SENATE BILL No. 852
Introduced by Senator Dodd
January 18, 2022
An act to add Division 6 (commencing with Section 62300) of Title 6 to the Government Code, relating to climate resilience districts. legislative counsel’s digest
SB 852, as introduced, Dodd. Climate resilience districts: formation:
funding mechanisms.
Existing law authorizes certain local agencies to form a community revitalization authority (authority) within a community re vitalization and in vestment area, as defined, to carry out pro visions of the Community Redevelopment Law in that area for purposes related to, among other things, infrastructure, af fordable housing, and economic revitalization. Existing law provides for the financing of these activities by, among other things, the issuance of bonds serviced by property tax increment revenues, and requires the authority to adopt a community revitalization and investment plan for the community revitalization and investment area that includes elements describing and go verning revitalization activities.
This bill w ould authorize a city , county, city and county , special district, or a combination of an y of those entities to form a climate resilience district for the purposes of raising and allocating funding for eligible projects and the operating e xpenses of eligible projects. The bill would define “eligible project” to mean projects that address sea level rise, extreme heat, extreme cold, the risk of wildfire, drought, and the risk of flooding, as specified. The bill w ould authorize a district created pursuant to these provisions to have boundaries that are identical to the boundaries of the participating entities or within the boundaries of the participating entities. The bill w ould authorize specified local
99 entities to adopt a resolution to provide property tax increment revenues to the district. The bill would also authorize specified local entities to adopt a resolution allocating other tax revenues to the district, subject to certain requirements. The bill would provide for the financing of the activities of the district by , among other things, le vying a benefit assessment, special tax, property-related fee, or other service charge or fee consistent with the requirements of the California Constitution. The bill would require each district to prepare an annual e xpenditure plan and an operating budget and capital improvement budget, which must be adopted by the governing body of the district and subject to review and revision at least annually . By imposing duties on counties in the administration of tax re venues and elections of a climate resilience district, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimb urse 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.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
line 1 SECTION 1. Division 6 (commencing with Section 62300) is line 2 added to Title 6 of the Government Code, to read:
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line 4 DIVISION 6. CLIMATE RESILIENCE DISTRICTS
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line 6 62300. This division shall be known, and may be cited, as the line 7 Climate Resilience Districts Act.
line 8 62301. It is the intent of Le gislature in enacting this di vision line 9 to provide the ability for local governments to create districts for line 10 the purpose of addressing climate change ef fects and impacts line 11 through acti vities and actions that include mitig ation and line 12 adaptation, as necessary and appropriate, to achie ve all of the line 13 following:
line 14 (a) Providing a sustained and certain level and source of funding line 15 at the local level.
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line 1 (b) Allowing activities and actions on an appropriate geographic line 2 basis.
line 3 (c) Facilitating the receipt and use of federal, state, local, and line 4 private funds.
line 5 62302. For purposes of this division:
line 6 (a) “District” means a climate resilience district formed pursuant line 7 to this division.
line 8 (b) “Eligible project” means a capital project that is designed line 9 and implemented to address climate change mitig ation or line 10 adaptation, including, but not limited to, all of the following:
line 11 (1) A project that addresses river, bay, or sea level rise, including line 12 sea walls, wetlands restoration, erosion control, and levies. line 13 (2) A project that addresses extreme heat, including constructing, line 14 improving, or modifying new or existing facilities. line 15 (3) A project that addresses e xtreme cold, rain, or sno w, line 16 including constructing, improving, or modifying new or existing line 17 facilities.
line 18 (4) A project that addresses the risk of wildfire, including line 19 establishing fire breaks, prescribed b urning, structure hardening, line 20 and vegetation control.
line 21 (5) A project that addresses drought, including multiuse land line 22 repurposing, groundw ater replenishment, groundw ater storage, line 23 and conjunctive use.
line 24 (6) A project that addresses the risk of flooding, including line 25 structure ele vation or relocation, wetlands restoration, flood line 26 easements, and levees.
