Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to, among other things, wind down the affairs of the dissolved redevelopment agencies and make payments due for enforceable obligations. Existing law, among other powers granted to successor agencies generally, additionally vests the successor agency to the former Redevelopment Agency of the City and County of San Francisco with the authority, rights, and powers of that former redevelopment agency solely for the purpose of issuing bonds or incurring other indebtedness, subject to the approval of the oversight board of the successor agency, to finance the construction of affordable housing and infrastructure required by specified development agreements, including the infrastructure required by the Transbay Implementation Agreement. Under existing law, these bonds and indebtedness are considered indebtedness incurred by the dissolved redevelopment agency secured by moneys deposited in the Redevelopment Property Tax Trust Fund established for that agency.

This bill would specify this authority to issue bonds or incur other indebtedness to finance the infrastructure required by the Transbay Implementation Agreement includes entering into arrangements with the Transbay Joint Powers Authority and the City and County of San Francisco to extend the time period for pledges of gross sales proceeds and net tax increments, as specified.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City and County of San Francisco.

Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to, among other things, wind down the affairs of the dissolved redevelopment agencies and make payments due for enforceable obligations. Existing law, among other powers granted to successor agencies generally, additionally vests the successor agency to the former Redevelopment Agency of the City and County of San Francisco with the authority, rights, and powers of that former redevelopment agency solely for the purpose of issuing bonds or incurring other indebtedness, subject to the approval of the oversight board of the successor agency, to finance the construction of affordable housing and infrastructure required by specified development agreements, including the infrastructure required by the Transbay Implementation Agreement. Under existing law, these bonds and indebtedness are considered indebtedness incurred by the dissolved redevelopment agency secured by moneys deposited in the Redevelopment Property Tax Trust Fund established for that agency.

This bill would specify this authority to issue bonds or incur other indebtedness to finance the infrastructure required by the Transbay Implementation Agreement includes entering into arrangements with the Transbay Joint Powers Authority and the City and County of San Francisco to extend the time period for pledges of gross sales proceeds and net tax increments, as specified.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City and County of San Francisco.

Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to, among other things, wind down the affairs of the dissolved redevelopment agencies and make payments due for enforceable obligations. Existing law, among other powers granted to successor agencies generally, additionally vests the successor agency to the former Redevelopment Agency of the City and County of San Francisco with the authority, rights, and powers of that former redevelopment agency solely for the purpose of issuing bonds or incurring other indebtedness, subject to the approval of the oversight board of the successor agency, to finance the construction of affordable housing and infrastructure required by specified development agreements, including the infrastructure required by the Transbay Implementation Agreement. Under existing law, these bonds and indebtedness are considered indebtedness incurred by the dissolved redevelopment agency secured by moneys deposited in the Redevelopment Property Tax Trust Fund established for that agency.

This bill would specify this authority to issue bonds or incur other indebtedness to finance the infrastructure required by the Transbay Implementation Agreement includes entering into arrangements with the Transbay Joint Powers Authority and the City and County of San Francisco to extend the time period for pledges of gross sales proceeds and net tax increments, as specified.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City and County of San Francisco.

Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to, among other things, wind down the affairs of the dissolved redevelopment agencies and make payments due for enforceable obligations. Existing law, among other powers granted to successor agencies generally, additionally vests the successor agency to the former Redevelopment Agency of the City and County of San Francisco with the authority, rights, and powers of that former redevelopment agency solely for the purpose of issuing bonds or incurring other indebtedness, subject to the approval of the oversight board of the successor agency, to finance the construction of affordable housing and infrastructure required by specified development agreements, including the infrastructure required by the Transbay Implementation Agreement. Under existing law, these bonds and indebtedness are considered indebtedness incurred by the dissolved redevelopment agency secured by moneys deposited in the Redevelopment Property Tax Trust Fund established for that agency.

This bill would specify this authority to issue bonds or incur other indebtedness to finance the infrastructure required by the Transbay Implementation Agreement includes entering into arrangements with the Transbay Joint Powers Authority and the City and County of San Francisco to extend the time period for pledges of gross sales proceeds and net tax increments. increments, as specified.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City and County of San Francisco.

Existing law dissolved redevelopment agencies and community development agencies as of February 1, 2012, and provides for the designation of successor agencies to, among other things, wind down the affairs of the dissolved redevelopment agencies and make payments due for enforceable obligations. Existing law, among other powers granted to successor agencies generally, additionally vests the successor agency to the former Redevelopment Agency of the City and County of San Francisco with the authority, rights, and powers of that former redevelopment agency solely for the purpose of issuing bonds or incurring other indebtedness, subject to the approval of the oversight board of the successor agency, to finance the construction of affordable housing and infrastructure required by specified development agreements, including the infrastructure required by the Transbay Implementation Agreement. Under existing law, these bonds and indebtedness are considered indebtedness incurred by the dissolved redevelopment agency secured by moneys deposited in the Redevelopment Property Tax Trust Fund established for that agency.

This bill would specify this authority to issue bonds or incur other indebtedness to finance the infrastructure required by the Transbay Implementation Agreement includes entering into arrangements with the Transbay Joint Powers Authority and the City and County of San Francisco to extend the time period for pledges of gross sales proceeds and net tax increments.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City and County of San Francisco.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2308

Author:(Haney)

As Amended Ver:August 4, 2026

Majority vote

SUMMARY

Allows the successor agency to the former San Francisco redevelopment agency (RDA) to extend its authority to issue bonds to finance infrastructure required by the Transbay Implementation Agreement (TIA) by specifying that arrangements to extend the time period for pledges of gross sales proceeds and tax increment entered into with the Transbay Joint Powers Authority (TJPA) and San Francisco are included within its existing authority to issue bonds for these purposes.

Senate Amendments

1. Specify that, for the purposes of this bill, "net tax increment" excludes all of the following:
   1. Administrative charges, fees, or costs for the City and County of San Francisco.
   2. The portion of the tax increment revenues that the successor agency to the RDA of the City and County of San Francisco is required by law to set aside in the agency's Affordable Housing Fund pursuant to law.
   3. A portion of the net tax increment revenues equal to the percentage of the revenue that the successor agency to the RDA of the City and County of San Francisco is required to pay all governmental entities as required by law.
   4. The portion of the tax increment revenues equal to the percentage of the revenues that the State of California may mandate the successor agency to the RDA of the City and County of San Francisco to pay from time to time in the future, including any payments which the successor agency to the RDA of the City and County of San Francisco may be required to pay to the Education Revenue Augmentation Fund pursuant to law.
   5. The portion of the tax increment revenues equal to the percentage of the revenues that the successor agency to the RDA of the City and County of San Francisco would otherwise pay to school entities, including the Education Revenue Augmentation Fund, pursuant to existing law after the effective term of the existing pledge of net tax increment.

COMMENTS

1. Redevelopment. Article XVI, Section 16 of the California Constitution authorizes the Legislature to provide for the formation of RDAs to eliminate blight in an area by means of a self-financing schedule that pays for the redevelopment project with tax increment derived from any increase in the assessed value of property within the redevelopment project area (or tax increment). Generally, property tax increment financing involves a local government forming a tax increment financing district to issue bonds and use the bond proceeds to pay project costs within the boundaries of a specified project area. To repay the bonds, the district captures increased property tax revenues that are generated when projects financed by the bonds increase assessed property values within the project area.

To calculate the increased property tax revenues captured by the district, the amount of property tax revenues received by any local government participating in the district is "frozen" at the amount it received within a project area prior to the project area's formation. In future years, as the project area's assessed valuation grows above the frozen base, the resulting additional property tax revenues — the so-called property tax "increment" revenues — flow to the tax increment financing district instead of other local governments that would have received those funds absent the formation of the RDA. After the bonds have been fully repaid using the incremental property tax revenues, the RDA is dissolved, ending the diversion of tax increment revenues from participating local governments.

Prior to Proposition 13, very few RDAs existed; however, after its passage, RDAs became a source of funding for a variety of local infrastructure activities. RDAs were required to set-aside approximately 20% of funding generated in a project area to increase the supply of low and moderate income housing in the project areas [AB 3674 (Montoya), Chapter 1337, Statutes of 1976]. At the time of dissolution, over 400 RDAs statewide were diverting roughly 12% of property taxes, over $5.6 billion yearly.

In 2011, facing a severe budget shortfall, the Governor proposed eliminating RDAs in order to deliver more property taxes to other local agencies. Ultimately, the Legislature approved and the Governor signed two measures, ABX1 26 (Blumenfield), Chapter 5 and ABX1 27 (Blumenfield), Chapter 6 that together dissolved RDAs as they existed at the time and created a voluntary redevelopment program on a smaller scale. In response, the California Redevelopment Association (CRA) and the League of California Cities, along with other parties, filed suit challenging the two measures. The Supreme Court denied the petition for peremptory writ of mandate with respect to ABX1 26. However, the Court did grant CRA's petition with respect to ABX1 27. As a result, all RDAs were required to dissolve as of February 1, 2012.

