Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements, including, among other things, that the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located. The bill would require any local agency, as defined, that purchases the property for use in developing low- and moderate-income housing to give priority to an entity that proposes a residential development with the greatest number of affordable housing units. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements, including, among other things, that the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located. The bill would require any local agency, as defined, that purchases the property for use in developing low- and moderate-income housing to give priority to an entity that proposes a residential development with the greatest number of affordable housing units. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements, including, among other things, that the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located. The bill would require any local agency, as defined, that purchases the property for use in developing low- and moderate-income housing to give priority to an entity that proposes a residential development with the greatest number of affordable housing units. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements. The bill would require the Judicial Council or the county to put the property out to competitive bid, as specified, and would require the bid process to favor an applicant that proposes a residential development with the greatest number of affordable housing units. requirements, including, among other things, that the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located. The bill would require any local agency, as defined, that purchases the property for use in developing low- and moderate-income housing to give priority to an entity that proposes a residential development with the greatest number of affordable housing units. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements. The bill would require the Judicial Council or the county to put the property out to competitive bid, as specified, and would require the bid process to favor an applicant that proposes a residential development with the greatest number of affordable housing units. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

Existing law authorizes the Judicial Council to dispose of surplus court facilities pursuant to a specified process that requires, among other things, the Judicial Council to consult with the county where the court facility is located, offer the facility to the county at a fair market value before offering it to another state or local government agency, and deposit the funds received from a sale into the State Court Facilities Construction Fund. The California Constitution requires the proceeds from the sale of surplus state property to be deposited into the Special Fund for Economic Uncertainties, a continuously appropriated fund.

This bill would, notwithstanding any other law, specifically authorize the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse if the sale complies with certain requirements. The bill would require the net proceeds from the sale of the courthouse to be deposited into the State Court Facilities Construction Fund. The bill would state that the disposition of this property is not a sale or other disposition of surplus state property within the meaning of the California Constitution.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2988

Author:(McCarty)

As Amended Ver:June 27, 2024

Majority vote

SUMMARY

Authorizes the Judicial Council to sell the main Sacramento County Courthouse when it becomes obsolete.

Major Provisions

1. Defines "property" as the Gordon D. Schaber Sacramento County Courthouse located at 720 Ninth Street, City of Sacramento, County of Sacramento, Assessor Parcel Number 002-0145-026.
2. Provides that, notwithstanding any other law, the Judicial Council may sell the property, in a fair market value transaction and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. The sale complies with the requirements of existing law regarding community impacts of selling court property;
   2. The Judicial Council consults with the county in which the property is located concerning the sale of the property; and
   3. The Judicial Council offers the county in which the property is located the right to purchase the property in a fair market value transaction before otherwise offering the property for sale.
3. Provides that if the county purchases the property the county must subsequently sell the property through a competitive bid process.
4. Requires that either the Judicial Council or a county selling a court property to favor an applicant that proposed a residential development containing the greatest number of affordable housing units.
5. Provides that the proceeds of the court facility sales authorized pursuant to 2), above, are to be deposited into the State Court Facilities Construction Fund.
6. Establishes the timelines for negotiations regarding court property sales.
7. Clarifies that the disposition of the property authorized by this bill does not constitute a sale or other disposition of surplus state property within the meaning of the California Constitution.

Senate Amendments

1. Clarify how the courthouse property is to be publically listed prior to being sold.
2. Revise the code section being added to the Government Code to avoid a chaptering conflict.

COMMENTS

Sacramento County's primary courthouse, the Gordon D. Schaber Sacramento County Courthouse, was originally built in 1965 and is beginning to show the ill effects of its age. As a result in 2014, the Judicial Council of California obtained a new parcel of land upon which it is currently constructing a state of the art facility for Sacramento County. Once the new courthouse opens, the original facility will be vacated. This bill authorizes the Judicial Council to sell the prime real estate in downtown Sacramento on which the existing courthouse stands upon its closure.

As a part of the consolidation of California's courts in 2002, recognizing that county governments previously owned many of California's courthouses, the Judicial Council was required to offer the county in which the property is located a chance to repurchase the surplus court facility at the fair market value. However, in 2004, Proposition 60A enacted Section 9 of Article III of the California Constitution and required that all surplus property be disposed of by the Department of General Services and that all sale proceeds be provided to the State's the Special Fund of Economic Uncertainties, or any successor fund.

Existing law generally requires state agencies to report to the Department of General Services all property that can be deemed surplus. The Department then submits a list of properties to the Legislature to be officially declared surplus by legislation. Upon approval by the Legislature, the Department must determine whether the land could first be used by any other state agency, local agency, or nonprofit affordable housing organization. The property can only be sold to the public once the Department determines that the property cannot be utilized by one of the aforementioned entities. Given the numerous steps required in order for the Department of General Services to sell surplus property, not only can compliance with the existing law be time consuming but the law does not generate revenue for the individually impacted state agency.