line 27 (c) “Participating entity” means a city, county, or special district line 28 within a climate resilience district that adopts a resolution directing line 29 the county auditor or auditor -controller to allocate its share of line 30 property tax increment within the area co vered by the district to line 31 the district pursuant to Section 62306.
line 32 (d) “Property tax increment” means that portion of the ad line 33 valorem taxes, as defined under subdi vision (a) of Section 1 of line 34 Article XIII A of the California Constitution, e xcluding any ad line 35 valorem taxes or assessments le vied pursuant to subdi vision (b) line 36 of Section 1 of Article XIIIA of the California Constitution, levied line 37 each year in excess of the amount levied by or for a taxing agency line 38 upon the total sum of the assessed value of the taxable property in line 39 the boundaries of a district as defined in the resolution first line 40 establishing the district, as sho wn upon the assessment roll used 99 SB 852 — 3 —
line 1 in connection with the taxation of that property by the taxing line 2 agency as of the last equalized roll prior to either the effective date line 3 of the authorizing resolution or , if specified in the authorizing line 4 resolution, another fiscal year no more than five years prior to the line 5 effective date of the authorizing resolution.
line 6 62303. (a) (1) A city, county, city and county, special district, line 7 or a combination of an y of those entities may form a climate line 8 resilience district pursuant to this division.
line 9 (2) The boundaries of the district shall be one of the following:
line 10 (A) Coterminous with the county, city, or special district forming line 11 the district.
line 12 (B) Within a city or a county forming the district. line 13 (C) Across two or more counties, cities, or special districts that line 14 are forming the district.
line 15 (b) (1) A district shall be formed for the purpose of raising and line 16 allocating funding for eligible projects and the operating expenses line 17 of eligible projects.
line 18 (2) Operating expenses may include any of the following:
line 19 (A) The expenses of operating the district.
line 20 (B) The planning of eligible projects.
line 21 (C) The operational expenses of any eligible project. line 22 (c) A district shall be deemed to be an “agenc y” described in line 23 subdivision (b) of Section 16 of Article XVI of the California line 24 Constitution only for purposes of receiving property tax increment line 25 revenues.
line 26 62304. Proceedings for the establishment of a district shall be line 27 instituted by the adoption of a resolution of intention to establish line 28 the proposed district and shall do all of the following:
line 29 (a) State that a district is proposed to be established pursuant to line 30 this division and describe the boundaries of the proposed district, line 31 which may be accomplished by reference to a map on file in the line 32 office of the clerk of the city or in the office of the recorder of the line 33 county, as applicable.
line 34 (b) State the type of eligible projects proposed to be financed line 35 or assisted by the district.
line 36 (c) State the need for the district and the goals the district line 37 proposes to achieve.
line 38 (d) (1) State that any property tax increment revenue from some line 39 or all af fected taxing entities within the district, if appro ved by 99 — 4 — SB 852
line 1 resolution pursuant to Section 62306, may be used to finance these line 2 activities.
line 3 (2) The city, county, city and county , or special district shall line 4 not enact a resolution proposing formation of a district and line 5 providing for the division of taxes of any participating entity unless line 6 a resolution approving the plan has been adopted by the governing line 7 body of each participating entity pursuant to Section 62306, which line 8 is proposed to be subject to di vision of taxes and has been filed line 9 with the legislative body at or prior to the time of the hearing. line 10 62305. (a) A district shall ha ve a membership consisting of line 11 one of the following, as appropriate:
line 12 (1) If a district has only one participating entity the district shall line 13 consist of three members of the legislative body of the participating line 14 entity, and tw o members of the public chosen by the le gislative line 15 body. The legislative body may appoint one of its members to be line 16 an alternate member of the le gislative body, who may serv e and line 17 vote in place of a member who is absent or disqualifies themselves line 18 from participating in a meeting of the district. The appointment of line 19 the public members shall be subject to the provisions of Sections line 20 54970 and 54972.