1. RDA Dissolution. ABX1 26 established successor agencies to manage the process of unwinding former RDA affairs, generally prohibited RDAs from incurring new or expanding existing monetary or legal obligations, and removed the authority for RDAs to engage in most activities except continuing to pay off enforceable obligations. With the exception of seven cities, the city or county that created each former RDA now serves as that RDA's successor agency. One of a successor agency's primary responsibilities is to make payments for the enforceable obligations RDAs entered into. These payments are supported by property tax revenues that would have gone to RDAs, but are instead deposited in the Redevelopment Property Tax Trust Fund (RPTTF). Enforceable obligations include bonds, bond-related payments, some loans, payments required by the federal government, obligations to the state or imposed by state law, payments to RDA employees, judgements or settlements, and other legally binding and enforceable agreements or contracts. Any remaining property tax revenues that exceed these enforceable obligations return to cities, counties, special districts, and school and community college districts to support core services.

Each successor agency has an oversight board responsible for supervising and approving its actions. The Department of Finance (DOF) can review and request reconsideration of an oversight board's decision. Once a successor agency takes over for an RDA, it reviews the RDA's outstanding assets and obligations, and develops a plan to resolve those obligations, also known as a Recognized Obligation Payment Schedule (ROPS). To obtain required DOF approval, a successor agency submits a series of ROPS to DOF. If DOF agrees with the plan, it issues a Finding of Completion acknowledging their progress towards paying off their obligations. Successor agencies issued a Finding of Completion can submit a Last and Final ROPS, meaning that (1) the remaining debt is limited to administrative costs and payments pursuant to enforceable obligations with defined payment schedules, (2) all remaining obligations have been previously listed on the ROPS and approved by DOF, and (3) the agency is not a party to outstanding or unresolved litigation. Successor agencies had until December 31, 2015 to receive their Finding of Completion from DOF. RDA dissolution law states that successor agencies that did not receive their Finding of Completion by this date, or did not enter into a written installment payment plan with DOF, were to never receive a Finding of Completion. Approximately nine successor agencies did not receive a Finding of Completion by the deadline.

1. San Francisco's RDA. In 2015, the Legislature passed, and the Governor signed, SB 107 (Committee on Budget and Fiscal Review), Chapter 325, Statutes of 2015, which authorized San Francisco’s successor agency to issue bonds and incur debt for other projects using RPTTF, including housing projects in Mission Bay, Hunters Point, and pursuant to the TIA. Using RPTTF to fund these projects extended the expected lifespan of the successor agency until 2058. Like its obligations under dissolution law, the successor agency must receive approval for these projects from its oversight board and DOF.

SB 593 (Wiener), Chapter 782, Statutes of 2023, authorized the successor agency to the SFRDA to issue bonds or incur indebtedness to finance the replacement of up to 5,842 units of affordable housing to satisfy the replacement housing obligation of the SFRDA as described in existing law and subsequently certified by the Department of Housing and Community Development.

1. Transbay Joint Powers Authority. TJPA has primary jurisdiction with respect to all matters concerning the financing, design, development, construction, and operation of the Transbay Program. The TJPA is a joint exercise of powers authority created in 2001 by San Francisco, the Alameda-Contra Costa Transit District and the Peninsula Corridor Joint Powers Board; subsequently, in 2017, the California High Speed Rail Authority was added as a member. The TJPA is governed by an 8-member Board of Directors.

According to the TJPA, "The Transbay Program is a transportation and housing project that has transformed downtown San Francisco and the San Francisco Bay Area’s regional transportation system by creating a world class transportation hub in the heart of a new neighborhood. The project replaced the former Transbay Terminal at First and Mission streets in San Francisco with a modern regional transit hub connecting the Bay Area and ultimately the State of California through: AC Transit, BART, Caltrain, Golden Gate Transit, Greyhound, Muni, SamTrans, WestCAT Lynx, Amtrak, Paratransit and future High-Speed Rail from the San Francisco to Los Angeles/Anaheim."

1. Transbay Agreement. In 2003, TJPA, San Francisco, and the State of California entered into an agreement in which the State agreed to transfer specified state-owned parcels to San Francisco and the TJPA, subject to certain restrictions. Under the agreement, City and TJPA title to the state-owned parcels is subject to a deed restriction requiring that any such parcel may be sold for development only when the gross sales proceeds are provided to the TJPA to finance development of the Transbay Terminal Project. The agreement further requires that a portion of tax increment revenues attributable to the state-owned parcels, the "net tax increment (NTI)," must be provided to the TJPA to finance development of the Transbay Terminal Project.

According to the Office of Community Investment and Infrastructure (OCII), the successor agency to San Francisco’s RDA, the Transbay Redevelopment Plan was adopted in June 2005. The Transbay Plan, its Design for Development, and its Open Space and Streetscape Plan call for the redevelopment, rehabilitation, and revitalization of the area generally bounded by Mission, Main, Second and Folsom Streets in downtown San Francisco. 

The Transbay Redevelopment Project Area consists of approximately forty acres of land that previously contained the now-demolished Embarcadero Freeway and ramps to the former Transbay Terminal, which were heavily damaged by the 1989 Loma Prieta earthquake, and surrounding properties. 

Transbay is divided into two zones. OCII has land use authority over Zone One, which is located in the southern portion of the Project Area. The Transbay Plan and its Development Controls and Design Guidelines direct the transformation of Zone One from public land previously occupied by the former freeway and ramps into a new, master-planned, high-density, mixed use/residential community. Zone Two is in the northern portion of Transbay and includes the Salesforce Transit Center, Salesforce Tower, and mostly commercial properties along Mission and Howard Streets. Zone Two falls under the land use authority of the San Francisco Planning Department, under the Transbay Plan and the Transit Center District Plan, as provided for in the Transbay Delegation Agreement between the former Agency and the Planning Department.

OCII and the TJPA are responsible for executing the Transbay Plan, pursuant to a 2005 Implementation Agreement. Other agreements that enable the redevelopment of Transbay are between TJPA, OCII, the San Francisco, and the State of California, and include the Transbay Transit Terminal Cooperative Agreement, the Option Agreement for the Purchase and Sale of Property between the City and County of San Francisco, the TJPA and the RDA, and, the Transbay RDA Project Tax Increment Allocation and Sales Proceeds Pledge Agreement.

According to the Author

"San Francisco needs modern, connected transit infrastructure to support our growing economy, build housing near jobs, and revitalize our downtowns. The Transbay Program is a transformative investment that will expand regional transit capacity, connect Caltrain and future high-speed rail to the Salesforce Transit Center, and unlock thousands of homes and new economic activity in the heart of San Francisco.

"However, the COVID-19 pandemic significantly affected the project's bonding capacity, and at a time when federal transit funding opportunities have become less certain, the project needs additional financial stability to move forward. AB 2308 addresses this challenge by extending the timeline for an existing value-capture financing tool tied to former state-owned parcels in the Transbay Redevelopment Area by 25 years. This targeted extension will help ensure the project can secure the financing needed to complete the Downtown Rail Extension, delivering increased transit capacity, new housing, downtown revitalization, and thousands of good, labor-backed construction jobs for California's workers – all without adding any new taxes."

Arguments in Support

According to the TJPA, the sponsors of this bill, "The Transbay Redevelopment Plan ("Transbay Plan") was adopted in June 2005. Together with its Design for Development and Open Space and Streetscape Plan, the Transbay Plan calls for the redevelopment, rehabilitation, and revitalization of approximately forty acres in downtown San Francisco, generally bounded by Mission, Main, Second, and Folsom Streets. The Plan is centered on construction of the Salesforce Transit Center (already completed) and the Caltrain Downtown Extension (DTX) also known as The Portal, which is still in preconstruction.

"Much of the project area consists of former state-owned land previously occupied by the Embarcadero Freeway and the ramps to the original Transbay Terminal, both of which were severely damaged in the 1989 Loma Prieta earthquake. The State agreed to convey this land to the TJPA at no cost, with the understanding that it would be used either for new public transit infrastructure or redeveloped for housing and other uses. In return, land sale proceeds and NTI generated from these parcels were pledged to support construction for the TJPA’s delivery of the Transbay Program.

"The Office of Community Investment and Infrastructure (OCII), as successor to the former Redevelopment Agency, and the TJPA jointly implement the Transbay Plan pursuant to a series of agreements, including the 2005 Transbay Implementation Agreement and the 2008 Transbay Pledge Agreement. These agreements pledge NTI from the former state-owned parcels to the TJPA. Following the dissolution of redevelopment agencies, the California Department of Finance confirmed that these agreements constitute enforceable obligations of OCII as successor agency.

"The TJPA anticipates completing delivery of The Portal, Phase 2 of the Transbay Program, in 2036 when rail service begins operations into the Transit Center. However, COVID-related impacts and shifts in the development market on the former state-owned parcels have significantly reduced projected tax increment revenues. As a result, the Project Area's bonding capacity has declined by an estimated $275 million, jeopardizing the TJPA's ability to generate the required local match to secure approximately $3.38 billion in federal funding for The Portal.

"Extending the term for collection of Net Tax Increment from 2050 to 2075 would reclaim an estimated $188 million in net present value bonding capacity. This extension is essential to preserving the financial viability of the project and unlocking critical federal investment.

