HomeMy WebLinkAbout05E Oversight Board Duties Summarya �
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
INTEROFFICE MEMORANDUM
TO: OVERSIGHT BOARD OF DIRECTORS
FROM: JOHN M. WOHLMUTH, EXECUTIVE DIRECTOR
DATE: MARCH 14, 2012
SUBJECT: OVERSIGHT BOARD DUTIES SUMMARY
The following is a very brief introduction to Assembly Bill 1X 26 ("AB 26") as well as a
brief summary of the Oversight Board's duties as stated within AB 26. For your
convenience we have attached a copy of the AB 26 highlighting the references to the
Oversight Board.
Backaround
On June 29, 2011, the Governor signed into law AB 26, which provides for the
dissolution of all redevelopment agencies in the State. The California Redevelopment
Association and the League of California Cities brought an action in the California
Supreme Court to have AB 26 declared unconstitutional. On December 29, 2011, the
California Supreme Court upheld the constitutionality of AB 26 and modified certain of
its deadlines. As a result, the Palm Desert Redevelopment Agency was dissolved on
February 1, 2012.
Successor Aqencies and the Oversiaht Board
AB 26 provides for "successor agencies" to assume the obligations and wind down the
affairs of the former redevelopment agencies. The City of Palm Desert elected to
become the 5uccessor Agency to the Palm Desert Redevelopment Agency. Under AB
26, the actions of successor agencies are generally subject to the approval and
direction of an oversight board. The oversight board is to consist of individuals
appointed by or on behalf of local taxing agencies. In this case, the members of the
Oversight Board of the Successor Agency to the Palm Desert Redevelopment Agency
were appointed by Riverside County, the City of Palm Desert, the Coachella Valley
Water District, the County Superintendent of Schools and the Chancellor of Community
College Districts.
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INTEROFFICE MEMORANDUM
Oversight Board Duties Summary
March 14, 2012
Page 2 of 2
Resqonsibilities of the Oversight Board
The Oversight Board is responsible for directing the Successor Agency to expeditiously
wind down the affairs of the Palm Desert Redevelopment Agency. Under AB 26, the
Oversight Board has fiduciary responsibilities to holders of enforceable obligations of
the Palm Desert Redevelopment Agency and also has fiduciary responsibilities to the
taxing agencies. In general, an "enforceable obligation" is a legally enforceable
contractual obligation entered into prior to June 29, 2011. Some examples of an
enforceable obligation would be loan agreements, contracts for the acquisition, sale or
lease of property, and construction contracts.
Direction and Approval of the Oversiqht Board
Before each six-month fiscal period, the Successor Agency must prepare a Recognized
Obligation Payment Schedule, which is subject to approval by the Oversight Board.
The Recognized Obligation Payment Schedule sets forth all of the enforceable
obligations of the Palm Desert Redevelopment Agency. The Successor Agency is
required to dispose of assets and properties of the Palm Desert Redevelopment Agency
as directed by the Oversight Board. The Oversight Board is to determine the amount of
proceeds from the sale of assets that are no longer needed for approved development
projects and the Successor Agency must transfer that amount to the County Auditor-
Controller. The administrative budgets of the Successor Agency are subject to the
approval of the �versight Board.
Procedural Matters
While a majority of the total membership of the Oversight Board constitutes a quorum, a
majority vote of the total membership is required to take action. The Oversight Board is
subject to the Ralph M. Brown Act (open public meetings), the California Public Records
Act, the Political Reform Act of 1974 (disclosure of economic interests), and
Government Code Section 1090 (prohibited conflicts of interest). An action of the
Oversight Board is not effective for three business days in order to allow the
Department of Finance to request a review of the action. If the Department of Finance
requests a review of an Oversight Board action within that three-day period, it has ten
days from the date of its request to approve the action or retum it to the Oversight
Board for consideration. Oversight Board members have personal immunity under
AB 26 from suit for their actions taken within the scope of their responsibilities.
M. WOHLMUTH
UTIVE DIRECTOR
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ABXa r26 Assembly BILL, 1 st Ext. Session - CH� ^T' sRED
BILL NUMBER: ABX1 26 CHAPTERED
BILL TEXT
CHAPTER 5
FILED WITH SECRETARY OF STATE JUNE
APPR�VED BY GOVERNOR JUNE 28, 2011
PASSED THE SEI�ATE JUNE 15, 2C11
PASSED THE ASSEMBLY JUNE 15, 2011
AM�NDED IN SENATE JUNE 14, 2011
INTRODUCED BY Assembly Member Blumenfield
MAY 19, 2011
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29, 2011
An act to amend Secticns 33500, 33501, 33607.5, and 33607.7 of,
and to add Part 1.8 ;commencing with Se�tior_ 34161) and Part 1.85
(commencing with Section 3417�) to U�_vision 29 of, the Health and
Safety Code, and to add Sections 97.401 and 9�.2 to the Revenue and
Taxation Code, relating to redevelopment, and making an appropriation
therefor, to �ake effect immediately, bill related to the budget.
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
bliqht, as defined. Existing law provides that an action may be
brought to review the validity of Lhe adoption or a:nendment of a
redevelopment plan by an agency, to review the validity of agency
findings or determinations, and otY:er agency actions.
This bill would revise the provisions of law authorizing an action
to be brought against the agency to determine cr review the validity
of specified agency actions.
(2) Existing law also requires trat if an aqency 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 cate
of this act. Effective October l, 2C11, the b'_�1 would dissolve all
redevelopment agencies and community development agencies in
existence and designate successor agencies, as deLined, as successor
entities. Thc bil� would impose various requirements on the successor
agencies and subjec� 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 Redcvclopment Property Tax
Trust Fund in the county. Revenues in �he trust fund would be
allocated to various taxiag entities in the coiinty and to cover
specified expenses of the former agency. By imposing additional
duties upen local public officials, the bill would create a
state-mandated local program.
(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 Lhis
act is successful.
(4) The bill would appropriate $500,000 to the Department of
Finance from the General Fund for adm'�nistrative costs associated
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with �he bill.
(5) The bil] would provide that its provisions take effect only if
specified legislation is enacted in the 2011-12 First �xtraordinary
Session of the Legislature.
(6) The California Constitution requires the state to reimburse
local agenci.es and school districts for certain costs mandated by the
state. Statutory provisions estabiish procedures for making that
reimbursement.
This bill would provide that no rein�ursement is required by this
act for a specified reaser..
(7) The California Constitution authorizes the Governor to decla�e
a fisca7 e�r.ergency and tc call the Legislature into special session
for that purpose. Governor Schwarzenegger issued a proclamation
declarinq a fiscal emergency, and calling a special session for this
purpose, on December 6, 201C. Governor Brown issued a precl�mation on
January 20, 2011, declaring and reaffirming t:�at a fiscal emergency
exists and stating that his proclamation supersedes the earlier
proclamation for purposes o£ that const'tutior.al 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 inmediately
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 l. The Legislature finds and dec-ares all of the
following:
(a) The economy and the resider_ts of this state are slowly
recovering from the worst recession since the Great Depression.
(b) State and 1oca1 governments are still facir.g incredibly
significant declines in revenues and increased need for core
gove�nmental services.
(c) Local qovernments across this state continue to confront
difficult choices and have had tc 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 layoLf teachers, as well
as make other hurt�ul cuts.
(e) Redevelopment agencies have expanded over the years in this
state. The expansion of redevelopn.ent agencies has ir.creasing-_y
shifted property taxes away from services provided to schools,
counties, special districts, and cities.
(f} Redevelopment agencies take in approximately 12 percent of all
of the property taxes collected across this state.
(g) It is estimated that under currert law, redevelopment agencies
will divert $5 bill;�on ir, property tax revenue from other taxing
aqencies in the 2011-12 fiscal year.
(hl The Legislature has all legislaLive 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 1`_mit 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 �irst to successor agericies to make payments
on the indebtedness incurred by the dissolved redevelopment agencies,
with remaining balances allocated in accordaace with applicable
constitutional and statutory provisions.
(j) It is the intent cf the Legislature to do al= of the following
in this act:
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(1) Bar existing redevelopment agencies from incurring new
obligations, prior �o tneir dissolution.
(2) Allocate property tax revenues to successor agencies for
making payments on indebtedness incurred by the redevelopment agency
prior to its dissolutior. and allocate remaining balances in
accordance with applicable const�lutional and statutory provisions.
(3} Beginning October 1, 2011, allocate these funds according tc
the existina property tax allocation within each coun�y to make the
funds available for cities, count'�es, special districts, and school
and community college districts.
(4) Require successor agencies to expeditiously wind down the
affairs of the dissoived redevelopment agencies and to provide the
successor agencies with limited authority that extends only to the
extent needed to implement a winddown o� recevelopment ager_cy
affairs.
S�C. 2. Section 33500 of the Health and Safety Code is amended to
reGd:
33500. (a) Notwithstanding any other provision of law, including
Section 33501, an artion may be brought to review ttie 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
amer.ding the plan, if the adoption of the ordinan�e occurred prior to
January l, 20ll.
(b) Notwithstanding any other provision of law, including Section
33501, an act'on may be brought to review tYie 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 findir.gs or determinations, if the
findings or determinations occurred prior to January l, 2011.