line 21 (2) If a district has two or more participating entities the district line 22 shall consist of a majority of members from the legislative bodies line 23 of the participating entities, and a minimum of tw o members of line 24 the public chosen by the le gislative bodies of the participating line 25 entities. A legislative body of a participating entity may appoint line 26 one of its members to be an alternate member of the le gislative line 27 body, who may serve and vote in place of a member who is absent line 28 or disqualifies themselves from participating in a meeting of the line 29 district. The appointment of the public members shall be subject line 30 to the provisions of Sections 54970 and 54972.
line 31 (3) If a district has more than three participating entities, the line 32 legislative bodies of the entities may , upon agreement by all line 33 participating entities, appoint only one member and one alternate line 34 member of their respective legislative bodies to the district and a line 35 minimum of two members of the public chosen by the legislative line 36 bodies of the participating entities. The appointment of the public line 37 members shall be subject to the provisions of Sections 54970 and line 38 54972.
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line 1 (b) The le gislative body shall ensure the district board is line 2 established at the same time that it adopts a resolution of intention line 3 pursuant to Section 62304.
line 4 (c) Board members of the district established pursuant to this line 5 division shall not recei ve compensation b ut may recei ve line 6 reimbursement for actual and necessary expenses incurred in the line 7 performance of official duties pursuant to Article 2.3 (commencing line 8 with Section 53232) of Chapter 2 of P art 1 of Division 2 of Title line 9 5.
line 10 (d) Board members of the district are subject to Article 2.4 line 11 (commencing with Section 53234) of Chapter 2 of P art 1 of line 12 Division 2 of Title 5.
line 13 (e) Notwithstanding any other law, any member of the legislative line 14 body of a participating entity who serves as a member of the district line 15 board pursuant to this section may also serve as a member of the line 16 governing body of an agenc y or entity formed pursuant to an line 17 agreement for the joint e xercise of po wer that the participating line 18 entity has entered into in accordance with the Joint Ex ercise of line 19 Powers Act (Chapter 5 (commencing with Section 6500) of line 20 Division 7 of Title 1).
line 21 62306. (a) (1) At an y time before or after adoption of the line 22 resolution establishing the district pursuant to Section 62304, any line 23 city, county, or special district, other than a school entity as defined line 24 in subdivision (n) of Section 95 of the Revenue and Taxation Code, line 25 or a successor agency as defined in subdivision (j) of Section 34171 line 26 of the Health and Safety Code, that receives ad valorem property line 27 taxes from property located within an area may adopt a resolution line 28 directing the county auditor or auditor -controller to allocate its line 29 share of property tax increment within the area co vered by the line 30 district to the district. The resolution adopted pursuant to this line 31 subdivision may direct the county auditor or auditor-controller to line 32 allocate less than the full amount of the property tax increment, line 33 and to establish a maximum amount of time in years that the line 34 allocation takes place. These amounts shall be allocated to the line 35 district and, when collected, shall be held in a separate fund by the line 36 district. Before adopting a resolution pursuant to this subdivision, line 37 a city, county, or special district shall approve a memorandum of line 38 understanding with the district governing the use of property tax line 39 increment funds by the district for administrati ve and o verhead line 40 expenses.
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line 1 (2) The provision for the receipt of property tax increment shall line 2 become effective in the property tax year that be gins after the line 3 December 1 immediately follo wing the adoption of a resolution line 4 pursuant paragraph (1). A resolution adopted pursuant to paragraph line 5 (1) shall be provided to the county auditor or auditor-controller no line 6 later than the December 1 immediately following its adoption. line 7 (3) A resolution adopted pursuant to this subdi vision may be line 8 repealed and be of no further ef fect beginning in the fiscal year line 9 following the adoption of any repeal, by giving the county auditor line 10 or auditor-controller at least 90 days’ notice prior to the end of the line 11 current fiscal year, provided, however, that the county auditor or line 12 auditor-controller shall continue to allocate the participating line 13 entity’s share of ad valorem property taxes that have been pledged line 14 to the repayment of debt issued by the district to the district until line 15 that debt has been fully repaid, including by means of a refinancing line 16 or refunding, unless otherwise agreed upon by the district and the line 17 participating entity. For purposes of determining the annual amount line 18 of a participating entity’s share of ad valorem property taxes that line 19 shall continue to be allocated to a district follo wing a repeal, the line 20 annual amount allocated for all years until the debt has been fully line 21 repaid shall be the maximum amount required to service the debt line 22 for an y single annual period as pro vided in the district’ s debt line 23 service schedule.
