HomeMy WebLinkAboutAssembly Bill No. 26 Assembly Bill No.26
CHAPTER 5
An act to amend Sections 33500, 33501, 33607.5, and 33607.7 of, and
to add Part 1.8 (commencing with Section 34161) and Part 1.85
(commencing with Section 34170)to Division 24 of,the Health and Safety
Code, and to add Sections 97.401 and 98.2 to the Revenue and Taxation
Code,relating to redevelopment,and making an appropriation therefor,to
take effect immediately,bill related to the budget.
[Approved by Governor June 28,2011.Filed with
Secretary of State June 29,2011.]
LEGISLATIVE COUNSEL'S DIGEST
AB 26,Blumenfield.Community redevelopment.
(1) The Community Redevelopment Law authorizes the establishment
of redevelopment agencies in communities to address the effects of blight,
as defined. Existing law provides that an action may be brought to review
the validity of the adoption or amendment of a redevelopment plan by an
agency, to review the validity of agency findings or determinations, and
other agency actions.
This bill would revise the provisions of law authorizing an action to be
brought against the agency to determine or review the validity of specified
agency actions.
(2) Existing law also requires that if an agency ceases to function, any
surplus funds existing after payment of all obligations and indebtedness
vest in the community.
The bill would suspend various agency activities and prohibit agencies
from incurring indebtedness commencing on the effective date of this act.
Effective October 1,2011,the bill would dissolve all redevelopment agencies
and community development agencies in existence and designate successor
agencies,as defined, as successor entities. The bill would impose various
requirements on the successor agencies and subject successor agency actions
to the review of oversight boards,which the bill would establish.
The bill would require county auditor-controllers to conduct an
agreed-upon procedures audit of each former redevelopment agency by
March 1, 2012. The bill would require the county auditor-controller to
determine the amount of property taxes that would have been allocated to
each redevelopment agency if the agencies had not been dissolved and
deposit this amount in a Redevelopment Property Tax Trust Fund in the
county. Revenues in the trust fund would be allocated to various taxing
entities in the county and to cover specified expenses of the former agency.
By imposing additional duties upon local public officials, the bill would
create a state-mandated local program.
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(3) The bill would prohibit a redevelopment agency from issuing new
bonds, notes, interim certificates, debentures, or other obligations if any
legal challenge to invalidate a provision of this act is successful.
(4) The bill would appropriate $500,000 to the Department of Finance
from the General Fund for administrative costs associated with the bill.
(5) The bill would provide that its provisions take effect only if specified
legislation is enacted in the 2011-12 First Extraordinary Session of the
Legislature.
(6) The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the state.Statutory
provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for
a specified reason.
(7) The California Constitution authorizes the Governor to declare a
fiscal emergency and to call the Legislature into special session for that
purpose.Governor Schwarzenegger issued a proclamation declaring a fiscal
emergency,and calling a special session for this purpose,on December 6,
2010.Governor Brown issued a proclamation on January 20,2011,declaring
and reaffirming that a fiscal emergency exists and stating that his
proclamation supersedes the earlier proclamation for purposes of that
constitutional provision.
This bill would state that it addresses the fiscal emergency declared and
reaffirmed by the Governor by proclamation issued on January 20, 2011,
pursuant to the California Constitution.
(8) This bill would declare that it is to take effect immediately as a bill
providing for appropriations related to the Budget Bill.
Appropriation:yes.
The people of the State of California do enact as follows:
SECTION 1. The Legislature finds and declares all of the following:
(a) The economy and the residents of this state are slowly recovering
from the worst recession since the Great Depression.
(b) State and local governments are still facing incredibly significant
declines in revenues and increased need for core governmental services.
(c) Local governments across this state continue to confront difficult
choices and have had to reduce fire and police protection among other
services.
(d) Schools have faced reductions in funding that have caused school
districts to increase class size and layoff teachers, as well as make other
hurtful cuts.
(e) Redevelopment agencies have expanded over the years in this state.
The expansion of redevelopment agencies has increasingly shifted property
taxes away from services provided to schools, counties, special districts,
and cities.
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(f) Redevelopment agencies take in approximately 12 percent of all of
the property taxes collected across this state.
(g) It is estimated that under current law,redevelopment agencies will
divert$5 billion in property tax revenue from other taxing agencies in the
2011-12 fiscal year.
(h) The Legislature has all legislative power not explicitly restricted to
it.The California Constitution does not require that redevelopment agencies
must exist and, unlike other entities such as counties, does not limit the
Legislature's control over that existence. Redevelopment agencies were
created by statute and can therefore be dissolved by statute.
(i) Upon their dissolution, any property taxes that would have been
allocated to redevelopment agencies will no longer be deemed tax increment.
Instead, those taxes will be deemed property tax revenues and will be
allocated first to successor agencies to make payments on the indebtedness
incurred by the dissolved redevelopment agencies,with remaining balances
allocated in accordance with applicable constitutional and statutory
provisions.
(j) It is the intent of the Legislature to do all of the following in this act:
(1) Bar existing redevelopment agencies from incurring new obligations,
prior to their dissolution.
(2) Allocate property tax revenues to successor agencies for making
payments on indebtedness incurred by the redevelopment agency prior to
its dissolution and allocate remaining balances in accordance with applicable
constitutional and statutory provisions.
(3) Beginning October 1, 2011, allocate these funds according to the
existing property tax allocation within each county to make the funds
available for cities, counties, special districts, and school and community
college districts.
(4) Require successor agencies to expeditiously wind down the affairs
of the dissolved redevelopment agencies and to provide the successor
agencies with limited authority that extends only to the extent needed to
implement a winddown of redevelopment agency affairs.
SEC. 2. Section 33500 of the Health and Safety Code is amended to
read:
33500. (a) Notwithstanding any other provision of law,including Section
33501,an action may be brought to review the validity of the adoption or
amendment of a redevelopment plan at any time within 90 days after the
date of the adoption of the ordinance adopting or amending the plan,if the
adoption of the ordinance occurred prior to January 1,2011.
(b) Notwithstanding any other provision of law,including Section 33501,
an action may be brought to review the validity of any findings or
determinations by the agency or the legislative body at any time within 90
days after the date on which the agency or the legislative body made those
findings or determinations,if the findings or determinations occurred prior
to January 1,2011.
(c) Notwithstanding any other law, including Section 33501, an action
may be brought to review the validity of the adoption or amendment of a
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redevelopment plan at any time within two years after the date of the
adoption of the ordinance adopting or amending the plan, if the adoption
of the ordinance occurred after January 1,2011.
(d) Notwithstanding any other law, including Section 33501, an action
may be brought to review the validity of any findings or determinations by
the agency or the legislative body at any time within two years after the
date on which the agency or the legislative body made those findings or
determinations,if the findings or determinations occurred after January 1,
2011.
SEC. 3. Section 33501 of the Health and Safety Code is amended to
read:
33501. (a) 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 and the redevelopment plan to be financed
or refinanced,in whole or in part,by the bonds,or to determine the validity
of a redevelopment plan not financed by bonds,including without limiting
the generality of the foregoing,the legality and validity of all proceedings
theretofore taken for or in any way connected with the establishment of the
agency, its authority to transact business and exercise its powers, the
designation of the survey area, the selection of the project area, the
formulation of the preliminary plan, the validity of the finding and
determination that the project area is predominantly urbanized, and the
validity of the adoption of the redevelopment plan,and also including the
legality and validity of all proceedings theretofore taken and(as provided
in the bond resolution)proposed to be taken for the authorization,issuance,
sale,and delivery of the bonds,and for the payment of the principal thereof
and interest thereon.
(b) Notwithstanding subdivision(a),an action to determine the validity
of a redevelopment plan, or amendment to a redevelopment plan that was
adopted prior to January 1,2011,may be brought within 90 days after the
date of the adoption of the ordinance adopting or amending the plan.
(c) Any action that is commenced on or after January 1,2011,which is
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 or legality
of any issue, document, or action described in subdivision (a), may be
brought within two years after any triggering event that occurred after
January 1,2011.
(d) For the purposes of protecting the interests of the state,the Attorney
General and the Department of Finance are interested persons pursuant to
Section 863 of the Code of Civil Procedure in any action brought with
respect to the validity of an ordinance adopting or amending a redevelopment
plan pursuant to this section.
(e) For purposes of contesting the inclusion in a project area of lands that
are enforceably restricted,as that term is defined in Sections 422 and 422.5
of the Revenue and Taxation Code,or lands that are in agricultural use,as
defined in subdivision(b)of Section 51201 of the Government Code, the
Department of Conservation, the county agricultural commissioner, the
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county farm bureau,the California Farm Bureau Federation,and agricultural
entities and general farm organizations that provide a written request for
notice,are interested persons pursuant to Section 863 of the Code of Civil
Procedure,in any action brought with respect to the validity of an ordinance
adopting or amending a redevelopment plan pursuant to this section.
SEC.4. Section 33607.5 of the Health and Safety Code is amended to
read:
33607.5. (a) (1) This section shall apply to each redevelopment project
area that,pursuant to a redevelopment plan which contains the provisions
required by Section 33670, is either: (A) adopted on or after January 1,
1994, including later amendments to these redevelopment plans; or (B)
adopted prior to January 1, 1994, but amended, after January 1, 1994, to
include new territory. For plans amended after January 1, 1994, only the
tax increments from territory added by the amendment shall be subject to
this section. All the amounts calculated pursuant to this section shall be
calculated after the amount required to be deposited in the Low and Moderate
Income Housing Fund pursuant to Sections 33334.2,33334.3,and 33334.6
has been deducted from the total amount of tax increment funds received
by the agency in the applicable fiscal year.