Recognizing the special needs of the courts, in prior years the Legislature has enacted specialized bills providing for the sale of surplus courthouse property. This bill would do the same for the Gordon D. Schaber Sacramento County Courthouse. Like its predecessors, this measure requires the Judicial Council to consider the impact of courthouse sales to the surrounding communities. The bill also requires the Judicial Council to consult with the local governments impacted by the sale, and offer the property to the county government before placing it on the open market. This measure also directs the proceeds of the property sales to the judicial branch to be utilized for future construction.

In light of the extreme lack of affordable housing in Sacramento County, this bill would direct either the Judicial Council, or Sacramento County, to sell the property in a manner that favors the development of affordable housing on the old courthouse site.

According to the Author

AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.

Arguments in Support

This bill is sponsored by the Judicial Council of California. In support of the bill they write:

The Judicial Council is committed to access to justice and serving all Californians in an efficient and effective manner. This bill meets that mandate by ensuring the council does not need to expend unnecessary funding, staff time, and mitigation measures for potential safety issues that are commonly associated with vacant buildings. By allowing the council to sell the property at fair market value and in alignment with existing law, state funding is appropriately expended where it is needed most—supporting court facilities that are actively in use to improve the court experience for the millions of Californians who access the courts each year.

Arguments in Opposition

No opposition on file.

FISCAL COMMENTS

According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

VOTES:

ASM JUDICIARY: 12-0-0

YES: Kalra, Dixon, Bauer-Kahan, Bryan, Connolly, Haney, Maienschein, McKinnor, Pacheco, Reyes, Sanchez, Waldron

ASM APPROPRIATIONS: 11-0-4

YES: Wicks, Arambula, Bryan, Calderon, Wendy Carrillo, Mike Fong, Grayson, Haney, Hart, Pellerin, Villapudua

ABS, ABST OR NV: Sanchez, Dixon, Jim Patterson, Ta

ASSEMBLY FLOOR: 69-0-11

YES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Connolly, Davies, Dixon, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Hoover, Irwin, Jackson, Jones-Sawyer, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Rodriguez, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wilson, Wood, Zbur, Robert Rivas

ABS, ABST OR NV: Cervantes, Chen, Megan Dahle, Essayli, Holden, Kalra, Mathis, McKinnor, Luz Rivas, Blanca Rubio, Wicks

SENATE FLOOR: 38-0-2

YES: Alvarado-Gil, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Wahab, Wiener, Wilk

ABS, ABST OR NV: Allen, Umberg

UPDATED

VERSION: June 27, 2024

CONSULTANT: Nicholas Liedtke / JUD. / (916) 319-2334 FN: 0003837

 CONSENT  

Bill No: AB 2988

Author: McCarty (D)

Amended: 6/27/24 in Senate

Vote: 21

SENATE JUDICIARY COMMITTEE: 11-0, 6/25/24

AYES: Umberg, Wilk, Allen, Ashby, Caballero, Durazo, Laird, Niello, Roth, Stern, Wahab

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 69-0, 5/23/24 - See last page for vote

SUBJECT: Courts

SOURCE: Judicial Council of California

DIGEST:

This bill authorizes the Judicial Council of California (Judicial Council) to sell the Gordon D. Schaber Sacramento County Courthouse, as provided, and requires the net proceeds from the sale to be deposited into the State Court Facilities Construction Fund.

ANALYSIS:

Existing law:

1. Provides that the Judicial Council, as the policymaking body for the judicial branch, has the following responsibilities and authorities with regard to court facilities:
   1. Full responsibility, jurisdiction, control, and authority as an owner would have over trial court facilities, the title of which is held by the state, including, but not limited to, the acquisition and development of facilities.
   2. The full range of policymaking authority over trial court facilities, including, but not limited to, planning, construction, acquisition, and operation, to the extent not expressly otherwise limited by law.
   3. Dispose of surplus court facilities, as specified. (Gov. Code § 70391) ^[1]
2. Requires the Judicial Council to consider the following factors regarding the potential new or planned use of a court facility prior to selling or transferring the facility:
   1. if the use is compatible with the use of other adjacent public buildings.
   2. if the use unreasonably departs from the historic or local character of the surrounding property or local community.
   3. if the use has a negative impact on the local community.
   4. if the use interferes with other governmental agencies that use or are located in or adjacent to the building containing the court facility.
   5. if the use is of sufficient benefit to outweigh the public good in maintaining it as a court facility or building. (§ 70391(c)(3))
3. Permits the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. the sales comply with the provisions of 2), above.
   2. the Judicial Council consults with the county where the property is located concerning the sale of the property.
   3. the Judicial Council offers the county in which the property is located the right to purchase the property at fair market value before otherwise offering the property for sale. (§ 70395 – 70397)
4. Requires the Judicial Council, in consultation with the superior court of each county and the county government, to enter into agreements regarding the transfer of responsibility for court facilities from that county to the Judicial Council. (§ 70321)
5. Requires that proceeds from the sale of surplus state property are to be used to pay the principal and interest on bonds issued pursuant to the Economic Recovery Bond Act, and upon the payment of those bonds to be deposited into the Special Fund for Economic Uncertainties, as specified. (Cal. Const. art. III, sec. 9)
6. Establishes procedures for the disposal of publicly-owned land that is surplus to the needs of local agencies. (§ 54220 et. seq.)
   1. Require local agencies to follow the procedures laid out in the State Lands Act before surplus land can be sold, including, but not limited, to sending a written notice of availability to various public agencies and nonprofit groups, referred to as “housing sponsors,” notifying them that land is available for the following purposes:
      1. low- and moderate-income housing.
      2. park and recreation, and open space.
      3. school facilities.
      4. infill opportunity zones or transit village plans. (§ 54222)