line 24 (4) When the loans, advances, and indebtedness of a district, if line 25 any, and interest thereon, have been paid, or the maximum amount line 26 of time in years has passed in accordance with a resolution adopted line 27 pursuant to this subdi vision, all funds thereafter recei ved from line 28 taxes upon the taxable property in the district’ s boundaries shall line 29 be paid into the funds of the respecti ve taxing agencies as tax es line 30 on all other property are paid.
line 31 (5) All of the tax es le vied and collected upon the taxable line 32 property in the boundaries of the district shall be paid into the line 33 funds of the respective taxing agencies as though the district had line 34 not been created unless the total assessed valuation of the taxable line 35 property in the boundaries of a district exceeds the total assessed line 36 value of the taxable property in the boundaries as sho wn by the line 37 last equalized assessment roll.
line 38 (b) (1) At any time before or after the adoption of the resolution line 39 establishing the district pursuant to Section 62304, a city, county, line 40 or special district, other than a school entity as defined in 99 SB 852 — 7 —
line 1 subdivision (n) of Section 95 of the Re venue and Taxation Code line 2 or a successor agency as defined in subdivision (j) of Section 34171 line 3 of the Health and Safety Code, may adopt a resolution to allocate line 4 tax revenues of that entity to the district, including revenues derived line 5 from local sales and use tax es imposed pursuant to the line 6 Bradley-Burns Uniform Local Sales and Use Tax Law (Part 1.5 line 7 (commencing with Section 7200) of Di vision 2 of the Re venue line 8 and Taxation Code) or transactions and use taxes imposed pursuant line 9 to the Transactions and Use Tax Law (Part 1.6 (commencing with line 10 Section 7251)of Division 2 of the Re venue and Taxation Code), line 11 provided that both of the following apply:
line 12 (A) The use of those re venues by the district for purposes of line 13 this division is consistent with the purposes for which that tax was line 14 imposed.
line 15 (B) The boundaries of the district are coterminous with the city line 16 or county that established the district.
line 17 (2) A resolution adopted pursuant to this subdi vision may be line 18 repealed and be of no further ef fect, provided, however, that the line 19 tax revenues allocated to the district that have been pledged to the line 20 repayment of debt issued by the district shall continue to be so line 21 allocated until that debt has been fully repaid, including by means line 22 of a refinancing or refunding, unless otherwise agreed upon by the line 23 district and the participating entity.
line 24 (c) A minimum of 95 percent of the allocated property tax line 25 increment revenues pursuant to subdivision (a), and allocated tax line 26 revenues pursuant to subdivision (b), shall be used to fund eligible line 27 projects and the operating expenses of eligible projects. Not more line 28 than 5 percent of allocated re venues may be used for line 29 administration.
line 30 62307. A district has, and may exercise, all powers, expressed line 31 or implied, that are necessary to carry out the intent and purposes line 32 of this division, including, but not limited to, the po wer to do all line 33 of the following:
line 34 (a) (1) Levy a benefit assessment, special tax le vied pursuant line 35 to Article 3.5 (commencing with Section 50075) of Chapter 1 of line 36 Part 1 of Di vision 1 of Title 5, or property-related fee or other line 37 service charge or fee consistent with the requirements of Articles line 38 XIII A, XIII C, and XIII D of the California Constitution, line 39 including, but not limited to, a benefit assessment levied pursuant line 40 to paragraph (2).
