Assembly Standing Committee on Local Government

We're going to wait a couple more minutes so we can get more Members to come into the hearing room, hopefully soon. Good afternoon, everyone. While we wait for other Members to come in, we're going to start the hearing March 26th at 1:30 First, I'll go through some housekeeping items. Welcome all, to the local government Committee hearing.

I would like to remind the public that testimony will be in person for these and future hearings. As we no longer use a moderate telephone service, we also accept written testimony through the position letter portal on the Committee's website.

We seek to protect the rights of all who participate in the legislative process so that we can have effective deliberation and decisions on the critical issues facing California. Protesters have appeared at some of our legislative hearings. Some of these people have yelled from the audience and issued threats of potential violence.

These actions actually disrupt the legislative hearing and the persons who caused the disruption were removed from the hearing room. As we proceed with witnesses and public comment, I want to make sure everyone understands that the Assembly has rules to ensure we maintain order and run an efficient and fair hearing.

We apply these rules consistently to all people who participate in our proceedings, regardless of the viewpoint they express in order to facilitate the goal of the hearing as much as possible from the public. Within the limits of our time, we will not permit conduct that disrupts, disturbs or otherwise impedes the orderly conduct of legislative proceedings.

We will not accept disruptive behavior or behavior that incites or threatens violence. The rules for today include not talking or loud noises from the audience. Public comment may be provided only at the designated time and place and as permitted by the chair. Public comment must relate to the subject of the bills or information being discussed today.

No engaging in conduct that disrupts, disturbs or otherwise impedes the orderly conduct of this hearing. Please be aware that violations of these rules may subject you to removal or other enforcement actions. We have four bills on our agenda today. One of this is proposed for the Consent Calendar, and that is AB 1030 by Assemblymember Papan.

All orders bills will be heard in the order in the order file. We will take up to two primary witnesses in support and up to two primary witnesses in opposition for each Bill. These witnesses will have three minutes each to provide their testimony. All subsequent witnesses should state their name, their organization and their position on the Bill.

We don't have a quorum yet. We're going to proceed as a Subcommitee. The first item on the agenda is AB59 by Assembly Member Aguiar Curry. Please, when you are ready.

I know I will be really good. Well, first of all, I just want to say thank you for having me today. And it's so nice to see these smiling faces that I've known for years at local government. Thank you, Mr. Chair and Members.

I would like to thank the Chair and the Committee staff for their work on this Bill. I will be accepting the Committee amendments today. Reclamation District 108 provides water to nearly 48,000 acres of Farmland in southern Calusa County and northern Yolo County. Currently, RD108's authority to participate in hydropower projects is set to expire January 1, 2026.

Without this authority, RD108 will lack the certainty it needs to engage in long term infrastructure planning and projects. Because the availability and cost of financing depends upon statutory authority. The District has already identified potential opportunities for future hydropower initiatives, including small hydropower facilities in the existing canals. However, to make these long term investments, RD108 needs assurance.

They need the assurance that it can participate in these projects over at least a 35 year period. By securing long term financing, RD108 can make these projects more affordable for the District In the long run. AB59 will remove the current sunset, ensuring RD108 can confidently plan for and participate in future hydropower projects.

With me today, I have two good friends that are in my district. Lewis Bair from the General manager of RD108 and Daurice Kalfsbeek Smith Chair of the Colusa County Board of Supervisors. Thank you.

Thank you so much. Good afternoon Mr. Chair Members. My name is Daurice Kalfsbeek Smith and I'm the Chair of the Colusa County Board of Supervisors representing District 2 where RD108 is housed. I'm here today in strong support of AB59.

I first wanted to thank the author, her staff as well as the Committee for the work that's been done on AB59. AB59 is an important measure that would allow RD108, the hydropower authorization to continue to seek opportunities to develop power through hydroelectric generation. RD108 has a close working relationship with Yolo and Calusa counties.

