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GC Sec 53398-53398.8
53398. (a) The Legislature finds and declares that the North
American Free Trade Agreement has resulted in a dramatic increase in
trade with Mexico. In 1998 companies in California exported over
$13.3 billion worth of goods to Mexico, and more than 80,000 jobs
throughout the state are the direct result of this trade. This
increased trade has strained the inadequate public infrastructure in
the region just north of the international border.
(b) The Legislature further finds and declares that there is a
significant opportunity for industrial development, including high
technology and biotechnology manufacturing, in the region along the
border. However, this region lacks the public infrastructure
necessary to support new development or to provide for the rapid and
reliable delivery of supplies to, and distribution of products from,
companies throughout the state.
(c) The Legislature finds and declares that the state and federal
governments have withdrawn in whole or in part from their former role
in financing infrastructure facilities, including highways, roads
and interchanges, sewage facilities and water reclamation works,
water supply and treatment works, flood control and drainage works,
schools, libraries, parks, parking facilities, open space, and
seismic retrofit and rehabilitation of public facilities.
(d) The Legislature further finds and declares that the methods
available to local agencies to finance public works often place an
undue and unfair burden on buyers of new homes, especially for public
works that benefit the broader community.
(e) The Legislature further finds and declares that the absence of
practical and equitable methods for financing both regional and
local public works leads to a declining standard of public works, a
failure to construct new public works needed to support new
commercial and industrial development in the region along the border,
a reduced quality of life and decreased safety for affected
citizens, increased objection to otherwise desirable development, and
excessive costs for homebuyers.
(f) The Legislature further finds and declares that it is
equitable and in the public interest to provide alternative
procedures for financing public works and services needed to support
new commercial and industrial development in the region along the
border that would generate significant new employment opportunities.
53398.1. Unless the context otherwise requires, the definitions
contained in this article shall govern the construction of this
(a) "Affected taxing entity" means any governmental taxing agency
that levied or had levied on its behalf a property tax on all or a
portion of the property located in the proposed district in the
fiscal year prior to the designation of the district, but not
including any county office of education, school district, community
college district, or the Educational Revenue Augmentation Fund.
(b) "Border development zone" means a strip of land three miles
wide with the international border with Mexico on the south, the mean
high tide of the Pacific Ocean on the west, and the border with the
State of Arizona on the east.
(c) "City" means a city, a county, or a city and county.
(d) "Debt" means any binding obligation to repay a sum of money,
including obligations in the form of bonds, certificates of
participation, long-term leases, loans from government agencies, or
loans from banks, other financial institutions, private businesses,
(e) "Designated official" means the city engineer or other
appropriate official designated pursuant to Section 53398.13.
(f) "District" means an infrastructure financing district located
in the border development zone.
(g) "Infrastructure financing district" means a legally
constituted governmental entity established pursuant to this chapter
for the sole purpose of financing public facilities.
(h) "Landowner" or "owner of land" means any person shown as the
owner of land on the last equalized assessment roll or otherwise
known to be the owner of the land by the legislative body. The
legislative body has no obligation to obtain other information as to
the ownership of land, and its determination of ownership shall be
final and conclusive for the purposes of this chapter. A public
agency is not a landowner or owner of land for purposes of this
(i) "Legislative body" means the city council or board of
53398.2. (a) The revenues available pursuant to Article 3
(commencing with Section 53398.30) may be used directly for work
allowed pursuant to Section 53398.3 (including use as matching funds
to accomplish this work), may be accumulated for a period not to
exceed five years to provide a fund for that work, may be pledged to
pay the principal of, and interest on, bonds issued pursuant to
Article 4 (commencing with Section 53398.40), or may be pledged to
pay the principal of, and interest on, bonds issued pursuant to the
Improvement Bond Act of 1915 (Division 10 (commencing with Section
8500) of the Streets and Highways Code) or the Mello-Roos Community
Facilities Act of 1982 (Chapter 2.5 (commencing with Section 53311)),
the proceeds of which have been or will be used entirely for
allowable purposes of the district. The revenue of the district may
also be advanced for allowable purposes of the district to an
Integrated Financing District established pursuant to Chapter 1.5
(commencing with Section 53175), in which case the district may be
party to a reimbursement agreement established pursuant to that
chapter. The revenues of the district may also be committed to
paying for any completed public facility acquired pursuant to Section
53398.3 over a period of time, including the payment of a rate of
interest not to exceed the bond buyer index rate on the day that the
agreement to repay is entered into by the city.
(b) The legislative body may enter into an agreement with any
affected taxing entity providing for the construction of, or
assistance in, financing public facilities.
53398.3. (a) A district may finance (1) the purchase, construction,
expansion, improvement, seismic retrofit, or rehabilitation of any
real or other tangible property with an estimated useful life of 15
years or longer that satisfies the requirements of subdivision (b),
(2) the planning and design work that is directly related to the
purchase, construction, expansion, or rehabilitation of that
property, and (3) the costs described in Sections 53398.5 and
53398.31. A district may only finance the purchase of facilities for
which construction has been completed, as determined by the
legislative body. The facilities need not be physically located
within the boundaries of the district. A district may not finance
routine maintenance, repair work, or the costs of ongoing operation
or providing services of any kind.