(2) The payments made pursuant to this section shall be in addition to
any amounts the affected taxing entities receive pursuant to subdivision(a)
of Section 33670.The payments made pursuant to this section to the affected
taxing entities, including the community, shall be allocated among the
affected taxing entities, including the community if the community elects
to receive payments,in proportion to the percentage share of property taxes
each affected taxing entity, including the community, receives during the
fiscal year the funds are allocated, which percentage share shall be
determined without regard to any amounts allocated to a city, a city and
county, or a county pursuant to Sections 97.68 and 97.70 of the Revenue
and Taxation Code, and without regard to any allocation reductions to a
city,a city and county,a county,a special district,or a redevelopment agency
pursuant to Sections 97.71,97.72,and 97.73 of the Revenue and Taxation
Code and Section 33681.12.The agency shall reduce its payments pursuant
to this section to an affected taxing entity by any amount the agency has
paid, directly or indirectly,pursuant to Section 33445, 33445.5, 33445.6,
33446, or any other provision of law other than this section for, or in
connection with, a public facility owned or leased by that affected taxing
agency,except:(A) any amounts the agency has paid directly or indirectly
pursuant to an agreement with a taxing entity adopted prior to January 1,
1994;or(B) any amounts that are unrelated to the specific project area or
amendment governed by this section. The reduction in a payment by an
agency to a school district,community college district,or county office of
education,or for special education,shall be subtracted only from the amount
that otherwise would be available for use by those entities for educational
facilities pursuant to paragraph(4). If the amount of the reduction exceeds
the amount that otherwise would have been available for use for educational
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facilities in any one year,the agency shall reduce its payment in more than
one year.
(3) If an agency reduces its payment to a school district, community
college district,or county office of education,or for special education,the
agency shall do all of the following:
(A) Determine the amount of the total payment that would have been
made without the reduction.
(B) Determine the amount of the total payment without the reduction
which: (i)would have been considered property taxes;and(ii)would have
been available to be used for educational facilities pursuant to paragraph
(4).
(C) Reduce the amount available to be used for educational facilities.
(D) Send the payment to the school district,community college district,
or county office of education,or for special education,with a statement that
the payment is being reduced and including the calculation required by this
subdivision showing the amount to be considered property taxes and the
amount,if any,available for educational facilities.
(4) (A) Except as specified in subparagraph(E),of the total amount paid
each year pursuant to this section to school districts,43.3 percent shall be
considered to be property taxes for the purposes of paragraph (1) of
subdivision(h)of Section 42238 of the Education Code, and 56.7 percent
shall not be considered to be property taxes for the purposes of that section
and shall be available to be used for educational facilities,including,in the
case of amounts paid during the 2011-12 fiscal year through the 2015-16
fiscal year,inclusive,land acquisition,facility construction,reconstruction,
remodeling,maintenance,or deferred maintenance.
(B) Except as specified in subparagraph (E), of the total amount paid
each year pursuant to this section to community college districts,47.5 percent
shall be considered to be property taxes for the purposes of Section 84751
of the Education Code, and 52.5 percent shall not be considered to be
property taxes for the purposes of that section and shall be available to be
used for educational facilities,including,in the case of amounts paid during
the 2011-12 fiscal year through the 2015-16 fiscal year, inclusive, land
acquisition,facility construction,reconstruction,remodeling,maintenance,
or deferred maintenance.
(C) Except as specified in subparagraph (E), of the total amount paid
each year pursuant to this section to county offices of education, 19 percent
shall be considered to be property taxes for the purposes of Section 2558
of the Education Code,and 81 percent shall not be considered to be property
taxes for the purposes of that section and shall be available to be used for
educational facilities, including, in the case of amounts paid during the
2011-12 fiscal year through the 2015-16 fiscal year, inclusive, land
acquisition,facility construction,reconstruction,remodeling,maintenance,
or deferred maintenance.
(D) Except as specified in subparagraph (E), of the total amount paid
each year pursuant to this section for special education, 19 percent shall be
considered to be property taxes for the purposes of Section 56712 of the
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Education Code,and 81 percent shall not be considered to be property taxes
for the purposes of that section and shall be available to be used for education
facilities,including,in the case of amounts paid during the 2011-12 fiscal
year through the 2015-16 fiscal year, inclusive, land acquisition, facility
construction, reconstruction, remodeling, maintenance, or deferred
maintenance.
(E) If,pursuant to paragraphs(2)and(3),an agency reduces its payments
to an educational entity, the calculation made by the agency pursuant to
paragraph(3) shall determine the amount considered to be property taxes
and the amount available to be used for educational facilities in the year the
reduction was made.
(5) Local education agencies that use funds received pursuant to this
section for school facilities shall spend these funds at schools that are: (A)
within the project area,(B)attended by students from the project area,(C)
attended by students generated by projects that are assisted directly by the
redevelopment agency,or(D)determined by the governing board of a local
education agency to be of benefit to the project area.
(b) Commencing with the first fiscal year in which the agency receives
tax increments and continuing through the last fiscal year in which the
agency receives tax increments, a redevelopment agency shall pay to the
affected taxing entities, including the community if the community elects
to receive a payment,an amount equal to 25 percent of the tax increments
received by the agency after the amount required to be deposited in the Low
and Moderate Income Housing Fund has been deducted. In any fiscal year
in which the agency receives tax increments,the community that has adopted
the redevelopment project area may elect to receive the amount authorized
by this paragraph.
(c) Commencing with the 11th fiscal year in which the agency receives
tax increments and continuing through the last fiscal year in which the
agency receives tax increments, a redevelopment agency shall pay to the
affected taxing entities, other than the community which has adopted the
project,in addition to the amounts paid pursuant to subdivision(b)and after
deducting the amount allocated to the Low and Moderate Income Housing
Fund,an amount equal to 21 percent of the portion of tax increments received
by the agency,which shall be calculated by applying the tax rate against
the amount of assessed value by which the current year assessed value
exceeds the first adjusted base year assessed value.The first adjusted base
year assessed value is the assessed value of the project area in the 10th fiscal
year in which the agency receives tax increment revenues.
(d) Commencing with the 31st fiscal year in which the agency receives
tax increments and continuing through the last fiscal year in which the
agency receives tax increments, a redevelopment agency shall pay to the
affected taxing entities, other than the community which has adopted the
project,in addition to the amounts paid pursuant to subdivisions(b)and(c)
and after deducting the amount allocated to the Low and Moderate Income
Housing Fund,an amount equal to 14 percent of the portion of tax increments
received by the agency,which shall be calculated by applying the tax rate
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against the amount of assessed value by which the current year assessed
value exceeds the second adjusted base year assessed value. The second
adjusted base year assessed value is the assessed value of the project area
in the 30th fiscal year in which the agency receives tax increments.
(e) (1) Prior to incurring any loans,bonds,or other indebtedness,except
loans or advances from the community,the agency may subordinate to the
loans, bonds, or other indebtedness the amount required to be paid to an
affected taxing entity by this section,provided that the affected taxing entity
has approved these subordinations pursuant to this subdivision.
(2) At the time the agency requests an affected taxing entity to subordinate
the amount to be paid to it, the agency shall provide the affected taxing
entity with substantial evidence that sufficient funds will be available to
pay both the debt service and the payments required by this section,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 agency will not be able to
pay the debt 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.
(f) (I) The Legislature finds and declares both of the following:
(A) The payments made pursuant to this section are necessary in order
to alleviate the financial burden and detriment that affected taxing entities
may incur as a result of the adoption of a redevelopment plan,and payments
made pursuant to this section will benefit redevelopment project areas.
(B) The payments made pursuant to this section are the exclusive
payments that are required to be made by a redevelopment agency to affected
taxing entities during the term of a redevelopment plan.
(2) Notwithstanding any other provision of law,a redevelopment agency
shall not be required,either directly or indirectly,as a measure to mitigate
a significant environmental effect or as part of any settlement agreement or
judgment brought in any action to contest the validity of a redevelopment
plan pursuant to Section 33501, to make any other payments to affected
taxing entities,or to pay for public facilities that will be owned or leased to
an affected taxing entity.
(g) As used in this section,a"local education agency"is a school district,
a community college district,or a county office of education.
SEC. 5. Section 33607.7 of the Health and Safety Code is amended to
read:
33607.7. (a) This section shall apply to a redevelopment plan amendment
for any redevelopment plans adopted prior to January 1, 1994,that increases
the limitation on the number of dollars to be allocated to the redevelopment
agency or that increases, or eliminates pursuant to paragraph (1) of
subdivision (e) of Section 33333.6, the time limit on the establishing of
loans, advances, and indebtedness established pursuant to paragraphs (1)
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and(2)of subdivision(a)of Section 33333.6,as those paragraphs read on
December 31, 2001, or that lengthens the period during which the
redevelopment plan is effective if the redevelopment plan being amended
contains the provisions required by subdivision (b) of Section 33670.
However,this section shall not apply to those redevelopment plans that add
new territory.
(b) If a redevelopment agency adopts an amendment that is governed by
the provisions of this section,it shall pay to each affected taxing entity either
of the following:
(1) If an agreement exists that requires payments to the taxing entity,the
amount required to be paid by an agreement between the agency and an
affected taxing entity entered into prior to January 1, 1994.
(2) If an agreement does not exist, the amounts required pursuant to
subdivisions (b), (c), (d), and (e) of Section 33607.5, until termination of
the redevelopment plan,calculated against the amount of assessed value by
which the current year assessed value exceeds an adjusted base year assessed
value.The amounts shall be allocated between property taxes and educational
facilities,including, in the case of amounts paid during the 2011-12 fiscal
year through the 2015-16 fiscal year, inclusive, land acquisition, facility
construction, reconstruction, remodeling, maintenance, or deferred
maintenance, according to the appropriate formula in paragraph (3) of
subdivision (a) of Section 33607.5. In determining the applicable amount
under Section 33607.5, the first fiscal year shall be the first fiscal year
following the fiscal year in which the adjusted base year value is determined.