This bill:

1. Authorizes the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse in a fair market value transaction and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. the Judicial Council complies with the existing law regarding the considerations and actions that must be taken prior to the sale of surplus court property.
   2. the Judicial Council consults with the county in which the property is located concerning the sale of the property.
   3. the Judicial Council offers the county in which the property is located the right to purchase the property in a fair market value transaction before otherwise offering the property for sale.
   4. the Judicial Council makes the availability of the property known to the Department of Housing and Community Development (DHCD) for the purpose of including the property on the up-to-date listing of all notices of availability for developing low- and moderate-income housing through the state maintained by DHCD on its website pursuant to paragraph (2) of subdivision (a) of Section 54222.
   5. the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located.
   6. any local agency, as defined, that purchases the Gordon D. Schaber Sacramento County Courthouse from the Judicial Council in a fair market value transaction to use the property for developing low- and moderate-income housing must give priority to an entity that agrees to use the site for housing and proposes to provide the greatest number of units that meet the requirements of Section 54222.5 in accordance with Article 8 (commencing with Section 54220) of Chapter 5 of Part 1 of Division 2 of Title 5.
2. Requires the net proceeds from the sale of the property to be deposited into the State Court Facilities Construction Fund.
3. Specifies that the disposition of the Gordon D. Schaber Sacramento County Courthouse does not constitute a sale or other disposition of surplus state property within the meaning of Section 9 of Article III of the California Constitution and is not subject to subdivision (g) of Section 11011.

Comments

1. Existing law generally requires state agencies to report to Department of General Services (Department) all property that can be deemed surplus. (Gov. Code § 11011.) The Department then submits a list of properties to the Legislature to be officially declared surplus by legislation and requests authorization to dispose of the land. Upon approval by the Legislature, the Department must determine whether the land could first be used by any other state agency, local agency, or nonprofit affordable housing organization. The property can only be sold to the public once the Department determines that the property cannot be utilized by one of the aforementioned entities. Proposition 60A enacted Section 9 of Article III of the California Constitution in 2004, and required that all surplus property be disposed of by the Department and that all sale proceeds be used to pay the principal and interest on bonds issued pursuant to the Economic Recovery Bond Act.
2. California overhauled its court system through a series of reforms over 20 years ago resulting in the existing superior court system where the Judicial Council has the responsibility, authority, and control over trial court facilities as an owner. Prior to the overhaul of the trial court system, individual counties managed California’s trial courts and owned many of the trial court facilities. As a result of SB 1732 (Escutia, Chapter 1082, Statutes of 2002), the Judicial Council took ownership of county court facilities. In 2021, the Legislature authorized the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state. (AB 143 (Committee on Budget, Chapter 79, Statutes of 2021.)) AB 143 also specified that the net proceeds from the sale of the property are to be deposited into the State Court Facilities Construction Fund. The Legislature specifically exempted the sale of these properties from the statutes governing surplus lands.

This bill seeks to enact similar provisions for the Gordon D. Schaber Sacramento County Courthouse, which will permanently close upon commencing occupancy in the new Tani Cantil-Sakauye Sacramento County Courthouse. The main differences in this bill are:

1. The Judicial Council makes the availability of the property known to the DHCD and any local public entity that has jurisdiction for developing low- and moderate-income housing.
2. The Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located.
3. Any local agency, as defined, that purchases the Gordon D. Schaber Sacramento County Courthouse from the Judicial Council in a fair market value transaction to use the property for developing low- and moderate-income housing must give priority to an entity that agrees to use the site for housing and proposes to provide the greatest number of units that meet the requirements of Section 54222.5 in accordance with Article 8 (commencing with Section 54220) of Chapter 5 of Part 1 of Division 2 of Title 5.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/5/24)

City of Sacramento

Judicial Council of California

Sacramento Area Council of Governments

OPPOSITION: (Verified 8/5/24)

None received

ARGUMENTS IN SUPPORT: The author writes, “AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.”