RD108 doesn't just efficiently provide water for food. They are also an innovator and educator for flood control and habitat improvement projects. Colusa County is proud to support AB59 and the opportunity for RD108 to reduce its energy costs in an affordable and environmentally responsible way. Thank you.

Thank you Chairman, Members of the Committee and proud to sit here with two amazing leaders that we're fortunate to have in our area. RD108 covers a large area in the Sacramento Valley. We are the second largest diverter on the Sacramento river. And we take overall stewardship of water very seriously.

Recovering energy that we use to pump water is really important. It's a cost effective way to help reduce water rates in our district. And it's just really difficult with the previous five year sunset to finance a project project and make it cost effective and recover your capital in that period of time.

And so really appreciate the consideration of the Committee removing that and allowing us the opportunity to do these types of projects. We strongly feel it's part of stewardship for being a water manager in the Valley.

Thank you for your testimony. Anybody in the room that wants to come up as in support, please state your name, affiliation and position of the Bill only.

Ivy Britton with the Northern California Water Association, strong support. Thank you.

Raquel Ayala with REEB Government relations on behalf of the California Central Valley Flood Control Association. In support. Thank you.

Jeff Neal representing the County of Yolo, also in support.

Thank you. Any primary witnesses in opposition or Members in opposition in General? Seeing none. Take it to the Committee Members. Any questions or comments? No. Okay. We don't have a quorum yet, as you know, but please go ahead and give me your closing statements before we can make a motion.

I just want to just make a comment how important water projects are up and down our State of California. And this is just one of many. And that the lending the support to make sure we can move forward is so important for these projects that they have identified. So I want to just simply ask for your aye vote when it's appropriate.

Great. Thank you, everyone.

Thank you. At that time, we'll get a quorum and we'll ask the question for a motion. Thank you.

Thank you so much for your time.

I'm handing the gavel over to Assembly member Pacheco. I do have a Bill on the agenda before 17. Again, we're just proceeding as a Subcommitee at the time.

Mr. Carrillo, you may proceed when you're ready.

Thank you, Madam Chair. Good afternoon, Members of the Committee. I want to start by accepting the Committee's amendments. I am happy to present AB 417

A measure that would provide clarification and improve the functionality and usefulness of laws that allow our cities and counties to utilize their own existing resources to build much needed critical infrastructure, such as affordable housing, projects to adapt to climate change, transition priority projects, fire hazard mitigation and more in order to respond to the needs of our communities.

Local governments have come up with creative ways to fund critical infrastructure. Tax increment financing tools such as Enhanced Infrastructure Financing Districts or EIFDs and Community Revitalization and Investment Authorities or CRIAs have become increasingly important in funding local infrastructure projects.

EIFDs and CRIAs enable cities and counties to use existing property tax revenue and not new or increased property taxes to finance projects that have been vetted and approved by local communities through a rigorous public participation and protest process.

One great aspect of these tools is that they allow our local agencies to partner together to solve the infrastructure challenges for communities that our communities face. EIFDs have been the most widely used and are often described as the most flexible tax increment financing tools, but as time passes, local officials have identified implementation issues.

This Bill makes a few changes to EIFD law which will do the following: Support small business in a manner that fosters economic recovery and provide clarification to the process of adding and participating local agency to an already created EIFD to encourage regional partnerships.

CRIAs were specifically designed to target communities with the greatest need in our regard to focus upon two major legislative policy concerns. And they are, assisting disadvantaged communities and the people who live in them by addressing dilapidated properties and infrastructure and secondly dedicating 25% of all funding for affordable housing.

This Bill will align CRIA law with the changes made to AFD's law by SB 1140 by Senator Caballero last year to streamline the formation process and it reduces barriers to make the formation of CRIAs difficult and unnecessarily cumbersome.

This Bill is supported by a coalition of stakeholders including the League of California Cities, American Planning Association, Cal Chamber and the Business Property Association, among others. I have our sponsor, Gurbax Sahota, President and CEO of the California Association for Local Economic Development, to testify and support today.