(c) The adjusted base year assessed value shall be the assessed value of
the project area in the year in which the limitation being amended would
have taken effect without the amendment or,if more than one limitation is
being amended,the first year in which one or more of the limitations would
have taken effect without the amendment. The agency shall commence
making these payments pursuant to the terms of the agreement,if applicable,
or,if an agreement does not exist,in the first fiscal year following the fiscal
year in which the adjusted base year value is determined.
SEC.6. Part 1.8(commencing with Section 34161)is added to Division
24 of the Health and Safety Code,to read:
PART 1.8. RESTRICTIONS ON REDEVELOPMENT AGENCY
OPERATIONS
CHAPTER 1. SUSPENSION OF AGENCY ACTIVITIES AND PROHIBITION ON
CREATION OF NEW DEBTS
34161. Notwithstanding Part 1 (commencing with Section 33000),Part
1.5(commencing with Section 34000),Part 1.6(commencing with Section
34050), and Part 1.7(commencing with Section 34100),or any other law,
commencing on the effective date of this part, no agency shall incur new
or expand existing monetary or legal obligations except as provided in this
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part.All of the provisions of this part shall take effect and be operative on
the effective date of the act adding this part.
34162. (a) Notwithstanding Part 1 (commencing with Section 33000),
Part 1.5 (commencing with Section 34000), Part 1.6 (commencing with
Section 34050), and Part 1.7 (commencing with Section 34100), or any
other law,commencing on the effective date of this act,an agency shall be
unauthorized and shall not take any action to incur indebtedness,including,
but not limited to,any of the following:
(1) Issue or sell bonds, for any purpose, regardless of the source of
repayment of the bonds.As used in this section,the term"bonds,"includes,
but is not limited to, any bonds, notes, bond anticipation notes, interim
certificates, debentures, certificates of participation, refunding bonds, or
other obligations issued by an agency pursuant to Part 1 (commencing with
Section 33000), and Section 53583 of the Government Code,pursuant to
any charter city authority or any revenue bond law.
(2) Incur indebtedness payable from prohibited sources of repayment,
which include,but are not limited to, income and revenues of an agency's
redevelopment projects,taxes allocated to the agency,taxes imposed by the
agency pursuant to Section 7280.5 of the Revenue and Taxation Code,
assessments imposed by the agency, loan repayments made to the agency
pursuant to Section 33746, fees or charges imposed by the agency, other
revenues of the agency,and any contributions or other financial assistance
from the state or federal government.
(3) Refund, restructure, or refinance indebtedness or obligations that
existed as of January 1, 2011, including, but not limited to, any of the
following:
(A) Refund bonds previously issued by the agency or by another political
subdivision of the state,including,but not limited to,those issued by a city,
a housing authority,or a nonprofit corporation acting on behalf of a city or
a housing authority.
(B) Exercise the right of optional redemption of any of its outstanding
bonds or elect to purchase any of its own outstanding bonds.
(C) Modify or amend the terms and conditions, payment schedules,
amortization or maturity dates of any of the agency's bonds or other
obligations that are outstanding or exist as of January 1,2011.
(4) Take out or accept loans or advances,for any purpose,from the state
or the federal government,any other public agency,or any private lending
institution,or from any other source.For purposes of this section,the term
"loans"include,but are not limited to,agreements with the community or
any other entity for the purpose of refinancing a redevelopment project and
moneys advanced to the agency by the community or any other entity for
the expenses of redevelopment planning, expenses for dissemination of
redevelopment information, other administrative expenses, and overhead
of the agency.
(5) Execute trust deeds or mortgages on any real or personal property
owned or acquired by it.
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(6) Pledge or encumber, for any purpose,any of its revenues or assets.
As used in this part,an agency's"revenues and assets"include,but are not
limited to, agency tax revenues, redevelopment project revenues, other
agency revenues, deeds of trust and mortgages held by the agency, rents,
fees,charges,moneys,accounts receivable,contracts rights,and other rights
to payment of whatever kind or other real or personal property.As used in
this part,to"pledge or encumber"means to make a commitment of,by the
grant of a lien on and a security interest in,an agency's revenues or assets,
whether by resolution, indenture, trust agreement, loan agreement, lease,
installment sale agreement, reimbursement agreement, mortgage, deed of
trust,pledge agreement,or similar agreement in which the pledge is provided
for or created.
(b) Any actions taken that conflict with this section are void from the
outset and shall have no force or effect.
(c) Notwithstanding subdivision(a),a redevelopment agency may issue
refunding bonds,which are referred to in this part as Emergency Refunding
Bonds,only where all of the following conditions are met:
(1) The issuance of Emergency Refunding Bonds is the only means
available to the agency to avoid a default on outstanding agency bonds.
(2) Both the county treasurer and the Treasurer have approved the
issuance of Emergency Refunding Bonds.
(3) Emergency Refunding Bonds are issued only to provide funds for
any single debt service payment that is due prior to October 1, 2011, and
that is more than 20 percent larger than a level debt service payment would
be for that bond.
(4) The principal amount of outstanding agency bonds is not increased.
34163. Notwithstanding Part 1 (commencing with Section 33000),Part
1.5(commencing with Section 34000),Part 1.6(commencing with Section
34050), and Part 1.7(commencing with Section 34100),or any other law,
commencing on the effective date of this part,an agency shall not have the
authority to,and shall not,do any of the following:
(a) Make loans or advances or grant or enter into agreements to provide
funds or provide financial assistance of any sort to any entity or person for
any purpose, including,but not limited to,all of the following:
(1) Loans of moneys or any other thing of value or commitments to
provide financing to nonprofit organizations to provide those organizations
with financing for the acquisition,construction,rehabilitation,refinancing,
or development of multifamily rental housing or the acquisition of
commercial property for lease,each pursuant to Chapter 7.5(commencing
with Section 33741)of Part 1.
(2) Loans of moneys or any other thing of value for residential
construction, improvement, or rehabilitation pursuant to Chapter 8
(commencing with Section 33750) of Part 1. These include, but are not
limited to,construction loans to purchasers of residential housing,mortgage
loans to purchasers of residential housing,and loans to mortgage lenders,
or any other entity,to aid in financing pursuant to Chapter 8(commencing
with Section 33750).
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(3) The purchase,by an agency,of mortgage or construction loans from
mortgage lenders or from any other entities.
(b) Enter into contracts with, incur obligations, or make commitments
to,any entity,whether governmental,tribal,or private,or any individual or
groups of individuals for any purpose, including, but not limited to, loan
agreements, passthrough agreements, regulatory agreements, services
contracts, leases, disposition and development agreements,joint exercise
of powers agreements, contracts for the purchase of capital equipment,
agreements for redevelopment activities, including, but not limited to,
agreements for planning, design, redesign, development, demolition,
alteration,construction,reconstruction,rehabilitation,site remediation,site
development or improvement,removal of graffiti,land clearance,and seismic
retrofits.
(c) Amend or modify existing agreements,obligations,or commitments
with any entity, for any purpose, including, but not limited to, any of the
following:
(1) Renewing or extending term of leases or other agreements, except
that the agency may extend lease space for its own use to a date not to exceed
six months after the effective date of the act adding this part and for a rate
no more than 5 percent above the rate the agency currently pays on a monthly
basis.
(2) Modifying terms and conditions of existing agreements,obligations,
or commitments.
(3) Forgiving all or any part of the balance owed to the agency on existing
loans or extend the term or change the terms and conditions of existing
loans.
(4) Increasing its deposits to the Low and Moderate Income Housing
Fund created pursuant to Section 33334.3 beyond the minimum level that
applied to it as of January 1,2011.
(5) Transferring funds out of the Low and Moderate Income Housing
Fund,except to meet the minimum housing-related obligations that existed
as of January 1, 2011, to make required payments under Sections 33690
and 33690.5,and to borrow funds pursuant to Section 34168.5.
(d) Dispose of assets by sale, long-term lease, gift, grant, exchange,
transfer,assignment,or otherwise,for any purpose,including,but not limited
to,any of the following:
(1) Assets,including,but not limited to,real property,deeds of trust,and
mortgages held by the agency,moneys,accounts receivable,contract rights,
proceeds of insurance claims,grant proceeds, settlement payments,rights
to receive rents,and any other rights to payment of whatever kind.
(2) Real property, including,but not limited to, land, land under water
and waterfront property,buildings, structures,fixtures, and improvements
on the land, any property appurtenant to, or used in connection with, the
land,every estate,interest,privilege,easement,franchise,and right in land,
including rights-of-way,terms for years,and liens,charges,or encumbrances
by way of judgment,mortgage,or otherwise,and the indebtedness secured
by the liens.
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(e) Acquire real property by any means for any purpose,including,but
not limited to,the purchase,lease,or exercising of an option to purchase or
lease, exchange, subdivide, transfer, assume, obtain option upon, acquire
by gift,grant,bequest,devise,or otherwise acquire any real property,any
interest in real property, and any improvements on it, including the
repurchase of developed property previously owned by the agency and the
acquisition of real property by eminent domain; provided, however, that
nothing in this subdivision is intended to prohibit the acceptance or transfer
of title for real property acquired prior to the effective date of this part.
(f) Transfer, assign, vest, or delegate any of its assets, funds, rights,
powers, ownership interests, or obligations for any purpose to any entity,
including,but not limited to,the community,the legislative body, another
member of a joint powers authority, a trustee, a receiver, a partner entity,
another agency,a nonprofit corporation,a contractual counterparty,a public
body,a limited-equity housing cooperative,the state,a political subdivision
of the state,the federal government,any private entity,or an individual or
group of individuals.
(g) Accept financial or other assistance from the state or federal
government or any public or private source if the acceptance necessitates
or is conditioned upon the agency incurring indebtedness as that term is
described in this part.