The Judicial Council of California writes:

The Judicial Council is committed to access to justice and serving all Californians in an efficient and effective manner. This bill meets that mandate by ensuring the council does not need to expend unnecessary funding, staff time, and mitigation measures for potential safety issues that are commonly associated with vacant buildings. By allowing the council to sell the property at fair market value and in alignment with existing law, state funding is appropriately expended where it is needed most—supporting court facilities that are actively in use to improve the court experience for the millions of Californians who access the courts each year.

ASSEMBLY FLOOR: 69-0, 5/23/24

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Connolly, Davies, Dixon, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Hoover, Irwin, Jackson, Jones-Sawyer, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Rodriguez, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Cervantes, Chen, Megan Dahle, Essayli, Holden, Kalra, Mathis, McKinnor, Luz Rivas, Blanca Rubio, Wicks

Prepared by: Amanda Mattson / JUD. / (916) 651-4113

8/7/24 13:38:45

**** END ****

1. All further references are to the Government Code unless stated otherwise. ↑

SENATE JUDICIARY COMMITTEE

Senator Thomas Umberg, Chair

2023-2024 Regular Session

Bill No: AB 2988 (Author:McCarty)

Version: June 11, 2024

Hearing Date: June 25, 2024

Fiscal: Yes

Urgency: No

Consultant: AM

SUBJECT

Courts

DIGEST

This bill authorizes the Judicial Council of California (Judicial Council) to sell the Gordon D. Schaber Sacramento County Courthouse, as provided, and requires the net proceeds from the sale to be deposited into the State Court Facilities Construction Fund.

EXECUTIVE SUMMARY

California overhauled its court system through a series of reforms over 20 years ago resulting in the Judicial Council having responsibility, authority, and control over trial court facilities as an owner. In 2021, the Legislature authorized the Judicial Council to sell specified court properties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, specified that the net proceeds from the sale of the property are to be deposited into the State Court Facilities Construction Fund, and exempted the sale of these properties from the statutes governing surplus lands.^[1] This bill seeks to do the same for the Gordon D. Schaber Sacramento County Courthouse, except that this bill requires the Judicial Council to make the availability of the property known to the Department of Housing and Community Development (DHCD) and any local public entity that has jurisdiction for developing low- and moderate-income housing through the state. The bill also requires a local agency that purchases the property from Judicial Council to give priority to an entity that agrees to use the site for housing and proposes to provide the greatest number of units of low- and moderate-income housing under specified provisions of law related to surplus land. This is bill is substantially similar to AB 959 (McCarty, 2023) that passed this Committee 11 to 0, but was ultimately held in the Senate Appropriations Committee. The bill is author sponsored. No timely support or opposition was received by this Committee.

PROPOSED CHANGES TO THE LAW

Existing law:

1. Provides that the Judicial Council, as the policymaking body for the judicial branch, has the following responsibilities and authorities with regard to court facilities:
   1. Full responsibility, jurisdiction, control, and authority as an owner would have over trial court facilities, the title of which is held by the state, including, but not limited to, the acquisition and development of facilities;
   2. The full range of policymaking authority over trial court facilities, including, but not limited to, planning, construction, acquisition, and operation, to the extent not expressly otherwise limited by law; and
   3. Dispose of surplus court facilities, as specified. (Gov. Code § 70391.) ^[2]
2. Requires the Judicial Council to consider the following factors regarding the potential new or planned use of a court facility prior to selling or transferring the facility:
   1. if the use is compatible with the use of other adjacent public buildings;
   2. if the use unreasonably departs from the historic or local character of the surrounding property or local community;
   3. if the use has a negative impact on the local community;
   4. if the use interferes with other governmental agencies that use or are located in or adjacent to the building containing the court facility; and
   5. if the use is of sufficient benefit to outweigh the public good in maintaining it as a court facility or building. (§ 70391(c)(3).)
3. Permits the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. the sales comply with the provisions of 2), above;
   2. the Judicial Council consults with the county where the property is located concerning the sale of the property; and
   3. the Judicial Council offers the county in which the property is located the right to purchase the property at fair market value before otherwise offering the property for sale. (§ 70395 – 70397.)
4. Requires the Judicial Council, in consultation with the superior court of each county and the county government, to enter into agreements regarding the transfer of responsibility for court facilities from that county to the Judicial Council. (§ 70321.)
5. Requires that proceeds from the sale of surplus state property are to be used to pay the principal and interest on bonds issued pursuant to the Economic Recovery Bond Act, and upon the payment of those bonds to be deposited into the Special Fund for Economic Uncertainties, as specified. (Cal. Const. art. III, sec. 9.)
6. Establishes procedures for the disposal of publicly-owned land that is surplus to the needs of local agencies. (§ 54220 et. seq.)
   1. Require local agencies to follow the procedures laid out in the SLA before surplus land can be sold, including, but not limited, to sending a written notice of availability to various public agencies and nonprofit groups, referred to as “housing sponsors,” notifying them that land is available for the following purposes:
      1. low- and moderate-income housing;
      2. park and recreation, and open space;
      3. school facilities; or
      4. infill opportunity zones or transit village plans. (§ 54222.)

