California Senate Bill SB1156 Amended / Bill

 BILL NUMBER: SB 1156AMENDED BILL TEXT AMENDED IN SENATE MAY 25, 2012 AMENDED IN SENATE APRIL 30, 2012 AMENDED IN SENATE MARCH 29, 2012 INTRODUCED BY Senator Steinberg FEBRUARY 22, 2012 An act to add Part 1.86 (commencing with Section 34191.1) to Division 24 of the Health and Safety Code, and to amend Section 21094.5 of the Public Resources Code, relating to economic development  , and making an appropriation therefor  . LEGISLATIVE COUNSEL'S DIGEST SB 1156, as amended, Steinberg.  Community Development and Housing Joint Powers Authority.   Sustainable Communities Investment Authority.  The Community Redevelopment Law authorizes the establishment of redevelopment agencies in communities to address the effects of blight, as defined. Existing law dissolved redevelopment agencies and community development agencies, as of February 1, 2012, and provides for the designation of successor agencies. Existing law requires that the successor agency, among other things, wind down the affairs of the former redevelopment agency and dispose of assets and properties of the former redevelopment agency, as directed by an oversight board. Existing law provides for various economic development programs that foster community sustainability and community and economic development initiatives throughout the state.  This bill would authorize the legislative bodies of the city and county of a sustainable communities investment area, as described, to form after July 1, 2012, a Sustainable Communities Investment Authority (authority) to carry out the Community Redevelopment Law, as amended, to increase, improve, and preserve the community's supply of low- and -moderate-income housing available at affordable housing cost. The bill would specify the process by which the governing body of an authority may be formed. The bill would authorize the authority to adopt a plan for a sustainable communities investment area and to include in that plan a provision for the receipt of tax increment funds provided that specified requirements are met.   The bill would establish prequalification requirements for construction contracts that will receive more than $1,000,000 from the Sustainable Communities Investment Authority and would require the Department of Industrial Relations to monitor and enforce compliance with prevailing wage requirements for specified projects. The bill would deposit moneys received by the department from developer charges related to the costs of monitoring and enforcement in the State Public Works Enforcement Fund. By depositing a new source of revenue in the State Public Works Enforcement Fund, a continuously appropriated special fund, the bill would make an appropriation.   This bill would authorize the legislative body of the city and county representing the geographic territory covering the area served by a former redevelopment agency to elect to form a Community Development and Housing Joint Powers Authority (authority) after July 1, 2012, and to carry out the provisions of the Community Redevelopment Law. The bill would authorize the authority to adopt a redevelopment plan for a project area covering specified areas and sites and to include a provision in the plan to provide for tax increment financing, provided that certain mitigation and land use plans have been adopted. The bill would retain the Low and Moderate Income Housing Fund of a former redevelopment agency in another fund and authorize the authority to enter into agreements to facilitate articulated career technical education pathways.  Vote: majority. Appropriation:  no   yes  . Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Part 1.86 (commencing with Section 34191.1) is added to Division 24 of the Health and Safety Code, to read: PART 1.86. ECONOMIC DEVELOPMENT and HOUSING PROGRAM CHAPTER 1. GENERAL PROVISIONS 34191.1. (a) The Legislature finds and declares that better economic development patterns in California can contribute to greater economic growth by reducing commuter times for employees, reducing the costs of public infrastructure, and reducing energy consumption. Better development patterns may also result in increased options in the type of housing available, more affordable housing, and a reduction in a household's combined housing and transportation costs. (b) The construction industry has been one of the sectors hardest hit by the economic downturn of recent years. Creating incentives for construction can help restore construction jobs, which are essential for a restoration of prosperity. (c) Economic development patterns can also help California attain some of its long-term strategic environmental objectives including reduced air pollution, greater water conservation, reduced energy consumption, and increased farmland and habitat preservation. (d) Implementation of the growth plans identified by the metropolitan planning organizations in their sustainable communities strategies, and in particular the development of areas identified for transit priority projects, is essential if California is to achieve the multiple benefits that would result from economic development.  Implementation of growth plans in transit priority areas requires redevelopment of existing   developed areas.  (e) In addition to  the  economic  problems of   pressures from  the current recession, development of transit priority projects remains challenging. Infrastructure is often old and inadequate. Sites may suffer from contamination that is expensive to remediate. The high construction costs in urban areas, particularly for multifamily dwellings, create an additional challenge. For these reasons, it is critical to restructure and refocus redevelopment in California to assist in achievement of these multiple benefits. (f) At the same time, California cannot afford a redevelopment program that causes schools to lose revenue at a time when investing in education is also key to the state's economic prosperity. A growth plan for the state consistent with regional sustainable communities strategies must also provide that schools are able to play their full role in achieving the future of California. (g) The elimination of redevelopment agencies has resulted in the loss of approximately one billion dollars ($1,000,000,000) annually in low- and moderate-income housing funds for communities throughout the state. Communities need alternative, permanent sources of revenue to support the continued production of affordable housing units.  To this end, it is the intent of the Legislature to preserve the provisions of the Community Redevelopment Law, as it was proposed to have been amended by Senate Bill 450 of the 2011-   12 Regular Session, to increase, improve, and preserve affordable housing through a new economic development strategy for the state.  (h) The Legislature finds that a comprehensive strategy for the long-term economic development of the state must encourage the creation of workforce skills needed to attract and retain a high-wage workforce, in addition to public infrastructure requirements. Public investments in human capital are as vital to the long-term growth of the state's economy as investments in physical capital. 34191.2. For purposes of this part, "authority" or  "Community Development and Housing Joint Powers Authority"   "Sustainable Communities Investment Authority   "  means the  joint exercise of powers agency formed under Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code   entity formed under Chapter 2   (commencing with Section 34191.10). That entity shall be regarded as an "agency" pursuant to Section 33003  . CHAPTER 2.  COMMUNITY DEVELOPMENT AND HOUSING JOINT POWERS   SUSTAINABLE COMMUNITIES INVESTMENT AUTHORITY   34191.10. (a) The legislative bodies of the city and county representing the geographic territory covering the area served by a former redevelopment agency may elect to form a Community Development and Housing Joint Powers Authority pursuant to this part after July 1, 2012, to carry out the Community Redevelopment Law (Part 1.8 (commencing with Section 33000)). If the former redevelopment agency was formed solely by a county, the county may exercise the powers authorized by this part.   34191.10.   (a) A Sustainable Communities Investment Authority may be formed after July 1, 2012, to carry out the provisions of the Community Redevelopment Law (Part 1.8 (commencing with Section 33000)), as it is amended by Senate Bill ___ of the 2011-12 Regular Session, to increase, improve, and preserve the community's supply of low- and -moderate-income housing available at an affordable housing cost. An authority may be formed as follows:   (1) If the sustainable communities investment area is within an incorporated area, the legislative bodies of the city and county representing the geographic territory of a sustainable communities investment area may form a Sustainable Communities Investment Authority pursuant to this part after July 1, 2012, by entering into a joint powers authority under Chapter 5 (commencing with Section 6500) of Title 1 of the Government Code. The governing board of the authority may be formed by any of the following proceedings:   (A) The legislative body of the city forms the governing board and establishes the parameters of the proposed economic development within a proposed sustainable communities investment area provided the economic development parameters are approved by the county.   (B) A governing board is appointed for a sustainable communities investment area consisting of five appointees: two appointed by the city with geographic jurisdiction, two by the county with geographic jurisdiction, and one appointed by the affected special districts with each district having one vote to select an appointee.  (C) The legislative body of the city appoints the governing board and designates a sustainable communities investment area but restricts the authority so that it may receive only the city share of tax increment revenue.   (D) The legislative body of the city appoints the governing board and designates a sustainable communities investment area consisting of a single project and restricts the authority so that 100 percent of tax increment revenue is invested in the project. Designation of the sustainable communities investment area shall be subject to county approval.   (2) If the sustainable communities investment area is within an unincorporated area, the authority may be formed by the county board of supervisors or by the board of supervisors of a city and county.  (b) The authority may enter into financial and other agreements with community colleges, K-12 school districts, and private businesses to facilitate the development and operation of articulated career technical education pathways, as specified in Section 88532 of the Education Code. CHAPTER 3. FINANCING 34191.15. An authority formed pursuant to this part may adopt a  redevelopment  plan for a  project   sustainable communities investment  area pursuant to this section. Notwithstanding any other provision of this division, a determination shall not be required to be made regarding blight within the  project   sustainable communities investment  area, and an action shall not be required to be taken for the elimination of blight in connection with the creation of a  redevelopment  plan for a  project   sustainable communities investment  area. The  redevelopment  plan shall terminate on a specified date not