34164. Notwithstanding Part 1 (commencing with Section 33000),Part
1.5(commencing with Section 34000),Part 1.6(commencing with Section
34050), and Part 1.7 (commencing with Section 34100),or any other law,
commencing on the effective date of this part, an agency shall lack the
authority to, and shall not, engage in any of the following redevelopment
activities:
(a) Prepare, approve, adopt, amend, or merge a redevelopment plan,
including,but not limited to,modifying,extending,or otherwise changing
the time limits on the effectiveness of a redevelopment plan.
(b) Create,designate,merge,expand,or otherwise change the boundaries
of a project area.
(c) Designate a new survey area or modify,extend,or otherwise change
the boundaries of an existing survey area.
(d) Approve or direct or cause the approval of any program,project,or
expenditure where approval is not required by law.
(e) Prepare, formulate, amend, or otherwise modify a preliminary plan
or cause the preparation, formulation, modification, or amendment of a
preliminary plan.
(f) Prepare, formulate, amend, or otherwise modify an implementation
plan or cause the preparation,formulation,modification,or amendment of
an implementation plan.
(g) Prepare,formulate,amend,or otherwise modify a relocation plan or
cause the preparation, formulation, modification, or amendment of a
relocation plan where approval is not required by law.
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(h) Prepare, formulate, amend, or otherwise modify a redevelopment
housing plan or cause the preparation, formulation, modification, or
amendment of a redevelopment housing plan.
(i) Direct or cause the development, rehabilitation, or construction of
housing units within the community, unless required to do so by an
enforceable obligation.
(j) Make or modify a declaration or finding of blight,blighted areas,or
slum and blighted residential areas.
(k) Make any new findings or declarations that any areas of blight cannot
be remedied or redeveloped by private enterprise alone.
(l) Provide or commit to provide relocation assistance,except where the
provision of relocation assistance is required by law.
(m) Provide or commit to provide financial assistance.
34165. Notwithstanding Part 1 (commencing with Section 33000),Part
1.5(commencing with Section 34000),Part 1.6(commencing with Section
34050), and Part 1.7 (commencing with Section 34100),or any other law,
commencing on the effective date of this part, an agency shall lack the
authority to,and shall not,do any of the following:
(a) Enter into new partnerships, become a member in a joint powers
authority, form a joint powers authority, create new entities, or become a
member of any entity of which it is not currently a member,nor take on nor
agree to any new duties or obligations as a member or otherwise of any
entity to which the agency belongs or with which it is in any way associated.
(b) Impose new assessments pursuant to Section 7280.5 of the Revenue
and Taxation Code.
(c) Increase the pay,benefits,or contributions of any sort for any officer,
employee, consultant, contractor, or any other goods or service provider
that had not previously been contracted.
(d) Provide optional or discretionary bonuses to any officers,employees,
consultants,contractors,or any other service or goods providers.
(e) Increase numbers of staff employed by the agency beyond the number
employed as of January 1,2011.
(f) Bring an action 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 any issuance or proposed issuance of revenue bonds under this chapter
and the legality and validity of all proceedings previously taken or proposed
in a resolution of an agency to be taken for the authorization,issuance,sale,
and delivery of the revenue bonds and for the payment of the principal
thereof and interest thereon.
(g) Begin any condemnation proceeding or begin the process to acquire
real property by eminent domain.
(h) Prepare or have prepared a draft environmental impact report. This
subdivision shall not alter or eliminate any requirements of the California
Environmental Quality Act(Division 13(commencing with Section 21000)
of the Public Resources Code).
34166. No legislative body or local governmental entity shall have any
statutory authority to create or otherwise establish a new redevelopment
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agency or community development commission. No chartered city or
chartered county shall exercise the powers granted in Part 1 (commencing
with Section 33000)to create or otherwise establish a redevelopment agency.
34167. (a) This part is intended to preserve, to the maximum extent
possible,the revenues and assets of redevelopment agencies so that those
assets and revenues that are not needed to pay for enforceable obligations
may be used by local governments to fund core governmental services
including police and fire protection services and schools.It is the intent of
the Legislature that redevelopment agencies take no actions that would
further deplete the corpus of the agencies'funds regardless of their original
source.All provisions of this part shall be construed as broadly as possible
to support this intent and to restrict the expenditure of funds to the fullest
extent possible.
(b) For purposes of this part,"agency"or"redevelopment agency"means
a redevelopment agency created or formed pursuant to Part 1 (commencing
with Section 33000) or its predecessor or a community development
commission created or formed pursuant to Part 1.7 (commencing with
Section 34100)or its predecessor.
(c) Nothing in this part in any way impairs the authority of a community
development commission, other than in its authority to act as a
redevelopment agency, to take any actions in its capacity as a housing
authority or for any other community development purpose of the jurisdiction
in which it operates.
(d) For purposes of this part,"enforceable obligation"means any of the
following:
(1) Bonds, as defined by Section 33602 and bonds issued pursuant to
Section 5850 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
redevelopment agency.
(2) Loans of moneys borrowed by the redevelopment agency for a lawful
purpose,including,but not limited to,moneys borrowed from the Low and
Moderate Income Housing Fund,to the extent they are legally required to
be repaid pursuant to a required repayment schedule or other mandatory
loan terms.
(3) 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,and unemployment payments.
(4) 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.
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(5) Any legally binding and enforceable agreement or contract that is
not otherwise void as violating the debt limit or public policy.
(6) Contracts or agreements necessary for the continued administration
or operation of the redevelopment agency to the extent permitted by this
part, including, but not limited to, 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.
(e) To the extent that any provision of Part 1 (commencing with Section
33000),Part 1.5(commencing with Section 34000),Part 1.6(commencing
with Section 34050),or Part 1.7(commencing with Section 34100)conflicts
with this part, the provisions of this part shall control. Further, if any
provision in Part 1 (commencing with Section 33000),Part 1.5(commencing
with Section 34000), Part 1.6 (commencing with Section 34050), or Part
1.7 (commencing with Section 34100)provides an authority that this part
is restricting or eliminating, the restriction and elimination provisions of
this part shall control.
(f) Nothing in this part shall be construed to interfere with a
redevelopment agency's authority, pursuant to enforceable obligations as
defined in this chapter, to (1) make payments due, (2) enforce existing
covenants and obligations,or(3)perform its obligations.
(g) The existing terms of any memorandum of understanding with an
employee organization representing employees of a redevelopment agency
adopted pursuant to the Meyers-Milias-Brown Act that is in force on the
effective date of this part shall continue in force until September 30,2011,
unless a new agreement is reached with a recognized employee organization
prior to that date.
(h) After the enforceable obligation payment schedule is adopted pursuant
to Section 34169, or after 60 days from the effective date of this part,
whichever is sooner,the agency shall not make a payment unless it is listed
in an adopted enforceable obligation payment schedule,other than payments
required to meet obligations with respect to bonded indebtedness.
(i) 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.
(j) For purposes of this part, "auditor-controller" means the officer
designated in subdivision(e)of Section 24000 of the Government Code.
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. 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
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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
such an 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.
34168. (a) Notwithstanding any other law, any action contesting the
validity of this part or Part 1.85 (commencing with Section 34170) or
challenging acts taken pursuant to these parts shall be brought in the Superior
Court of the County of Sacramento.
(b) If any provision of this part or the application thereof to any person
or circumstance is held invalid,the invalidity does not affect other provisions
or applications of this part which can be given effect without the invalid
provision or application, and to this end, the provisions of this part are
severable.
CHAPTER 2. REDEVELOPMENT AGENCY RESPONSIBILITIES
34169. Until successor agencies are authorized pursuant to Part 1.85
(commencing with Section 34170),redevelopment agencies shall do all of
the following:
(a) Continue to make all scheduled payments for enforceable obligations,
as defined in subdivision(d)of Section 34167.
(b) Perform obligations required pursuant to any enforceable obligations,
including,but not limited to,observing covenants for continuing disclosure
obligations and those aimed at preserving the tax-exempt status of interest
payable on any outstanding agency bonds.
(c) Set aside or maintain reserves in the amount required by indentures,
trust indentures,or similar documents governing the issuance of outstanding
redevelopment agency bonds.
(d) Consistent with the intent declared in subdivision (a) of Section
34167,preserve all assets,minimize all liabilities,and preserve all records
of the redevelopment agency.
(e) Cooperate with the successor agencies,if established pursuant to Part
1.85 (commencing with Section 34170), and provide all records and
information necessary or desirable for audits,making of payments required
by enforceable obligations,and performance of enforceable obligations by
the successor agencies.
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(f) Take all reasonable measures to avoid triggering an event of default
under any enforceable obligations as defined in subdivision(d)of Section
34167.
(g) (1) Within 60 days of the effective date of this part, adopt an
Enforceable Obligation Payment Schedule that lists all of the obligations
that are enforceable within the meaning of subdivision(d)of Section 34167
which includes the following information about each obligation:
(A) The project name associated with the obligation.
(B) The payee.
(C) A short description of the nature of the work,product,service,facility,
or other thing of value for which payment is to be made.
(D) The amount of payments obligated to be made,by month, through
December 2011.
(2) Payment schedules for issued bonds may be aggregated,and payment
schedules for payments to employees may be aggregated. This schedule
shall be adopted at a public meeting and shall be posted on the agency's
Internet Web site or,if no Internet Web site exists,on the Internet Web site
of the legislative body, if that body has an Internet Web site.The schedule
may be amended at any public meeting of the agency.Amendments shall
be posted to the Internet Web site for at least three business days before a
payment may be made pursuant to an amendment. The Enforceable
Obligation Payment Schedule shall be transmitted by mail or electronic
means to the county auditor-controller,the Controller,and the Department
of Finance.A notification providing the Internet Web site location of the
posted schedule and notifications of any amendments shall suffice to meet
this requirement.