This bill:

1. Authorizes the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse in a fair market value transaction and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. the Judicial Council complies with the existing law regarding the considerations and actions that must be taken prior to the sale of surplus court property;
   2. the Judicial Council consults with the county in which the property is located concerning the sale of the property; and
   3. the Judicial Council offers the county in which the property is located the right to purchase the property in a fair market value transaction before otherwise offering the property for sale
   4. the Judicial Council makes the availability of the property known to the DHCD and any local public entity that has jurisdiction for developing low- and moderate-income housing through the state maintained by DHCD on its website pursuant to paragraph (2) of subdivision (a) of Section 54222;
   5. the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located; and
   6. any local agency, as defined, that purchases the Gordon D. Schaber Sacramento County Courthouse from the Judicial Council in a fair market value transaction to use the property for developing low- and moderate-income housing must give priority to an entity that agrees to use the site for housing and proposes to provide the greatest number of units that meet the requirements of Section 54222.5 in accordance with Article 8 (commencing with Section 54220) of Chapter 5 of Part 1 of Division 2 of Title 5.
2. Requires the net proceeds from the sale of the property to be deposited into the State Court Facilities Construction Fund.
3. Specifies that the disposition of the Gordon D. Schaber Sacramento County Courthouse does not constitute a sale or other disposition of surplus state property within the meaning of Section 9 of Article III of the California Constitution and is not subject to subdivision (g) of Section 11011.

COMMENTS

1. Stated need for the bill

The author writes:

AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.

1. The sale of state court facilities

Existing law generally requires state agencies to report to Department of General Services (Department) all property that can be deemed surplus. (Gov. Code § 11011.) The Department then submits a list of properties to the Legislature to be officially declared surplus by legislation and requests authorization to dispose of the land. Upon approval by the Legislature, the Department must determine whether the land could first be used by any other state agency, local agency, or nonprofit affordable housing organization. The property can only be sold to the public once the Department determines that the property cannot be utilized by one of the aforementioned entities. Proposition 60A enacted Section 9 of Article III of the California Constitution in 2004, and required that all surplus property be disposed of by the Department and that all sale proceeds be used to pay the principal and interest on bonds issued pursuant to the Economic Recovery Bond Act.

California overhauled its court system through a series of reforms over 20 years ago resulting in the existing superior court system where the Judicial Council has the responsibility, authority, and control over trial court facilities as an owner. Prior to the overhaul of the trial court system, individual counties managed California’s trial courts and owned many of the trial court facilities. As a result of SB 1732 (Escutia, Ch. 1082, Stats. 2002), the Judicial Council took ownership of county court facilities. In 2021, the Legislature authorized the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state. (AB 143 (Committee on Budget, Ch. 79, Stats. 2021.)) AB 143 also specified that the net proceeds from the sale of the property are to be deposited into the State Court Facilities Construction Fund. The Legislature specifically exempted the sale of these properties from the statutes governing surplus lands.

This bill seeks to enact similar provisions for the Gordon D. Schaber Sacramento County Courthouse, which will permanently close upon commencing occupancy in the new Tani Cantil-Sakauye Sacramento County Courthouse. The main differences in this bill are:

• the Judicial Council makes the availability of the property known to the DHCD and any local public entity that has jurisdiction for developing low- and moderate-income housing;
• the Judicial Council makes the availability of the property known to any local public entity that has jurisdiction for developing low- and moderate-income housing where the property is located; and
• any local agency, as defined, that purchases the Gordon D. Schaber Sacramento County Courthouse from the Judicial Council in a fair market value transaction to use the property for developing low- and moderate-income housing must give priority to an entity that agrees to use the site for housing and proposes to provide the greatest number of units that meet the requirements of Section 54222.5 in accordance with Article 8 (commencing with Section 54220) of Chapter 5 of Part 1 of Division 2 of Title 5.

SUPPORT

None received

OPPOSITION

None received

RELATED LEGISLATION

Pending Legislation:

AB 3282 (Committee on Judiciary, 2024) among other things, authorizes the Judicial Council to sell certain court facilities in Plumas and Stanislaus Counties, as provided. AB 3282 is pending in this Committee and will be heard on the same day as this bill.

Prior Legislation:

AB 959 (McCarty, 2023) was substantially similar to the provisions of AB 3282 (Committee on Judiciary, 2024) that authorize the sale of specified court properties in Plumas and Stanislaus Counties. AB 959 was held in the Senate Appropriations Committee.

AB 143 (Committee on Budget, Ch. 79, Stats. 2021), among other things, authorized the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, specified that the net proceeds from the sale of the property are to be deposited into the State Court Facilities Construction Fund, and exempted the sale of these properties from the statues governing surplus lands.