"Importantly, AB 2308 does not alter or reduce revenues from non-state parcels, nor does it change the structure or purpose of the existing NTI pledge. The legislation simply extends the duration of the current pledge on former state-owned parcels from 2050 to 2075 to allow for TJPA to obtain future bond proceeds as intended when the original legislation was approved. It does not create new obligations, redirect funds from other entities, or modify the fundamental financing framework already approved and recognized as enforceable."

Arguments in Opposition

None on file

FISCAL COMMENTS

None.

VOTES:

ASM LOCAL GOVERNMENT: 10-0-0

YES: Carrillo, Ta, Johnson, Pacheco, Ramos, Ransom, Blanca Rubio, Stefani, Ward, Wilson

ASM HOUSING AND COMMUNITY DEVELOPMENT: 12-0-0

YES: Haney, Patterson, Ávila Farías, Caloza, Garcia, Kalra, Lee, Quirk-Silva, Ta, Tangipa, Wicks, Wilson

ASSEMBLY FLOOR: 66-0-14

YES: Addis, Aguiar-Curry, Ahrens, Alanis, Alvarez, Ávila Farías, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bryan, Calderon, Caloza, Carrillo, Castillo, Connolly, Davies, DeMaio, Dixon, Elhawary, Ellis, Fong, Gabriel, Garcia, Gipson, Jeff Gonzalez, Mark González, Hadwick, Haney, Harabedian, Jackson, Johnson, Kalra, Krell, Lackey, Lee, Lowenthal, Macedo, McKinnor, Muratsuchi, Nguyen, Ortega, Pacheco, Patel, Patterson, Pellerin, Quirk-Silva, Ramos, Ransom, Michelle Rodriguez, Rogers, Blanca Rubio, Sanchez, Schiavo, Schultz, Sharp- Collins, Solache, Soria, Stefani, Ta, Tangipa, Ward, Wilson, Zbur, Rivas

ABS, ABST OR NV: Arambula, Bonta, Chen, Flora, Gallagher, Hart, Hoover, Irwin, Papan, Petrie-Norris, Celeste Rodriguez, Valencia, Wallis, Wicks

UPDATED

VERSION: August 4, 2026

CONSULTANT: Jimmy MacDonald / L. GOV. / (916) 319-3958 FN: 0004030

 THIRD READING  

Bill No: AB 2308

Author: Haney (D)

Amended: 8/4/26 in Senate

Vote: 21

SENATE LOCAL GOVERNMENT COMMITTEE: 6-1, 6/10/26

AYES: Durazo, Arreguín, Ashby, Cervantes, Laird, Seyarto

NOES: Choi

ASSEMBLY FLOOR: 66-0, 5/7/26 (Consent) - See last page for vote

SUBJECT: Redevelopment: successor agency debt: City and County of San Francisco

SOURCE: Transbay Joint Powers Authority

DIGEST:

This bill allows the successor agency to the former San Francisco redevelopment agency to extend its authority to issue bonds to finance the Transbay Program.

ANALYSIS:

Existing law:

1. Establishes the Community Redevelopment Law, which governs the authority to establish a redevelopment agency (RDA) and the authority for a RDA to function as an agency and to adopt and implement a redevelopment plan.
   
2. Provides that RDA plans adopted on or before December 31, 1993, had to terminate no more than 40 years from their adoption or January 1, 2009, whichever is later. After this point, the RDA had no authority to act pursuant to the redevelopment plan except to pay previously incurred indebtedness, comply with affordable housing production requirements, and enforce existing covenants, contracts, or other obligations.
   
3. Requires each RDA to make deposits into a Low and Moderate Income Housing Fund the agency maintained to increase, improve, and preserve the community’s supply of low- and moderate-income housing, generally not less than 20% of all taxes allocated to the agency.
4. Requires RDAs to replace low- or moderate-income housing units destroyed or removed as part of their previous projects.
   
5. Dissolves redevelopment agencies as of February 1, 2012.
   
6. Establishes successor agencies to manage the process of unwinding former RDAs’ affairs, and oversight boards to approve successor agency decisions.
   
7. Allows the Department of Finance (DOF) to review and request reconsideration of an oversight board’s decision.
   
8. Requires the successor agency to submit specified information on its outstanding assets and obligations, also known as a Recognized Obligation Payment Schedule (ROPS).
   
9. Allows DOF to issue a finding of completion to a successor agency acknowledging their progress towards paying off their obligations provided that its Final ROPS contains specified information.
10. Allows a successor agency to make payments for the enforceable obligations RDAs entered into listed on the ROPS. These payments are supported by property tax revenues that would have gone to RDAs, but are instead deposited in a Redevelopment Property Tax Trust Fund (RPTTF). Enforceable obligations include bonds, bond-related payments, some loans, payments required by the federal government, obligations to the state or imposed by state law, payments to RDA employees, judgements or settlements, and other legally binding and enforceable agreements or contracts.
11. Authorizes San Francisco’s successor agency to issue bonds and incur debt for other projects using RPTTF, including housing projects in Mission Bay, Hunters Point, and pursuant to the Transbay Implementation Agreement (TIA).

This bill:

1. Allows the successor agency to the former San Francisco redevelopment agency (RDA) to extend its authority to issue bonds to finance infrastructure required by the TIA by specifying that arrangements to extend the time period for pledges of gross sales proceeds and net tax increment (NTI) entered into with the Transbay Joint Powers Authority (TJPA) and San Francisco are included within its existing authority to issue bonds for these purposes.
2. Defines NTI to exclude administrative costs, affordable housing set aside payments from the former redevelopment agency, contributions to the city and county’s Educational Revenue Augmentation Fund, and residual payments the successor agency would otherwise pay to school entities after the effective term of the existing pledge of net tax increment.

Background

Redevelopment agencies. Citing a significant State General Fund deficit, Governor Brown’s 2011-12 budget proposed eliminating RDAs and returning billions of dollars of property tax revenues to schools, cities, and counties to fund core services. Among the statutory changes that the Legislature adopted to implement the 2011-12 budget, AB X1 26 (Blumenfield, Chapter 5, Statutes of 2011, First Extraordinary Session) dissolved all RDAs. The California Supreme Court's 2011 ruling in California Redevelopment Association v. Matosantos upheld AB X1 26, but invalidated AB X1 27 (Blumenfield, Chapter 6, Statutes of 2011, First Extraordinary Session 2011), which would have allowed most RDAs to avoid dissolution. In response, the California Redevelopment Association challenged the two measures. The Supreme Court denied the petition for peremptory writ of mandate with respect to AB X1 26, but granted it with respect to AB X1 27. As a result, all RDAs dissolved as of February 1, 2012. At the time of dissolution, over 400 RDAs statewide were diverting 12% of property taxes, over $5.6 billion yearly.

RDAs’ dissolution deprived many local agencies of the primary tool they used to eliminate physical and economic blight, finance new construction, improve public infrastructure, rehabilitate existing buildings, and increase the supply of affordable housing. At the time the state dissolved RDAs, the Controller estimated that statewide, the requirement to set aside 20% of funding generated in a project area for low- and moderate-income housing obligated RDAs to spend $1 billion on affordable housing.

City and County of San Francisco. San Francisco’s RDA completed various redevelopment projects dating back to the 1960s. The RDA project areas diverted funds from the City and County of San Francisco and other taxing entities, including Bay Area Rapid Transit District, San Francisco Unified School District, San Francisco Community College District, and the city and county’s Educational Revenue Augmentation Fund (ERAF), for its redevelopment projects. In 2015, the Legislature passed, and the Governor signed, SB 107 (Committee on Budget and Fiscal Review, Chapter 325, Statutes of 2015), which authorized the successor agency to issue bonds and incur debt for other projects using RPTTF, including the housing projects in Mission Bay, Hunters Point, and pursuant to the TIA. Using RPTTF to fund these projects extended the expected lifespan of the successor agency until 2058.

Transbay Joint Powers Authority (TJPA). The TJPA is a joint exercise of powers authority created in 2001 by San Francisco, the Alameda-Contra Costa Transit District and the Peninsula Corridor Joint Powers Board; subsequently, in 2017, the California High Speed Rail Authority was added as a member. An 8-member board governs the TJPA. TJPA has primary jurisdiction with respect to all matters concerning the financing, design, development, construction, and operation of the Transbay Program.

In 2003, TJPA, San Francisco, and the State of California entered into an agreement in which the State agreed to transfer specified state-owned parcels to San Francisco and the TJPA, subject to certain restrictions. Under the agreement, known as TIA, the state-owned parcels are subject to a deed restriction requiring that TJPA can only sell these parcels when the proceeds go to the TJPA to finance the Transbay Terminal Project. The agreement further requires that a portion of tax increment revenues attributable to the state-owned parcels, the “net tax increment (NTI),” go to TJPA to finance development of the Transbay Terminal Project.

