E California Association for Local Economic Development D
June 22, 2022
The Honorable Tom Umberg
Legislative Office Building
1021 O Street, Suite 6730
Sacramento, CA 95814
Dear Senator Umberg:
The California Association for Local Economic Development (CALED), an organization representing over 800 public and private local economic development professionals, regrets that it must Oppose your SB 361, As Amended June 20, 2022 because it sets a dangerous precedent giving the Department of Housing and Community Development (HCD) unilateral authority to review, fine and delay projects in Orange County without transparent standards or a judicial process.
The broad language in the bill raises many concerns but does not address the problematic issues that arose in a high-profile project in your district. Some of the concerns raised by SB 361 include:
• Creates uncertainty and loss of public funds: it is unclear as to what parameters constitute a violation and what the rights and remedies are for agencies entangled in this process - eventually leading to a standstill on land transfers resulting in financial losses to public agencies.
• Lack of judicial process or transparency: the bill does not include a clear process for implementation, giving HCD authority to review according to their subjective process, levy fines at will, and potentially kill projects without a public process protecting the authority and rights of jurisdictions in Orange County. If a public agency disagrees with HCD's notice of violation, this could result in up to 3-5 years delay to go through court proceedings.
• Cause extreme delays and cloud the title process: by expressly prohibiting the disposition of land until HCD determines that the disposing agency has complied with the SLA or deems the alleged violation not to be a violation, the State and private parties are given rights to prevent land dispositions and to potentially invalidate land dispositions already completed. A title company is likely not going to issue title insurance until HCD approves of the land disposition, which will result in substantial delays in the land disposition closing and the potential loss of project funding.
Retroactively punitive - jeopardizing past projects: the language in Section 54230.5 (c), when combined with the additional text of the code section, could be interpreted to mean that this new authority would be enforceable as of January 1, 2021.
The California Association for Local Economic Development (CALED) is the premier statewide professional economic development organization dedicated to advancing its members' ability to achieve excellence in delivering economic development services to their communities and business clients. 2150 River Plaza Drive, Suite 275% Sacramento, CA 95833 ÷ (916) 448-8252 * Fax: (916) 448-3811 * www.caled.org E California Association for Local Economic Development D
Honorable Senator Umberg
CALED represents hundreds of members working to bring economic opportunities to alifornians. We believe solutions to such issues should be considered within the scop f sorely needed broader policy and process reforms to the Surplus Lands Act, an CALED and our members would be helpful in contributing expertise to those discussions.
For these reasons, we regret that we must oppose SB 361. Thank you for your consideration and please feel free to contact me at 916-448-8252 with any questions.
Sincerely,
tuberfedat
Gurbax Sahota
President & CEO
Cc: Chair and Members of Assembly Housing and Community Development The California Association for Local Economic Development (CALED) is the premier statewide professional economic development organization dedicated to advancing its members' abilitv to achieve excellence in delivering economic development services to their communities and business clients. 2150 River Plaza Drive, Suite 275% Sacramento, CA 95833(916) 448-8252 * Fax: (916) 448-3811 * www.caled.org