to exceed 30 years from the date of the first issuance of bond indebtedness by the authority. A  project   sustainable communities investment  area shall include only the following areas: (a) For areas within the geographic boundaries of a metropolitan planning organization where a sustainable communities strategy has been adopted by the metropolitan planning organization, and the State Air Resources Board, pursuant to subparagraph (H) of paragraph (2) of subdivision (b) of Section 65080 of the Government Code, has accepted the metropolitan planning organization's determination that the sustainable communities strategy would, if implemented, achieve the greenhouse gas emission reduction targets: (1) Transit priority areas where a transit priority project, as defined in Section 21155 of the Public Resources Code, may be constructed, provided that if the  project   sustainable communities investment  area is based on proximity to a planned major transit stop or a high-quality transit corridor, the stop or the corridor must be scheduled to be completed within the planning horizon established by Section 450.322 of Title 23 of the Code of Federal Regulations. For purposes of this paragraph, a transit priority area may include a military base reuse plan that meets the definition of a transit priority area and  it may include  a contaminated site within a transit priority area. (2) Areas that are small walkable communities, as defined in paragraph (4) of subdivision (e) of Section 21094.5 of the Public Resources Code  ,   except that small walkable communities may also be designated in a city that is within the area of a metropolitan planning organization  . No more than one small walkable community project area shall be designated within a city. (b) Sites that have land use approvals, covenants, conditions and restrictions, or other effective controls restricting the sites to clean energy manufacturing, and  sites  that are consistent with the sustainable communities strategy, if those sites are within the geographic boundaries of a metropolitan planning organization. Clean energy manufacturing consists of the manufacture of components, parts, or materials for the generation of renewable energy resources or for alternative fuel vehicles. 34191.16.  (a)    Solely for purposes of Section 16 of Article XVI of the California Constitution, a  redevelopment  plan  for a sustainable communities investment area  adopted pursuant to Section 34191.15 may include a provision for the receipt of tax increment funds according to Section 33670, provided that the local government with land use jurisdiction has adopted all of the following:  (a) A school mitigation plan to offset losses of property tax revenue to schools serving the project area as a result of the imposition of a provision for the receipt of tax increment funds. The plan may include assessment districts, provisions of covenants, conditions and restrictions, or other mechanisms. Except as otherwise specified, the plan shall be approved by the fiscally affected school districts. If the plan is not approved by the school districts, it may be submitted by the authority established under this part to the Department of Finance for approval. The department shall approve the plan if there is no impact on the state budget because of the provisions of subdivision (b) of Section 8 of Article XVI of the California Constitution or if the impacts on the state budget are not unacceptable.   (b)   (1)  An analysis of the public service costs and revenue-generating impact of new development with respect to the provision of basic public services, including police, fire, and rescue services. The plan shall include a strategy for mitigating unfunded service impacts.  (c)   (2)  A sustainable parking standards ordinance that restricts parking in transit priority project areas.  (d)   A provision requiring that 20 percent of the housing in the project area be affordable to persons of low and moderate income.   (3) A jobs plan. All entities receiving financial support from the authority shall incorporate into any and all agreements a jobs plan, which shall describe how the project will create construction careers that pay prevailing wages, living wage permanent jobs, and a program for community outreach, local hire, and job training. This plan shall also describe the project developer's commitment to offer jobs to disadvantaged California residents, including veterans of the Iraq and Afghanistan wars, people with a history in the criminal justice system, and single-parent families.   (e)   (4)  For transit priority areas and small walkable communities within a metropolitan planning organization, a plan consistent with the use designation, density, building intensity, and applicable policies specified for the project   sustainable communities investment  area in the sustainable communities strategy and that, for new residential construction, provides a density of at least 20 dwelling units per net acre and for nonresidential uses, provides a minimum floor area ratio of 0.75.  (f)   (5)  Within small walkable communities outside a metropolitan planning organization, a plan for new residential construction that provides a density of at least 20 dwelling units per net acre and, for nonresidential uses, provides a minimum floor area ratio of 0.75.  (g)   (b)  For areas referred to in  paragraph (4) of  subdivision  (e)   (a)  , the authority shall obtain the metropolitan planning organization's concurrence that the plan is consistent with the use designation, density, building intensity, and applicable policies for the project area in the sustainable communities strategy.  (c) For purposes of Section 16 of Article XVI of the California Constitution and in the event a tax increment financing provision is included pursuant to subdivision (a), the terms "district" and "affected taxing entity" shall exclude a school district and special districts.  34191.17. The authority shall approve any bond financing under this division.  34191.18. The Low and Moderate Income Fund shall be retained in the Sustainable Economic Development and Housing Trust Fund for uses authorized under Section 33334.2. If the funds are not contracted for use within 60 months from the effective date of this section, the balance shall be transferred to an agency designated by the Governor for use as grants to the authority for the provision of affordable housing to low- and moderate-income households. Any funds expended by the authority for affordable housing from any of the granted funds shall be credited against the 20-percent set-aside requirement under Section 33334.2.   34191.19.   34191.18.  A state or local public pension fund system authorized by state law or local charter, respectively, including, but not limited to, the Public Employees' Retirement System, the State Teachers' Retirement System, a system established under the County Employees Retirement Law of 1937, Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of Title 3 of the Government Code, or an independent system, may invest capital in the public infrastructure projects and private commercial and residential developments undertaken by an authority.  34191.20.   34191.19.  (a) An authority may exercise the full powers granted under Chapter 2.8 (commencing with Section 53395) of Part 1 of Division 2 of Title 5 of the Government Code and the Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). (b) An authority may implement a local transactions and use tax under Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, except that the resolution authorizing the tax may designate the use of the proceeds of the tax. (c) An authority may issue bonds paid for with authority proceeds, which shall be deemed to be special funds to be expended by the authority for the purposes of carrying out this part. CHAPTER  4.   PREQUALIFICATION   REQUIREMENTS   34191.20. All construction contracts in excess of one million dollars ($1,000,000) on projects that will receive more than one million dollars ($1,000,000) from the Sustainable Communities Investment Authority, including projects undertaken by private developers shall comply with the following prequalification process: (a) The authority shall require that each prospective bidder complete and submit to the authority a standardized questionnaire and financial statement in a form specified by the authority, including a complete statement of the prospective bidder's financial ability and experience in performing public works. The questionnaire and financial statement shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. The questionnaires and financial statements shall not be public records and shall not be open to public inspection. (b) The authority shall adopt and apply a uniform system of rating bidders on the basis of the completed questionnaires and financial statements, in order to determine the size of the contracts, if any, upon which each bidder shall be deemed qualified to bid. (c) The questionnaire described in subdivision (a) and the uniform system of rating bidders described in subdivision (b) shall cover, at a minimum, the issues covered by the standardized questionnaire and model guidelines for rating bidders developed by the Department of Industrial Relations pursuant to subdivision (a) of Section 20101 of the Public Contract Code. (d) For purposes of this section, bidders shall include all subcontractors performing work on a contract in excess of 3 percent of the total cost. (e) A bid shall not be accepted from any person or entity who is required to submit a completed questionnaire and financial statement for prequalification pursuant to subdivision (a) but has not done so by the deadline set by the authority or who has not been prequalified by the authority prior to the deadline for submission of bids. (f) This section shall not prevent an authority from establishing additional prequalification requirements.   34191.21. (a) (1) The Department of Industrial Relations shall monitor and enforce compliance with prevailing wage requirements for any project paid for in whole or part out of public funds, within the meaning of subdivision (b) of Section 1720 of the Labor Code, including funds of a Sustainable Communities Investment Authority and shall charge each awarding body or developer for the reasonable and directly related costs of monitoring and enforcing compliance with the prevailing wage requirements on each project. (2) All moneys received by the department pursuant to this section shall be deposited in the State Public Works Enforcement Fund created by Section 1771.3 of the Labor Code. (b) Paragraph (1) of subdivision (a) shall not apply to any project paid for in whole or part out of public funds if the awarding body or developer has entered into a collective bargaining agreement that binds all of the contractors performing work on the project and includes a mechanism for resolving disputes about the payment of wages.  