(c) Notwithstandir.a any other law, includ;�ng Section 33501, an
acticn may be brought Lo review the validity of �he adoption or
amendment of a redevelopment plan at any time within two years after
the date of the adoption of the crdirance adopting or amending the
plan, if the adopLion of the ordinance occurred after January 1,
2011.
(dj Notwithstanding any other law, including Section 33501, an
action may be brouyht to review the validity of any findings or
determinations by the acency or the legislative bcdy at any time
with'�n two years after the date on which the agency or the
legislative pody made �hose findings or determinations, if the
findings or determinations occurred after Jaiivary 1, 2011.
SEC. 3. Section 33501 of Y_he Health and Safety Ccde is amended to
read:
33501. (a) An action may be brouqht pursuant to Chapter 9
(commencing with Section 860) of Tit1e 10 of Part 2 of the Code oi
Civil Procedure to determine the validi�y 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 o�
the foregoing, the legality and validity of all proceedings
thereLofore 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 suroey area, the selection of the
project area, the £oxmu-�ation of the preliminary plan, the validity
of the finding and determination that the project area is
predominantly urbanized, and the valid�ty ot Yhe adoption of the
redevelopmeiit plan, and also including the legality and validity of
al1 proceedings theretofore taken and ;as provided in the bond
resolution) proposed to be taken for the authorization, issuaace,
sale, and delivery of the bonas, and for the payment of the principal
thereof and interest thereon.
(b) Notwithstanding subdivision (a), an action to determine the
validity of a reaevelopment 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 adop�iriq or
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amending the plan.
(c) Any act;_on rhat is commenced on or after January l, 2011,
which is brought pursuant to Chap�er 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 trigyering
event that occurred after January 1, 2011.
(d) For the purposes of protecting tre interests of the state,
the Attcrney General and the Department of Finance are interested
persons pursuant to SecLion 863 of the Code of Civil Procedure in any
action brought with respect to the validity of an ordinance adopting
or amending a redevelopm.ent plan pursuant to this section.
(e) For purposes of cor.testing 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 subdivis�on (b) of
Section 51201 of the Gove�nmeat Code, the Department o� Conservation,
�he county aqricultural commissioner, the county farm bureau, ttie
California Farm Bureau Federation, and agricultural entities and
general farm organizations that provide a written request for notice,
are interested persons pursuar.t to Section 863 of the Code of Civil
Procedure, in any action breught with respect to the validity of an
ordi_nance adopting or amendiny a redevelopmenr plan pursuant to this
section.
SEC. 4. Section 33607.5 of the Health and Safety �ode is amended
to read:
33607.5. ;a) (1) This section shall appiy 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 amendmenLs to tYiese
redevelopment plans; or (B) adopted prior to January 1, 1994, but
amended, after January l, 1994, to include new territory. For plans
amended after January l, 1994, only the tax increments from territory
added by the amendment shall be subject to this section. All the
amounts calculated pursnant to this section shall be calculated after
the amcunt required to be deposited ir the Low and Moderate Income
Housing Fund pursuant to Sections 33334.2, 33334.3, and 33334.6 has
been deducLed 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 shal7. be in
addition �o ariy amounts the affected taxing entities receive pursuar.t
to subdivision (a) of Section 336?0. The payments made pursuant to
this section to the affected taxing entities, including the
community, shall be allccated among the affected taxing entities,
including the community if the community elects to receive payments,
ia proportion to the percentage share of property taxes each affected
taxing entity, including the community, receives during tre fisca-_
year the funds are a]loca�ed, 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 'I'axation 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 thc Rever.ue and Taxaticn Code and Section
33E81.12. The agency sha-i1 reduce its pa;m.en�s pursuant to this
section to an affected taxing entity by any amount the agency nas
paid, directly or indirectly, pursuant to Section 33445, 33445.5,
33445.6, 33446, or any other provision of law ot:"�er than this section
for, or in connection with, a publi� 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 l, 1994; or (B) any amounts �hat are
unrelated to the specific project area or amendment governed by tiiis
section. The reduction in a paymer.t by an agency to a school
district, community colleqe district, or county office of education,
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or for special education, sha-ii be subtrac�ed orily from the amount
that otherwise would be available for use by those en�ities for
educational facilities pursuant to paraaraph (4). If the amount of
the reduction exceeds :he amount that otherwise would have been
avai�able for use for educational facilities in any cne 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 d-�strict, or county office of education, or for
specia,� education, the ageacy shall do all of the following:
(A) Deterrciine the amour.t of the total payment that would have been
made without the reductien.
(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 f�cilities
pursuant to paragraph (4).
(C) Reduce the amount available to be used for educaticnal
facilities.
(D) Send the payment to the school district, �ommunity colleqe
district, or courty office of education, or for special education,
with a statement that the payment is beinq reduced and including the
calculation required by this subdivision showing the amount to be
considered property taxes and the amount, if ar.y, available for
educational facilities.
(4) (A) Except as specified ir. subparagraph (E), of the total
amount paid each year pursuant to t'�is section to school districts,
43.3 percent shall be considered to be property taxes for the
purposes oY paragraph (1) of subdivision (h; of Section 42238 of the
Education Code, and �6.7 percent shall not be considered to be
property taxes for the purposes of that sect-�on 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 acquisit'on, 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 sectior. Lo cor,u:�unity colleqe
districts, 47.5 percent shall be considered to be property taxes for
the purposes of Secticn 84751 of the Education Code, and 52.5 percer.t
shali not be ronsidered to be prope=ty 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 f;�scal year, inclusive, land
acquisition, facility construction, recor_struction, 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 201�--12
fiscal year throagh the 2015-16 fisca� year, inclusive, land
acquisition, facility construction, reconstruction, remedeling,
maintenance, or deferred maintenance.
(D) Except as specified in sabparagraph (E), of the tctal amount
paid each year pursuant to this secl.ion Lor special education, 19
percent shall be considered to be property `axes for the purposes of
Section 56712 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 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, r_emodeling, mair_tenance, or deferred
maintenance.
(E) If, pursuant to paragraphs (2) and (3), an agency reduces its
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payments to an educational entity, the calculation made by the agency
pursuant to paragraph (3) sha11 determine the amour.t considered to
be property taxes and the amount available to be used for educatior.al
facilities in the year the reduction was made.
(5) Local education agencies thaz 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 =rom
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 o� a local educaticn agency to be
of benefit to Lhe project area.
(bi Commencing with the first f'scal 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
tne community elects to receive a payment, an amount equal to 25
percent of the tax increments received by the agency after the amount
req:iired to be deposited in the Low and Moaerate 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 arnount authorized by tY:is
paragraph.
(c) Commencing with the 11th fiscal year ir. which the ager.cy
receives tax increments and continuing thrcuqh the last �iscal year
in which the ager.cy rece-�ves tax increments, a redevelopment agency
shall pay to the affected taxing entitics, other than the community
which has adopted the projecr, 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) Com.*nencing 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 redecelopment agency
shall pay to the affected taxing entities, other tran the community
which has adopted the project, in addition to the amo�,ints paid
pursuant to subdivisioas (b) and (c) and after deducting the amount
allocated Y_o the T�ow and Moderate Income Hous'_ng Fund, an amount
equal to 14 percent of the portion of tax increments received by the
agency, wt:ich shall be calculated by applying the �ax rate against
the amotint 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 i_ncurring any loans, bonds, or other
indebtedness, except loans or advances from the commurity, the agency
may subordinate to the loans, bonds, or other indebtedness the
amount required to be paid to an affec�ed taxing enti�y by this
section, provided that the affected taxing entity has approved these
subordinations pursuant to this subdivision.
(2) At the time the agency requests ar, affected taxir.g en�ity tc
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) Withir. 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
subordinatien only if it finds, based upen substantial evidence,
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that the agency will not be able to pay the debt payments and the
amount required to be paid to the affected taxinq 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) (1) The Leqislature finds and declares both of the fo�lowira:
(A) The payments made pursuant to this sectien are necessary ir.
order to alleviate the financial burde:� and detrimer.t that affected
taxing entities may incur as a result of the adoption of a
redevelopment plan, and payments made pt_rsuant tc �his section will
benefit redevelopment project areas.
(B) The payments rnade pursuant to Lhis section are the exclusive
payments that are required to be made by a redevelopmer_t agency tc
affected taxing entities during the term of a redevelopment plan.
(2i Notwithstanding ar.y other provision of law, a redevelopment
agency shall not be required, either directly or �ndirectly, as a
measure Lo mitiqate a significant envircnme-�ta1 effect or as part of
any settlement agreement or judgment brouqht in any action to contest
the validity of a redevelopment plan pursuant to Secticn 33501, to
make any other payments to affected taxing entities, or to pay for
public facili�ies that will be owned or leased to an affected taxing
entity.
(g) As used in this section, a"local education agency" is a
school distric-, a community college district, or a county office of
education.
SEC_ 5. Sectior. 33607.7 of tl:e 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 nu�rber of dollars `o b2
allocated to the redevelopment age-�cy or that increases, or
eliminates pursuant to paragraph (1) of subdivision (e) of Section
33333.6, the t_me limit on the establishing o� loaas, advances, and
indebtedness established pursuant to paragraphs (1) and (2) of
subdivision (a) oF Section 33333.6, as those paragraphs read on
December 31, 2001, or that lenqthens t:�e period during which the
redevelopment plan is effective if the redevelopmer.t plan be;_ng
amended contains the provisions required by subdivision (b) of
Secticn 33670. However, this sectien shall not apply to those
redevelopment plans that add new territory.