PRIOR VOTES

Assembly Floor (Ayes 69, Noes 0)

Assembly Appropriations Committee (Ayes 11, Noes 0)

Assembly Judiciary Committee (Ayes 12, Noes 0)

**************

1. (AB 143 (Committee on Budget, Ch. 79, Stats. 2021.)) ↑

2. All further references are to the Government Code unless stated otherwise. ↑

ASSEMBLY THIRD READING

ATR Bill Id:AB 2988

Author:(McCarty)

As Amended Ver:May 16, 2024

Majority vote

SUMMARY

Authorizes the Judicial Council to sell the main Sacramento County Courthouse when it becomes obsolete.

Major Provisions

1. Defines "property" as the Gordon D. Schaber Sacramento County Courthouse located at 720 Ninth Street, City of Sacramento, County of Sacramento, Assessor Parcel Number 002-0145-026.
2. Provides that, notwithstanding any other law, the Judicial Council may sell the property, in a fair market value transaction and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. The sale complies with the requirements of existing law regarding community impacts of selling court property;
   2. The Judicial Council consults with the county in which the property is located concerning the sale of the property; and
   3. The Judicial Council offers the county in which the property is located the right to purchase the property in a fair market value transaction before otherwise offering the property for sale.
3. Provides that if the county purchases the property the county must subsequently sell the property through a competitive bid process.
4. Requires that either the Judicial Council or a county selling a court property to favor an applicant that proposed a residential development containing the greatest number of affordable housing units.
5. Provides that the proceeds of the court facility sales authorized pursuant to 2), above, are to be deposited into the State Court Facilities Construction Fund.
6. Establishes the timelines for negotiations regarding court property sales.
7. Clarifies that the disposition of the property authorized by this bill does not constitute a sale or other disposition of surplus state property within the meaning of the California Constitution.

COMMENTS

Sacramento County's primary courthouse, the Gordon D. Schaber Sacramento County Courthouse, was originally built in 1965 and is beginning to show the ill effects of its age. As a result in 2014, the Judicial Council of California obtained a new parcel of land upon which it is currently constructing a state of the art facility for Sacramento County. Once the new courthouse opens, the original facility will be vacated. This bill authorizes the Judicial Council to sell the prime real estate in downtown Sacramento on which the existing courthouse stands upon its closure.

As a part of the consolidation of California's courts in 2002, recognizing that county governments previously owned many of California's courthouses, the Judicial Council was required to offer the county in which the property is located a chance to repurchase the surplus court facility at the fair market value. However, in 2004, Proposition 60A enacted Section 9 of Article III of the California Constitution and required that all surplus property be disposed of by the Department of General Services and that all sale proceeds be provided to the State's the Special Fund of Economic Uncertainties, or any successor fund.

Existing law generally requires state agencies to report to the Department of General Services all property that can be deemed surplus. The Department then submits a list of properties to the Legislature to be officially declared surplus by legislation. Upon approval by the Legislature, the Department must determine whether the land could first be used by any other state agency, local agency, or nonprofit affordable housing organization. The property can only be sold to the public once the Department determines that the property cannot be utilized by one of the aforementioned entities. Given the numerous steps required in order for the Department of General Services to sell surplus property, not only can compliance with the existing law be time consuming but the law does not generate revenue for the individually impacted state agency.

Recognizing the special needs of the courts, in prior years the Legislature has enacted specialized bills providing for the sale of surplus courthouse property. This bill would do the same for the Gordon D. Schaber Sacramento County Courthouse. Like its predecessors, this measure requires the Judicial Council to consider the impact of courthouse sales to the surrounding communities. The bill also requires the Judicial Council to consult with the local governments impacted by the sale, and offer the property to the county government before placing it on the open market. This measure also directs the proceeds of the property sales to the judicial branch to be utilized for future construction.

In light of the extreme lack of affordable housing in Sacramento County, this bill would direct either the Judicial Council, or Sacramento County, to sell the property in a manner that favors the development of affordable housing on the old courthouse site.

According to the Author

AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.

Arguments in Support

This bill is sponsored by the Judicial Council of California. In support of the bill they write:

The Judicial Council is committed to access to justice and serving all Californians in an efficient and effective manner. This bill meets that mandate by ensuring the council does not need to expend unnecessary funding, staff time, and mitigation measures for potential safety issues that are commonly associated with vacant buildings. By allowing the council to sell the property at fair market value and in alignment with existing law, state funding is appropriately expended where it is needed most—supporting court facilities that are actively in use to improve the court experience for the millions of Californians who access the courts each year.

Arguments in Opposition

No opposition on file.

FISCAL COMMENTS

According to the Assembly Appropriations Committee, revenue (State Court Facilities Construction Fund) of an unknown amount, potentially in the millions to tens of millions of dollars, less any costs for Judicial Council to manage the sale of the specified properties. Judicial Council reports that transaction costs are expected to be limited to property appraisals, title, and escrow fees. Affordable housing provisions may reduce the revenue derived from the sale by an unknown amount.