Comments

1. Purpose of the bill. According to the author, “San Francisco needs modern, connected transit infrastructure to support our growing economy, build housing near jobs, and revitalize our downtowns. The Transbay Program is a transformative investment that will expand regional transit capacity, connect Caltrain and future high-speed rail to the Salesforce Transit Center, and unlock thousands of homes and new economic activity in the heart of San Francisco. However, the COVID-19 pandemic significantly affected the project’s bonding capacity, and at a time when federal transit funding opportunities have become less certain, the project needs additional financial stability to move forward. AB 2308 addresses this challenge by extending the timeline for an existing value-capture financing tool tied to former state-owned parcels in the Transbay Redevelopment Area by 25 years. This targeted extension will help ensure the project can secure the financing needed to complete the Downtown Rail Extension, delivering increased transit capacity, new housing, downtown revitalization, and thousands of good, labor-backed construction jobs for California’s workers – all without adding any new taxes.”
2. The song that never ends. AB X1 26 created successor agencies to unwind RDAs obligations so that property tax revenues previously going to RDAs flow back to the local agencies generating the revenue. The property tax revenue used to issue these bonds originates from not just the successor agency, which is the city in many cases, but also the county, special districts, and school and community college districts, which impacts the state by way of the Proposition 98 minimum funding guarantee. This bill allows San Francisco to extend its authority to issue bonds for the Transbay Project. By doing so, this bill delays the dissolution of its successor agency for another couple decades until the new bonds are fully paid off, which pushes the estimated dissolution date for the successor agency to 2075.

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

SUPPORT: (Verified 8/5/26)

Transbay Joint Powers Authority (Source)

Metropolitan Transportation Commission

Peninsula Corridor Joint Powers Board

OPPOSITION: (Verified 8/5/26)

None received

ASSEMBLY FLOOR: 66-0, 5/7/26

AYES: Addis, Aguiar-Curry, Ahrens, Alanis, Alvarez, Ávila Farías, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bryan, Calderon, Caloza, Carrillo, Castillo, Connolly, Davies, DeMaio, Dixon, Elhawary, Ellis, Fong, Gabriel, Garcia, Gipson, Jeff Gonzalez, Mark González, Hadwick, Haney, Harabedian, Jackson, Johnson, Kalra, Krell, Lackey, Lee, Lowenthal, Macedo, McKinnor, Muratsuchi, Nguyen, Ortega, Pacheco, Patel, Patterson, Pellerin, Quirk-Silva, Ramos, Ransom, Michelle Rodriguez, Rogers, Blanca Rubio, Sanchez, Schiavo, Schultz, Sharp-Collins, Solache, Soria, Stefani, Ta, Tangipa, Ward, Wilson, Zbur, Rivas

NO VOTE RECORDED: Arambula, Bonta, Chen, Flora, Gallagher, Hart, Hoover, Irwin, Papan, Petrie-Norris, Celeste Rodriguez, Valencia, Wallis, Wicks

Prepared by: Jonathan Peterson / L. GOV. / (916) 651-4119

8/7/26 14:40:36

**** END ****

SENATE COMMITTEE ON LOCAL GOVERNMENT

Senator María Elena Durazo, Chair

2025 - 2026 Regular

Redevelopment: successor agency debt: City and County of San Francisco

Allows the successor agency to the former San Francisco redevelopment agency to extend its authority to issue bonds to finance the Transbay Program.

Background

Redevelopment agencies. From the early 1950s until the state dissolved them in 2011, California redevelopment agencies (RDAs) used property tax increment financing to pay for economic development projects in blighted areas. Generally, property tax increment financing involves a city or county forming a tax increment financing district to issue bonds and use the bond proceeds to pay project costs within the boundaries of a specified project area. To repay the bonds, the district captures increased property tax revenues generated when projects financed by the bonds increase assessed property values within the project area. To calculate the increased property tax revenues captured by the district, the amount of property tax revenues obtained by any local agency that receives a share of property tax revenues from property within a project area is “frozen” at the amount it received from that property prior to the project area’s formation. In future years, as the project area’s assessed valuation grows above the frozen base, the resulting additional property tax revenues—the increment—flows to the tax increment financing district instead of other local agencies. After the bonds have been fully repaid, the district is dissolved, ending the diversion of tax increment revenues from participating local agencies. Property tax revenues then flow back to each local agency that receives a share of the property tax.

RDA plans adopted on or before December 31, 1993, had to terminate no more than 40 years from their adoption or January 1, 2009, whichever is later. After this point, the RDA had no authority to act pursuant to the redevelopment plan except to pay previously incurred indebtedness, comply with affordable housing production requirements, and enforce existing covenants, contracts, or other obligations.

RDA law required each RDA to make deposits into a Low and Moderate Income Housing Fund (Housing Fund) the agency maintained to increase, improve, and preserve the community’s supply of low- and moderate-income housing, generally not less than 20% of all taxes allocated to the agency. In 1975, the Legislature amended RDA law to require RDAs to replace low- or moderate-income housing units destroyed or removed as part of their previous projects (AB 1018, Sieroty).

Citing a significant State General Fund deficit, Governor Brown’s 2011-12 budget proposed eliminating RDAs and returning billions of dollars of property tax revenues to schools, cities, and counties to fund core services. Among the statutory changes that the Legislature adopted to implement the 2011-12 budget, AB X1 26 (Blumenfield, 2011) dissolved all RDAs. The California Supreme Court's 2011 ruling in California Redevelopment Association v. Matosantos upheld AB X1 26, but invalidated AB X1 27 (Blumenfield, 2011), which would have allowed most RDAs to avoid dissolution. In response, the California Redevelopment Association (CRA) challenged the two measures. The Supreme Court denied the petition for peremptory writ of mandate with respect to AB X1 26, but granted it with respect to AB X1 27. As a result, all RDAs dissolved as of February 1, 2012. At the time of dissolution, over 400 RDAs statewide were diverting 12% of property taxes, over $5.6 billion yearly.

RDAs’ dissolution deprived many local agencies of the primary tool they used to eliminate physical and economic blight, finance new construction, improve public infrastructure, rehabilitate existing buildings, and increase the supply of affordable housing. At the time the state dissolved RDAs, the Controller estimated that statewide, the requirement to set aside 20% of funding generated in a project area for low- and moderate-income housing obligated RDAs to spend $1 billion on affordable housing.

RDA dissolution. AB X1 26 prohibited RDAs from incurring new or expanding existing monetary or legal obligations unless otherwise specified, removed the authority for RDAs to engage in most activities except continuing to pay off enforceable obligations, and established successor agencies to manage the process of unwinding former RDA affairs. With the exception of seven cities, the city or county that created each former RDA now serves as that RDA’s successor agency.

One of a successor agency’s primary responsibilities is to make payments for RDAs’ enforceable obligations: bonds, bond-related payments, some loans, payments required by the federal government, obligations to the state or imposed by state law, payments to RDA employees, judgements or settlements, and other legally binding and enforceable agreements or contracts. These payments are supported by property tax revenues that would have gone to RDAs, but are instead deposited in a Redevelopment Property Tax Trust Fund (RPTTF).

Any remaining property tax revenues that exceed these enforceable obligations return to cities, counties, special districts, and school and community college districts to support core services. The amount that these taxing entities receive increases as the successor agency pays off these enforceable obligations. As a successor agency adds additional enforceable obligations, or takes more time to pay off existing enforceable obligations, the slower this stream of property tax revenue returns to these taxing entities.

Each successor agency has an oversight board responsible for supervising and approving its actions. The oversight board includes one member of the legislative body from the county and a city, special district, school district, and community college district within the territory of the successor agency. Additionally, the county board of supervisors appoints a public member, and the mayor or board of supervisors appoints one member to represent RDA employees.

The Department of Finance (DOF) can review and request reconsideration of an oversight board’s decision. Once a successor agency takes over for an RDA, it reviews the RDA’s outstanding assets and obligations, and develops a plan to resolve those obligations, also known as a Recognized Obligation Payment Schedule (ROPS). To obtain required DOF approval, a successor agency submits a series of ROPS to the department. If DOF agrees with the plan, it issues a Finding of Completion acknowledging their progress towards paying off their obligations. Successor agencies issued a Finding of Completion can submit a Last and Final ROPS, meaning that: (1) the remaining debt is limited to administrative costs and payments pursuant to enforceable obligations with defined payment schedules; (2) all remaining obligations have been previously listed on the ROPS and approved by DOF; and (3) the agency is not a party to outstanding or unresolved litigation. Successor agencies had until December 31, 2015, to receive their Finding of Completion from DOF. Nine successor agencies did not receive a Finding of Completion by the deadline.

City and County of San Francisco. San Francisco’s RDA completed various redevelopment projects dating back to the 1960s. The RDA project areas diverted funds from the City and County of San Francisco and other taxing entities, including Bay Area Rapid Transit District, San Francisco Unified School District, San Francisco Community College District, and the city and county’s Educational Revenue Augmentation Fund (ERAF), for its redevelopment projects. Current estimates show that San Francisco RDA’s successor agency won’t dissolve until around 2058.

In 2003, the Department of Housing and Community Development (HCD) determined that San Francisco’s RDA demolished 14,207 affordable housing units and replaced only 7,498 units, certifying a net loss of 6,709 units. Under AB 1018 (Sieroty, 1975), the City had to replace the remaining units. However, RDA law limited the effectiveness to 40 years after the redevelopment plan’s adoption or 2009, whichever is later. SB 2113 (Burton, 2000) granted San Francisco until January 1, 2014, or until the agency replaces all the housing units demolished, to incur debt to replace the demolished affordable housing units. It also gave the RDA until 2044 to repay this indebtedness. Prior to RDA dissolution in 2011, San Francisco had only developed 867 of the 6,709 units, and this outstanding balance of 5,842 units remains.

