AB 480

Bill Subjects

Abstract

Existing law prescribes requirements for the disposal of surplus land by a local agency, as defined, and requires, except as provided, a local agency disposing of surplus land to comply with certain notice requirements before disposing of the land or participating in negotiations to dispose of the land with a prospective transferee, particularly that the local agency send a notice of availability to specified entities that have notified the Department of Housing and Community Development of their interest in surplus land, as specified. Under existing law, if the local agency receives a notice of interest, the local agency is required to engage in good faith negotiations with the entity desiring to purchase or lease the surplus land. This bill would define the term "dispose" to mean the sale of the surplus property or a lease of any surplus property entered into on or after January 1, 2024, for a term longer than 15 years, including renewal options, as specified. The bill would provide that "dispose" does not include entering a lease for surplus land on which no development or demolition will occur, regardless of the term of the lease. Existing law requires a local agency to take formal action in a regular public meeting to declare that land is surplus and is not necessary for the agency's use and to declare land as either "surplus land" or "exempt surplus land," as supported by written findings, before a local agency may take any action to dispose of it consistent with an agency's policies or procedures. This bill would exempt a local agency, in specified instances, from making a declaration at a public meeting for land that is "exempt surplus land" if the local agency identifies the land in a notice that is published and available for public comment at least 30 days before the exemption takes effect. Existing law defines "exempt surplus land," for which a local agency is not required to follow the requirements for disposal of surplus land, except as provided, as, among other things, surplus land that is put out to open, competitive bid by a local agency for specified housing and mixed-use development purposes, and surplus land that is subject to valid legal restrictions that are not imposed by the local agency and that would make housing prohibited, as specified. This bill would recast the definition of "exempt surplus land" with respect to surplus land for specified housing purposes, to remove the requirement that it be put out to open, competitive bid. The bill would also include within the definition of "exempt surplus land" surplus land totaling 10 or more acres, consisting of a single parcel, or of 2 or more adjacent or nonadjacent parcels totaling 10 or more acres, combined for disposition to one or more buyers pursuant to a plan or ordinance adopted by the legislative body of the local agency, or a state statute, as specified. The bill would require that land be subject to an open, competitive bid process, as specified, and that the development satisfy certain requirements. The bill would make a violation of these provisions subject to specified penalties. The bill would also require that a local agency that disposes of land pursuant to those provisions do so through a disposition and development agreement containing specified provisions. The bill would also require, with respect to surplus land that is subject to valid legal restrictions, that the legal restrictions described above be supported by documentary evidence and written findings, as specified. The bill would require that certain surplus land be transferred with a covenant or restriction recorded against the land at the time of sale, as specified. By narrowing the circumstances under which certain surplus land may be defined as "exempt surplus land" and, therefore, expanding the duties of local officials, the bill would impose a state-mandated local program. Existing law defines "exempt surplus land" to include surplus land that a local agency is exchanging for another property necessary for the agency's use. This bill would include easements necessary for the agency's use for purposes of that provision. Existing law specifies that, for purposes of these provisions, the term "exempt surplus land," includes, among other things, surplus land that is put out to open, competitive bid by a local agency, as specified, for purposes of a mixed-use development that is more than one acre in area, that includes not less than 300 housing units, and that restricts at least 25% of the residential units to lower income households with an affordable sales price or an affordable rent for a minimum of 55 years for rental housing and 45 years for ownership housing. This bill would modify these provisions to require that the mixed-use development include not less than 300 residential units, would modify the affordability restriction to 50 years for rental or ownership housing located on tribal trust lands, and would require the restrictions to be recorded, as specified. Existing law also defines exempt surplus land as, among other things, land that was transferred by the state to a local agency, as specified, that includes residential units that are restricted to persons and families of low or moderate income with an affordable sales price or rent, at least 80% of which shall be restricted to persons and families of lower income. This bill would expand the definition of exempt surplus land to include land that is owned by a California public-use airport on which residential use is prohibited pursuant to specified federal law. The bill would expand in the definition of exempt surplus land to also include certain mixed-use developments that meet specified conditions, including that at least 25% of the residential units are restricted to lower income households and at least 50% of the square footage of the new construction is designated for residential use, and surplus land owned by a local agency whose primary mission or purpose is to supply the public with a transportation system that is developed for commercial, or industrial uses or activities, for the sole purpose of investment if certain conditions are met. The bill would also modify exemptions related to land transferred after activation of a parking authority and land that is a former military base to include