Three bills intended to create a tighter link between land use planning and water supply topped the land use measures approved by the state Legislature this year.

Before adjourning on September 14, lawmakers also approved a number of housing measures, although a highly controversial bill that would have put teeth into the housing element law was put on hold until next year. The Legislature passed a bill that allows redevelopment agencies to extend their life spans under certain conditions; however, the Department of Finance is urging the governor to veto it.

In addition, the Legislature passed a bill introduced late in the session designed to cut back on the use of "certificates of compliance" by landowners to claim that large ranches were subdivided into smaller parcels during the 19th century. The bill emerged out of the controversy over the Hearst Ranch's attempt to use certificates of compliance to raise the value of its San Luis Obispo County property.

The Legislature did not approve school bonds despite proposals for as much as $27 billion in new school spending; however a $2.6 billion park bond for the March 2002 ballot did pass. Few natural resources measures advanced during the session, and lawmakers made no significant changes to the California Environmental Quality Act.

Nearly two weeks after the session ended, Gov. Gray Davis still had not decided whether to sign or veto approximately 800 bills. A public feud at the end of the session between Davis and Senate President Pro Tem John Burton over a failed bailout of Southern California Edison appeared to make uncertain the fate of unrelated bills on the governor's desk. Davis spokesmen denied the conflict would affect the governor's decisions, but observers said the bad blood between the fellow Democrats could spill over to other arenas.

The Legislature approved three important water bills: SB 221 (Kuehl), SB 610 (Costa) and SB 672 (Machado). The net effect is to strengthen the connection between water supply and land use planning. The Kuehl bill requires proof of water availability at the tentative map stage; the Costa bill encourages long-term water planning; the Machado bill integrates regional and state needs and encourages exploitation of new technologies.

Under SB 221, a water provider or local government must make the finding, based on substantial evidence, that adequate water is available for a project without putting the existing community at risk, explained Randele Kanouse, a lobbyist for East Bay Municipal Utility District. If there is no water agency, or if the water agency fails to comply, the local government must make the finding. The mandate applies only to subdivisions of at least 500 units, and it exempts some infill and low-income housing projects.

If inadequate water is available, the bill expressly allows a developer to work with a water district, city or county to pursue new supplies — a provision that Kanouse called an "invitation for a developer to bring his checkbook." This additional supply could be in the form of new water development, water transfers, conservation retrofits, recycling technology, desalination plants, and other things. If a developer intends to rely on groundwater, the local water provider must evaluate the developer's groundwater rights.

Kanouse, who has lobbied for such a bill for years, called SB 221 a major advance in linking land use planning with water supplies. After appearing to have died for the year, the bill returned to life in August, partly because development interests dropped their opposition, he said.

"I really do believe … that a set of clear rules is better for them [developers] than dealing with the courts," Kanouse said. "This helps them minimize the risk of getting sued late in the planning stages on a half-billion-dollar project and losing two or three years in getting houses built."

California Building Industry Association representatives did not return phone calls regarding the water bills. DeAnn Baker, a lobbyist for the California State Association of Counties, said her organization dropped its opposition to SB 221 when Kuehl eliminated language that essentially gave water districts veto power over developments. As finally passed, the bill allows cities and counties to approve tentative maps on the condition that adequate water becomes available — even if a water agency has said no. The bill walks a fine line between insisting on water planning and maintaining local governments' discretion, she said.

The Costa bill, SB 610, is intended to tighten legislation from 1995 (SB 901). The earlier bill called for local governments to provide a water supply assessment in the environmental impact report for projects of at least 500 units. However, local governments and water districts have found loopholes or ignored the bill in almost every instance. The bill attempts to close the loopholes and make clear the need to have a valid Urban Water Management Plan to addresses provision of water for proposed large developments.

