following:
(1) Exempt from taxation as an organization described in Section
501(c)(3) of the Internal Revenue Code, and qualified to do business
in the state.
(2) A "qualified organization" as defined in Section 170(h)(3) of
the Internal Revenue Code.
(3) An organization that has as its principal purpose and activity
the direct protection or stewardship of natural land or resources,
or cultural or historic resources, including, but not limited to,
agricultural lands, wildlife habitat, wetlands, endangered species
habitat, open-space areas, and outdoor recreational areas.
(c) If a state or local public agency, in the development of its
own project, is required to transfer an interest in real property to
mitigate an adverse impact upon natural resources, the agency may
transfer the interest to a nonprofit organization that meets the
requirements set forth in paragraphs (1) to (3), inclusive, of
subdivision (b).
(d) The recorded instrument that places title with a nonprofit
organization pursuant to subdivision (b) shall include, at a minimum,
a provision that if the state or local public agency that authorized
the nonprofit organization to hold the title, or its successor
agency, determines that the interest in real property that is held by
the nonprofit organization is not being held, monitored, or managed
for conservation purposes in the manner specified in that instrument
or in the mitigation agreement between the state or local public
agency and the nonprofit organization, the interest in real property
shall revert to the state or that local public agency, or to another
public agency or nonprofit organization qualified pursuant to
subdivision (b), approved by the state or local public agency.
(e) A state or local public agency shall exercise due diligence in
reviewing the qualifications of a nonprofit organization to
effectively manage and steward natural land or resources. The state
or local public agency may adopt guidelines to assist the agency in
that review process.
(f) This section shall become operative on January 1, 2022.