(h) Prepare a preliminary draft of the initial recognized obligation
payment schedule,no later than September 30,2011,and provide it to the
successor agency,if a successor agency is established pursuant to Part 1.85
(commencing with Section 34170).
(i) The Department of Finance may review a redevelopment agency
action taken pursuant to subdivision(g)or(h).As such,all agency actions
shall not be effective for three business days,pending a request for review
by the department. Each agency shall designate an official to whom the
department may make these 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.In the
event that the department requests a review of a given agency action, the
department shall have 10 days from the date of its request to approve the
agency action or return it to the agency for reconsideration and this action
shall not be effective until approved by the department. In the event that
the department returns the agency action to the agency for reconsideration,
the agency must resubmit the modified action for department approval and
the modified action shall not become effective until approved by the
department.This subdivision shall apply to a successor agency,if a successor
agency is established pursuant to Part 1.85 (commencing with Section
34170), as a successor entity to a dissolved redevelopment agency, with
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respect to the preliminary draft of the initial recognized obligation payment
schedule.
CHAPTER 3. APPLICATION OF PART TO FORMER PARTICIPANTS OF THE
ALTERNATIVE VOLUNTARY REDEVELOPMENT PROGRAM
34169.5. (a) It is the intent of the Legislature that a redevelopment
agency, that formerly operated pursuant to the Alternative Voluntary
Redevelopment Program(Part 1.9(commencing with Section 34192)),but
that becomes subject to this part pursuant to Section 34195,shall be subject
to all of the requirements of this part,except that dates and deadlines shall
be appropriately modified, as provided in this section, to reflect the date
that the agency becomes subject to this part.
(b) For purposes of a redevelopment agency that becomes subject to this
part pursuant to Section 34195,the following shall apply:
(1) Any reference to "January 1, 2011," shall be construed to mean
January 1 of the year preceding the year that the redevelopment agency
became subject to this part,but no earlier than January 1,2011.
(2) Any reference to a date"60 days from the effective date of this part"
shall be construed to mean 60 days from the date that the redevelopment
agency becomes subject to this part.
(3) Except as provided in paragraphs(1)and(2),any reference to a date
certain shall be construed to be the date, measured from the date that the
redevelopment agency became subject to this part,that is equivalent to the
duration of time between the effective date of this part and the date certain
identified in statute.
SEC.7. Part 1.85(commencing with Section 34170)is added to Division
24 of the Health and Safety Code,to read:
PART 1.85. DISSOLUTION OF REDEVELOPMENT AGENCIES AND
DESIGNATION OF SUCCESSOR AGENCIES
CHAPTER 1. EFFECTIVE DATE,CREATION OF FUNDS,AND DEFINITION
OF TERMS
34170. (a) Unless otherwise specified,all provisions of this part shall
become operative on October 1,2011.
(b) If any provision of this part or the application thereof to any person
or circumstance is held invalid,the invalidity shall not affect other provisions
or applications of this part which can be given effect without the invalid
provision or application, and to this end, the provisions of this part are
severable.
34170.5. (a) The successor agency shall create within its treasury a
Redevelopment Obligation Retirement Fund to be administered by the
successor agency.
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Ch.5 —20—
(b) The county auditor-controller shall create within the county treasury
a Redevelopment Property Tax Trust Fund for the property tax revenues
related to each former redevelopment agency, for administration by the
county auditor-controller.
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 for
the 2011-12 fiscal year 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) for any fiscal year or such lesser amount as agreed to by the
successor agency. However, the allowance amount shall exclude any
administrative costs that can be paid from bond proceeds or from sources
other than property tax.
(c) "Designated local authority" shall mean a public entity formed
pursuant to subdivision(d)of Section 34173.
(d) (I) "Enforceable obligation"means any of the following:
(A) Bonds, as defined by Section 33602 and bonds issued pursuant to
Section 58383 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.
(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.
(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
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any necessary and required compensation or remediation for such
termination.
(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 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.
(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.
(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.
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(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 county, city, or city and county that
authorized the creation of each redevelopment agency or another entity as
provided 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.
CHAPTER 2. EFFECT OF REDEVELOPMENT AGENCY DISSOLUTION
34172. (a) (1) All redevelopment agencies and redevelopment agency
components of community development agencies created under Part 1
(commencing with Section 33000), Part 1.5 (commencing with Section
34000), Part 1.6 (commencing with Section 34050), and Part 1.7
(commencing with Section 34100)that were in existence on the effective
date of this part are hereby dissolved and shall no longer exist as a public
body,corporate or politic.Nothing in this part dissolves or otherwise affects
the authority of a community redevelopment commission,other than in its
authority to act as a redevelopment agency, in its capacity as a housing
authority or for any other community development purpose of the jurisdiction
in which it operates. For those other nonredevelopment purposes, the
community development commission derives its authority solely from
federal or local laws, or from state laws other than the Community
Redevelopment Law(Part 1 (commencing with Section 33000)).
(2) A community in which an agency has been dissolved under this
section may not create a new agency pursuant to Part 1 (commencing with
Section 33000), Part 1.5 (commencing with Section 34000), Part 1.6
(commencing with Section 34050),or Part 1.7(commencing with Section
34100). However, a community in which the agency has been dissolved
and the successor entity has paid off all of the former agency's enforceable
obligations may create a new agency pursuant to Part 1 (commencing with
Section 33000), Part 1.5 (commencing with Section 34000), Part 1.6
(commencing with Section 34050),or Part 1.7 (commencing with Section
34100), subject to the tax increment provisions contained in Chapter 3.5
(commencing with Section 34194.5)of Part 1.9(commencing with Section
34192).
(b) All authority to transact business or exercise powers previously
granted under the Community Redevelopment Law(Part 1 (commencing
with Section 33000) is hereby withdrawn from the former redevelopment
agencies.
(c) Solely for purposes of Section 16 of Article XVI of the California
Constitution,the Redevelopment Property Tax Trust Fund shall be deemed
to be a special fund of the dissolved redevelopment agency to pay the
principal of and interest on loans, moneys advanced to, or indebtedness,
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whether funded, refunded, assumed, or otherwise incurred by the
redevelopment agency to finance or refinance, in whole or in part, the
redevelopment projects of each redevelopment agency dissolved pursuant
to this part.
(d) Revenues equivalent to those that would have been allocated pursuant
to subdivision(b)of Section 16 of Article XVI of the California Constitution
shall be allocated to the Redevelopment Property Tax Trust Fund of each
successor agency for making payments on the principal of and interest on
loans, and moneys advanced to or indebtedness incurred by the dissolved
redevelopment agencies. Amounts in excess of those necessary to pay
obligations of the former redevelopment agency shall be deemed to be
property tax revenues within the meaning of subdivision(a)of Section 1 of
Article XIII A of the California Constitution.
34173. (a) Successor agencies, as defined in this part, are hereby
designated as successor entities to the former redevelopment agencies.
(b) Except for those provisions of the Community Redevelopment Law
that are repealed,restricted,or revised pursuant to the act adding this part,
all authority,rights,powers,duties,and obligations previously vested with
the former redevelopment agencies,under the Community Redevelopment
Law,are hereby vested in the successor agencies.
(c) (1) Where the redevelopment agency was in the form of a joint powers
authority, and where the joint powers agreement governing the formation
of the joint powers authority addresses the allocation of assets and liabilities
upon dissolution of the joint powers authority,then each of the entities that
created the former redevelopment agency may be a successor agency within
the meaning of this part and each shall have a share of assets and liabilities
based on the provisions of the joint powers agreement.
(2) Where the redevelopment agency was in the form of a joint powers
authority, and where the joint powers agreement governing the formation
of the joint powers authority does not address the allocation of assets and
liabilities upon dissolution of the joint powers authority,then each of the
entities that created the former redevelopment agency may be a successor
agency within the meaning of this part,a proportionate share of the assets
and liabilities shall be based on the assessed value in the project areas within
each entity's jurisdiction, as determined by the county assessor, in its
jurisdiction as compared to the assessed value of land within the boundaries
of the project areas of the former redevelopment agency.
(d) (1) A city,county, city and county,or the entities forming the joint
powers authority that authorized the creation of each redevelopment agency
may elect not to serve as a successor agency under this part.A city,county,
city and county,or any member of a joint powers authority that elects not
to serve as a successor agency under this part must file a copy of a duly
authorized resolution of its governing board to that effect with the county
auditor-controller no later than one month prior to the effective date of this
part.
(2) The determination of the first local agency that elects to become the
successor agency shall be made by the county auditor-controller based on
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the earliest receipt by the county auditor-controller of a copy of a duly
adopted resolution of the local agency's governing board authorizing such
an election.As used in this section,"local agency"means any city,county,
city and county,or special district in the county of the former redevelopment
agency.
(3) If no local agency elects to serve as a successor agency for a dissolved
redevelopment agency, a public body, referred to herein as a"designated
local authority"shall be immediately formed,pursuant to this part, in the
county and shall be vested with all the powers and duties of a successor
agency as described in this part.The Governor shall appoint three residents
of the county to serve as the governing board of the authority.The designated
local authority shall serve as successor agency until a local agency elects
to become the successor agency in accordance with this section.
(e) The liability of any successor agency,acting pursuant to the powers
granted under the act adding this part, shall be limited to the extent of the
total sum of property tax revenues it receives pursuant to this part and the
value of assets transferred to it as a successor agency for a dissolved
redevelopment agency.
34174. (a) Solely for the purposes of Section 16 of Article XVI of the
California Constitution,commencing on the effective date of this part, all
agency loans, advances, or indebtedness, and interest thereon, shall be
deemed extinguished and paid; provided, however, that nothing herein is
intended to absolve the successor agency of payment or other obligations
due or imposed pursuant to the enforceable obligations;and provided further,
that nothing in the act adding this part is intended to be construed as an
action or circumstance that may give rise to an event of default under any
of the documents governing the enforceable obligations.