The Association of California Water Agencies opposed both SB 221 and SB 610. Representatives did not return phone calls, but a letter from AWCA to lawmakers said, "We believe the failure to implement SB 901 results from a fundamental disconnection between CEQA and the SB 901 process. We do not believe SB 610 solves this problem, and we have serious doubts about the ability of DWR [Department of Water Resources] to prepare meaningful and timely water supply availability assessments for local development projects."


Other legislation

Lawmakers approved a comprehensive bill that addresses extension of redevelopment project areas. Senate Bill 211 (Torlakson) allows redevelopment agencies with projects areas created before 1994 to continue doing business for an additional 10 years. To be eligible for the extension, an agency cannot have "excess surplus funds," it must have a state-approved housing element and it must make a finding that significant blight remains.

Under the extension, the agency must set aside 30% of tax increment revenue for low- and very low-income housing, as compared with the usual requirement of 20% for low- and moderate-income housing. The measure allows state agencies, counties and special districts to ask the attorney general to review redevelopment agency requests for extensions. Under current law, the majority of the state's redevelopment project areas cannot issue new debt after 2004, and their redevelopment plans sunset in 2009.

The Department of Finance opposes the bill because of the costs of reviewing proposed extensions and the loss of future revenue. The agency's opposition made a veto a strong possibility, and some insiders were giving the bill only a 50% chance of surviving.

A bill that came about during the last three weeks of the session generated as much attention as any land use measure this year. Senate Bill 497 (Sher) amends the lot line exemption within the Subdivision Map Act. The bill prohibits landowners from using certificates of compliance to reconfigure old subdivisions of at least five parcels. The key language was added after the Hearst Corporation revealed that it would seek certificates of compliance for 279 parcels on the Hearst Ranch in San Luis Obispo County, greatly increasing the land's value — and the potential cost to the state or nonprofit organizations that want to prevent development. The parcels were apparently created on the 80,000-acre ranch in 1852. Real estate, development and forestry interests strongly fought this bill, while cities, counties, the California Chapter of the American Planning Association and a number of environmental groups supported SB 497.

A park bond was the second-to-last bill approved by lawmakers. Assembly Bill 1602 (Keeley) is a $2.6 billion park and natural resources bond. The largest pieces of the money would be allocated for neighborhood, community and regional parks ($832.5 million); state land conservancies ($445 million); the Wildlife Conservation Board ($300 million); cleaning up beaches and waterways ($300 million); acquiring and restoring historical resources ($267.5 million); and state parks ($225 million). Voters would decide the measure in March 2002. However, there were indications this bill might fall victim to the Davis-Burton feud, as Burton was a principle co-author.

Housing was one of the few land use issues that received consistent lawmaker attention despite the electricity mess, state budget problems and redistricting. Marc Brown, of the California Housing Law Project, said that 2001 was a good year for housing advocates at the Capitol. Seven bills backed by his organization made it to the governor's desk (see list for details). Among those measures was the Torlakson redevelopment bill, which advocates say could provide up to $1 billion for low and very-low income housing.


Not this year

One housing bill that stalled was SB 910 (Dunn), a measure that sought to enforce the housing element law by withholding transportation funds from cities and counties that lack a housing element approved by the Department of Housing and Community Department. A working group has already begun meeting to discuss housing element issues before the Legislature reconvenes in January. However, Dunn has vowed to revive the bill and has made clear he thinks local governments should be penalized for not planning for their fair share of affordable housing.

Baker, of CSAC, spent a great deal of time fighting the bill, which, she said, treats housing as if it existed in a vacuum. The bill ignores lack of infrastructure, air quality problems, and the notion that building residences in unincorporated areas often violates "smart growth" principles, she argued.

Bills that addressed large-scale planning fared poorly. Assembly Bill 857 (Wiggins) and SB 741 (Sher) passed in intent form only and are headed for a conference committee. The Wiggins bill calls for the Office of Planning and Research to prepare a state comprehensive plan by 2003, while the Sher bill addressed details of what should appear in the governor's five-year infrastructure plan that is required as of 2002.