SEC. 2. Section 21094.5 of the Public Resources Code is amended to read: 21094.5. (a) (1) If an environmental impact report was certified for a planning level decision of a city or county, the application of this division to the approval of an infill project shall be limited to the effects on the environment that (A) are specific to the project or to the project site and were not addressed as significant effects in the prior environmental impact report or (B) substantial new information shows the effects will be more significant than described in the prior environmental impact report. A lead agency's determination pursuant to this section shall be supported by substantial evidence. (2) An effect of a project upon the environment shall not be considered a specific effect of the project or a significant effect that was not considered significant in a prior environmental impact report, or an effect that is more significant than was described in the prior environmental impact report if uniformly applicable development policies or standards adopted by the city, county, or the lead agency, would apply to the project and the lead agency makes a finding, based upon substantial evidence, that the development policies or standards will substantially mitigate that effect. (b) If an infill project would result in significant effects that are specific to the project or the project site, or if the significant effects of the infill project were not addressed in the prior environmental impact report, or are more significant than the effects addressed in the prior environmental impact report, and if a mitigated negative declaration or a sustainable communities environmental assessment could not be otherwise adopted, an environmental impact report prepared for the project analyzing those effects shall be limited as follows: (1) Alternative locations, densities, and building intensities to the project need not be considered. (2) Growth inducing impacts of the project need not be considered. (c) This section applies to an infill project that satisfies both of the following: (1) The project satisfies any of the following: (A) Is consistent with the general use designation, density, building intensity, and applicable policies specified for the project area in either a sustainable communities strategy or an alternative planning strategy for which the State Air Resources Board, pursuant to subparagraph (H) of paragraph (2) of subdivision (b) of Section 65080 of the Government Code, has accepted a metropolitan planning organization's determination that the sustainable communities strategy or the alternative planning strategy would, if implemented, achieve the greenhouse gas emission reduction targets. (B) Consists of a small walkable community project located in an area designated by a city for that purpose. (C) Is located within the boundaries of a metropolitan planning organization that has not yet adopted a sustainable communities strategy or alternative planning strategy, and the project has a residential density of at least 20 units per net acre or a floor area ratio of at least 0.75. (2) Satisfies all applicable statewide performance standards contained in the guidelines adopted pursuant to Section 21094.5.5. (d) This section applies after the Secretary of the Natural Resources Agency adopts and certifies the guidelines establishing statewide standards pursuant to Section 21094.5.5. (e) For the purposes of this section, the following terms mean the following: (1) "Infill project" means a project that meets the following conditions: (A) Consists of any one, or combination, of the following uses: (i) Residential. (ii) Retail or commercial, where no more than one-half of the project area is used for parking. (iii) A transit station. (iv) A school. (v) A public office building. (B) Is located within an urban area on a site that has been previously developed, or on a vacant site where at least 75 percent of the perimeter of the site adjoins, or is separated only by an improved public right-of-way from, parcels that are developed with qualified urban uses. (2) "Planning level decision" means the enactment or amendment of a general plan, community plan, specific plan, or zoning code. (3) "Prior environmental impact report" means the environmental impact report certified for a planning level decision, as supplemented by any subsequent or supplemental environmental impact reports, negative declarations, or addenda to those documents. (4) "Small walkable community project" means a project that is located in a small walkable community project area. A small walkable community project area means an area within an incorporated city that is not within the boundary of a metropolitan planning organization and meets all the following requirements: (A) Has a project area of approximately one-quarter-mile diameter of contiguous land completely within the existing incorporated boundaries of the city. (B) Has a project area that includes a residential area adjacent to a retail downtown area. (C) The project area has an average net density of at least eight dwelling units per net acre or a floor area ratio for retail or commercial use of not less than 0.50. For purposes of this subparagraph: (i) "Floor area ratio" means the ratio of gross building area (GBA) of development, exclusive of structured parking areas, proposed for the project divided by the total net lot area (NLA); (ii) "gross building area" means the sum of all finished areas of all floors of a building included within the outside faces of its exterior walls; and (iii) "net lot area" means the area of a lot excluding publicly dedicated land, private streets that meet local standards, and other public use areas as determined by the local land use authority. (5) "Urban area" includes either an incorporated city or an unincorporated area that is completely surrounded by one or more incorporated cities that meets both of the following criteria: (A) The population of the unincorporated area and the population of the surrounding incorporated cities equal a population of 100,000 or more. (B) The population density of the unincorporated area is equal to, or greater than, the population density of the surrounding cities.