(b) Nothing in this part,including,but not limited to,the dissolution of
the redevelopment agencies,the designation of successor agencies,and the
transfer of redevelopment agency assets and properties,shall be construed
as a voluntary or involuntary insolvency of any redevelopment agency for
purposes of the indenture,trust indenture, or similar document governing
its outstanding bonds.
34175. (a) It is the intent of this part that pledges of revenues associated
with enforceable obligations of the former redevelopment agencies are to
be honored. It is intended that the cessation of any redevelopment agency
shall not affect either the pledge,the legal existence of that pledge, or the
stream of revenues available to meet the requirements of the pledge.
(b) All assets,properties,contracts,leases,books and records,buildings,
and equipment of the former redevelopment agency are transferred on
October 1,2011,to the control of the successor agency,for administration
pursuant to the provisions of this part. This includes all cash or cash
equivalents and amounts owed to the redevelopment agency as of October
1,2011.
34176. (a) The city, county, or city and county that authorized the
creation of a redevelopment agency may elect to retain the housing assets
and functions previously performed by the redevelopment agency.If a city,
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county,or city and county elects to retain the responsibility for performing
housing functions previously performed by a redevelopment agency, all
rights,powers, duties, and obligations, excluding any amounts on deposit
in the Low and Moderate Income Housing Fund,shall be transferred to the
city,county,or city and county.
(b) If a city, county, or city and county does not elect to retain the
responsibility for performing housing functions previously performed by a
redevelopment agency, all rights, powers, assets, liabilities, duties, and
obligations associated with the housing activities of the agency,excluding
any amounts in the Low and Moderate Income Housing Fund, shall be
transferred as follows:
(1) Where there is no local housing authority in the territorial jurisdiction
of the former redevelopment agency, to the Department of Housing and
Community Development.
(2) Where there is one local housing authority in the territorial jurisdiction
of the former redevelopment agency,to that local housing authority.
(3) Where there is more than one local housing authority in the territorial
jurisdiction of the former redevelopment agency, to the local housing
authority selected by the city,county,or city and county that authorized the
creation of the redevelopment agency.
(c) Commencing on the operative date of this part,the entity assuming
the housing functions formerly performed by the redevelopment agency
may enforce affordability covenants and perform related activities pursuant
to applicable provisions of the Community Redevelopment Law (Part 1
(commencing with Section 33000), including, but not limited to, Section
33418.
CHAPTER 3. SUCCESSOR AGENCIES
34177. Successor agencies are required to do all of the following:
(a) Continue to make payments due for enforceable obligations.
(1) On and after October 1, 2011, 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.
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(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 January 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 January 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 October 1,2011,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.
(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.
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(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
(l).
(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.
(I) (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 November 1,2011. From October 1,2011,to July 1,2012,the
initial draft of that schedule shall project the dates and amounts of scheduled
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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 December 15,2011,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.
34178. (a) Commencing on the operative date of this part,agreements,
contracts, or arrangements between the city or county, or city and county
that created the redevelopment agency and the redevelopment agency are
invalid and shall not be binding on the successor agency;provided,however,
that a successor entity wishing to enter or reenter into agreements with the
city,county,or city and county that formed the redevelopment agency that
it is succeeding may do so upon obtaining the approval of its oversight
board.
(b) Notwithstanding subdivision (a), any of the following agreements
are not invalid and may bind the successor agency:
(1) A duly authorized written agreement entered into at the time of
issuance, but in no event later than December 31, 2010, of indebtedness
obligations, and solely for the purpose of securing or repaying those
indebtedness obligations.
(2) A written agreement between a redevelopment agency and the city,
county,or city and county that created it that provided loans or other startup
funds for the redevelopment agency that were entered into within two years
of the formation of the redevelopment agency.
(3) A joint exercise of powers agreement in which the redevelopment
agency is a member of the joint powers authority.However,upon assignment
to the successor agency by operation of the act adding this part,the successor
agency's rights,duties,and performance obligations under that joint exercise
of powers agreement shall be limited by the constraints imposed on successor
agencies by the act adding this part.
34178.7. For purposes of this chapter with regard to a redevelopment
agency that becomes subject to this part pursuant to Section 34195, only
references to "October 1, 2011," and to the "operative date of this part"
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shall be modified in the manner described in Section 34191.All other dates
shall be modified only as necessary to reflect the appropriate fiscal year or
portion of a fiscal year.
CHAPTER 4. OVERSIGHT BOARDS
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 January 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) 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.
(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.
(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) Where 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,where such appointment is subject to confirmation by the county board
of supervisors, one member appointed by the largest special district, by
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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 where such an 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.
(b) The Governor may appoint individuals to fill any oversight board
member position described in subdivision (a) that has not been filled by
January 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 shall have personal immunity from suit
for their actions taken within the scope of their responsibilities as oversight
board members.
(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.
(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 the act adding this part.As such,all oversight board actions
shall not be effective for three business days,pending a request for review
by the department.Each oversight board shall designate an official to whom
the department may make such 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. In the event that the department requests a review of a given
oversight board action,it shall have 10 days from the date of its request to
approve the oversight board action or return it to the oversight board for
reconsideration and such oversight board action shall not be effective until
approved by the department. In the event that the department returns the
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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.
(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.
(I) 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.
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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.
(b) Refunding of outstanding bonds or other debt of the former
redevelopment agency by successor agencies in order to provide for savings
or to finance debt service spikes;provided,however,that no additional debt
is created and debt service is not accelerated.
(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,where 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 the county assessor.
(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.
(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.
34181. The oversight board shall direct the successor agency to do all
of the following:
(a) Dispose of all assets and properties of the former redevelopment
agency that were funded by tax increment revenues of the dissolved
redevelopment agency; provided, however, that the oversight board may
instead direct the successor agency to transfer ownership of those assets
that were constructed and used for a governmental purpose,such as roads,
school buildings, parks, and fire stations, to the appropriate public
jurisdiction pursuant to any existing agreements relating to the construction
or use of such an asset.Any compensation to be provided to the successor
agency for the transfer of the asset shall be governed by the agreements
relating to the construction or use of that asset. Disposal shall be done
expeditiously and in a manner aimed at maximizing value.
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(b) Cease performance in connection with and terminate all existing
agreements that do not qualify as enforceable obligations.
(c) Transfer housing responsibilities and all rights,powers, duties,and
obligations along with any amounts on deposit in the Low and Moderate
Income Housing Fund to the appropriate entity pursuant to Section 34176.
(d) Terminate any agreement, between the dissolved redevelopment
agency and any public entity located in the same county, obligating the
redevelopment agency to provide funding for any debt service obligations
of the public entity or for the construction,or operation of facilities owned
or operated by such public entity,in any instance where the oversight board
has found that early termination would be in the best interests of the taxing
entities.
(e) Determine whether any contracts,agreements,or other arrangements
between the dissolved redevelopment agency and any private parties should
be terminated or renegotiated to reduce liabilities and increase net revenues
to the taxing entities, and present proposed termination or amendment
agreements to the oversight board for its approval.The board may approve
any amendments to or early termination of such agreements where it finds
that amendments or early termination would be in the best interests of the
taxing entities.
CHAPTER 5. DUTIES OF THE AUDITOR-CONTROLLER
34182. (a) (1) The county auditor-controller shall conduct or cause to
be conducted an agreed-upon procedures audit of each redevelopment agency
in the county that is subject to this part,to be completed by March 1,2012.
(2) The purpose of the audits shall be to establish each redevelopment
agency's assets and liabilities, to document and determine each
redevelopment agency's passthrough payment obligations to other taxing
agencies,and to document and determine both the amount and the terms of
any indebtedness incurred by the redevelopment agency and certify the
initial Recognized Obligation Payment Schedule.
(3) The county auditor-controller may charge the Redevelopment Property
Tax Trust Fund for any costs incurred by the county auditor-controller
pursuant to this part.
(b) By March 15, 2012,the county auditor-controller shall provide the
Controller's office a copy of all audits performed pursuant to this section.
The county auditor-controller shall maintain a copy of all documentation
and working papers for use by the Controller.
(c) (1) The county auditor-controller shall determine the amount of
property taxes that would have been allocated to each redevelopment agency
in the county had the redevelopment agency not been dissolved pursuant to
the operation of the act adding this part.These amounts are deemed property
tax revenues within the meaning of subdivision(a)of Section 1 of Article
XIII A of the California Constitution and are available for allocation and
distribution in accordance with the provisions of the act adding this part.
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The county auditor-controller shall calculate the property tax revenues using
current assessed values on the last equalized roll on August 20,pursuant to
Section 2052 of the Revenue and Taxation Code,and pursuant to statutory
formulas or contractual agreements with other taxing agencies, as of the
effective date of this section, and shall deposit that amount in the
Redevelopment Property Tax Trust Fund.
(2) Each county auditor-controller shall administer the Redevelopment
Property Tax Trust Fund for the benefit of the holders of former
redevelopment agency enforceable obligations and the taxing entities that
receive passthrough payments and distributions of property taxes pursuant
to this part.
(3) In connection with the allocation and distribution by the county
auditor-controller of property tax revenues deposited in the Redevelopment
Property Tax Trust Fund, in compliance with this part, the county
auditor-controller shall prepare estimates of amounts to be allocated and
distributed, and provide those estimates to both the entities receiving the
distributions and the Department of Finance,no later than November 1 and
May 1 of each year.
(4) Each county auditor-controller shall disburse proceeds of asset sales
or reserve balances,which have been received from the successor entities
pursuant to Sections 34177 and 34187,to the taxing entities.In making such
a distribution, the county auditor-controller shall utilize the same
methodology for allocation and distribution of property tax revenues
provided in Section 34188.
