Although Democrats took control of state government this year for the first time since the early 1980s, the legislative session did not produce a batch of liberal bills. In fact, with regards to land use, environmental regulation and local government finance, the session may have been most remarkable for what lawmakers did not do. The Legislature approved no major changes to the California Environmental Quality Act. Transportation and affordable housing bonds died. Proposals to reduce the voting requirement from two-thirds to majority for local transportation-related sales tax measures and local school bonds also failed to advance. However, the Legislature did place on the March 2000 ballot a $2.1 billion parks bond, a $2 billion water resources bond, and a$350 million library bond. Lawmakers also strengthened affordable housing laws, approved a measure intended to prevent local governments from competing for major retailers, and closed a loophole in Marks-Roos bond financing rules. Gov. Davis has until Oct. 10 to decide on the bills. Local Land Use Two of September's most interesting bills reduced local land use control, but one of them received a quick Davis veto. The governor rejected a last-minute measure to prevent cities and counties from approving big-box stores with grocery and pharmacy departments. He had not taken action on another bill that moved control of a large, unincorporated island from the City of Redlands to developer-friendly San Bernardino County. Wal-Mart and its big-box brethren were targets of legislators' gut-and-amend tactics. AB 84 by Assemblyman Brett Granlund (R-Yucaipa) originally addressed political committees. But only three days before the Legislature's September 10 deadline, Assembly Speaker Antonio Villaraigosa and Assemblyman Richard Floyd (D-Wilmington) removed the original text and inserted new language. As amended, the measure prohibits cities and counties from approving a retail store of more than 100,000 square feet that has more than 15% of floor space dedicated to nontaxable merchandise. The bill supposedly gives relief to local agencies that must provide expensive public safety and roads to such stores, prevents big box retailers from pitting communities against one another, and discourages development on the urban fringe. But the measure is aimed clearly at Wal-Marts with grocery sections, Sam's Club, and Costco. Those stores typically are larger than 100,000 square feet and have substantial portions dedicated to food and drugs, which are nontaxable. Organized labor and several large grocers, including Safeway, Ralph's and Stater Bros., backed the measure. Big boxes' employees are often nonunion, while most supermarket jobs are union. Traditional supermarkets have struggled to compete with the all-in-one discounters. (See also Local Watch, page 2.) Floyd told the Los Angeles Times that warehouse stores should be contained "before these bastards take over the whole country." In his veto message Davis conceded that "the fiscal arrangement between state and local governments" encourages cities and counties to choose retail development over manufacturing and housing. "But," Davis said, "matters largely involving local land-use and zoning decisions should not be preempted by the Legislature and Governor without thoughtful deliberation." The Redlands measure, AB 1553 by Thomas Calderon (D-Montebello), would preempt a local land-use and zoning decision. (See CP&DR Local Watch, November 1998; CP&DR Legal Digest, November 1997.) Majestic Realty, headed by influential developer Ed Roski Jr., wants to build a shopping mall and other retail outlets on a 1,200-acre unincorporated island known as "the doughnut hole." Under state law, Redlands, which wants to annex the territory, has the final say because the property lies within the city's sphere of influence. However, Redlands earlier tried to make a deal with a different developer, and Majestic has resisted annexation. The bill requires the San Bernardino Local Agency Formation Commission to remove the doughnut hole from Redlands' sphere of influence, and allows a county service area to provide water and sewer, even though Redlands has facilities nearby. This bill is not the Legislature's first foray into local LAFCO decision-making, as lawmakers have made several attempts this decade to adjust spheres of influence and special district boundaries. A Senate analysis stated, "AB 1553 invites the Legislature to intervene in a specific land use squabble, as if it were some Super-LAFCO." Bonds The largest bond measure to qualify for the next state ballot was Villaraigosa's AB 18, a $2.1 billion parks proposal, and Davis signed the bill. Villaraigosa's measure focuses on urban parks, with $826 million earmarked for local parks, zoos, playgrounds, trails and ball fields. The $1.97 billion water bond, AB 1584 by Assembly Mike Machado (D-Linden), contains money for