In 2015, the Legislature passed, and the Governor signed, SB 107 (Committee on Budget and Fiscal Review), which authorized the successor agency to issue bonds and incur debt for other projects using RPTTF, including the housing projects in Mission Bay, Hunters Point, and pursuant to the Transbay Implementation Agreement, but did not include projects to satisfy the replacement housing obligation. Using RPTTF to fund these projects extended the expected lifespan of the successor agency until 2058. Like its obligations under dissolution law, the successor agency must receive approval for these projects from its oversight board and DOF. For these obligations, the successor agency must make diligent efforts to ensure it obtains the lowest long-term financing, make use of an independent financial advisor, and follow other financial safeguards.

SB 593 (Wiener, 2023) authorized the successor agency to the SFRDA to issue bonds or incur indebtedness to finance the replacement of up to 5,842 units of affordable housing to satisfy the replacement housing obligation of the SFRDA as described in existing law and subsequently certified by the Department of Housing and Community Development. SB 593 includes provisions to ensure that only property tax revenues that would be returned to San Francisco, not other taxing entities, are used to finance these affordable housing obligations, and allowed the successor agency to incur new debt for these affordable housing projects, which could delay dissolution beyond the current 2058 estimate.

Transbay Joint Powers Authority (TJPA). The TJPA is a joint exercise of powers authority created in 2001 by San Francisco, the Alameda-Contra Costa Transit District and the Peninsula Corridor Joint Powers Board; subsequently, in 2017, the California High Speed Rail Authority was added as a member. An 8-member board governs the TJPA. TJPA has primary jurisdiction with respect to all matters concerning the financing, design, development, construction, and operation of the Transbay Program.

According to the TJPA, “The Transbay Program is a transportation and housing project that has transformed downtown San Francisco and the San Francisco Bay Area’s regional transportation system by creating a world class transportation hub in the heart of a new neighborhood. The project replaced the former Transbay Terminal at First and Mission streets in San Francisco with a modern regional transit hub connecting the Bay Area and ultimately the State of California through: AC Transit, BART, Caltrain, Golden Gate Transit, Greyhound, Muni, SamTrans, WestCAT Lynx, Amtrak, Paratransit and future High-Speed Rail from the San Francisco to Los Angeles/Anaheim.”

In 2003, TJPA, San Francisco, and the State of California entered into an agreement in which the State agreed to transfer specified state-owned parcels to San Francisco and the TJPA, subject to certain restrictions. Under the agreement, the state-owned parcels are subject to a deed restriction requiring that TJPA can only sell these parcels when the proceeds go to the TJPA to finance the Transbay Terminal Project. The agreement further requires that a portion of tax increment revenues attributable to the state-owned parcels, the “net tax increment (NTI),” go to TJPA to finance development of the Transbay Terminal Project.

The Transbay Redevelopment Project Area consists of approximately forty acres of land that previously contained the now-demolished Embarcadero Freeway and ramps to the former Transbay Terminal, which were heavily damaged by the 1989 Loma Prieta earthquake, and surrounding properties.

TJPA wants to allow the successor agency to the former San Francisco RDA to extend its authority to issue bonds to finance infrastructure for the Transbay Project.

Proposed Law

Assembly Bill 2308 allows the successor agency to the former San Francisco redevelopment agency (RDA) to extend its authority to issue bonds to finance infrastructure required by the Transbay Implementation Agreement (TIA) by specifying that arrangements to extend the time period for pledges of gross sales proceeds and NTI entered into with the Transbay Joint Powers Authority (TJPA) and San Francisco are included within its existing authority to issue bonds for these purposes. AB 2308 defines NTI to exclude administrative costs, affordable housing set aside payments from the former redevelopment agency, and contributions to the city and county’s ERAF.

Comments

1. Purpose of the bill. According to the author, “San Francisco needs modern, connected transit infrastructure to support our growing economy, build housing near jobs, and revitalize our downtowns. The Transbay Program is a transformative investment that will expand regional transit capacity, connect Caltrain and future high-speed rail to the Salesforce Transit Center, and unlock thousands of homes and new economic activity in the heart of San Francisco.

“However, the COVID-19 pandemic significantly affected the project’s bonding capacity, and at a time when federal transit funding opportunities have become less certain, the project needs additional financial stability to move forward. AB 2308 addresses this challenge by extending the timeline for an existing value-capture financing tool tied to former state-owned parcels in the Transbay Redevelopment Area by 25 years. This targeted extension will help ensure the project can secure the financing needed to complete the Downtown Rail Extension, delivering increased transit capacity, new housing, downtown revitalization, and thousands of good, labor-backed construction jobs for California’s workers – all without adding any new taxes.”

2. The song that never ends. AB X1 26 created successor agencies to unwind RDAs obligations so that property tax revenues previously going to RDAs flow back to the local agencies generating the revenue. The property tax revenue used to issue these bonds originates from not just the successor agency, which is the city in many cases, but also the county, special districts, and school and community college districts, which impacts the state by way of the Proposition 98 minimum funding guarantee. AB 2308 allows San Francisco to extend its authority to issue bonds for the Transbay Project. By doing so, AB 2308 delays the dissolution of its successor agency for another couple decades until the new bonds are fully paid off, which pushes the estimated dissolution date for the successor agency to 2075.

3. Special legislation. The California Constitution prohibits special legislation when a general law can apply (Section 16 of Article IV). AB 2308 contains findings and declarations explaining the need for legislation that applies only to the Transbay Project in the City and County of San Francisco due to the unique transportation and development needs of the jurisdiction and the unique role the Transbay Project has played in enhancing downtown San Francisco property values.

4. Coming and going. The Senate Committee on Rules has ordered a double referral of AB 2308: first to the Committee on Local Government to hear issues related to local government powers, and second to the Committee on Appropriations.

Assembly Actions

Assembly Local Government Committee: 10-0
Assembly Housing and Community Development Committee: 12-0
Assembly Floor: 66-0

Support and Opposition

(6/5/2026)

Support: None Submitted

Opposition: None Submitted

-- END --

Date of Hearing: April 29, 2026

ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT

Matt Haney, Chair

ABPCA Bill Id:AB 2308 (

Author:Haney) – As Introduced Ver:February 19, 2026

SUBJECT: Redevelopment: successor agency debt: City and County of San Francisco

SUMMARY: Allows the successor agency to the former San Francisco redevelopment agency (RDA) to extend its authority to issue bonds to finance infrastructure required by the Transbay Implementation Agreement (TIA) by specifying that arrangements to extend the time period for pledges of gross sales proceeds and tax increment entered into with the Transbay Joint Powers Authority (TJPA) and San Francisco are included within its existing authority to issue bonds for these purposes. Specifically, this bill:

1. Specifies that the authority, rights, and powers of the successor agency to the RDA of San Francisco to issue bonds or incur other indebtedness to finance the infrastructure required by the TIA includes the authority to enter into arrangements with the TJPA and San Francisco to extend the time period for pledges of gross sales proceeds and net tax increment.
2. Finds and declares that a special statute is necessary and that a general statute cannot be made applicable because of the unique transportation and development needs in San Francisco and the unique role the Transbay Project has played in enhancing downtown San Francisco property values.

EXISTING LAW:

1. Article XVI, Section 16 of the California Constitution authorizes the Legislature to provide for the formation of RDAs to eliminate blight in an area by means of a self-financing schedule that pays for the redevelopment project with tax increment derived from any increase in the assessed value of property within the redevelopment project area (or tax increment).
2. Establishes successor agencies to RDAs that would, except in certain situations, be the city, county, or city and county in the territorial jurisdiction of the former RDA. (Health and Safety Code (HSC) Section 34177)
3. Allows a city or county that authorized the creation of an RDA to elect to retain the housing assets and functions previously performed by the RDA. (HSC 34177)
4. Requires the entity assuming the housing functions of the former RDA to submit a list of all housing assets to DOF by August 1, 2012, as specified. (HSC 34177)
5. Allows the entity that assumed the housing functions to designate the use of and commit indebtedness obligation proceeds that remain after the satisfaction of enforceable obligations that have been approved in a Recognized Obligation Payment Schedule and that are consistent with the indebtedness obligation covenants. (HSC 34177)
6. Requires the proceeds to be derived from indebtedness obligations that were issued for the purposes of affordable housing prior to January 1, 2011, and were backed by the Low- and Moderate-Income Housing Fund. (HSC 34177)
7. Allows the RDA of the City and County of San Francisco to, subject to the approval of the Board of Supervisors of the City and County of San Francisco, retain its ability to incur indebtedness exclusively for Low- and Moderate-Income Housing Fund activities, as specified, until January 1, 2014, or until the agency replaces all of the housing units demolished prior to the enactment of the replacement housing obligations in Chapter 970 of the Statutes of 1975, whichever occurs earlier. (HSC 34177.7)  
8. Allows the ability of the RDA of the City and County of San Francisco to receive tax increment revenues to repay indebtedness incurred for these Low- and Moderate- Income Housing Fund activities to be extended until no later than January 1, 2044. (HSC 34177.7)  

FISCAL EFFECT: None. This bill was keyed non-fiscal by Legislative Counsel.