(d) By October 1, 2012, the county auditor-controller shall report the
following information to the Controller's office and the Director of Finance:
(1) The sums of property tax revenues remitted to the Redevelopment
Property Tax Trust Fund related to each former redevelopment agency.
(2) The sums of property tax revenues remitted to each agency under
paragraph(1)of subdivision(a)of Section 34183.
(3) The sums of property tax revenues remitted to each successor agency
pursuant to paragraph(2)of subdivision(a)of Section 34183.
(4) The sums of property tax revenues paid to each successor agency
pursuant to paragraph(3)of subdivision(a)of Section 34183.
(5) The sums paid to each city,county,and special district,and the total
amount allocated for schools pursuant to paragraph(4) of subdivision (a)
of Section 34183.
(6) Any amounts deducted from other distributions pursuant to
subdivision(b)of Section 34183.
(e) A county auditor-controller may charge the Redevelopment Property
Tax Trust Fund for the costs of administering the provisions of this part.
(f) The Controller may audit and review any county auditor-controller
action taken pursuant to the act adding this part. As such, all county
auditor-controller actions shall not be effective for three business days,
pending a request for review by the Controller. In the event that the
Controller requests a review of a given county auditor-controller action,he
or she shall have 10 days from the date of his or her request to approve the
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county auditor-controller's action or return it to the county auditor-controller
for reconsideration and such county auditor-controller action shall not be
effective until approved by the Controller. In the event that the Controller
returns the county auditor-controller's action to the county auditor-controller
for reconsideration,the county auditor-controller must resubmit the modified
action for Controller approval and such modified county auditor-controller
action shall not become effective until approved by the Controller.
34183. (a) Notwithstanding any other law, from October 1, 2011, to
July 1,2012,and for each fiscal year thereafter,the county auditor-controller
shall,after deducting administrative costs allowed under Section 34182 and
Section 95.3 of the Revenue and Taxation Code, allocate moneys in each
Redevelopment Property Tax Trust Fund as follows:
(1) Subject to any prior deductions required by subdivision(b),first,the
county auditor-controller shall remit from the Redevelopment Property Tax
Trust Fund to each local agency and school entity an amount of property
tax revenues in an amount equal to that which would have been received
under Section 33401, 33492.140, 33607, 33607.5, 33607.7, or 33676, as
those sections read on January 1, 2011, or pursuant to any passthrough
agreement between a redevelopment agency and a taxing jurisdiction that
was entered into prior to January 1, 1994,that would be in force during that
fiscal year,had the redevelopment agency existed at that time.The amount
of the payments made pursuant to this paragraph shall be calculated solely
on the basis of passthrough payment obligations, existing prior to the
effective date of this part and continuing as obligations of successor entities,
shall occur no later than January 16,2012,and no later than June 1,2012,
and each January 16 and June 1 thereafter.Notwithstanding subdivision(e)
of Section 33670,that portion of the taxes in excess of the amount identified
in subdivision (a) of Section 33670, which are attributable to a tax rate
levied by a taxing agency for the purpose of producing revenues in an amount
sufficient to make annual repayments of the principal of, and the interest
on, any bonded indebtedness for the acquisition or improvement of real
property shall be allocated to, and when collected shall be paid into, the
fund of that taxing agency.
(2) Second,on January 16,2012,and June 1,2012,and each January 16
and June 1 thereafter, to each successor agency for payments listed in its
Recognized Obligation Payment Schedule for the six-month fiscal period
beginning January 1,2012,or July 1,2012,and each January 16 and June
1 thereafter,in the following order of priority:
(A) Debt service payments scheduled to be made for tax allocation bonds.
(B) Payments scheduled to be made on revenue bonds,but only to the
extent the revenues pledged for them are insufficient to make the payments
and only where the agency's tax increment revenues were also pledged for
the repayment of the bonds.
(C) Payments scheduled for other debts and obligations listed in the
Recognized Obligation Payment Schedule that are required to be paid from
former tax increment revenue.
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(3) Third,on January 16,2012,and June 1,2012,and each January 16
and June 1 thereafter,to each successor agency for the administrative cost
allowance, as defined in Section 34171, for administrative costs set forth
in an approved administrative budget for those payments required to be paid
from former tax increment revenues.
(4) Fourth,on January 16,2012,and June 1,2012,and each January 16
and June 1 thereafter,any moneys remaining in the Redevelopment Property
Tax Trust Fund after the payments and transfers authorized by paragraphs
(1)to(3),inclusive,shall be distributed to local agencies and school entities
in accordance with Section 34188.
(b) If the successor agency reports,no later than December 1,2011,and
May 1, 2012, and each December 1 and May 1 thereafter, to the county
auditor-controller that the total amount available to the successor agency
from the Redevelopment Property Tax Trust Fund allocation to that successor
agency's Redevelopment Obligation Retirement Fund, from other funds
transferred from each redevelopment agency, and from funds that have or
will become available through asset sales and all redevelopment operations,
are insufficient to fund the payments required by paragraphs (1) to (3),
inclusive,of subdivision(a)in the next six-month fiscal period,the county
auditor-controller shall notify the Controller and the Department of Finance
no later than 10 days from the date of that notification. The county
auditor-controller shall verify whether the successor agency will have
sufficient funds from which to service debts according to the Recognized
Obligation Payment Schedule and shall report the findings to the Controller.
If the Controller concurs that there are insufficient funds to pay required
debt service,the amount of the deficiency shall be deducted first from the
amount remaining to be distributed to taxing entities pursuant to paragraph
(4),and if that amount is exhausted,from amounts available for distribution
for administrative costs in paragraph (3). If an agency, pursuant to the
provisions of Section 33492.15,33492.72,33607.5,33671.5,33681.15,or
33688,made passthrough payment obligations subordinate to debt service
payments required for enforceable obligations, funds for servicing bond
debt may be deducted from the amounts for passthrough payments under
paragraph(1),as provided in those sections,but only to the extent that the
amounts remaining to be distributed to taxing entities pursuant to paragraph
(4) and the amounts available for distribution for administrative costs in
paragraph(3)have all been exhausted.
(c) The county treasurer may loan any funds from the county treasury
that are necessary to ensure prompt payments of redevelopment agency
debts.
(d) The Controller may recover the costs of audit and oversight required
under this part from the Redevelopment Property Tax Trust Fund by
presenting an invoice therefor to the county auditor-controller who shall set
aside sufficient funds for and disburse the claimed amounts prior to making
the next distributions to the taxing jurisdictions pursuant to Section 34188.
Subject to the approval of the Director of Finance, the budget of the
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Controller may be augmented to reflect the reimbursement, pursuant to
Section 28.00 of the Budget Act.
34185. Commencing on January 16,2012,and on each January 16 and
June 1 thereafter, the county auditor-controller shall transfer, from the
Redevelopment Property Tax Trust Fund of each successor agency into the
Redevelopment Obligation Retirement Fund of that agency,an amount of
property tax revenues equal to that specified in the Recognized Obligation
Payment Schedule for that successor agency as payable from the
Redevelopment Property Tax Trust Fund subject to the limitations of
Sections 34173 and 34183.
34186. Differences between actual payments and past estimated
obligations on recognized obligation payment schedules must be reported
in subsequent recognized obligation payment schedules and shall adjust the
amount to be transferred to the Redevelopment Obligation Retirement Fund
pursuant to this part.These estimates and accounts shall be subject to audit
by county auditor-controllers and the Controller.
34187. Commencing January 1,2012,whenever a recognized obligation
that had been identified in the Recognized Payment Obligation Schedule is
paid off or retired,either through early payment or payment at maturity,the
county auditor-controller shall distribute to the taxing entities,in accordance
with the provisions of the Revenue and Taxation Code, all property tax
revenues that were associated with the payment of the recognized obligation.
34188. For all distributions of property tax revenues and other moneys
pursuant to this part, the distribution to each taxing entity shall be in an
amount proportionate to its share of property tax revenues in the tax rate
area in that fiscal year,as follows:
(a) (1) For distributions from the Redevelopment Property Tax Trust
Fund, the share of each taxing entity shall be applied to the amount of
property tax available in the Redevelopment Property Tax Trust Fund after
deducting the amount of any distributions under paragraphs(2)and(3)of
subdivision(a)of Section 34183.
(2) For each taxing entity that receives passthrough payments,that agency
shall receive the amount of any passthrough payments identified under
paragraph (1) of subdivision (a) of Section 34183, in an amount not to
exceed the amount that it would receive pursuant to this section in the
absence of the passthrough agreement. However, to the extent that the
passthrough payments received by the taxing entity are less than the amount
that the taxing entity would receive pursuant to this section in the absence
of a passthrough agreement, the taxing entity shall receive an additional
payment that is equivalent to the difference between those amounts.
(b) Property tax shares of local agencies shall be determined based on
property tax allocation laws in effect on the date of distribution,without the
revenue exchange amounts allocated pursuant to Section 97.68 of the
Revenue and Taxation Code, and without the property taxes allocated
pursuant to Section 97.70 of the Revenue and Taxation Code.
(c) The total school share,including passthroughs,shall be the share of
the property taxes that would have been received by school entities, as
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defined in subdivision(f)of Section 95 of the Revenue and Taxation Code,
in the jurisdictional territory of the former redevelopment agency,including,
but not limited to,the amounts specified in Sections 97.68 and 97.70 of the
Revenue and Taxation Code.
34188.8. For purposes of a redevelopment agency that becomes subject
to this part pursuant to Section 34195,a date certain identified in this chapter
shall not be subject to Section 34191, except for dates certain in Section
34182 and references to"October 1,2011,"or to the"operative date of this
part,".However,for purposes of those redevelopment agencies,a date certain
identified in this chapter shall be appropriately modified, as necessary to
reflect the appropriate fiscal year or portion of a fiscal year.