a large mixture of programs, including aquifer storage, flood protection, watershed protection, water system repairs, conservation and river cleanup. The bond earmarks no funding for new reservoirs, although the measure's supporters say all the programs combined equal one moderate-sized dam. Senate President Pro Tempore John Burton's transportation bond package did not make the ballot. Burton initially proposed four $4 billion bonds spread over six years. He later condensed SB 3 to one $8 billion bond. The measure, which needed a two-thirds vote in both houses, passed the Senate 32-8, but Republicans blocked it in the Assembly. They argued for a pay-as-you-go approach. Lawmakers might revive a transportation bond when they reconvene in January. Housing Although housing bonds failed, SB 948 by Senator Richard Alarcon (D-Los Angeles) amends various state regulations, including the housing element law. Among other things, the measure: broadens the anti-NIMBY law by tightening the findings a city or county must make to deny an affordable housing project; lengthens rent-control provisions; requires local agencies to decide on an affordable housing project within 90 days of EIR certification; allows lawsuits challenging housing element adequacy at any time — not just shortly after adoption — so long as the local jurisdiction receives 60 days to correct deficiencies; clarifies density bonus requirements. Farmworker housing is the subject of AB 1505 by Assemblywoman Denise Ducheny (D-San Diego). The measure requires local general plans to identify adequate sites with public services for housing agricultural employees. The law also allows development of farmworker housing on Williamson Act parcels of no more than 5 acres, within certain requirements. Local Government Finance Lawmakers approved a small package of relief bills along with the budget in June. But a proposal to phase out the property tax shift from cities and counties to schools (ACA 17) became a two-year bill. A bill to eliminate competition among cities and counties for sales tax-producers did pass and received Davis's signature. AB 178 by Assemblyman Tom Torlakson (D-Antioch), prohibits local governments from offering incentives — such as tax rebates, discount real estate and low-interest loans — to a big box retailer relocating within a 25-mile radius, or to an auto dealer within 40-miles. Local governments may offer incentives only if the "winning" city or county agrees to share sales tax revenue with the "losing" jurisdiction. AB 1511 by Dean Florez (D-Shafter) closes a loophole that allows local agencies to issue Marks-Roos bonds for projects outside their jurisdiction. The measure prohibits a joint powers authority that includes a mutual water company from issuing the bonds. Florez pursued the bill after the cities of Waterford and San Joaquin created a JPA with a developer's water company for the purpose of issuing bonds for a San Bernardino County subdivision. Williamson Act Several bills made adjustments to the Williamson Act. AB 1480 limits mining on Williamson Act property and alters procedures for swapping Williamson Act land for conservation easements. SB 985 prohibits the building of artificial lakes created as subdivision amenities or as waterskiing facilities on Williamson Act land. The bill also forbids land swaps for property under the Super Williamson Act. AB47 guides Williamson Act cancellation fees to the Agricultural Land Stewardship Program Fund, rather than the state's general fund. Other Legislation o AB 1630 appropriates $320,000 to the Los Angeles LAFCO to study the feasibility of detaching San Pedro, Wilmington and Harbor City from the City of Los Angeles. o AB 1473 requires the governor, beginning in 2002, to submit annually a five-year capital improvement program and proposed funding sources. o AB 1555 expedites island annexations — except certain large islands, gated communities, Laguna Beach's Emerald Bay, and Redlands' doughnut hole. o AB 597 requires Caltrans to develop flexible highway design standards. The measure is aimed at highways that also serve as city streets. o SB 47 reenacts and modifies the state Superfund law. The measure establishes a mechanism for state cleanup funding, but provides no money, and it requires the state to pursue many responsible parties, not only those with deep pockets. o AB 497 lets the attorney general enforce violations of the Community Redevelopment Law. o SB 807 lets LAFCOs approve water service by cities and special districts outside their jurisdictions in response to threats to public health or safety. o SB 216 creates the San Gabriel and Lower Los Angeles Rivers and Mountains Conservancy to acquire and manage public lands. o SB 754 creates the Los Angeles River Conservation and Restoration Commission to prepare a conservation and restoration plan. o AB 1229 broadens the California Farmland Conservancy Program.