Thank you. As the Chair said, my name is Gurbax Sahota and I'm President and CEO of the California Association for Local Economic Development. We represent over 950 economic developers. Those are city and county staff primarily, but also private sector and nonprofit that work at the local level to create economic opportunity for Californians.

And I'm pleased to share that a lot of our Members understand the value of these tax increment financing tools and as a result we are seeing more communities, more local governments explore forming them, including over 30 that have been formed right now and a new CRIA as well that was formed in the City of Victorville.

With a specific focus, CRIA is on affordable housing, as you had heard the chair say that 25% of that funding does support affordable housing. So we convened a group of our folks that have these already existing tools to find out how could we help them be more effective.

And I'm pleased to share that the input that you see in this piece of legislation are the things that they said they needed in order to advance economic development, create opportunities, fund infrastructure, and also support affordable housing projects in their communities. So we're really grateful that the chair, especially the chair of local government was caring and understanding enough to put this legislation forward.

We certainly appreciate all the work of the Committee staff as well and the amendments that they provided. And we strongly urge your aye vote on this legislation. Please.

Thank you.

Thank you. Are there any witnesses in the audience in support? Please state your name, organization and position.

Good afternoon. Lauren Day Valencia representing the American Planning Association. I'm really pleased to be in support. And really appreciate the additional refinements to these existing tools. Thank you.

Raquel Ayala with Reeb Government Relations on behalf of the California Central Valley Flood Control Association in strong support. Thank you.

Good afternoon, Madam Chair, Members of the Committee. Paul Gonzalez, on behalf of the cities of Carson and Lakewood, like to thank the Assembly Member. And the sponsors for sharpening the tools in our toolbox. And with that, we ask for your support. Thank you.

Thank you. Are there any witnesses in the audience who would like to speak in opposition to this Bill?

Yes, Mr. Chair. Members, Bob Naylor representing Fieldstead and Company. That is Howard Amundsen Jr. He is an Orange County philanthropist interested in social justice and property rights. And we have no problem with the EIFD portion of this Bill at all because EIFDs are not granted eminent domain authority in law. Our problem is with.

And we have no problem with the substance of the strengthening of the provisions of the CRIA law. But the CRA law does have eminent domain authority. It's really one of the few parts of, of legislation that specifically authorize the taking of property by eminent domain for non infrastructure purposes.

The abuse of eminent domain has been well documented, most recently by the Commission on Reparations. They have a whole chapter on it. The social injustice that has been wrought by abusive eminent domain over the years is all well recorded and we don't want to see that repeated here.

So we have asked the author to take an amendment to repeal the one little provision that grants eminent domain authority and make clear that CRIAs cannot exercise eminent domain. That would be. We would withdraw our opposition to the Bill if that amendment were taken. Thank you very much.

Thank you. Are there any other witnesses in opposition? Seeing none, we have now established quorum. Madam Secretary, may you please take the roll?

Carrillo?

Aye.

Present. Todd? Hoover? Pacheco? Pacheco, present. Ramos? Ramos, present. Ransom? Rubio? Rubio, present. Stefani?

Here.

Stefani, present. Ward? Ward, present. Wilson?

We have a quorum and I will now bring it back up to the dais. Are there any Members with any questions? Is there a second? Madam Secretary, may you please take the roll? Oh, I'm sorry. Member Carrillo, would you like to close?

Thank you, Madam Chair. Just in closing, ultimately, AB 417 improves the functionality and usefulness of EIFDs and CRIAs by streamlining administrative processes and providing other crucial clarification to existing law while maintaining public participation and transparency. These reforms will significantly improve the ability for local governments to support economic development and build critical infrastructure in communities across the state.

Respectfully I ask for an aye vote.

Thank you. And the Chair reco is do pass as amended. Thank you, Madam Secretary. May you please take the role.

Carillo? Carillo, aye. Ta? Hoover? Pacheco? Pacheco, aye. Ramos? Ramos, aye. Ransom? Rubio? Rubio, aye. Stefani? Stefani, aye. Ward? Ward, aye. Wilson?

Your Bill is out, but we'll leave it open so that other Members can add on.

