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Action in the Capitol This Week on Economic Development, Redevelopment and Enterprise Zones

May 2, 2013
This week was one of the busiest for policy committees in the Capitol with a few dozen important bills for cities, including several addressing post-redevelopment, economic development and enterprise zones.
Many of these bills are on the League’s Hot Bill list and are supported by the organization. All the bills, with the exception of  AB 1229, will now go to the Appropriations Committee for a fiscal analysis. AB 1229 does not have a fiscal impact and is eligible to go straight to the Assembly Floor.
Economic Development
The League is focusing this year on legislation that creates new tools of economic development for cities. Two League-supported bills, AB 1080 (Alejo) and AB 294 (Holden), passed out of the Assembly Local Government Committee on Wednesday afternoon.
AB 1080 authorizes redevelopment authority for disadvantaged communities and closed military bases by creating a new entity called a Community Revitalization Investment Authority. For more on AB 1080, please see: “Development Tools for Disadvantaged Communities Moves to Assembly Local Government Committee,” CA Cities Advocate, April 17, 2013.
AB 294 authorizes the California Infrastructure and Economic Development Bank to augment local investments in infrastructure by approving the use of the ERAF share of property tax for specific infrastructure investments. The League has been working with Assembly Member Holden’s office on a revised set of amendments to clarify the bill.

The Senate Environmental Quality Committee heard and approved SB 470 (Wright) on Wednesday morning. Supported by the League, the bill provides local agencies enhanced flexibility when disposing of publicly owned property for economic development purposes and would provide former Polanco Redevelopment Act brownfield remediation tools to cities and counties.
A number of post-redevelopment bills went before committee this week including, AB 440, AB 564, AB 1229 and SB 684.
Co-sponsored by the League, SB 684 (Hill) passed out of the Senate Transportation and Housing Committee Tuesday afternoon. The bill addresses an unintended consequence of the elimination of redevelopment related to signage in former redevelopment areas. For more on SB 684, please see: “League Co-Sponsors Bill to Address Signage Issue in Former Redevelopment Areas," CA Cities Advocate, Feb. 22, 2013.
AB 440 (Gatto) passed out of the Assembly Local Government Committee Wednesday afternoon. The League-supported bill gives cities, counties and housing authorities the authority to use the brownfield remediation tools previously granted to redevelopment agencies under the Polanco Redevelopment Act. It also gives these agencies the ability to use this authority at any location in their jurisdiction, not just in former redevelopment project areas. California’s policy goals of greenhouse gas reduction, transit-oriented development and reducing sprawl depend heavily upon investing in the revitalization of urban areas.
Two additional League-supported bills, AB 564 (Mullin) and AB 1229 (Atkins), were heard in the Assembly Housing and Community Development Committee on Wednesday morning. Both bills passed out of the committee.
Cities are supportive of measures that help local agencies move forward from the difficult redevelopment dissolution process. AB 564 provides additional certainty to successor agencies and other public and private entities. Once the agency receives a finding of completion from the Department of Finance (DOF), any items listed on the Recognized Obligation Payment Schedule that fall within the following three categories can’t be subsequently questioned by DOF. From the statute, the categories include:
  • The ability to transfer former redevelopment agency-owned properties to the city or county for redevelopment upon completion of a long-term property management plan approved by DOF;
  • The ability to repay city loans made to the redevelopment agency; and
  • The ability to use unspent bond proceeds issued by redevelopment agencies before Dec. 31, 2010. 
AB 1229 helps address another post-redevelopment issue — affordable housing. The League supports this bill that restores cities’ zoning authority for inclusionary housing. These programs are an important tool in the production of affordable new homes for working families.
Enterprise Zones
League-opposed SB 434 passed out of the Senate Governance and Finance Committee Thursday morning. The preservation of the enterprise zone program is of critical importance to the League and the cities in the 42 zones, and this bill is detrimental to the program. It undercuts the majority of local governments and participating businesses that comply with its regulations.
The League has longstanding policy principles supporting the Enterprise Zone Program and, like the author, does not want to see one community pitted against another creating winners and losers. However, the provisions in SB 434 go well beyond addressing a business that chooses to move from one existing California location to an Enterprise Zone. The numerous aggressive provisions of SB 434 permanently harm the Enterprise Zone Program.

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