VOTES

ASM JUDICIARY: 12-0-0

YES: Kalra, Dixon, Bauer-Kahan, Bryan, Connolly, Haney, Maienschein, McKinnor, Pacheco, Reyes, Sanchez, Waldron

ASM APPROPRIATIONS: 11-0-4

YES: Wicks, Arambula, Bryan, Calderon, Wendy Carrillo, Mike Fong, Grayson, Haney, Hart, Pellerin, Villapudua

ABS, ABST OR NV: Sanchez, Dixon, Jim Patterson, Ta

UPDATED

VERSION: May 16, 2024

CONSULTANT: Nicholas Liedtke / JUD. / (916) 319-2334 FN: 0003191

Date of Hearing: April 10, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

ABPCA Bill Id:AB 2988

Author:(McCarty) – As Introduced Ver:February 16, 2024

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill authorizes the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse.

FISCAL EFFECT:

Revenue (State Court Facilities Construction Fund) of an unknown amount, potentially in the millions to tens of millions of dollars, less any costs for the Judicial Council to manage the sale of the specified properties. The Judicial Council reports that transaction costs are expected to be limited to property appraisals, title, and escrow fees.

COMMENTS:

1. Purpose. According to the author:

AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.

1. Background. Generally, state entities must complete a very specific process for selling surplus property unless the Legislature provides specific authority allowing a sale to bypass the standard process. This bill provides that authority for one courthouse property in Sacramento County, allowing the Judicial Council to sell the property if certain conditions are met, and directing the proceeds from the sale back into the judicial branch. According to the Assembly Committee on Judiciary, the author and the Judicial Council are engaged in ongoing discussions about potentially designating this property for affordable housing, although the bill in print does not reflect any agreement about such a designation.

Analysis Prepared by: Annika Carlson / APPR. / (916) 319-2081

Date of Hearing: March 19, 2024

ASSEMBLY COMMITTEE ON JUDICIARY

Ash Kalra, Chair

ABPCA Bill Id:AB 2988

Author:(McCarty) – As Introduced Ver:February 16, 2024

PROPOSED CONSENT

SUBJECT: Courts

KEY ISSUE: should the judicial council be permitted to sell the main Sacramento county courthouse while bypassing THE state’s surplus property sales procedures?

SYNOPSIS

This non-controversial and straightforward measure authorizes the Judicial Council to sell the Gordon D. Schaber Sacramento County Courthouse upon its scheduled closure in late 2024 or early 2025. Similar to prior court sale measures approved by this Committee, the bill requires the Judicial Council to follow a statutory process that ensures that the building sales generally conform to local land use rules and public preferences for the use of the property. This measure also directs the proceeds of the buildings to the State Court Facilities Construction Fund, which enables the funding to be used to help construct new court facilities, thus lessening cost pressures on the General Fund.

The author notes that this bill is the topic of ongoing discussions with the Judicial Council to determine if the property can be sold to an affordable housing developer to provide much needed affordable housing in Sacramento’s downtown core. Although a potential agreement between the Judicial Council and the author has yet to be reached, the existing sales procedures in this bill sufficiently safeguard the process of the proposed sale to merit its approval by this Committee at this time. This bill has no known support or opposition.

SUMMARY: Authorizes the Judicial Council to sell the main Sacramento County Courthouse when it becomes obsolete. Specifically, this bill:

1. Defines “property” as the Gordon D. Schaber Sacramento County Courthouse located at 720 Ninth Street, City of Sacramento, County of Sacramento, Assessor Parcel Number 002-0145-026.
2. Provides that, notwithstanding any other law, the Judicial Council may sell the property, in a fair market value transaction and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. The sale complies with the requirements of existing law regarding community impacts of selling court property;
   2. The Judicial Council consults with the county in which the property is located concerning the sale of the property; and
   3. The Judicial Council offers the county in which the property is located the right to purchase the property in a fair market value transaction before otherwise offering the property for sale.
3. Provides that the proceeds of the court facility sales authorized pursuant to 2) are to be deposited into the State Court Facilities Construction Fund.
4. Clarifies that the disposition of the property authorized by this bill does not constitute a sale or other disposition of surplus state property within the meaning of the California Constitution.

EXISTING LAW:

1. Tasks the Judicial Council, as the policymaking body for the judicial branch, with the following responsibilities and authorities with regard to court facilities:
   1. Exercise full responsibility, jurisdiction, control, and authority as an owner would have over trial court facilities the title of which is held by the state, including, but not limited to, the acquisition and development of facilities;
   2. Exercise the full range of policymaking authority over trial court facilities, including, but not limited to, planning, construction, acquisition, and operation, as specified; and
   3. Dispose of surplus court facilities, as specified. (Government Code Section 70391.)
2. Requires, prior to selling or transferring a court facility, the Judicial Council to consider, regarding the potential new or planned use of the facility, the following factors:
   1. If the use is compatible with the use of other adjacent public buildings;
   2. If the use unreasonably departs from the historic or local character of the surrounding property or local community;
   3. If the use has a negative impact on the local community;
   4. If the use interferes with other governmental agencies that use or are located in or adjacent to the building containing the court facility; and
   5. If the use is of sufficient benefit to outweigh the public good in maintaining it as a court facility or building. (Government Code Section 70391 (c)(3).)
3. Permits the Judicial Council to sell specified court properties in Los Angeles, Fresno, and Kings Counties at fair market value and upon the terms and conditions and subject to the reservations the Judicial Council deems in the best interests of the state, if all of the following requirements are satisfied:
   1. The sales comply with the provisions of 2), above;
   2. The Judicial Council consults with the county where the property is located concerning the sale of the property; and
   3. The Judicial Council offers the county in which the property is located the right to purchase the property at fair market value before otherwise offering the property for sale. (Government Code Sections 70395 – 70397.)
4. Requires the Judicial Council, in consultation with the superior court of each county and the county government, to enter into agreements regarding the transfer of responsibility for court facilities from that county to the Judicial Council. (Government Code Section 70321.)
5. Requires that proceeds from the sale of surplus state property are to be used to pay the principal and interest on bonds issued pursuant to the Economic Recovery Bond Act and upon the payment of those bonds to be deposited into the Special Fund for Economic Uncertainties, as specified. (Cal. Const. art. III, sec. 9.)

FISCAL EFFECT: As currently in print this bill is keyed fiscal.

COMMENTS: Sacramento County’s primary courthouse, the Gordon D. Schaber Sacramento County Courthouse, was originally built in 1965 and is beginning to show the ill effects of its age. As a result in 2014, the Judicial Council of California obtained a new parcel of land upon which it is currently constructing a state of the art facility for Sacramento County. Once the new courthouse opens, the original facility will be vacated. This bill authorizes the Judicial Council to sell the prime real estate in downtown Sacramento on which the existing courthouse stands upon its closure. In support of the bill the author states:

AB 2988 allows the Judicial Council to sell the Sacramento County Courthouse per statute. In addition, AB 2988 will provide greater affordable housing options and reduce community displacement caused by the influx of housing prices by authorizing the county to purchase the property, and permitting it to be turned into affordable housing.

Existing law requires the state to adhere to a very specific process for selling surplus property unless the Legislature provides specific-authority for the sale of government property. As a part of the consolidation of California’s courts in 2002, recognizing that county governments previously owned many of California’s courthouses, the Judicial Council was required to offer the county in which the property is located a chance to repurchase the surplus court facility at the fair market value. However, in 2004, Proposition 60A enacted Section 9 of Article III of the California Constitution and required that all surplus property be disposed of by the Department of General Services and that all sale proceeds be provided to the State’s the Special Fund of Economic Uncertainties, or any successor fund.

Existing law generally requires state agencies to report to Department of General Services all property that can be deemed surplus. The Department then submits a list of properties to the Legislature to be officially declared surplus by legislation. Upon approval by the Legislature, the Department must determine whether the land could first be used by any other state agency, local agency, or nonprofit affordable housing organization. The property can only be sold to the public once the Department determines that the property cannot be utilized by one of the aforementioned entities. Given the numerous steps required in order for the Department of General Services to sell surplus property, not only can compliance with the existing law be time consuming but the law does not generate revenue for the individually impacted state agency.

This bill clarifies that the sale of the Sacramento County courthouse is permitted to bypass the traditional surplus property sales process. Recognizing the special needs of the courts, in prior years the Legislature has enacted specialized bills providing for the sale of surplus courthouse property. This bill would do the same for the Gordon D. Schaber Sacramento County Courthouse. Like its predecessors, this measure requires the Judicial Council to consider the impact of courthouse sales to the surrounding communities. The bill also requires the Judicial Council to consult with the local governments impacted by the sale, and offer the property to the county government before placing it on the open market. This measure also directs the proceeds of the property sales to the judicial branch to be utilized for future construction.

Ongoing discussions between the author and the Judicial Council about making the Gordon D. Schaber Sacramento County Courthouse property available for affordable housing. The author indicates to this Committee that he has been in discussions with the Judicial Council about the possibility of designating the property upon which the Gordon D. Schaber Sacramento County Courthouse sits for affordable housing. Due to the intricacies of courthouse sales and the need to recoup the maximum value for the state’s property these discussions remain ongoing. It has been indicated to this Committee that a final resolution of these discussions may take several more months, long after the deadline for this bill to advance out of this Committee. Given that the majority of the provisions related to affordable housing are likely to be in the jurisdiction of the Committee on Housing and Community Development, and in light of the bill’s existing provisions requiring all proceeds of the courthouse sale to be returned to the State Court Facilities Construction Fund, the provisions of this bill within this Committee’s jurisdiction appear appropriate. As such, while the Committee will monitor ongoing discussions between the author and the Judicial Council, the Committee believes the bill as currently in print is appropriate to move forward in order to facilitate further discussions between stakeholders.

REGISTERED SUPPORT / OPPOSITION:

Support

None on file

Opposition

None on file

Analysis Prepared by: Nicholas Liedtke / JUD. / (916) 319-2334