Before we proceed to the last item on the agenda, we need to adopt the rules for local government first and a second. Madam Secretary, please call the roll.

[roll call]

The six here we leave the role open for those thousand Members to add on. With that, we'll go to the last item on the agenda. That's AB533. Assembly Member Flora, when you're ready, Assembly Member.

Thank you, Mr. Chair and Members, happy to present AB533. It reauthorizes healthcare districts that own or operate a hospital or clinic to use build design process when contracting for construction of a health facility.

This is this Authority expired on January 1st of 2025, leaving only a few districts with the ability to use design build AB 533 restores this authority and ensures all districts can continue utilize this efficient construction method without future uncertainty. And with me is Sarah Bridge, the Vice President of Associated California Health Care Districts.

Thank you Assembly Member and thank you Chair and Members of the Committee. Sarah Bridge. With the Association of California Healthcare Districts here in strong support of AB533 and as sponsors of the measures, I want to first start by thanking the Committee and the author for their work on this measure.

As the Assembly Member mentioned, AB533 is necessary to ensure that healthcare districts that operate clinics and hospitals can secure financing and execute infrastructure projects in an efficient manner. In 2016, the Legislature nearly unanimously passed the Bill that would allow healthcare district hospitals or clinics to utilize design build for construction projects.

Unfortunately, the authority was sunset on January 1st, 2025 leaving a significant gap in district's ability to effectively construct projects. The Bill in front of you today is a replica of what was previous authority that sunset on January 1st. It does not make any changes to the notifications or modifications to the contracting and competitive bid process process.

It merely allows for one entity to be utilized for both the design and construction of a project. As I mentioned, financing infrastructure projects as local governments may be very difficult and is incredibly complex. To Fund a single hospital project, it often takes multiple financing sources, many of which are federal loans or grants.

In order to utilize this financing, we must have an upfront cost estimate, a feature only available and unique to the design build process. AB 533 is a straightforward and streamlined measure. I'm happy to answer any questions for the Committee but respectfully request your aye vote today.

Thank you Mr. Chair. Members Beau Biller on behalf of the Design Build Institute of America Western Pacific region and it's all been covered. We ask for your I vote.

Thank you for your testimony. We open it up to Members of the public in support. State your name, affiliation and position on the Bill.

Good afternoon Mr. Chair and Members. Connie Delgado on behalf of the District Hospital Leadership Forum in support. Thank you.

Thank you Mr. Chair Goeff Neill representing the American Council of Engineering Companies of California also in support.

Thank you. Are there any primary witnesses in opposition to the measure? Anybody else in the audience? Seeing none. Take it back to the Committee Members for questions or comments. See none. Is there a motion? Motion made by Mr. Ramos seconded by Assembly Member Pacheco. Closing statements? Thank you. Madam Secretary. Please call the roll.

[Roll Call]

The measures pass the 70. We'll leave the rule open for the Members to add on. Thank you. Assemblymember for colleagues we still need to go over one item on the agenda. That's for the consent calendar item. Madam Secretary, please call the roll again. AB 1030 by Papan Motion second. First and a second by Pacheco and a second. Thank you, Madam Secretary.

[Roll Call]

Measure 7-0 is out. We have a couple of items that we need to go over for those that missed. Right. We're going to go through that. For those Members that were absent. Item number one. AB59, please call roll first and second. Thank you. Just call the roll.

[Roll Call]

AB59, 7-0. The measure's out. And we have a couple of Members that need to add on some of the items on the agenda. Otherwise, thank you. We are gonna go over Consent calendar for those Members that need to add on or wish to add on. So please call the roll on consent calendar.

[Roll Call]

Measures out a zero. We're going to go next on AB59 for Aguiar Curry.

[Roll Call]

Measures out a zero. Item number two on the agenda. AB417. Carrillo.

[Roll Call]

Seven. Zero. The bill's out. Item number three on the agenda. AB533. Flora.

[Roll Call]

Measures out eight zero. And with that, we're going to close the hearing.