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line 1 (2) The district may le vy a benefit assessment for an y of the line 2 purposes authorized by this di vision pursuant to an y of the line 3 following:
line 4 (A) The Improvement Act of 1911 (Di vision 7 (commencing line 5 with Section 5000) of the Streets and Highways Code). line 6 (B) The Impro vement Bond Act of 1915 (Di vision 10 line 7 (commencing with Section 8500) of the Streets and Highw ays line 8 Code).
line 9 (C) The Municipal Impro vement Act of 1913 (Di vision 12 line 10 (commencing with Section 10000) of the Streets and Highw ays line 11 Code).
line 12 (D) The Landscaping and Lighting Act of 1972 (P art 2 line 13 (commencing with Section 22500) of Di vision 15 of the Streets line 14 and Highways Code), notwithstanding Section 22501 of the Streets line 15 and Highways Code.
line 16 (E) Any other statutory authorization.
line 17 (b) Apply for and receive grants from federal and state agencies. line 18 (c) Solicit and accept gifts, fees, grants, and allocations from line 19 public and private entities.
line 20 (d) Issue revenue bonds for any of the purposes authorized by line 21 this division pursuant to the Revenue Bond Law of 1941 (Chapter line 22 6 (commencing with Section 54300) of P art 1 of Di vision 2 of line 23 Title 5), subject to any applicable constitutional requirements. line 24 (e) Incur general oblig ation bonded indebtedness for the line 25 acquisition or impro vement of real property or for funding or line 26 refunding of an y outstanding indebtedness, subject to an y line 27 applicable constitutional requirements.
line 28 (f) Receive and manage a dedicated revenue source. line 29 (g) Deposit or invest moneys of the district in banks or financial line 30 institutions in the state in accordance with state law. line 31 (h) Sue and be sued, e xcept as otherwise pro vided by la w, in line 32 all actions and proceedings, in all courts and tribunals of competent line 33 jurisdiction.
line 34 (i) Engage counsel and other professional services. line 35 (j) Enter into and perform all necessary contracts. line 36 (k) Enter into joint po wers agreements pursuant to the Joint line 37 Exercise of Po wers Act (Chapter 5 (commencing with Section line 38 6500) of Division 7 of Title 1).
line 39 (l) Hire staff, define their qualifications and duties, and provide line 40 a schedule of compensation for the performance of their duties. 99 SB 852 — 9 —
line 1 (m) Use interim or temporary staff provided by local agencies line 2 that are a members of the district. A person who performs duties line 3 as interim or temporary staff shall not be considered an employee line 4 of the district.
line 5 62308. (a) If a district proposes a measure that will generate line 6 revenues for the district that requires v oter approval pursuant to line 7 the California Constitution, the board of supervisors of the county line 8 or counties in which the district has determined to place the line 9 measure on the ballot shall call a special election on the measure. line 10 The special election shall be consolidated with the next regularly line 11 scheduled statewide election and the measure shall be submitted line 12 to the v oters in the appropriate counties, consistent with the line 13 requirements of Articles XIII A, XIII C, and XIII, or Article XVI line 14 of, the California Constitution, as applicable. line 15 (b) A district shall be deemed a district for purposes of Section line 16 317 of the Elections Code. A measure proposed by a district that line 17 requires voter approval shall be submitted to the voters of within line 18 the boundaries of the district in accordance with the provisions of line 19 the Elections Code applicable to districts, including the provisions line 20 of Chapter 4 (commencing with Section 9300) of Di vision 9 of line 21 the Elections Code.
line 22 (c) The district shall file with the board of supervisors of each line 23 county in which the measure shall appear on the ballot a resolution line 24 of the district requesting consolidation, and setting forth the exact line 25 form of the ballot question, in accordance with Section 10403 of line 26 the Elections Code.
line 27 (d) The legal counsel for the district shall prepare an impartial line 28 analysis of the measure. The impartial analysis prepared by the line 29 legal counsel for the district shall be subject to review and revision line 30 by the county counsel of the county that contains the lar gest line 31 population, as determined by the most recent federal decennial line 32 census, among those counties in which the measure will be line 33 submitted to the voters.