(b) If a redevclopmer.t 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:
(lj If ar. agreement exists that requires payments `_o t_�e tax�ny
entity, the amount required to be paid by an agreement between the
agency and an affected taxiny entity entered into prior to January 1,
1994.
(2) If an agreemerit does not exist, �he 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 amour_ts shal� be allocated
between property taxes and educational facilities, including, in the
case of amounts paid during the 2011-"�2 �iscal year through tne
2015-16 fiscal year, inclusive, land acquisition, facllity
construct,�on, reconstruction, remodeling, maintenance, or deferred
maintenance, according to the appropriate formula in paragraph (3) of
subdivision (a) of Section 33607.5. In determining the applica�le
amount under Section 33607.5, the first fiscal year sha11 be the
first fiscal year following the fiscal year in w:Zich the adjusted
base year value is determined.
(c) The adjusted base year assessed vaiue shall be the assessed
value of the project area in the year in which the limitation being
amended would have taken effect without Lhe amerdment or, if more
than one limitatior. is being amended, the first year in which one or
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more of the limitations would have taken effect without the
amendment. The agency shall commence makinq 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 (commencinq with Section 34161) is added to
Division 24 of the IIealth and Safety Code, to read:
PART 1.8. RESTRiCTIONS ON REDEVELOPMENT AGENCY OPERATIONS
CHAPTER l. SUSPENSION OE AGENCY ACTIVITIES AND PROHIBITION ON
CREATION OF NEW DEBTS
34161. Netwithstanding Part 1(cor,unencing wiLh 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 cf this part, no agency
shall incur new or expand existing monetary cr legal obligations
except as providec in this part. 1111 of the provisions of this part
shall take effect aad be operative on the efLective date of rhe act
adding this part.
34162. (a) Notwithstanding Part 1(commencir.g with Section
33000), ParC 1.5 (commencing with Section 34000), Part 1.6
(cemmencing with Ser_.tion 34050), and Part 1.7 (commencing with
Section 34100;, or any other law, commencing en t:�e effective date of
this act, an agency sYiall 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, fcr any purpose, regardless of the source
of repayment of the bonds. As used in this section, the term "bor_ds,"
includes, but is no� limited to, ary bonds, notes, �ond anticipation
notes, interim cer�ificates, deber.tures, certificates of
participation, refunding bonds, or ot_�er 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 indebtedr.ess payable from prohibited soiirces of
repayment, which include, but are not limited-to, income and revenues
of an agency's redevelopment pro�ects, taxes allocated to the
agency, taxes imposed by the agency pursuant te Section 7280.5 of the
Revenue and Taxation Code, assessments imposed by the agency, loan
repayments :nade 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 obl-�gatio-�s
t�hat existed as o£ Januaxy l, 2011, including, but not limited tc,
any of the following:
(A) Refun� bonds previously issued by the agency or by another
political subdivisicn of the state, including, but not limi�ed Lc,
those issued by a city, a housing au�hority, or a nonprofit
corpora�ion acting on behalf of a ci�y or a housing authority.
(B) Exercise the right of optional redemption of any of its
outstanding bonds or elect to purcha�e any of its owr 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 l, 2011.
(4) Take out or accept loans or advances, for any purpose, from
the state or th2 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 fer tre purpose cf
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refinancing a redevelopment project and moneys advanced to the agency
by the community or any other en�ity for the expenses of
redevelonment 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.
(6) Pledge or encumber, for any purpose, any of its revenues er
assets. As used in this part, an agency's "revenues and assets"
include, but are not limited to, agenr_.y tax revenues, redevelopmen�
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 whaLever
kind or other real or personal property. As used in this part, to
"pledge or encu:nber" 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 agree:nent, reimbursement agreement, :nortgage,
deed of trust, pledge agreement, or similar agreement in which the
pledge is provided for or created.
(b) Any actions taken that cenflict with this section are
void from the outset and shall have no �orce or effect.
(c) Notwithstanding subdivision �a), a redevelopment agency may
issue refundinq bonds, which are referred to in this part as
Emergenry Refunding Bonds, only where all of the followinq conditions
are met:
(1) The issuance of Emergency Refunding Bor.ds is the only means
available to the agency to avoid a default on outstandinq agency
bonds.
(2) Both the county treasurer and the Treasurer have approved the
issuance of Emergency Refunding Bonds.
(3) Emergency Refunding Bonds are issued enly 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 �han a level debt
service payment would be for that bond.
(4) The principal amount cf outstanding agercy bonds is not
increased.
34163. Notwithstanding Part 1(commencing with Section 33000),
Part 1.5 (commencing with Sectior 39000), Part 1.6 (commencing with
Section 34050;, and Part 1.7 (commencing with Section 34100�, or any
other ]aw, commencir.g on the effective date of this part, an ayency
shall not have the authority to, ar.d shall not, do any of the
following:
(a) Make loans or advances or graaL or enter into agreements to
provide funds or provide financial assistance of any sort to any
entity or person for any purpose, including, but rot limited to, all
of the following:
(1) Loans of moncys or any other thing of value or commitments Y_o
provide financing to nonprofit organizations tc provide those
organizations with financing for the acquisition, construction,
rehabilitation, refinancinq, or development of multifamily rental
hotising or the acquisition of commercial property for lease, each
pursuan� to Chapter 7.5 (commencing with Section 33791) of Part 1.
(2) Loans of moneys or any other tt:ing of value for residential
construction, improvement, or rehabilitation pursuant to Chapter 8
(commencing with Section 33750; or Part 1. These include, but are not
limited to, cons�ruction 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).
(3) The purchase, by an agency, of mortgage or censtruction loans
from mortgage lenders or from any other entities.
(b) Enter into contracts with, incur obligations, or make
commitments to, any entity, whether gover:imental, tribal, or private,
or any individual or groups of individuals for any purpose,
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including, but not limited to, loan agreements, passthrough
agreements, regulatory agreements, services contracts, leases,
dispesition and development agreements, joint exercise of powers
agreements, contracts for the purchase of capital ecuipment,
agreements for redevelopment activities, including, but not limited
to, agreements for planning, design, redesign, develcpment,
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 witn any entity, for any pu�pose, including, but not
limited to, any of the rcllowing:
(l) Renewi_ng 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 T,ow and Moderate Income Housing
Fund created pursuant to Section 33334.3 beyond the minimum 1eve1
that applied to it as of January l, 2011.
(5) Transferring funds out of the Low and Moderate Income Housinq
Fund, except to meet the minimum housing-related obligations that
existed as of January 1, 20�1, to make required payments under
Sectior.s 33690 and 33690.5, and to borrow funds pursuant to Section
34168.5.
(d) Dispose of asseLs by sale, lor_g-term lease, gift, grant,
exchange, transfer, assignment, or otherwise, for any purpose,
including, but not limited to, any of the followinq:
(1) Assets, includino, 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, lar.d, land under
water and waterfront property, buildings, structures, fixtures, and
improvements on the '�and, any property appurtenant tc, or ssed in
connection with, the land, every estate, interest, privilege,
easement, franchise, and riqht in land, ir.cluding rights-of-way,
terms for years, and liens, charges, or encumbrances by way of
judgment, mcrtgage, or otherwise, and the i:�debtedness secured by the
liens.
(e) Acquire real property py any r�eans for any purpcse, includiiig,
but not limited to, the purchase, lease, or exercising cf an option
to purchase or lease, exchange, subdivide, transfer, assume, obtain
option upon, acquire by gif�, grant, bequest, devise, or otherwise
acquire any real property, any interest in real property, and any
improvements on it, including the repurchase ot developed property
previously ownea by the agency and the acquisition of real property
by eminent domain; provided, however, that nothing in this
subdivision is irtended to prohibit the acceptance or transfer of
title for real property acquired prior to the effective date �f 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, che
legislative body, another menber of a joint pcwers author,�ty, a
trustee, a receiver, a partner entity, another aqency, a nonprofit
corporation, a contractual counterparty, a public body, a
limited-equity heusing cooperative, l,he state, a political
subdivision of the state, the federal government, any private entity,
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or an individual or group of individuals.
(g) Accept financial or other assistance from the state or federal
government or any publ;�c or private source if the acceptance
necessitates or is conditioned upon the agency incurring indebtedness
as that term is described in tnis part.
34164. Notwithstanding Part 1(commencing with Section 33000),
Part 1.5 (commencinq 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, ar agency
shall lack the authority tc, and shall not, er_gage in any of the
following redevelopment activities:
(a) Prepare, approve, adopt, amend, or merge a redevelopme:�t plan,
including, but not limited to, modifying, extending, or otherwise
changing the time limits on the effectiveness of a redevelcpment
plan.
(b) �reate, designate, merge, expand, or otherwise change the
bour.daries 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, formslate, amend, or otherwise modify a preliminary
pian or cause the preparation, formulation, medification, 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, mcoification, or
amendment of a relocation plan where approval is not required by law.
(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 hcusing units wi�hin the community, unless requi_red
to do so by an enforceable obligation.
(j) Make or modify a declara:ion or finding of blight, blighted
areas, or slum and blighted resi_dential areas.
(k) Make any new findings or declarations that any areas of blight
cannot be remedied or redeveloped by private en�erprise alone.