CHAPTER 6. EFFECT OF THE ACT ADDING THIS PART ON THE COMMUNITY
REDEVELOPMENT LAW
34189. (a) Commencing on the effective date of this part,all provisions
of the Community Redevelopment Law that depend on the allocation of tax
increment to redevelopment agencies,including,but not limited to,Sections
33445, 33640, 33641, 33645, and subdivision (b) of Section 33670, shall
be inoperative, except as those sections apply to a redevelopment agency
operating pursuant to Part 1.9(commencing with Section 34192).
(b) The California Law Revision Commission shall draft a Community
Redevelopment Law cleanup bill for consideration by the Legislature no
later than January 1,2013.
(c) To the extent that a provision of Part 1 (commencing with Section
33000),Part 1.5(commencing with Section 34000),Part 1.6(commencing
with Section 34050), and Part 1.7 (commencing with Section 34100)
conflicts with this part,the provisions of this part shall control. Further,if
a provision of Part 1 (commencing with Section 33000), Part 1.5
(commencing with Section 34000), Part 1.6 (commencing with Section
34050),or Part 1.7(commencing with Section 34100)provides an authority
that the act adding this part is restricting or eliminating,the restriction and
elimination provisions of the act adding this part shall control.
(d) It is intended that the provisions of this part shall be read in a manner
as to avoid duplication of payments.
CHAPTER 7. STABILIZATION OF LABOR AND EMPLOYMENT RELATIONS
34190. (a) It is the intent of the Legislature to stabilize the labor and
employment relations of redevelopment agencies and successor agencies
in furtherance of and connection with their responsibilities under the act
adding this part.
(b) Nothing in the act adding this part is intended to relieve any
redevelopment agency of its obligations under Chapter 10 (commencing
with Section 3500)of Division 4 of Title 1 of the Government Code.Subject
to the limitations set forth in Section 34165, prior to its dissolution, a
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redevelopment agency shall retain the authority to meet and confer over
matters within the scope of representation.
(c) A successor agency,as defined in Sections 34171 and 34173, shall
constitute a public agency within the meaning of subdivision(c)of Section
3501 of the Government Code.
(d) Subject to the limitations set forth in Section 34165,redevelopment
agencies,prior to and during their winding down and dissolution,shall retain
the authority to bargain over matters within the scope of representation.
(e) In recognition that a collective bargaining agreement represents an
enforceable obligation, a successor agency shall become the employer of
all employees of the redevelopment agency as of the date of the
redevelopment agency's dissolution. If, pursuant to this provision, the
successor agency becomes the employer of one or more employees who,
as employees of the redevelopment agency,were represented by a recognized
employee organization,the successor agency shall be deemed a successor
employer and shall be obligated to recognize and to meet and confer with
such employee organization. In addition,the successor agency shall retain
the authority to bargain over matters within the scope of representation and
shall be deemed to have assumed the obligations under any memorandum
of understanding in effect between the redevelopment agency and recognized
employee organization as of the date of the redevelopment agency's
dissolution.
(f) The Legislature finds and declares that the duties and responsibilities
of local agency employer representatives under this chapter are substantially
similar to the duties and responsibilities required under existing collective
bargaining enforcement procedures and therefore the costs incurred by the
local agency employer representatives in performing those duties and
responsibilities under the act adding this part are not reimbursable as
state-mandated costs.Furthermore,the Legislature also finds and declares
that to the extent the act adding this part provides the funding with which
to accomplish the obligations provided herein, the costs incurred by the
local agency employer representatives in performing those duties and
responsibilities under the act adding this part are not reimbursable as
state-mandated costs.
(g) The transferred memorandum of understanding and the right of any
employee organization representing such employees to provide representation
shall continue as long as the memorandum of understanding would have
been in force,pursuant to its own terms. One or more separate bargaining
units shall be created in the successor agency consistent with the bargaining
units that had been established in the redevelopment agency. After the
expiration of the transferred memorandum of understanding,the successor
agency shall continue to be subject to the provisions of the
Meyers-Milias-Brown Act.
(h) Individuals formerly employed by redevelopment agencies that are
subsequently employed by successor agencies shall,for a minimum of two
years,transfer their status and classification in the civil service system of
the redevelopment agency to the successor agency and shall not be required
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Ch.5 —40—
to requalify to perform the duties that they previously performed or duties
substantially similar in nature and in required qualification to those that
they previously performed. Any such individuals shall have the right to
compete for employment under the civil service system of the successor
agency.
CHAPTER 8. APPLICATION OF PART TO FORMER PARTICIPANTS OF THE
ALTERNATIVE VOLUNTARY REDEVELOPMENT PROGRAM
34191. (a) It is the intent of the Legislature that a redevelopment agency
that formerly operated pursuant to the Alternative Voluntary Redevelopment
Program(Part 1.9(commencing with Section 34192)),that becomes subject
to this part pursuant to Section 34195, shall be subject to all of the
requirements of this part, except that dates and deadlines shall be
appropriately modified, as provided in this section,to reflect the date that
the agency becomes subject to this part.
(b) Except as otherwise provided by law,for purposes of a redevelopment
agency that becomes subject to this part pursuant to Section 34195, the
following shall apply:
(1) Any reference to "January 1, 2011," shall be construed to mean
January 1 of the year preceding the year that the redevelopment agency
became subject to this part,but no earlier than January 1,2011.
(2) Any reference to"October 1,2011,"or to the"operative date of this
part," shall mean the date that is the equivalent to the "October 1, 2011,"
identified in Section 34167.5 for that redevelopment agency as determined
pursuant to Section 34169.5.
(3) Except as provided in paragraphs(1)and(2),any reference to a date
certain shall be construed to be the date, measured from the date that the
redevelopment agency became subject to this part,that is equivalent to the
duration of time between the operative date of this part and the date certain
identified in statute.
SEC. 8. Section 97.401 is added to the Revenue and Taxation Code,to
read:
97.401. Commencing October 1, 2011, the county auditor shall make
the calculations required by Section 97.4 based on the amount deposited on
behalf of each former redevelopment agency into the Redevelopment
Property Tax Trust Fund pursuant to paragraph (1) of subdivision (c) of
Section 34182 of the Health and Safety Code.The calculations required by
Section 97.4 shall result in cities, counties, and special districts annually
remitting to the Educational Revenue Augmentation Fund the same amounts
they would have remitted but for the operation of Part 1.8 (commencing
with Section 34161) and Part 1.85 (commencing with Section 34170) of
Division 24 of the Health and Safety Code.
SEC. 9. Section 98.2 is added to the Revenue and Taxation Code, to
read:
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98.2. For the 2011-12 fiscal year, and each fiscal year thereafter, the
computations provided for in Sections 98 and 98.1 shall be performed in a
manner which recognizes that passthrough payments formerly required
under the Community Redevelopment Law (Part 1 (commencing with
Section 33000)of Division 24 of the Health and Safety Code)are continuing
to be made under the authority of Part 1.85 (commencing with Section
34170)of Division 24 of the Health and Safety Code and those payments
shall be recognized in the TEA calculations as though they were made under
the Community Redevelopment Law. Additionally, the computations
provided for in Sections 98 and 98.1 shall be performed in a manner that
recognizes payments to a Redevelopment Property Tax Trust Fund,
established pursuant to Section 34170.5 of the Health and Safety Code as
if they were payments to a redevelopment agency as provided in subdivision
(b)of Section 33670 of the Health and Safety Code.
SEC. 10. If a legal challenge to invalidate any provision of this act is
successful, a redevelopment agency shall be prohibited from issuing new
bonds,notes,interim certificates,debentures,or other obligations,whether
funded,refunded,assumed,or otherwise,pursuant to Article 5(commencing
with Section 33640)of Chapter 6 of Part 1 of Division 24 of the Health and
Safety Code.
SEC. 11. The sum of five hundred thousand dollars($500,000)is hereby
appropriated to the Department of Finance from the General Fund for
allocation to the Treasurer, Controller, and Department of Finance for
administrative costs associated with this act. The department shall notify
the Joint Legislative Budget Committee and the fiscal committees in each
house of any allocations under this section no later than 10 days following
that allocation.
SEC. 12. If any provision of this act or the application thereof to any
person or circumstance is held invalid,the invalidity shall not affect other
provisions or applications of this act which can be given effect without the
invalid provision or application and to this end,the provisions of this act
are severable.The Legislature expressly intends that the provisions of Part
1.85 (commencing with Section 34170) of Division 24 of the Health and
Safety Code are severable from the provisions of Part 1.8 (commencing
with Section 34161) of Division 24 of the Health and Safety Code, and if
Part 1.85 is held invalid,then Part 1.8 shall continue in effect.
SEC. 13. No reimbursement is required by this act pursuant to Section
6 of Article XIII B of the California Constitution because a local agency or
school district has the authority to levy service charges,fees,or assessments
sufficient to pay for the program or level of service mandated by this act,
within the meaning of Section 17556 of the Government Code.
SEC. 14. This act shall take effect contingent on the enactment of
Assembly Bill 27 of the 2011-12 First Extraordinary Session or Senate Bill
15 of in the 2011-12 First Extraordinary Session and only if the enacted
bill adds Part 1.9(commencing with Section 34192)to Division 24 of the
Health and Safety Code.
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SEC. 15. This act addresses the fiscal emergency declared and reaffirmed
by the Governor by proclamation on January 20, 2011, pursuant to
subdivision(f)of Section 10 of Article IV of the California Constitution.
SEC. 16. This act is a bill providing for appropriations related to the
Budget Bill within the meaning of subdivision(e)of Section 12 of Article
IV of the California Constitution,has been identified as related to the budget
in the Budget Bill,and shall take effect immediately.
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