line 34 (e) Each county included in the measure shall use the e xact line 35 ballot question, impartial analysis, and ballot language pro vided line 36 by the district. If tw o or more counties included in the measure line 37 are required to prepare a translation of ballot materials into the line 38 same language other than English, the county that contains the line 39 largest population, as determined by the most recent federal line 40 decennial census, among those counties that are required to prepare 99 — 10 — SB 852
line 1 a translation of ballot materials into the same language other than line 2 English shall prepare the translation and that translation shall be line 3 used by the other county or counties, as applicable. line 4 (f) Notwithstanding Section 13116 of the Elections Code, if a line 5 measure proposed by a district pursuant to this division is submitted line 6 to the voters of the district in two or more counties, the elections line 7 officials of those counties shall mutually agree to use the same line 8 letter designation for the measure.
line 9 (g) The county clerk of each county shall report the results of line 10 the special election to the authority . If tw o-thirds of all v oters line 11 voting on the question at the special election v ote affirmatively, line 12 or a dif ferent appro val threshold required by the California line 13 Constitution at the time the election is achieved, the measure shall line 14 take effect in the counties in which the measure appeared on the line 15 ballot within the timeframe specified in the measure. line 16 (h) The county clerk of each county shall report the results of line 17 the special election to the district.
line 18 62309. (a) Each district shall prepare an annual e xpenditure line 19 plan that identifies and describes the operations and eligible line 20 projects undertaken by the district. The expenditure plan shall be, line 21 after public review and hearing, adopted by the go verning body line 22 of the district and subject to review and revision at least annually. line 23 (b) Each district shall also prepare and adopt an annual operating line 24 budget and capital impro vement b udget. The annual operating line 25 budget and capital improvement budget shall be, after public review line 26 and hearing, adopted by the go verning body of the district and line 27 subject to review and revision at least annually. line 28 62310. (a) A district shall pro vide for re gular audits of its line 29 accounts and records, maintain accounting records, and report line 30 accounting transactions in accordance with generally accepted line 31 accounting principles adopted by the Go vernmental Accounting line 32 Standards Board of the Financial Accounting Foundation for both line 33 public reporting purposes and for reporting of acti vities to the line 34 Controller.
line 35 (b) A district shall provide for annual financial reports and make line 36 copies of the annual financial reports available to the public. line 37 (c) Commencing in the calendar year in which a district has line 38 allocated a cumulati ve total of more than one million dollars line 39 ($1,000,000) in property tax increment revenues under this division line 40 or other re venues pursuant to subdi vision (b) of Section 62253, 99 SB 852 — 11 —
line 1 including any proceeds of a debt issuance, and each year thereafter, line 2 the district shall contract for an independent audit conducted in line 3 accordance with generally accepted go vernmental auditing line 4 standards.
line 5 62311. (a) All meetings of the district shall be subject to the line 6 Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) line 7 of Part 1 of Division 2 of Title 5.)
line 8 (b) All records prepared, owned, used, or retained by the district line 9 are public records for purposes of the California Public Records line 10 Act (Division 10 (commencing with Section 7920.000) of Title line 11 1.)
line 12 SEC. 2. The Legislature finds and declares that the allocation line 13 of revenues derived from a sales and use tax or a transactions and line 14 use tax to climate resilience district pursuant to Di vision 6 line 15 (commencing with Section 62300) of Title 6 to the Go vernment line 16 Code, as added by this act, is not subject to Section 29 of Article line 17 XIII of the California Constitution because a district is not a city, line 18 county, or city and county within the meaning of that pro vision, line 19 but is rather a separate political entity as described in subdivision line 20 (c) of Section 62303 of the Go vernment Code, as added by this line 21 act.
line 22 SEC. 3. If the Commission on State Mandates determines that line 23 this act contains costs mandated by the state, reimb ursement to line 24 local agencies and school districts for those costs shall be made line 25 pursuant to Part 7 (commencing with Section 17500) of Division line 26 4 of Title 2 of the Government Code.
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