(1) Provide or commit to provide relocation assistance, except
where the prov'_sion of relocation assistance is required by law.
(m) Provide or commit to provide financial assistance.
34165. Notwithstanding Part 1(commencing with Section 3300C),
Part 1.5 (commencing with Secticn 39000), Part 1.6 (commencing with
Section 34050), and Part 1.7 (cemmeacing 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 followirig:
(a) Enter into new partnershi_ps, become a member in a joint powers
authority, form a joint powers authority, create r.ew entit��es, or
become a member ot dny entity ot which it is noL 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 Secticn 72��.5 of the
Revenue and Taxation Code.
(c) Increase the pay, benefits, or contributions of any sort for
any officer, employee, consti�-tant, coatractor, cr aay other goods or
service provider that had not previously been contracted.
(d) Provide optional or discretionary bonuses Lo any officers,
employees, consultants, contractors, or any oY_her service or geods
providers.
(e) Increase numbers of stafi employed by the agency beyond the
number employed as of January 1, 2011.
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(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 �he authorization, issuance, sale, and
delivery ef 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 Cede).
34166. No legislative body or local qovernmenta�_ entity shall
have any statutory authority to create or otherwise establish a new
redevelopmen� agency or community development commission. No
chartered city or chartered county shall exercise the powers granted
in Part �y (commencing with Section 33000) to create or ctherwise
establish a redevelopment agency.
34167. (a) This part is intended to preserve, to the maximum
extent possihle, the revenues and assets of redevelopment agencies sc
that those assets and revenues that are nct 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 ccrpus of the
agencies' funds regardless o£ their original source. All provisions
of this part shall be construed as broadly as possible to support
this intent and to restr'ct the expenditure of funds to the fullest
extent possible.
(b) P'or purposes of this part, "agency" or "redeve]opment 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 3410G) or its predecessor.
(c) Nothing in this part in any way impairs the authority of a
community development commissior,, other than in its authority to act
as a redevelopment agency, to take any actions in its capaci�y 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 C.ode, includir,g 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 o� moneys borrowed by the redevelopment agency for a
lawful purpose, including, but not li_nited to, moneys borrowed from
the Low and Moderate Income Hcusing Eund, to the extent they are
legally required to be repaid pursuant to a required repaymen�
schedule or other mandatory loan terms.
(3) Payments required by the federal government, preexisting
obligations to the state or obligations inposed by state -aw, otrer
than passthrough payments that are made by the county
auditor-controller pursuant to Section 34183, or legally enforcea:�le
payments required in connection with the agencies' employees,
including, but not limited to, pension payments, pension obligation
debt service, and unemployment paymcats.
(4) Judgments or settlements entered by a competent court ot law
or bir.ding arbitration decisions against the former redevelopment
agency, other than passthrough payments that are made by the county
auditor-controller p�:rsuant to Section 34183. A1org with the
successor agency, the oversight board shall have the author-_ty and
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standing to appeal any judgment or to set aside any settlement or
arbitration decision.
(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 o£ the redevelopment agency to the extent
permitted by this part, including, but not limited to, agreements to
purchase or rent office space, equipment and suppl-�es, and
pay-related expenses pursuant to Section 33127 and for carrying
insurance pursuant to Section 33134.
(e) '�'o the extent that any provision ef Part 1;commencing with
Section 33000), Part 1.5 (commencing with Section 34000), Part 1.6
(commencing with Se�tion 34050), or Part 1.7 (commencing with Section
34100) conflicts with this pUrt, the provisions of this part shall
control. Further, if any provision in Part 1(commencing with Section
330D0), Part 1.5 (commencing with Section 34000), Part 1.6
(commencing with Section 34050), or Part 1.7 (commencing with �ection
34100) provides an authority that this part is restricting or
eliminating, the restriction aad elimination provisions of :his part
shall control.
(f) Nothing in this part shall be construed to interfere with a
redevelopment agercy's authority, pursuant tc enforceable obliqations
as defined in this chapter, to (1) make payments due, (2) enforce
existing covenan�s and obligations, or (3) perform its obligations.
(g) The existing terms of any memorandum cf Lnderstaridiiiy with an
employee orqanization representing employees of a redevelopment
agency adopted pursuant to the Meyers-Milias-Brown 71ct that is in
force on the e�fective date cf Lhis part sha11 continue in force
until September 30, 2011, unless a new agreement is reached with a
recognized er�ployee organizatien prior to that c�;te.
(h) After the enforceab'�e cbligation payment schedule is adopted
plirsuanY_ to Secticn 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 obligatior
payment schedule, other than paymer.ts required to meet obligatior.s
with respect to bonded indebtedness.
(i) The Department of Finance and the Controller shall each have
the authority to reqnire any documeats 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 Lo prevent a violation
under �r�is part and to obtain injunctive or other appropri_ate relief.
(j) For purposes of Lhis part, "anditor-controller" means the
officer designated in subdivision (e) of Section 24000 of the
Government Code.
34167.5. Conmencing on the effective date of the act adding this
part, �he Controiler shall review the activities of redevelopment
agencies in the staLe to deterrnine whetYier an asset transfer has
occurred after January l, 2011, between the city or co�,�nty, or ci_ty
and county that created a redevelopment agency or any other public
agency, and the redevelopment agency. If such an asseL lransfer did
occur during that period and the goverr.ment agency that received �he
assets is .iot contrac`_ually committed to a third party for the
expenditure or encumbranre of those assets, to the extent not
prohibited by state and federal -�aw, the Controlle� shall order the
available assets to be returned to the redevelopment agency or, on or
after Oc_ober l, 2011, to the successor agency, if a successor
agency is established pursuant to Part 1.�35 (commencing with Section
34170). Upon receiving such an order from the Controller, an affec�ed
locai agency shall, as soon as practicable, reverse the transfer anc
return the applicabie assets to the redevelopment agency or, on or
after Oc�ober l, 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
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redevelopment aqency during the period covered in this section is
deemed not to be in the furtherance of tne 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 cr the application thereof to
any person or �ir_cumstance is held invalid, the invalidity does not
affect other provisions or applications of this part which can be
given ef`ect without the invalid provisior. or app�ication, and to
this end, �he provisions of this part are severable.
CHAPTER 2. REDEVELOPMENT AGF,NCY RESPONSIBILITIES
34169. Until successcr agencies are authorized pursuant to Part
1.85 (commenciag with Section 341'70), redevelopment agencies shall dc
all of the following:
(a) Continue to make all schedtiled payments for enforceable
obligations, as defined in subdivision (d) of Section 34167.
(b) Perform obligations required pursuant to any en�crceable
obligations, including, but not limited tc, observing covenants for
continuing disclosure obligations and those aimed at preserving the
tax-exempL status ot interest payable on any outstand�ng aqer.cy
bor.ds .
(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) Cons'Lstent with the intent declared in ssbdivision (a) of
Section 34167, preserve a11 assets, minimize all liabi-_'_ties, and
preserve all records of the redevelopment agency_
(e) Cooperate with the successor agencies, if established pursuant
to Part 1.85 (commencing with Section 34170j, and provide all
records and information necessary or desirable for audits, making of
payments required by enforceable obligations, aad performance of
enforceable obligations by the successor agencies.
(f) Take a11 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 o� the effective date of this part, adopt
an Enforceable Obligation Payment Schedule that lists all o`_ the
obligations that are cnforceable within the meaning of subdivision
(d) of Section 34167 which includes the followiny information about
each obligation:
(A) The project name associated with the obligation.
(B) The payee.
(C) A short description o� the nature of the work, product,
service, faci-�ity, or other thing of value for which payment is to be
made.
(D) The amount of payments obligated to be n�ade, by month, through
December 2011.
(2) Payment schedules for issued bonds may be aggregated, and
paycr,ent schedules for payments to employees may be aggregated. This
schedule shall be adopted at a public meeting and shall be pos�ed on
the agency's Internet Web site cr, if no Internet Web site exis�s, on
the Internet Web si�e 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 amenctment. The Enforceai�le Obliqa�ioa Payment Schedule
sha11 be transm�tted by mail or electronic means to tne county
auditor-controller, the Controller, and the Department of Finance. ?1
notification providing the Internet Web site location of the posted
schedule and notifications of any amendments shall suffice to meet
this requirement.
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(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 5e�tion 34170).
(i) The Department of Finance may review a redevelopment agency
action taken pursuant to subdivision (g) or (h}. As such, ai'_ agency
actions shall not be effective fcr three business days, pend'ng 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 telept�one number and e-mail contact
information for the purpose of communicating with the departrient
pursuant to this subdivision. In the event tYiat the department
requests a review of a aiven agency action, the department shall have
10 days from the date of its request to approve thc acency 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 deparrmer.t. This subdivision shall
apply to a successor agency, if a successor agency is established
pursuant to Part 1.E35 (commencing with Section 34170�, as a successor
entity to a dissolved redevelopment agency, with respect to the
preliminary draft ot the initial recoqnized obligation payment
schedule.
CHAPTER 3. APPLICATION OF PART TO FORM�H YARTICIPANTS OF THE
ALTERNATIVE VOLUNTARY REDEVELOPMENT PROGRAM
34169.5. (a) It is the intent of the Leaislature that a
redevelopmen- agency, that formerly operated pursuant to the
Alternative Voluntary Redevelopment Program (Part 1.9 (commencing
with Section 39192)), but that becomes subject to this part pursuant
to Section 34195, shali be subject to all of Lhe requirements ot this
part, except that dates and deadlines shall be appropriately
modified, as provided in this section, to refle�t the date that the
agency beco�r:es subject to this part.