COMMENTS:

Author’s Statement: According to the author, “San Francisco needs modern, connected transit infrastructure to support our growing economy, build housing near jobs, and revitalize our downtowns. The Transbay Program is a transformative investment that will expand regional transit capacity, connect Caltrain and future high-speed rail to the Salesforce Transit Center, and unlock thousands of homes and new economic activity in the heart of San Francisco. However, the COVID-19 pandemic significantly affected the project’s bonding capacity, and at a time when federal transit funding opportunities have become less certain, the project needs additional financial stability to move forward. AB 2308 addresses this challenge by extending the timeline for an existing value-capture financing tool tied to former state-owned parcels in the Transbay Redevelopment Area by 25 years. This targeted extension will help ensure the project can secure the financing needed to complete the Downtown Rail Extension, delivering increased transit capacity, new housing, downtown revitalization, and thousands of good, labor-backed construction jobs for California’s workers – all without adding any new taxes.”

Redevelopment: Article XVI, Section 16 of the California Constitution authorizes the Legislature to provide for the formation of RDAs to eliminate blight in an area by means of a self-financing schedule that pays for the redevelopment project with tax increment derived from any increase in the assessed value of property within the redevelopment project area (or tax increment). Generally, property tax increment financing involves a local government forming a tax increment financing district to issue bonds and use the bond proceeds to pay project costs within the boundaries of a specified project area. To repay the bonds, the district captures increased property tax revenues that are generated when projects financed by the bonds increase assessed property values within the project area.

To calculate the increased property tax revenues captured by the district, the amount of property tax revenues received by any local government participating in the district is “frozen” at the amount it received within a project area prior to the project area’s formation. In future years, as the project area's assessed valuation grows above the frozen base, the resulting additional property tax revenues — the so-called property tax “increment” revenues — flow to the tax increment financing district instead of other local governments that would have received those funds absent the formation of the RDA. After the bonds have been fully repaid using the incremental property tax revenues, the RDA is dissolved, ending the diversion of tax increment revenues from participating local governments.

Prior to Proposition 13, very few RDAs existed; however, after its passage, RDAs became a source of funding for a variety of local infrastructure activities. RDAs were required to set-aside approximately 20% of funding generated in a project area to increase the supply of low and moderate income housing in the project areas [AB 3674 (Montoya), Chapter 1337, Statutes of 1976]. At the time of dissolution, over 400 RDAs statewide were diverting roughly 12% of property taxes, over $5.6 billion yearly.

In 2011, facing a severe budget shortfall, the Governor proposed eliminating RDAs in order to deliver more property taxes to other local agencies. Ultimately, the Legislature approved and the Governor signed two measures, ABX1 26 (Blumenfield), Chapter 5 and ABX1 27 (Blumenfield), Chapter 6 that together dissolved RDAs as they existed at the time and created a voluntary redevelopment program on a smaller scale. In response, the California Redevelopment Association (CRA) and the League of California Cities, along with other parties, filed suit challenging the two measures. The Supreme Court denied the petition for peremptory writ of mandate with respect to ABX1 26. However, the Court did grant CRA's petition with respect to ABX1 27. As a result, all RDAs were required to dissolve as of February 1, 2012.

RDA Dissolution: ABX1 26 established successor agencies to manage the process of unwinding former RDA affairs, generally prohibited RDAs from incurring new or expanding existing monetary or legal obligations, and removed the authority for RDAs to engage in most activities except continuing to pay off enforceable obligations. With the exception of seven cities, the city or county that created each former RDA now serves as that RDA’s successor agency. One of a successor agency’s primary responsibilities is to make payments for the enforceable obligations RDAs entered into. These payments are supported by property tax revenues that would have gone to RDAs, but are instead deposited in the Redevelopment Property Tax Trust Fund (RPTTF). Enforceable obligations include bonds, bond-related payments, some loans, payments required by the federal government, obligations to the state or imposed by state law, payments to RDA employees, judgements or settlements, and other legally binding and enforceable agreements or contracts. Any remaining property tax revenues that exceed these enforceable obligations return to cities, counties, special districts, and school and community college districts to support core services.

Each successor agency has an oversight board responsible for supervising and approving its actions. The Department of Finance (DOF) can review and request reconsideration of an oversight board’s decision. Once a successor agency takes over for an RDA, it reviews the RDA’s outstanding assets and obligations, and develops a plan to resolve those obligations, also known as a Recognized Obligation Payment Schedule (ROPS). To obtain required DOF approval, a successor agency submits a series of ROPS to DOF. If DOF agrees with the plan, it issues a Finding of Completion acknowledging their progress towards paying off their obligations. Successor agencies issued a Finding of Completion can submit a Last and Final ROPS, meaning that (1) the remaining debt is limited to administrative costs and payments pursuant to enforceable obligations with defined payment schedules, (2) all remaining obligations have been previously listed on the ROPS and approved by DOF, and (3) the agency is not a party to outstanding or unresolved litigation. Successor agencies had until December 31, 2015 to receive their Finding of Completion from DOF. RDA dissolution law states that successor agencies that did not receive their Finding of Completion by this date, or did not enter into a written installment payment plan with DOF, were to never receive a Finding of Completion. Approximately nine successor agencies did not receive a Finding of Completion by the deadline.

San Francisco’s RDA: In 2015, the Legislature passed, and the Governor signed, SB 107 (Committee on Budget and Fiscal Review), Chapter 325, Statutes of 2015, which authorized San Francisco’s successor agency to issue bonds and incur debt for other projects using RPTTF, including housing projects in Mission Bay, Hunters Point, and pursuant to the TIA. Using RPTTF to fund these projects extended the expected lifespan of the successor agency until 2058. Like its obligations under dissolution law, the successor agency must receive approval for these projects from its oversight board and DOF.

SB 593 (Wiener), Chapter 782, Statutes of 2023, authorized the successor agency to the SFRDA to issue bonds or incur indebtedness to finance the replacement of up to 5,842 units of affordable housing to satisfy the replacement housing obligation of the SFRDA as described in existing law and subsequently certified by the Department of Housing and Community Development.

Transbay Joint Powers Authority: TJPA has primary jurisdiction with respect to all matters concerning the financing, design, development, construction, and operation of the Transbay Program. The TJPA is a joint exercise of powers authority created in 2001 by San Francisco, the Alameda-Contra Costa Transit District and the Peninsula Corridor Joint Powers Board; subsequently, in 2017, the California High Speed Rail Authority was added as a member. The TJPA is governed by an 8-member Board of Directors.

According to the TJPA, “The Transbay Program is a transportation and housing project that has transformed downtown San Francisco and the San Francisco Bay Area’s regional transportation system by creating a world class transportation hub in the heart of a new neighborhood. The project replaced the former Transbay Terminal at First and Mission streets in San Francisco with a modern regional transit hub connecting the Bay Area and ultimately the State of California through: AC Transit, BART, Caltrain, Golden Gate Transit, Greyhound, Muni, SamTrans, WestCAT Lynx, Amtrak, Paratransit and future High-Speed Rail from the San Francisco to Los Angeles/Anaheim.”

Transbay Agreement: In 2003, TJPA, San Francisco, and the State of California entered into an agreement in which the State agreed to transfer specified state-owned parcels to San Francisco and the TJPA, subject to certain restrictions. Under the agreement, City and TJPA title to the state-owned parcels is subject to a deed restriction requiring that any such parcel may be sold for development only when the gross sales proceeds are provided to the TJPA to finance development of the Transbay Terminal Project. The agreement further requires that a portion of tax increment revenues attributable to the state-owned parcels, the "net tax increment (NTI)," must be provided to the TJPA to finance development of the Transbay Terminal Project.

According to the Office of Community Investment and Infrastructure (OCII), the successor agency to San Francisco’s RDA, the Transbay Redevelopment Plan was adopted in June 2005. The Transbay Plan, its Design for Development, and its Open Space and Streetscape Plan call for the redevelopment, rehabilitation, and revitalization of the area generally bounded by Mission, Main, Second and Folsom Streets in downtown San Francisco. 

The Transbay Redevelopment Project Area consists of approximately forty acres of land that previously contained the now-demolished Embarcadero Freeway and ramps to the former Transbay Terminal, which were heavily damaged by the 1989 Loma Prieta earthquake, and surrounding properties. 

Transbay is divided into two zones. OCII has land use authority over Zone One, which is located in the southern portion of the Project Area. The Transbay Plan and its Development Controls and Design Guidelines direct the transformation of Zone One from public land previously occupied by the former freeway and ramps into a new, master-planned, high-density, mixed use/residential community. Zone Two is in the northern portion of Transbay and includes the Salesforce Transit Center, Salesforce Tower, and mostly commercial properties along Mission and Howard Streets. Zone Two falls under the land use authority of the San Francisco Planning Department, under the Transbay Plan and the Transit Center District Plan, as provided for in the Transbay Delegation Agreement between the former Agency and the Planning Department.