an affordability restriction of 50 years for rental or ownership housing located on tribal trust lands. Existing law requires any local agency disposing of surplus land to send a written notice of availability of the property to specified entities. Existing law requires the Department of Housing and Community Development to maintain on its internet website a list of all notices of availability throughout the state. This bill would require the department to also maintain on its internet website a list of all entities, including housing sponsors, that have notified the department of their interest in surplus land for the purpose of developing low- and moderate-income housing. This bill would also specify that certain actions are not considered "participating in negotiations" for purposes of the above-described notice of availability requirement, including issuing a request for proposals or negotiating a lease for purposes of complying with specified provisions of law. The bill would make other nonsubstantive changes to provisions that describe the entities to which notices of availability for developing low- and moderate-income housing, for open-space purposes, and for school facilities construction are required to be sent. Existing law requires an entity proposing to use the surplus land for developing low- and moderate-income housing to agree to make available not less than 25% of the total number of units developed on the parcels at affordable housing cost for a period of at least 55 years. This bill would instead require the entity to require requirement to agree to make available not less than 25% of the total number of units developed on the parcels at affordable housing cost for a minimum of 55 years for rental housing, land use for ownership housing, and 50 years for rental or ownership housing located on tribal trust lands. Existing law specifies that after the disposing agency has received a notice of interest from the entity desiring to purchase or lease the land, if price or terms cannot be agreed upon after a good faith negotiation period, the land may be disposed of, as specified. This bill would recast that provision to state that after the specified good faith negotiation, the local agency may dispose of the surplus land, as specified. Existing law proclaims that nothing in these provisions relating to the disposition of surplus property shall preclude a local agency, housing authority, or redevelopment agency that purchases land from a disposing agency from reconveying the land to a nonprofit or for-profit housing developer for development of low- and moderate-income housing. This bill would modify that provision to remove reference to housing authorities and redevelopment agencies and make other nonsubstantive changes. Existing law specifies that any public agency disposing of surplus land to a specified entity that intends to use the land for park or recreation purposes, for open-space purposes, for school purposes, or for low- and moderate-income housing purposes may provide for a payment period of up to 20 years in any contract of sale or sale by trust deed for the land. This bill would modify those provisions to refer, instead, to a local agency disposing of surplus land. Existing law authorizes a local agency to negotiate concurrently with all entities that provide notice of interest for the purpose of developing affordable housing that meets specified requirements. This bill would modify that provision to reference low- and moderate-income housing that meets specified requirements. The bill would make other nonsubstantive changes to this provision. Existing law makes a local agency that disposes of land in violation of these provisions after receiving notice from the Department of Housing and Community Development liable for a penalty of 30% of the final sale price of the surplus land sold for a first violation and 50% for any subsequent violation. This bill would, instead, make a local agency that disposes of surplus land in violation of these provisions, except as specified, after receiving a notification from the Department of Housing and Community Development, as specified, that the local agency is in violation of these provisions liable for a penalty of 30% of the applicable disposition value, which the bill would define. This bill would prohibit the penalties for violating these provisions from applying to nonsubstantive violations that do not impact the availability or construction of housing affordable to lower income households or the ultimate disposition of the land, as specified. The bill would make nonsubstantive changes to, and correct an erroneous cross-reference in, those provisions. Existing law provides that certain dispositions of real property by local agencies are subject to surplus land disposal procedures as they existed on December 31, 2019, if those dispositions are pursuant to specified legal agreements and the disposition is completed by December 31, 2022, or by December 31, 2024, if the property is located in a charter city with a population of over 2,000,000 persons and a local agency has an option agreement duly authorized by the governing body to purchase the property from a former redevelopment agency. This bill would instead subject dispositions of real property by local agencies to surplus land disposal procedures as they existed on December 31, 2019, if those dispositions are pursuant to specified legal agreements and the dispositions are completed by December 31, 2027. The bill would authorize a local agency that terminated an exclusive negotiating agreement or legally binding agreement to dispose of property, as specified, to elect whether to ask the requisite party to consider reviving the terminated agreement, and would make the revived agreement subject to these provisions, as applicable. This bill would specify that the law governing surplus land does not require a local agency to dispose of land that is determined to be surplus. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above. This bill would make its operation contingent on the enactment of SB 747 of the 2023–24 Regular Session. This bill would incorporate additional changes to Section 54221 of the Government Code proposed by SB 747 to be operative only if this bill and SB 747 are enacted and this bill is enacted last.