(b) For purposes of a redevelopment agency that becomes subjec_t to
this part pursuant to Section 34195, the following shall apply:
(1) Any reference to "January l, 2011," shall be construed Lo mean
January 1 of the year preceding the year that the redevelopment
agency became subject to this part, but ne earlier than JanuGry l,
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
�edevelopmenL aaency becon:es subject to tkiis part.
(3) �xcept as provided in paraqraphs (1) ar.d (2), any reference to
a date certain shall be construed to be the date, measured from the
da�e that the redevelopment acency became subject to this part, that
is equivalent to the duration of time between the effective date of
this part and �he date certair identified in sLaLuLe.
SEC. 7. Part 1.85 (commencinq with Secticn 39170) is added to
Division 24 of the Health and Safety Code, to read:
PART 1.85. DISSOLUTION OF REDEVELOPMENT AGENCIES ANL
DESIGNATION OF SUCCESSOR AGENCIES
CHAPTER 1. EFFECTIVE DATE, CREATION OF FUNDS, AND DEFINITION
OF TERMS
39170. (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
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any person or circumstance is held invalid, the invalidity sha�l 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
treasu�y a Redevelopment Obligation Retirement Fund to be
administered by the successor agency.
(b) The county audiLor-controller shall create within the county
treasury a Redevelopment Property Tax Trust Fund for the property tax
revenues related to cach former redevelopment agency, for
administration by t2ie county auditor-controller.
34171. The following terms sha��1 have the following meanings:
(ai "Administrative budget" means the budget for admir.istrative
costs of the successor agencies as previded in Section 34177.
(b; "Administrative cost allowance" means an amount that, subject
to the approval of the oversight board, is payable frem property tax
revenues of up to 5 percent of the property tax alloca�ed 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, thaL Lhe 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 snccessor agency. However, the allowance
amount shall exclude any administrat-�ve 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) ;��j "Enforceable obligation" means any of the following:
(A) Bonds, as defined by Section 33602 and bonds �ssued 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) Paymeiits required by the federal qovernment, preexisting
obligations tc 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 agreemenL.
(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 cosnty
auditor-controller pursuant to Section 34183. Along with the
successor agency, the oversight board sha11 have the authority and
standing to appeal any judgm.ent or to set aside any settlement or
arbitration de�ision.
(E) Any legally binding and enforceabie agreement or contract that
is not otherwise void as violating the debt limit or public policy.
Hewever, nothing in this act shall prohibit either the successor
agency, with the approval or at the direction of the oversight board,
or the oversight board itself from terminating any existing
agreements or contracts and providing any necessary and required
compensation or remediation for such termination.
(F) Contracts or agreements necessary for the administration or
operation of the successor agency, in accordance with this part,
including, but not limited tc, agreements to purchase or rent office
space, equipment ar.d supplies, ar.d pay-reiated expenses pursuar.t to
Section 33127 and for carrying ir.surance pursuar.t to Section 33134.
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(G) Amounts borrowed from or payments owinq to the Low and
Moderate Income Housing Fund of a redevelopmen� 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 arrangemer.ts 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 (Bl 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 e:�tered 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 obligaticns.
(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 veid on
the effective date of this part; provided, however, that such
contracts or agreements for the provision of housiriy properly
authorized under Part 1(commencing �aith Section 33000) shall not be
deemed void.
(e) "Indebtedness obligations" means bonds, notes, certifica�es of
participation, or ether evidence of indebtedness, issued or
delivered by the redevelopment ager.cy, or by a joint exercise cf
powers authority created by the redevelopment aqency, 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 Secticn
33000)).
(f) "Oversight board" shall mean each entity established pursuant
to Section 341/9.
(q) "Recoqnized obliqation" means an obligation listed in the
Recognized Obligation Payment Schedule.
(h) "Recognized Obligation Payment Schedule" means the document
setting forth the n:inimum payment amosnts and due dates of payments
required by enforceable obligations for each six-month fisca-� period
as provided in subdivision (m� of Section 34177.
(i) "School entity" means any entity defined as such in
subdivision {f) o`_ 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 ano�her
entity as provided in Section 34173.
(k) "Taxing entities" means ci�ies, counties, a city and coun;y,
special districts, and school enti_ies, as defined in subdivision (f)
of Section 95 of the Revenue and 'Iaxation Code, that receive
passthrough payments and distributioas of property taxes pursuant to
the provisions of this part.
CHAPTER 2. EFFECT OF REDEVE�OPMENT AGENCY DISSOLUTION
34172. (a) (1) All redevelopn:ent agencies and redevelopment
agency components of community development agencies created under
Part 1(commencing with Section 33C00), Part 1.5 (commencing with
Section 34000), Part 1.6 (commencing with Section 39050), and Part
1.� (commencing with Section 34100) that were in existence on the
effective date o� 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 authoriLy Lo act as a
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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 39050), or Part 1.7 {commencing with
Section 34700). However, a community in which the agency has peeri
dissolved and tY:e successer entity has paid off all of the former
agency's enforcea;�le obligations may create a new agency pursuant to
Part 1(commencing with Sectioa 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 (corunencing with Sectien 34194.5)
of Part 1.9 (commencing with Section 34192j.
(b) All autherity 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 £or purposes of Section 16 of Article XVI of the
California Constitution, the Redevelopment Property Tax Trust Fuad
shall be dcemed te be a special fund of the dissolved redevelopment
agency to pay the principal of and interest on loans, moneys advanced
to, or indebtedness, 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 equivatent to those that would have been allocated
pursuant to subd,�vision (b) of Sectioa 16 of Article XVI of the
Cal�fornia Constitutioa 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 mcneys advanced to or
indebtedness incurred by the dissolved redevelopment agencies.
Amounts in excess o� those necessary to pay obligations of the -ormer
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 c:efined in this part, are
hereby designated as successor entities to the fo~mer redevelopment
agencies.
(b) Except for those provisions of the Community Redeveloprlent �aw
that are repealed, restricted, or revised pursuant to tre act adding
this part, all authority, rights, powers, duties, and obligations
previously vested with the former redevelonment agencies, under the
Community Redevelopment �aw, are hereby cested in the successor
agencies.
(c) (1) Wherc the redevelopment agency was in the form of a joint
powers au�hority, and where the jo;�nt powers agreement governing the
formation of the joint powers authority addresses the allocation of
assets and liabilities upon dissoluticn of tne joint powers
authority, then each of the entities thar created the former
redevelopment aqency 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 aqreement.
(2) Where the redevelopment agency was in the form of a joint
powers authority, and where the joint powers agreement governing the
formation cf the joint pcwers authority does not address the
allocation of assets and liabilities upon dissolution of the joint
powers autherity, then each of the entities that created the former
redevelopment agency may be a successor agency within the meaning of
this part, a proporlionate Share of the assets and liabilities shali
be based on the assessed value in the project areas w'_thin each
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entity's jurisdiction, as determined 'ay the county assessor, in its
jurisdiction as compared to the assessed value of land within the
boundaries of the project areas of `he former redevelopment agency.
(d) (1) A city, county, city and coiinty, or the entities forminy
the jcint powers auttiority 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 merr�er of a
joint powers authority thzt elects not to serve as a successor agency
under this part must file a copy of a duly authorized resolution o�
its governing board to that effect with the county audi�or-contro�_1er
no later than one month prior to the effective date of this parL.
(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 the earliest receipt by the county
auditor-cont�oller of a copy of a duly adcpted resolution of the
local agency's governing board authorizing such an election. As used
in this sectien, "local agency" means any city, county, ci�y and
county, or special distr`�ct in the county of the former redevelopment
ager.cy.
(3) If no lecal agency elects to serve as a sLccessor agency £ox a
dissolved redevelopment agency, a public body, referred to herein as
a"designated local authority" shall be immediately formcd, 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 appoirit three residents of the couaty to serve as the
governing board of the authority. The designated local authority
shall serve as successor agency until a loca� agency elects to become
the successor agency in accordance with this sectio�.
(e) The liabi�ity of any successor agericy, acting pursuant to the
powers granted under the act adding this part, shall be limited to
the extenC ot tYie 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 ef
this part, all agency loans, advances, or indebtedness, and interes�
thereon, shall be deemed extinguished and paid; previded, however,
that nothing hereiri is ir.tended to absolve the successor agency of
payment or other obligations due or imposed pursuant to the
enforceable obligations; and provided further, that no�hing in the
act adding this part is intended to be construed as an action or
circumstance that may give rise to an ever.t of default under any o�
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 cor.strued as a voluntary or invol�;atary
insolvency of any redevelopment agency for purposes of the indenture,
trust indenture, or sir.ii'�ar 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 ttie cessation of any
redevelopment agency shall not affect either rhe pledge, the legal
existence of that pledge, or the stream of rever.ues available to �eet
the requirements of the pledge_
(b) All assets, properties, contracts, ]eases, books and records,
buildings, and equipment of the former redevelepment agency are
transferred on October 1, 2011, to the control of the successor
agency, for administration pursuant to the provisions o£ 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 autho�ized
the creation of a redevelopment ager.cy may elect to retain the
housing assets and functions previously performed by the
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redevelopment aqency. If a ci�y, county, or city and county elects to
retain the responsibility fo� 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 cotinty 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 housirig
activities of the agency, excluding any amounts in the Low and
Moderate Income Housirg Fund, sha11 be transferred as follows:
(l) Where there is no locai housing authority in Lhe territorial
jurisdiction of the former redevelopment agency, to the Department of
Housing and Community Development.
