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Governor Vetoes Burdensome Collective Bargaining Measure; Authorizes IFD’s and Looks to Next Year for Partnership on Redevelopment Alternative

September 30, 2014
The waning hours until Gov. Jerry Brown’s bill-signing deadline at midnight Tuesday brought a flurry of decisions significant to cities.
As of this afternoon, the Governor issued his final action on the 33 League priority bills that made it to his desk this legislative session.

On the economic development front, the League was pleased with the Governor’s decision to sign SB 628 (Beall), which creates an alternative to existing Infrastructure Finance District (IFD) law called “Enhanced Infrastructure Finance District Law (EIFD).” This new EIFD law can be used by local agencies to develop infrastructure funded by tax increment revenue, subject to conditions that are less cumbersome than the requirements of existing, little-used IFD law. He also signed SB 614 (Wolk), which allows a local agency, until Jan. 1, 2025, to use tax increment financing in a newly formed or reorganized district to fund infrastructure improvements in disadvantaged unincorporated communities.
Local government agencies prevailed in a battle over the fate of several labor relations bills. Most significant was the veto of AB 2126 (Bonta), a League-opposed hot bill that would have removed balance points in the existing collective bargaining process to provide preferential treatment, leverage and delay mechanisms to public employee organizations to the detriment of public employers and their responsibility to make good decisions for local taxpayers. Gov. Brown acknowledged his local government experience as the former mayor of Oakland in his veto message, stating that the “negotiating process between labor and management … seems extraordinarily robust and extensive.”  
In keeping with this theme, the Governor handed vetoes to the following League-opposed workers’ compensation and employee relations bills that would have increased costs and placed additional burdens on city employers:
  • AB 2052 (Gonzalez), which would have expanded the lists of peace officers that qualify for various workers compensation presumptions.
  • AB 2378 (Perea), which would have provided an additional year of temporary disability eligibility to public safety personnel, resulting in up to three full years of such payments.
  • SB 388 (Lieu), which would have permitted officers and firefighters who are witnesses — not under investigation — to have a union representative present when being questioned about a coworker who is being formally investigation. 
On other items results were mixed. The League was pleased to see the Governor sign a pair of bills consistent with the League’s requests:
  • AB 2374 (Mansoor), which requires the Department of Health Care Services to create a death-investigation policy and prohibits the department from approving an organization that registers counselors without determining whether he or she is registered or had certification revoked;
  • SB 1077 (DeSaulnier), which requires the California Transportation Commission, in consultation with the State Transportation Agency, to study the feasibility of a road-usage charge as an alternative to the current gas tax.
Disappointment came however, with the Governor’s decision to sign SB 556 (Padilla) and his veto of AB 2493 (Bloom). The former will create costly uniform, vehicle and badge requirements for local agencies providing health and public safety services through contracted employees. The latter would have authorized access to redevelopment bond proceeds for infrastructure and housing projects in the planning stages before the dissolution of redevelopment.
The Governor’s veto message on AB 2493 focusses on the overall costs of spending these bond proceeds, leaving little room for a return for a return of this bill. More encouragingly, however, he did note the cost to local governments to defease high-interest bond rates and wrote that he would direct the Department of Finance to develop a plan to address the bond debt.
Doors Open for Next Year:
While Brown vetoed five other bills that had League backing, but in each instance he left open the prospect of future discussions on the issues that they attempted to address:
  • AB 1399 (Medina), which would have created a California New Markets Tax Credit program by allocating up to $200 million over seven years in tax credits to attract private capital and matching funds to spur investment and job creation in low-income communities. The governor wrote that he supported private investment in poor communities, the cost of the bill meant that it should be considered as part of the annual budget.
  • AB 1999 (Atkins), which would have authorized up to a 25-percent state income tax  credit on the cost of rehabilitating certified historic structures. Brown again wrote that he supported the goals of the bill, but its $400 million cost should be discussed within the context of the budget.
  • AB 2280 (Alejo), which would have allowed for the creation of a new local entity, called a Community Revitalization Investment Authority, that would have provided a narrowed redevelopment option for the disadvantaged communities. The governor expressed a desire to work with the author on a version of the bill drafted in statute outside of former redevelopment agency law.
  • AB 2577 (Cooley), which would have allowed local agencies that provide ground emergency medical transport to Medi-Cal recipients to recapture up to $400 million statewide in lost reimbursements via interngornmental transfer. Brown wrote that he supported finding ways to increase the availability of federal funds, but that he felt that the timeframe was problematic because Department of Health Care Services is working at capacity on the implementation of the Affordable Care Act.
  • SB 1129 (Steinberg), which would have cleaned up and clarified redevelopment dissolution law, including expediting long-range property management plans to enable affected communities to complete local projects and providing more certainty for agencies receiving a finding of completion. The governor’s veto message expresses a willingness work with the Legislature on revisions to redevelopment agency dissolution statutes that “make them operate more fairly and advantageously for everyone.” 
In some cases the Governor’s decisions failed to match the League’s requests, yet, on balance, with the most onerous bills vetoed and some forward movement on economic development and other issues, the 2014 Session concludes as a positive year.

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