OCII and the TJPA are responsible for executing the Transbay Plan, pursuant to a 2005 Implementation Agreement. Other agreements that enable the redevelopment of Transbay are between TJPA, OCII, the San Francisco, and the State of California, and include the Transbay Transit Terminal Cooperative Agreement, the Option Agreement for the Purchase and Sale of Property between the City and County of San Francisco, the TJPA and the RDA, and, the Transbay RDA Project Tax Increment Allocation and Sales Proceeds Pledge Agreement.

Arguments in Support: According to the TJPA, the sponsors of this bill, “The Transbay Redevelopment Plan (“Transbay Plan”) was adopted in June 2005. Together with its Design for Development and Open Space and Streetscape Plan, the Transbay Plan calls for the redevelopment, rehabilitation, and revitalization of approximately forty acres in downtown San Francisco, generally bounded by Mission, Main, Second, and Folsom Streets. The Plan is centered on construction of the Salesforce Transit Center (already completed) and the Caltrain Downtown Extension (DTX) also known as The Portal, which is still in preconstruction.

“Much of the project area consists of former state-owned land previously occupied by the Embarcadero Freeway and the ramps to the original Transbay Terminal, both of which were severely damaged in the 1989 Loma Prieta earthquake. The State agreed to convey this land to the TJPA at no cost, with the understanding that it would be used either for new public transit infrastructure or redeveloped for housing and other uses. In return, land sale proceeds and NTI generated from these parcels were pledged to support construction for the TJPA’s delivery of the Transbay Program.

“The Office of Community Investment and Infrastructure (OCII), as successor to the former Redevelopment Agency, and the TJPA jointly implement the Transbay Plan pursuant to a series of agreements, including the 2005 Transbay Implementation Agreement and the 2008 Transbay Pledge Agreement. These agreements pledge NTI from the former state-owned parcels to the TJPA. Following the dissolution of redevelopment agencies, the California Department of Finance confirmed that these agreements constitute enforceable obligations of OCII as successor agency.

“The TJPA anticipates completing delivery of The Portal, Phase 2 of the Transbay Program, in 2036 when rail service begins operations into the Transit Center. However, COVID-related impacts and shifts in the development market on the former state-owned parcels have significantly reduced projected tax increment revenues. As a result, the Project Area’s bonding capacity has declined by an estimated $275 million, jeopardizing the TJPA’s ability to generate the required local match to secure approximately $3.38 billion in federal funding for The Portal.

“Extending the term for collection of Net Tax Increment from 2050 to 2075 would reclaim an estimated $188 million in net present value bonding capacity. This extension is essential to preserving the financial viability of the project and unlocking critical federal investment.

“Importantly, AB 2308 does not alter or reduce revenues from non-state parcels, nor does it change the structure or purpose of the existing NTI pledge. The legislation simply extends the duration of the current pledge on former state-owned parcels from 2050 to 2075 to allow for TJPA to obtain future bond proceeds as intended when the original legislation was approved. It does not create new obligations, redirect funds from other entities, or modify the fundamental financing framework already approved and recognized as enforceable.”

Arguments in Opposition: None on file.

Double referred: This bill is double referred. It was heard in the Assembly Committee on Local Government and passed on a vote of 10-0 on April 15, 2026.

REGISTERED SUPPORT / OPPOSITION:

Support

Transbay Joint Powers Authority (Sponsor)
Friends of the Downtown Rail Extension
San Francisco Building and Construction Trades Council
San Francisco Chamber of Commerce
San Francisco County Transportation Authority
South Beach and Rincon and Mission Bay Neighborhood Association Board of Directors
SPUR
Transform

Opposition

None on file.

Analysis Prepared by: Lisa Engel / H. & C.D. / (916) 319-2085

Date of Hearing: April 15, 2026

ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT

Juan Carrillo, Chair

ABPCA Bill Id:AB 2308 (

Author:Haney) – As Introduced Ver:February 19, 2026

SUBJECT: Redevelopment: successor agency debt: City and County of San Francisco.

SUMMARY: Allows the successor agency to the former San Francisco redevelopment agency (RDA) to extend its authority to issue bonds to finance infrastructure required by the Transbay Implementation Agreement (TIA) by specifying that arrangements to extend the time period for pledges of gross sales proceeds and tax increment entered into with the Transbay Joint Powers Authority (TJPA) and San Francisco are included within its existing authority to issue bonds for these purposes. Specifically, this bill:

1. Specifies that the authority, rights, and powers of the successor agency to the RDA of San Francisco to issue bonds or incur other indebtedness to finance the infrastructure required by the TIA includes the authority to enter into arrangements with the TJPA and San Francisco to extend the time period for pledges of gross sales proceeds and net tax increment.
2. Finds and declares that a special statute is necessary and that a general statute cannot be made applicable because of the unique transportation and development needs in San Francisco and the unique role the Transbay Project has played in enhancing downtown San Francisco property values.

FISCAL EFFECT: None.

COMMENTS:

1. Bill Summary and Author’s Statement. This bill allows the successor agency to the former San Francisco RDA to extend its authority to issue bonds to finance infrastructure required by the TIA by specifying that arrangements to extend the time period for pledges of gross sales proceeds and tax increment entered into with the TJPA and San Francisco are included within its existing authority to issue bonds for these purposes. The TJPA is the sponsor of this bill.

According to the author, “San Francisco needs modern, connected transit infrastructure to support our growing economy, build housing near jobs, and revitalize our downtowns. The Transbay Program is a transformative investment that will expand regional transit capacity, connect Caltrain and future high-speed rail to the Salesforce Transit Center, and unlock thousands of homes and new economic activity in the heart of San Francisco.

“However, the COVID-19 pandemic significantly affected the project’s bonding capacity, and at a time when federal transit funding opportunities have become less certain, the project needs additional financial stability to move forward. AB 2308 addresses this challenge by extending the timeline for an existing value-capture financing tool tied to former state-owned parcels in the Transbay Redevelopment Area by 25 years. This targeted extension will help ensure the project can secure the financing needed to complete the Downtown Rail Extension, delivering increased transit capacity, new housing, downtown revitalization, and thousands of good, labor-backed construction jobs for California’s workers – all without adding any new taxes.”

1. Redevelopment. Article XVI, Section 16 of the California Constitution authorizes the Legislature to provide for the formation of RDAs to eliminate blight in an area by means of a self-financing schedule that pays for the redevelopment project with tax increment derived from any increase in the assessed value of property within the redevelopment project area (or tax increment). Generally, property tax increment financing involves a local government forming a tax increment financing district to issue bonds and use the bond proceeds to pay project costs within the boundaries of a specified project area. To repay the bonds, the district captures increased property tax revenues that are generated when projects financed by the bonds increase assessed property values within the project area.

To calculate the increased property tax revenues captured by the district, the amount of property tax revenues received by any local government participating in the district is “frozen” at the amount it received within a project area prior to the project area’s formation. In future years, as the project area's assessed valuation grows above the frozen base, the resulting additional property tax revenues — the so-called property tax “increment” revenues — flow to the tax increment financing district instead of other local governments that would have received those funds absent the formation of the RDA. After the bonds have been fully repaid using the incremental property tax revenues, the RDA is dissolved, ending the diversion of tax increment revenues from participating local governments.

Prior to Proposition 13, very few RDAs existed; however, after its passage, RDAs became a source of funding for a variety of local infrastructure activities. RDAs were required to set-aside approximately 20% of funding generated in a project area to increase the supply of low and moderate income housing in the project areas [AB 3674 (Montoya), Chapter 1337, Statutes of 1976]. At the time of dissolution, over 400 RDAs statewide were diverting roughly 12% of property taxes, over $5.6 billion yearly.

In 2011, facing a severe budget shortfall, the Governor proposed eliminating RDAs in order to deliver more property taxes to other local agencies. Ultimately, the Legislature approved and the Governor signed two measures, ABX1 26 (Blumenfield), Chapter 5 and ABX1 27 (Blumenfield), Chapter 6 that together dissolved RDAs as they existed at the time and created a voluntary redevelopment program on a smaller scale. In response, the California Redevelopment Association (CRA) and the League of California Cities, along with other parties, filed suit challenging the two measures. The Supreme Court denied the petition for peremptory writ of mandate with respect to ABX1 26. However, the Court did grant CRA's petition with respect to ABX1 27. As a result, all RDAs were required to dissolve as of February 1, 2012.

1. RDA Dissolution. ABX1 26 established successor agencies to manage the process of unwinding former RDA affairs, generally prohibited RDAs from incurring new or expanding existing monetary or legal obligations, and removed the authority for RDAs to engage in most activities except continuing to pay off enforceable obligations. With the exception of seven cities, the city or county that created each former RDA now serves as that RDA’s successor agency. One of a successor agency’s primary responsibilities is to make payments for the enforceable obligations RDAs entered into. These payments are supported by property tax revenues that would have gone to RDAs, but are instead deposited in the Redevelopment Property Tax Trust Fund (RPTTF). Enforceable obligations include bonds, bond-related payments, some loans, payments required by the federal government, obligations to the state or imposed by state law, payments to RDA employees, judgements or settlements, and other legally binding and enforceable agreements or contracts. Any remaining property tax revenues that exceed these enforceable obligations return to cities, counties, special districts, and school and community college districts to support core services.