(2) Where there is one local housinc author'_ty in the texritorial
�urisdiction of the former redevelopment agency, to 'hat local
housing authority.
(3) Where there is more than one lccal housing auLhority in the
territorial jurisdiction of the former redevelopment agency, to the
local housing authority selected by the city, county, or city and
county that aathorized the creation of the redeve'�opment agency.
(c) Commencing on the operative date of this part, rhe entity
assuming the housinq functions formerly performed by the
redevelopment agency may enforce affordability covenants and perfor�r.
related activities pursuant to applicable provisions of the Commun_Ly
Redevelopmen� Law (Part 1(commencing with Section 33000),
including, but not limited to, Section 33418.
CHAPTER 3. SUCCESSOR AGENCIES
3417�. Successor agencies are required to do all of the
following:
(a) Continue to make paymer.ts due for enforceable ob'�igations.
(1) On and after October 1, 2011, and until a Recognized
Obligation Payment Schedule becomes operative, on7y payments required
pursuant to an eriforceable obliaations paymen� schedule shall be
made. The initial enforceable obligation payment scYiedule shall be
the last schedule adopted by the redevelopment agency under Section
34169. However, payments associated with obligations excluded from
the ciefinition of enforceable ebligations by paragraph (2j of
subdivision (e) of Section 34171 sl-:all be excluded from the
enforceable obligations payment schedule and be removed from the last
schedule adopted by the redevelopment agency under Section 34169
pr�or to the successor agency adoptiag it as its enforceab-�e
obligations payment scnedule pursuant to this subdivision. The
enforceable obligation payment schedule may be amerided by the
successor agency at any public meeting and sha7l he subject to the
apprcval of the oversight board as soon as the beard has sufficient
members to form a quorum.
(2) The Department of Finance and the Controller shall each have
the authority to require any documen�s associated with the
enforceablc 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 l, 2012, only those payments listed in
the Recognized Obl,�gation Payment Schedule may be made by the
successor agency from the funds specified in the Recogr.ized
Obligation Payment Schedule. In additicn, commencing Jar.uary 1, 2012,
the Reccgnized �bligation Payment Schedule shall supersede the
Statement of Indebtedness, which shall no longer be prepared nor have
any effect under the Community Redevelopmer.t Law.
(4) Nothing in the act adding this part is to be ccnstrued as
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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 l, 2012, a successor agercy
shall have no authority and is hereby prohibiLed from accelerating
payment or making any lump-sum payments that are intended to prepay
loans unless such accelerated repayments were required pricr to the
effective date of this part.
(b) Maintain reserves in `he amount required by indentures, trust
indentures, or similar documents governing the issuance of
outstariding redevelopment aqency bonds.
(c) Perform obligations required pursuant to any enforceable
obligation.
(d) Remit unencumbered balances of redevelopment aqency funds to
the county auditor-contro7ler for distribution to the taxing
entities, including, but not limited to, the ur.encumbered balar.ce of
the Low and Moderate Income Housinq Fund of a former redevelcpment
agency. In making the distrihuri_on, the county at.di_tor-contreller
shall utilize the same methodology for alloca�ioa 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 oY the agency, each as
determined by the oversight board, shall be transferred to the
county auditor-controller for distribution as property tax preceeds
under Section 34188.
(f) Enforce al1 former redevelopment agency rights for the benefit
of the taxing entities, inc-_uding, but not limi�ed to, continuing to
collect loans, rents, and other revenses that caere due to the
redevelopment agency.
(g) Effectuate transfer of hcusinq functions and assets to the
appropriate entity designated pursuant to Section 34176.
(h) Expedit-�ously wind down the affairs of the redevelopment
aqency 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 whicn 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 tne
oversight board for its approval. The proposed admiaistrative budget
shall include all of the following:
(1) Estimated amounts for successor agency administrative ccsts
for the upcoming six-month fiscal period.
(2) Pr000sed sou�ces of payment for the costs identified in
paragraph (1).
(3) Proposals fo� arrangements for administrative and operations
services provided by a city, county, city and county, or other
eiitity.
(k) Provide administrative cost estimates, from its approved
administrative budge� 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.
(1) (1) Before each six-month fiscal period, prepare a Recognized
Obligation Payment Schedule in accordance with tlie requirements of
this paragraph. For each recognized obligation, the Recognized
Obligation Payment Schedule shall identify one or more of the
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following sources of payment:
(A) Low and Moderate Income Housinq Fund.
(B) Bond proceeds.
(C) Reserve balances.
(D) Administrative cost allowance.
(E) The Redevelopment Property Tax Trust Furid, but only to the
extent no other funding source is available or when payment from
property tax revenues is required by an enforceable obligat'on or by
the provisions oi this part.
(r) Other revenue sources, including rents, cor.cessions, asset
sale proceeds, interest earnings, and any other revenues derived from
the former redevelopment agency, as approved by Che oversight board
in accordance w�th 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 Recegnized Obligation Payment �chedule is prepared by
the successor agcncy for the enforceable obligations of the former
redevelopment agency by November 1, 2011. From Cctober l, 2011, to
July 1, 2012, the initial draft of that schedule shall project the
dates and amounts of scheduled paymer.ts for each enforceable
obligation for the remainder of the time period during which the
redevelopment agency would have been aut:�orized to obligate property
tax increment had such a redevelopment agency not been dissolved, and
shall be reviewed and certified, as �o its accuracy, by an external
auditer designated pursuant to Section 34182.
(B) The certified Recognized Obligation Payment Schedule is
submitted to and duly approved by the oversiqht board.
(C) A copy of the approved Recognized Obligatien Payment Schedule
is submitted to the county auditor-controller and both the Controller'
s office and the Department of Finance aad be posted on the successor
agency's Internet Web site.
(31 The Hecognized Obligation Payment 5chedule shall be forward
looking to the next six months. ':'he first Recognized Obligation
Payment Schedule shall be submitted to the Controller's office and
the Department of Finance by December 15, 20ll, 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 ir.curred, prier to January l,
2012, shall be made from property tax revenues received in the spring
of 2011 property tax distribution, and from other revennes and
balances transferred to the successor ageacy.
34178. (a) Commencina on the operative date o� this part,
agreements, contracts, or arrangements be�ween Lhe city or county, or
city and county that created the redeve]_opment agency ar.d the
redevelopment agency are invalid and shall not be bindir.g on the
successor agency; provided, however, that a successor entity wisYiiny
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 upo� obtaining tne approval of its oversight board.
(bi Notwithstanding subdivision (a), any of the following
agreements are not invalid and may bind the successor agency:
(1) A duly authorized written agreemer.t entered into at the time
of issuance, but in no event later than December 31, 2010, of
indebtedness obligat_ons, and solely fer 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 redevelepmeat agency that were entered
into within two years of the formation of tne redevelopment agency.
(3) A joint exercise of powers agreement in which the
redevelcpment agency is a member of the joint powers authority.
However, upon assignment to the successor agency by operation of the
act adding tt:is part, the successor agency's rights, duties, and
performance obligations under that joint exercise of powers agreement
shall be limited by the constraints impcsed on successor agencies by
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the act adding tnis part.
34178.7. For purposes of this chapter wiCh regard to a
redevelopment agency that becomes subject to this part pursuant to
Section 34195, only references to "October 1, 2011," and to tl^:e
"operative date of this part" 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.
CHAPTFR 4. OVERSIGHT BOARDS
34179. (a) Each s�accessor agency shall have an oversight board
composed of seven members. 'Phe 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 l, 2012. Members
shall be selected as follows:
(1) One member appointed by the county board of supervisors.
(2) One member appoiated 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
di_strict that is eligible to receive property tax reveaues pursuant
to Section 34188.
(4) One member appointed by the county superintendent of educatior
to represent schoois if the superintendent is e'-ected. If the county
superintendent of education is appointed, then the appointment made
pursuant to this paragraph shall be made by the county board of
educaticn.
(5) One member appointed by the Chancellor of the California
Comcnunity Colleges to represent community college districts in the
county.
(6) One member of the public appoi_nted by the county board of
supervisors.
(7) One member representing the emplcyees of the former
redevelopment agency appointed by the mayor or chair ef 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 forr.ied the
redevelopment agency, then the largest city by acreaqe 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 additi_onal member to represent the public.
(9) If there are no special districts of the type that are
eligib]e to receive property tax pursuant to Section 34188, within
the territorial jurisdiction of thc former redevelopment agency, then
the county may apooint one member to represent the pubiic.
(10) Where a redevelopment agency was formed by an entity that is
both a charter city and a county, the oversight board shall bc
composed of seven members selected as follows: tnree members
appointed by the mayor of the city, where such appointment is subject
te confirmation by the county board of supervisors, one member
appointed by the largest special district, by properCy 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 Secticn 39188,
one member appointed by the county superintendent of education to
represent schools, one member appointed by the Chancellor of the
Catifornia Community Colleges to represenL comir,unity colleqe
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 con�irmation by the county board of
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supervisors, to represent the largest nun,ber of former redevelopment
agency employees employed by the successor agency at that time.