(b) The district shall finance only public capital facilities that
provide significant benefits to the area of the border development
zone, including, but not limited to, all of the following:
(1) Highways, interchanges, ramps and bridges, major and minor
arterial streets, major and minor collector streets, parking
facilities, and transit facilities. Phased road widening projects
shall also be permitted.
(2) Sewage collection, pumping, treatment and water reclamation
plants and interceptor pipes.
(3) Facilities for the collection and treatment of water for urban
(4) Flood control levees and dams, retention basins, and drainage
(5) Child care facilities.
(7) Parks, recreational facilities, and open space.
(8) Facilities for the transfer and disposal of solid waste,
including transfer stations and vehicles.
(9) Public safety facilities.
(c) Any district that constructs dwelling units shall set aside
not less than 20 percent of those units to increase and improve the
community's supply of low- and moderate-income housing available at
an affordable housing cost, as defined by Section 50052.5 of the
Health and Safety Code, to persons and families of low and moderate
income, as defined in Section 50093 of the Health and Safety Code.
(d) A district may also finance the purchase of sewage treatment
capacity that provides significant benefits to the area of the border
development zone. The facility providing the sewage treatment
capacity need not be physically located within the boundaries of the
53398.4. (a) A district may not include any portion of a
redevelopment project area that is or has been previously created
pursuant to Part 1 (commencing with Section 33000) of Division 24 of
the Health and Safety Code, whether the creation is or was proper or
improper. A redevelopment project area may not include any portion
of a district created pursuant to this chapter.
(b) A district may finance only the facilities or services
authorized in this chapter to the extent that the facilities or
services are in addition to those provided in the territory of the
district before the district was created. The additional facilities
or services may not supplant facilities or services already available
within that territory when the district was created but may
supplement those facilities and services as needed to serve new
(c) A district may include areas that are not contiguous.
53398.5. It is the intent of the Legislature that the area of the
districts created be substantially undeveloped, and the establishment
of a district should not ordinarily lead to the removal of existing
dwelling units. If, however, any dwelling units are proposed to be
removed or destroyed in the course of private development or public
works construction within the area of the district, the legislative
body shall do all of the following:
(a) Within four years of the removal or destruction, cause or
require the construction or rehabilitation, for rental or sale to
persons or families of low or moderate income, of an equal number of
replacement dwelling units at affordable housing cost, as defined in
Section 50052.5 of the Health and Safety Code, within the territory
of the district if the dwelling units removed were inhabited by
persons or families of low or moderate income, as defined in Section
50093 of the Health and Safety Code.
(b) Within four years of the removal or destruction, cause or
require the construction or rehabilitation, for rental or sale to
persons of low or moderate income, a number of dwelling units that is
at least one unit but not less than 20 percent of the total dwelling
units removed at affordable housing cost, as defined in Section
50052.5 of the Health and Safety Code, within the territory of the
district if the dwelling units removed or destroyed were not
inhabited by persons of low or moderate income, as defined in Section
50093 of the Health and Safety Code.
(c) Provide relocation assistance and make all the payments
required by Chapter 16 (commencing with Section 7260) of Division 7
of Title 1, to persons displaced by any public or private development
occurring within the territory of the district. This displacement
shall be deemed to be the result of public action.
(d) Ensure that removal or destruction of any dwelling units
occupied by persons or families of low or moderate income does not
take place unless and until there are suitable housing units, at
comparable cost to the units from which the persons or families were
displaced, available and ready for occupancy by the residents of the
units at the time of their displacement. The housing units shall be
suitable to the needs of these displaced persons or families and
shall be decent, safe, sanitary, and otherwise standard dwellings.
53398.6. Any action or proceeding to attack, review, set aside,
void, or annul the creation of a district or the adoption of an
infrastructure financing plan, including a division of taxes
thereunder, shall be commenced within 30 days after the enactment of
the ordinance creating the district pursuant to Section 53398.21.
Consistent with the time limitations of this section, such an action
or proceeding with respect to a division of taxes under this chapter
may be brought pursuant to Chapter 9 (commencing with Section 860) of
Title 10 of Part 2 of the Code of Civil Procedure, except that
Section 869 of the Code of Civil Procedure shall not apply.
53398.7. An action to determine the validity of the issuance of
bonds pursuant to this chapter may be brought pursuant to Chapter 9
(commencing with Section 860) of Title 10 of Part 2 of the Code of
Civil Procedure. However, notwithstanding the time limits specified
in Section 860 of the Code of Civil Procedure, the action shall be
commenced within 30 days after adoption of the resolution pursuant to
Section 53398.43 providing for issuance of the bonds if the action
is brought by an interested person pursuant to Section 863 of the
Code of Civil Procedure. Any appeal from a judgment in that action
or proceeding shall be commenced within 30 days after entry of
53398.8. An infrastructure financing district in the border
development zone is a "district" within the meaning of Section 1 of
Article XIIIA of the California Constitution.