Each successor agency has an oversight board responsible for supervising and approving its actions. The Department of Finance (DOF) can review and request reconsideration of an oversight board’s decision. Once a successor agency takes over for an RDA, it reviews the RDA’s outstanding assets and obligations, and develops a plan to resolve those obligations, also known as a Recognized Obligation Payment Schedule (ROPS). To obtain required DOF approval, a successor agency submits a series of ROPS to DOF. If DOF agrees with the plan, it issues a Finding of Completion acknowledging their progress towards paying off their obligations. Successor agencies issued a Finding of Completion can submit a Last and Final ROPS, meaning that (1) the remaining debt is limited to administrative costs and payments pursuant to enforceable obligations with defined payment schedules, (2) all remaining obligations have been previously listed on the ROPS and approved by DOF, and (3) the agency is not a party to outstanding or unresolved litigation. Successor agencies had until December 31, 2015 to receive their Finding of Completion from DOF. RDA dissolution law states that successor agencies that did not receive their Finding of Completion by this date, or did not enter into a written installment payment plan with DOF, were to never receive a Finding of Completion. Approximately nine successor agencies did not receive a Finding of Completion by the deadline.

1. San Francisco’s RDA. In 2015, the Legislature passed, and the Governor signed, SB 107 (Committee on Budget and Fiscal Review), Chapter 325, Statutes of 2015, which authorized San Francisco’s successor agency to issue bonds and incur debt for other projects using RPTTF, including housing projects in Mission Bay, Hunters Point, and pursuant to the TIA. Using RPTTF to fund these projects extended the expected lifespan of the successor agency until 2058. Like its obligations under dissolution law, the successor agency must receive approval for these projects from its oversight board and DOF.

SB 593 (Wiener), Chapter 782, Statutes of 2023, authorized the successor agency to the SFRDA to issue bonds or incur indebtedness to finance the replacement of up to 5,842 units of affordable housing to satisfy the replacement housing obligation of the SFRDA as described in existing law and subsequently certified by the Department of Housing and Community Development.

1. Transbay Joint Powers Authority. TJPA has primary jurisdiction with respect to all matters concerning the financing, design, development, construction, and operation of the Transbay Program. The TJPA is a joint exercise of powers authority created in 2001 by San Francisco, the Alameda-Contra Costa Transit District and the Peninsula Corridor Joint Powers Board; subsequently, in 2017, the California High Speed Rail Authority was added as a member. The TJPA is governed by an 8-member Board of Directors.

According to the TJPA, “The Transbay Program is a transportation and housing project that has transformed downtown San Francisco and the San Francisco Bay Area’s regional transportation system by creating a world class transportation hub in the heart of a new neighborhood. The project replaced the former Transbay Terminal at First and Mission streets in San Francisco with a modern regional transit hub connecting the Bay Area and ultimately the State of California through: AC Transit, BART, Caltrain, Golden Gate Transit, Greyhound, Muni, SamTrans, WestCAT Lynx, Amtrak, Paratransit and future High-Speed Rail from the San Francisco to Los Angeles/Anaheim.”

1. Transbay Agreement. In 2003, TJPA, San Francisco, and the State of California entered into an agreement in which the State agreed to transfer specified state-owned parcels to San Francisco and the TJPA, subject to certain restrictions. Under the agreement, City and TJPA title to the state-owned parcels is subject to a deed restriction requiring that any such parcel may be sold for development only when the gross sales proceeds are provided to the TJPA to finance development of the Transbay Terminal Project. The agreement further requires that a portion of tax increment revenues attributable to the state-owned parcels, the "net tax increment (NTI)," must be provided to the TJPA to finance development of the Transbay Terminal Project.

According to the Office of Community Investment and Infrastructure (OCII), the successor agency to San Francisco’s RDA, the Transbay Redevelopment Plan was adopted in June 2005. The Transbay Plan, its Design for Development, and its Open Space and Streetscape Plan call for the redevelopment, rehabilitation, and revitalization of the area generally bounded by Mission, Main, Second and Folsom Streets in downtown San Francisco. 

The Transbay Redevelopment Project Area consists of approximately forty acres of land that previously contained the now-demolished Embarcadero Freeway and ramps to the former Transbay Terminal, which were heavily damaged by the 1989 Loma Prieta earthquake, and surrounding properties. 

Transbay is divided into two zones. OCII has land use authority over Zone One, which is located in the southern portion of the Project Area. The Transbay Plan and its Development Controls and Design Guidelines direct the transformation of Zone One from public land previously occupied by the former freeway and ramps into a new, master-planned, high-density, mixed use/residential community. Zone Two is in the northern portion of Transbay and includes the Salesforce Transit Center, Salesforce Tower, and mostly commercial properties along Mission and Howard Streets. Zone Two falls under the land use authority of the San Francisco Planning Department, under the Transbay Plan and the Transit Center District Plan, as provided for in the Transbay Delegation Agreement between the former Agency and the Planning Department.

OCII and the TJPA are responsible for executing the Transbay Plan, pursuant to a 2005 Implementation Agreement. Other agreements that enable the redevelopment of Transbay are between TJPA, OCII, the San Francisco, and the State of California, and include the Transbay Transit Terminal Cooperative Agreement, the Option Agreement for the Purchase and Sale of Property between the City and County of San Francisco, the TJPA and the RDA, and, the Transbay RDA Project Tax Increment Allocation and Sales Proceeds Pledge Agreement.

1. Previous Legislation. SB 1404 (Leno) of 2014 would have allowed San Francisco's successor agency to receive tax increment revenues and issue debt to pay for specified replacement housing obligations. SB 1404 was vetoed by Governor Brown saying, “This bill allows the Successor Agency of the former City and County of San Francisco Redevelopment Agency to create a new enforceable obligation to replace approximately 5,800 units of affordable housing.
   
   “Without a doubt, San Francisco faces extraordinary housing affordability challenges, compounded by the number of affordable units previously destroyed by the former redevelopment agency. I applaud the author and the mayor's continued efforts to increase affordability in this area. This bill as drafted, however, would grant this particular Successor Agency the ability to use tax increment and redevelopment law in a way that no other successor agency in the state has been granted.”
2. Arguments in Support. According to the TJPA, the sponsors of this bill, “The Transbay Redevelopment Plan (“Transbay Plan”) was adopted in June 2005. Together with its Design for Development and Open Space and Streetscape Plan, the Transbay Plan calls for the redevelopment, rehabilitation, and revitalization of approximately forty acres in downtown San Francisco, generally bounded by Mission, Main, Second, and Folsom Streets. The Plan is centered on construction of the Salesforce Transit Center (already completed) and the Caltrain Downtown Extension (DTX) also known as The Portal, which is still in preconstruction.

“Much of the project area consists of former state-owned land previously occupied by the Embarcadero Freeway and the ramps to the original Transbay Terminal, both of which were severely damaged in the 1989 Loma Prieta earthquake. The State agreed to convey this land to the TJPA at no cost, with the understanding that it would be used either for new public transit infrastructure or redeveloped for housing and other uses. In return, land sale proceeds and NTI generated from these parcels were pledged to support construction for the TJPA’s delivery of the Transbay Program.

“The Office of Community Investment and Infrastructure (OCII), as successor to the former Redevelopment Agency, and the TJPA jointly implement the Transbay Plan pursuant to a series of agreements, including the 2005 Transbay Implementation Agreement and the 2008 Transbay Pledge Agreement. These agreements pledge NTI from the former state-owned parcels to the TJPA. Following the dissolution of redevelopment agencies, the California Department of Finance confirmed that these agreements constitute enforceable obligations of OCII as successor agency.

“The TJPA anticipates completing delivery of The Portal, Phase 2 of the Transbay Program, in 2036 when rail service begins operations into the Transit Center. However, COVID-related impacts and shifts in the development market on the former state-owned parcels have significantly reduced projected tax increment revenues. As a result, the Project Area’s bonding capacity has declined by an estimated $275 million, jeopardizing the TJPA’s ability to generate the required local match to secure approximately $3.38 billion in federal funding for The Portal.

“Extending the term for collection of Net Tax Increment from 2050 to 2075 would reclaim an estimated $188 million in net present value bonding capacity. This extension is essential to preserving the financial viability of the project and unlocking critical federal investment.

“Importantly, AB 2308 does not alter or reduce revenues from non-state parcels, nor does it change the structure or purpose of the existing NTI pledge. The legislation simply extends the duration of the current pledge on former state-owned parcels from 2050 to 2075 to allow for TJPA to obtain future bond proceeds as intended when the original legislation was approved. It does not create new obligations, redirect funds from other entities, or modify the fundamental financing framework already approved and recognized as enforceable.”

1. Arguments in Opposition. None on file.
2. Double-referral. This bill has been double-referred to the Assembly Committee on Housing and Community Development.

REGISTERED SUPPORT / OPPOSITION:

Support

Transbay Joint Powers Authority [SPONSOR]

Opposition

None on file

Analysis Prepared by: Jimmy MacDonald / L. GOV. / (916) 319-3958