(b) The Governor may appoint indiv�duals 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 ineetings of the oversight board and may
include such costs in its administrative budget. Oversight board
members shal� serve without compensation or reimbursement fer
expenses.
(d) Oversight board members shall have personal immunity from suit
for their act�ons taken within the scope of their responsibilities
as oversight board members.
(e) A majority of the total membership of thc oversight board
shall constitute a quorum for the trarisactiori of business. A majority
vote of the total membership of the oversight board is required for
ttie oversight board to take action. T:�e 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 Pol_itical Reform Act of
19�4.
(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 sYial� serve at the pleasure
of the entity thaY_ 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 sha11 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 informa�ion for the purpose of communicating with the
department pursuant to �his 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 ocersight board action shall not be
effective until approved by the department. In the event that the
department returns the oversight board action to the oversight board
for reconsideration, the oversight board shall resubmit the modified
action for department approval and the modified oversight board
action shall not become effective until approved by the department.
(i) Oversight boards shall have fiduciary responsibilities to
holders of enforceable obligations and �he 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 Secticn 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 aistrict, or
community ccllege district.
(j) Commencing on and after July l, 2016, in each county where
more than one oversight board was created by operat-_on cf the act
adding this part, there shall be only one oversight board appointed
as follows:
(1) One member may be appointed by the coLaty board cf
supervisors,
(2) One member may be appointed by the city selection committee
established pursuant to Section 502?0 of the GovernmenC Code. In a
city and county, the mayor may appoint one member.
(3) One member may be appointed by the independent special
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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 tc Section 34188.
(4) One member may be appointed by the county superintendent of
education to represent schools if the superintendent is elected. I�
the county superintendent of education is appointed, then the
appoinY_ment made pursuant to this paragraph shall be made by the
county board of educaticn.
(5; One member may be apnointed by the Chancellor of the
California Community Colleges to represent com-nunity 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 e�r.ployee
orqanization 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, cr any member posiLion that remains vacant
for more than 60 days.
(1) Commencing on and after July 1, 2016, ia cach county wnere
only one oversight board was created by operation of the act adding
this part, then there wi_11 be no change to the composition of that
oversight board as a result of the operation of subdivisicn (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.
39180. All of the following successor agency actions shall first
be approved by the oversight board:
(a) The establis:�ment 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
inden�ures, trust iadentures, or similar ciocumerits yoverning the
issuance of outstanding redevelopment agency bonds.
(d) Merging of project areas.
(e) Continuing the acceptance of federa� or state grants, or other
forms of financial assistance from either public or private sources,
where assistance is conditioned Lpon the provision of matching
funds, by the successor entity as successor te the former
redevelopment agency, in an amount qreater than 5 percent.
(f) (1) If a city, county, or city and county wishes to retain any
prcperties or other assets for future redevelopment activities,
funded from its owr, 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 p_operty
tax, as determined pursuant to Section 34188, for the value of the
property retained.
(2) If no other agreement is reacned on valuation of the retained
assets, the value will be the fair market value as of thc 2011
property tax lien date as determined by the county assessor.
(g) Establishment of the Recognized Obligatior Payment Schedule.
(h) A request by the successer agency to enter into an agreement
with the city, ceunty, 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 rever.ues
pursuant to subdivision (b) of Section 341?8.
34181. The oversiqht board shall direct the sLccessor agency to
do all of the following:
(a) Dispose o£ all assets and properties ot the tormer
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redevelopment agency tnat 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 gover�ed by the agreements
relating to the construction or use ef that asset. Disposal shall be
done expeditiously and in a manner aimed at maximizinq value.
(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 amoL�ts on deposit in the Low
and Moderate Income Housir.c 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 fundinq 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 taxinq entities.
(e) Determine whether any contracts, agreements, or other
arrangements between the dissolved redevelopment agency and any
private parties shoald be terminated or renegotiated �o reduce
liabilities and ir.crease net revenues to the taxing entities, and
present proposed termination or amendment agrcements to the oversight
board for its approval. The board may approve aay amendments to or
early termination of such agreements where it finds that amendments
or early termination would be in the best �nterests of the taxing
entities.
CHAPTER 5. DUTIES OF THE AUDITOR-CONTROLLER
34182. (a; (l) The county auditor-controller shall conduct or
cause to be conducted an agreed-upon procedures audit of each
redevelopment aqency in the county that is subject to this par�, to
be completed by March l, 2012.
(2) `I'he purpose of tne audits shall be to establish each
redevelopment agency's assets and liabilities, to document and
determine each redevelopment agency's oassthrough payment obligations
to other taxing agencies, and to docLment and determine both the
amount and the terms of any indebtedness incurred by the
redevelopment agency and cer�ify the initial Reccqnized Obligaticn
Payment Scnedule.
(3) The county auditor-controller mGy 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 perFcrmed pursuant te
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 amoun�
of property taxes that would have been allocated to each
redevelepmer.t agency in the county had tre redevelcpment 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
subdivisicn (a) of Section 1 of Article XIII A of the California
Constitution and are available for allccation and distribution in
accordance with the provisions of the act adding this part. 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
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pursuant to statutory formulas or contractual agreements with other
taxing aqencies, as of the effective date of this section, and shall
deposit that amount in the Redevelopment Property Tax Trust Fund.
(2) Each county auditor-contrcller shall administer the
Redevelopment Property Tax Trust rund for the benefit of the holders
of former redevelopment agency enforceable obl;_gatior.s and the taxing
entities that receive passthrough payments and distributions of
property taxes pursuant to this part.
(3) In connection with the allocatior. and distribution by the
county auditor-controller of property tax revenues deposited in the
Redevelopment Property Tax Trust Fund, i� compliance with this part,
the county auditor-controller shall prepare estimates of amounts tc
be allocaLed 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 0� each year.
(4) Each cosnty auditor-controller shall disburse proceeds of
asset sales or reserve balances, which tiave been received from the
successor entities pursuant to Sections 34177 and 34187, to the
taxing entities. In making such a distribution, the coun�y
auditor-controller shall utilize the same metnodology for allocation
and distribution of property Yax revenues provided in Section 34188.
(d) By October l, 2012, the county auditor-controller shall report
the following ir.formation Co 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 �ax revenues remitted to each ager.cy
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 subdiv,�sion (a) of Secticn 39183.
(4) The sums of property tax revenues paid to each successor
agency pursuant te paragraph (3) of subdivision (a) of Section 39183.
(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 otYier distributions bursuant to
subdivision (b) o� Section 34183.
(e) A county audi�or-controller may charge the Redevelopr�ent
Property Tax Trust Fund for the costs of admin-�stering the provisio:�s
of this part.
(f) The Controller may audit and review any county
auditor-controller ac�ion taken pursuant to the act adding this part.
As such, all county auditor-controller actions s2iall 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 county
auditor-Cor.troller'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
tne Controller. In the event that the Controller returns the county
auditor-centroller's action to the coun:y auditor-controller for
reconsidera�ion, the county auditor-controller must resubmit the
modified action for ConYroller approval ard such modified county
auditor-controller action shall not beccme effective until approved
by the Controller.
34183. (a) Notwithstanding any other law, from October l, 2011,
to July l, 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 mcneys in each Redevelopment Property Tax
Trust Fund as follows:
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(1) Subject to any prior deductions required by subdivision (b),
first, the county auditor-controller sha11 remit from the
Redevelopment Property Tax Trust Fund to each local aqency and school
entity an amount of property tax revenues in aa 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
l, 2011, or pursuant to any passthrough agreement between a
redevelopment aaency and a �axing jurisdiction that was entered into
prior to January 1, 1994, that would be in force during that fiscal
year, had the redevelopment agency existed a� t:�at 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 Janiiary
16, 2012, and no later than June 1, 2012, and eGch January 16 and
June 1 thereafter. Notwithstanding subdivision (e) of Section 33670,
that portion of `he taxes in excess of Y_he amount identifi_ed 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 su�ficient to make annual repayments of the principal
o�, and the interest on, any bonded indebtedness for the acquisition
or improvement of real property shall be allocated tio, and when
collected shall be paid into, the fund of that taxing agency.
(2) Second, on January 16, 2012, and June l, 2012, and each
January 16 and June 1 Lhereafter, to each successor ayency tor
payments listed in its Recognized Obligati.on Payment Schedule for the
six-month fiscal period beginning January l, 2012, or July 1, 2012,
and each January 16 and June 1 thereafter, in the following order of
priority:
(A) ilebt service payments scheduled to be made for tax a�_location
bonds.
(B) Pay-nents scheduled to be maae on revenue bonds, but only to
the extent the revenues pledqed 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 eblig�tions listed in
the Recognized Obligation Payment Schedule that are required to be
paid from former tax increment revenue.
(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 Sectior: 34171, for
adm�nistrative costs set forth i_n an approved admiristrative budget
for those payments required to be paid from former tax increment
revenues.
(4) Fourth, on January 16, 2012, and June l, 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 39188.
