Redevelopment: Educational Revenue Augmentation Fund: transfer payments.

(1) Existing law establishes the California Infrastructure and Economic Development Bank with specified authority, including the authority to make loans to sponsors in connection with the financing of a project and the authority to engage the services of private consultants to render professional and technical assistance. Existing property tax law requires the county auditor, in each fiscal year, to allocate property tax revenue to local jurisdictions in accordance with specified formulas and procedures. Existing property tax law also makes specified reductions to the amounts of ad valorem property tax revenue that would otherwise be annually allocated. Existing law generally requires that the revenues not allocated to counties, cities, and special districts as a result of these reductions be transferred to the Educational Revenue Augmentation Fund in that county for allocation to school districts, community college districts, and the county office of education. This bill would establish within the California Infrastructure and Economic Development Bank an Educational Revenue Augmentation Fund account (ERAF account) for the purpose of receiving and holding deposits of redevelopment agency transfer payments, as defined, and any interest accruing thereon. The bill would authorize the bank to sell for, and on behalf of, the state all or any portion of ERAF account assets or residual interest to a special purpose trust, which the bill would establish. The net proceeds from the sale of ERAF assets to the special purpose trust would be deposited in the State ERAF Account. The bill would, commencing with the 2009–10 fiscal year, and for each fiscal year thereafter during the time a specified redevelopment agency receives tax revenue from an applicable redevelopment project, require the county auditor to determine the agency transfer payment, as defined, for the agency to be deposited into the county's Educational Revenue Augmentation Fund. By imposing additional duties on local officials, the bill would impose a state-mandated local program. The bill would require, on or before March 15 of each fiscal year, the county auditor to transfer the agency transfer payment from the county's Educational Revenue Augmentation Fund to the ERAF account of the California Infrastructure and Economic Development Bank. The bill would also permit an authorized issuer, as defined, to issue bonds, notes, or other evidence of indebtedness to provide net proceeds to make one or more loans to one or more redevelopment agencies to fund that agency's obligations in the event of a shortfall caused by the obligation to fund the agency transfer payment. The bill would also require the bank, by December 1, 2009, to certify whether proceeds in the amount of at least $7,400,000,000 will be deposited on or before December 31, 2010, in the State ERAF Account. If the bank does not certify that the amount of the proceeds that will be deposited in the State ERAF Account on or before June 30, 2010, will be at least $7,400,000,000, the changes made by the bill would become inoperative on December 1, 2009, or on the date of the certification if the certification is made before December 1, 2009. The bill would authorize the bank to impose a fee upon a redevelopment agency in an amount to offset the reasonably anticipated and ongoing administrative costs of implementing these provisions. The bill would require the fees to be continuously appropriated to the bank for expenditure to implement these provisions. (2) The Community Redevelopment Law authorizes the establishment of redevelopment agencies in communities to address the effects of blight in those communities. Existing law requires each agency to prepare or cause to be prepared, and approve, a redevelopment plan for each project area. Existing law requires that a redevelopment plan contain specified limitations, including, but not limited to, a time limit on the establishing of loans, advances, and indebtedness to be paid to finance a redevelopment project, a time line on the effectiveness of a redevelopment plan, and a time line to repay indebtedness. The bill would modify and extend several time limit requirements as they are applied to specific redevelopment plans or plan amendments and, in these instances, require the legislative body to adopt an ordinance conforming the applicable redevelopment plan or amendment to these provisions. (3) The bill would provide its provisions shall become inoperative or will not become operative, as applicable, unless, on or before December 1, 2009, a validation proceeding has been filed by the bank or the special purpose trust and in response to this filing the superior court holds, or upon review the Supreme Court holds, that those provisions are constitutional and that there is no legal bar to the securitization of the payments by redevelopment agencies to the state. The bill would also make the operation of other provisions of law, regarding a fuel tax subvention, and the suspension of Section 25.5 of Article XIII of the California Constitution contingent upon the operation of these specified provisions. The bill would also provide that if the sections amended or added by the act remain operative and in effect after December 1, 2009, the additions and changes to state law proposed by Assembly Bill 26 of the 2009-10 Fourth Extraordinary Session of the Legislature and Senate Bill 26 of the 2009-10 Fourth Extraordinary Session of the Legislature would become inoperative on January 1, 2010. The bill would provide, except as specified, that it become operative on January 1, 2010. (4) The bill would declare that its provisions are interdependent on each other and are therefore not severable. (5) 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 no reimbursement is required by this act for a specified reason. (6) The California Constitution authorizes the Governor to declare a fiscal emergency and to call the Legislature into special session for that purpose. The Governor issued a proclamation declaring a fiscal emergency, and calling a special session for this purpose, on July 1, 2009. This bill would state that it addresses the fiscal emergency declared by the Governor by proclamation issued on July 1, 2009, pursuant to the California Constitution. (7) This bill would declare that it is to take effect immediately as an urgency statute. This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2009.