(b) If the successor agency reper�s, no later than December l,
2011, and May l, 2012, and each December 1 and May 1 thereafter, to
the ceunty auditor-controller that the total amount available tc �he
successor agency frem the Redevelopment Property Tax Trust Fund
allocation to that successor agency's Redevelopment Obligation
Retirement Fund, from other funds trar.sferred 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 �he 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 Recogr,ized Obligation Payment Schedule and shali report the
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findings to the Controller. I£ 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 Lo be
distributed to taxir.g entities pursuant to paragraph (4), and if tnat
amount is exhausted, from amounts available for distribution fer
administrative cos`s in paragraph (3). If an agency, pursuant to the
provisions of Sectior. 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) anc tne amounts available for
distribu}ion for administrative costs ir. paragraph (3) have all been
exhausted_
(cj 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 Redevclopment Property Tax TrusY_
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 makir.c the next distributions
to the taxing jurisdicticns pursuant to Section 34188. Subject to thc
approval of the Director of Finance, the buaget of the ConLroller
may be augmented to reflect the reimbursement, pursuant to Section
28.00 of the Budget Act.
3�185. 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 ObligaLion 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.
391B6. Differences between actual payments and past estimated
obligations on recognized obligation payment schedules rtust be
reported in subsequent recogni_zed obligat,�on payment schedules and
shall adjust the amount to be transferred to the Redevelopment
Obligation Retirement Fund pursuant to this pa�t. These estimates and
accounts shal_ be subject to audit by county auditor-controllers and
the Controller.
34187. Commencirg January 1, 2012, whenever a recognized
obligation that had been identified in the Reccgnized Payment
Obligation Schedule is paid off or retired, either through early
payment or payment at maturity, the county auditor-controlier 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 Lax
revenues in the tax rate area in tha� fiscal year, as follows:
(a) (1) For distributions from the Redevelopment Property Tax
Trust Fund, the share of each taxing er.tity sha�l 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 39183.
i2) Fer each taxing entity that receives passthrough payments,
that aqency shall receive the amount of any passthrough payments
identified under paragraph (1) of subdivision (a) oL 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 pass�hrough payments received by the taxing
entity are less than the amount that the taxing entity would receive
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pursuant to this section in the absence of a passthrough agreement,
the taxing entity shall receive an additiona-_ payment that is
equivalent to the difference betweer 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 allocatec
pursuant to Sect�on 97.70 of the Rever.ue and Taxation Code.
(c) The total school share, including passthrcughs, shall be the
share of the property taxes that would have been received by schcol
entities, as 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
subjecL tc this part pursuant to Section 3�195, 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 chap�er shall be appropriately modified, as necessary to
reflect the appropriate fiscal year or pertion of a fiscal year.
CHAPTER 6_ EFFECT OF THE ACT ADDING T�IIS 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 oL tax increment to redevelopment agencies, including, but
not limited to, �ections 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 l, 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 SecLion 34050), and Part 1.7 (commencing with
Section 34100) conflicts with this part, the procisions 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 tha� the act adding this part is
restricting or eliminating, the restricLion and elimination
provisions of the act adding this part shall ccntrol.
(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 L11BOR AND EMFLOYMENT 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 tne act adding this part.
(b� Nothing in the act adding thi5 part is intended to re-�ieve any
redevelopment agency of its obligations under Chapter 10 {commencing
with Section 3500) of Division 4 cf Title 1 of the Government Cede.
Subject to the limitations set forth in Section 34165, prior to its
dissolution, a 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
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(c) of Section 350� of the Government Code.
(d) Subject to the limitations set forth in Section 39165,
redevelopment agencies, prior to and during their windir_a down and
dissolution, shall retain the authority to bargain over matters
within the scope of representation.
(e) In recognition that a collective baryaining agreement
represents an enforceable obligation, a successor agency shall become
tne employer of all employees of the redevelopment agency as of the
date of the redevelopment agency's dissolution. It, 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 emp7oyer and shali be obligated to
recognize and to meet and co:�fer with such employee organization. In
addition, the successor agency sriall retain tre authority to bargain
over matters within the scope of representation and sha11 be deemed
to have assumed thc obligations under any memorandum of understanding
in effect between tYie redevelopment agency and recognized employee
crganization as of the date of the redevelopment agency's
dissolution.
(f) The Legislature fiiids ar.d declares that the dut'�es and
responsibilities of 7oca1 ager.cy employer representatives under this
chapter are substantially similar to the duties and responsibilities
required under existirig collective bargaininq enforcement procedures
and therefore the costs incurred by the local agency employer
representatives in performing those duties and responsib-_lities under
the act addinq this part are not rei:nbursable as state-mandated
costs. Furthermcre, the Legislatnre also f'_nds and declares that to
the extent the act adding this part provides the funding with which
to accomplish the obligations provided herein, tre costs incurred by
the local agency employer representatives in performing �hose duties
and resoonsibilities ander the act adding this part are not
reimbursable as state-mandated costs.
(g) The transferred memorandum o£ understanding arid 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, pursuan: to its own terms.
One or more separate bargaining ur.its shall be created in the
successor agency consistent with the bargaining units that had been
established in the redevelopment agency. A£ter 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 redevelcpment agencies that
are subsequently e�r.ployed by successor agencies shall, for a minimum
of two years, traiisfer their status and classification in the civil
service system of the redevelopmen� agency to the successor agency
and shall not be required to requalify to perform the duties tha�
they previously performed or duties substantia'�1y similar in nature
and in required qualification to those that they previously
performed_ Any such iridividuals shall have the riqht to compete for
employmenY under the civil service system of the successor agency.
CHAPTER 8. APPLICATION OF P71RT TO FORMER PARTICIPANTS OF THE
ALTERNATIV� VOLUNTARY REDEVELOPMENT PROGRAM
34191. (a) It is the intent of the Legislature that a
redevelopment agency that former�y operated pursuant to the
Alternative Voluntary Redevelopment Progra:n (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 �o this pari.
(b) Except as otherwise provided by law, for purposes of a
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redevelopment agency that becomes subject to this pa�t pursuant to
Section 34195, Lhe following shall apply:
(1) Any reference to "January i, 2011," shall be construed to mean
January 1 of the year preceding the year that the redevelopment
aqency became subject to this part, but no earlier than January l,
2011.
(2) Any reference to "October l, 2011," or to the "eperative date
of this part," shall mean the date that is tY:e 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 dGte, measured fro:n the
date that the redevelopment agency became subject to this parL, 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 amoun�
deposited on behalf of each former redevelopment agency into tre
Redevelopment Property Tax Trust Fund pursuant to paragraph (1) of
subdivision (c) of Section 34182 of the Health and Safety Ccde. The
calculations required by Section 97.� shall result in cities,
counties, and special districts annually remit�ing to the Educational
Revenue AugmentaLion Fund the same amounts they would have remitted
but for the operation of Part 1.8 (commencing with Section 34161) and
Part 1.85 (commencirg with Section 34170) of Division 24 of the
Health and Safety Code.
SEC. 9. Sect,�on 98.2 is added to the Revenue and Taxation Code, to
read:
98.2. For the 2011-12 fiscal year, and each fiscal year
thereafter, the computations previded for in Sections 98 and 98.1
shall be performed in a manner which recognizes that passthrough
payments formerly required under the Co:nmunity Redevelopment Law
(Part 1(commencing with Section 33C00) of Divisior. 24 of the Health
and Safety Code) are continuing to be made iinder the authority cf
Part 1.85 (commencing with Section 34170) of Division 24 of the
Health and Safety Code and those payments shall be recoqnized 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 perFermed 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 336'70 of the Heaith and Safety Code.
SEC. 10. If a legal challenge to invalidate any provision of this
act is successful, a redevelopment agency shall be prohibited fro�r;
issuing new bonds, notes, interim certificates, debentures, or other
obligations, whether funded, refunded, assumed, or o�herwise,
pursuant to Article 5(commencing with Section 33640) of Chapter 6 of
Part 1 cf Division 24 of the Health and Safety Code.
SEC. 11. The sum of five hundred thousand dollars ($500,000) is
hereby appropriated to the Departrlent of Finance from the Genera'�
Fund for allocation to the Treasurer, Controller, and Department of
Finance for administrative costs associated with this act. The
department shall notify the Joint T�egislative Budget Committee and
the fiscal committees in each house of any allocat;�ons under this
section no later than 10 days followinq that allocation.
SEC. 12. If any provision of this act or the application thereof
to any person or circumstance is held invalid, the invalidity sha11
not affect other provisions or applicaticns 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 29 of the Health arid Safety Code are
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severable from the provisions cf Part 1.8 (commencing with Section
34161) of Division 29 of the Health and Safety Code, and if Par: 1.85
is held invalid, then Part 1.8 shall cont:inue in effect.
SEC. 13. No reimbursement is reauired by this act pursuant to
Section 6 of Arti�le XIII B of the California Constitution because a
locai agency or school district has the authority to levy service
charges, fees, or assessments sufficicnt to pay ior the program cr
level cf service manda�ed 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 ttie enac�ed bill adds Part 1.9 (commencing with Section 34192) to
Division 24 of the Health and Safety Ccde.
SEC. 15. This act addresses the fiscal emergency declared and
reatfirmed by the Governor by proclamaticn on January 20, 2011,
pursuant to subdivision (f) of Section 10 of 7lrticle 1V of the
California Censtitution.
S�,C. 16. This act is a bill providing fcr appropriations related
to the Budget Bill within the meaning of subdivision (e) ef Section
12 of Article IV of the California ConstiLution, Yias been identified
as related to the budgct in the Budget Bill, and shall take effect
immediately.
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