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SB-381 Surplus residential property: priorities, procedures, price, and fund.(2021-2022)

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Date Published: 07/05/2021 09:00 PM
SB381:v95#DOCUMENT

Amended  IN  Assembly  July 05, 2021
Amended  IN  Senate  May 20, 2021
Amended  IN  Senate  May 03, 2021
Amended  IN  Senate  March 09, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 381


Introduced by Senator Portantino

February 10, 2021


An act to amend Section Sections 54237 and 54237.7 of, and to add Section Sections 54239 and 54239.0.1 to, the Government Code, relating to local government, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.


LEGISLATIVE COUNSEL'S DIGEST


SB 381, as amended, Portantino. Surplus residential property: priorities and procedures: City of South Pasadena. priorities, procedures, price, and fund.
(1) Existing law establishes priorities and procedures that any state agency disposing of surplus residential property is required to follow. Under existing law, specified single-family residences must first be offered to their present occupants, as specified. Existing law then requires the property to be offered to housing-related entities, as provided, prior to placing the property up for sale for fair market value, subject to specified priorities. Existing law also requires historic homes, as defined, to be offered first to a housing-related public entity or to a nonprofit private entity, as described.
This bill would, with respect to surplus residential properties located within the State Route 710 corridor in the City of South Pasadena, require surplus single-family residential properties, which includes any applicable locally-designated historic home as defined, and any historic home to be offered to the City of South Pasadena after the properties are offered to present occupants, including present occupants who have occupied the property for 5 years or more and meet certain conditions, pursuant to specified provisions and the present occupants either decline to purchase or do not qualify and close on the property within 274 days of the Department of Transportation adopting emergency regulations. The bill would require a multifamily residential property in the State Route 710 corridor area of the city to first be offered to certain present occupants who have formed a limited equity cooperative housing entity or an entity for the ownership of common interest developments before offering those properties to the city. The bill would also require all other occupied, unoccupied, and unimproved surplus residential properties in the State Route 710 corridor area of the city to first be offered to the city. The bill would set forth procedures that apply to properties under the bill’s provisions, including that each property be subject to a recorded covenant requiring the property remain available and affordable for ownership or rental by persons and families of low or moderate income, except as specified. The bill would require all proceeds from the city’s sale of any property purchased pursuant to the bill’s provisions to be reinvested into low- or moderate income moderate-income housing within its jurisdiction. The bill would require, following an offer of these properties to the City of South Pasadena, the properties to then be offered in accordance with the priorities and procedures in existing law relating to the sale of the property to a private housing-related entity or housing-related public entity and sale for fair market value.
(2) Existing law, known as the Administrative Procedure Act, governs the procedures for the adoption, amendment, or repeal of regulations by state agencies and for the review of those regulatory actions by the Office of Administrative Law. Existing law establishes procedures for the adoption of emergency regulations, including requiring that the state agency make a finding that the adoption of a regulation or order of repeal is necessary to address an emergency, as defined. Under existing law, a regulation, amendment, or repeal adopted as an emergency regulatory action may only remain in effect for up to 180 days, unless the adopting agency complies with specified requirements relating to notice of regulatory action and public comment.
This bill would require the Department of Transportation to adopt emergency regulations within 60 days of the effective date of the bill’s provisions, to implement the above-described requirements relating to the disposal of surplus property. The bill would include findings that an emergency exists for purposes of specified provisions of the Administrative Procedure Act. The bill, notwithstanding the 180-day limit for emergency regulations, would provide that emergency regulations adopted under its provisions would remain in effect for 2 years after adoption, or until the adoption of permanent regulations, whichever occurs sooner.
(3) Existing law creates the SR-710 Rehabilitation Account, which is continuously appropriated to the Department of Transportation, and into which proceeds from the sale of surplus residential property by the department are deposited. Existing law requires that the total funds maintained in the account not exceed $500,000 and that funds exceeding that amount, less any reimbursements due to the federal government, be transferred to the State Highway Account in the State Transportation Fund to be used for allocation by the California Transportation Commission, as specified.
This bill would authorize an increase in the amount of the total funds maintained in the account up to $1,200,000. By authorizing an increase in the funds held in a continuously appropriated fund, the bill would make an appropriation.
(4) Existing law requires a surplus residence or property to be sold to present occupants at an affordable price, as described.
This bill would require that a surplus residence or property located in the City of South Pasadena that is offered by a selling agency to a present occupant of the residence or property be offered at a price based on the appraisal of the residence or property in 2016 if certain conditions apply. The bill would require an offer made or accepted prior to January 1, 2022, that is not in compliance with this provision to be corrected so the price is based on the 2016 appraisal. The bill would provide that an offer made based on the 2016 appraisal shall only be effective until December 31, 2022.
(5) This bill would make findings regarding the public purpose served by the bill.

(3)

(6) This bill would make legislative findings and declarations as to the necessity of a special statute for the City of South Pasadena.

(4)

(7) This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2/3   Appropriation: NOYES   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 54237 of the Government Code is amended to read:

54237.
 (a) Notwithstanding Section 11011.1, but subject to Section 54239 in the City of South Pasadena, an agency of the state disposing of surplus residential property shall do so in accordance with the following priorities and procedures:
(1) First, all single-family residences presently occupied by their former owners shall be offered to those former owners at the appraised fair market value.
(2) Second, all single-family residences shall be offered, pursuant to this article, to their present occupants who have occupied the property for two years or more and who are persons and families of low or moderate income.
(3) Third, all single-family residences shall be offered, pursuant to this article, to their present occupants who have occupied the property for five years or more and whose household income does not exceed 150 percent of the area median income.
(4) Fourth, a single-family residence shall not be offered, pursuant to this article, to present occupants who are not the former owners of the property if the present occupants have had an ownership interest in real property in the last three years.
(b) (1) Single-family Subject to Section 54239.0.1, single-family residences offered to their present occupants pursuant to paragraphs (2) and (3) of subdivision (a) shall be offered to those present occupants at an affordable price. The price shall not be less than the price paid by the agency for original acquisition, unless the acquisition price was greater than the current fair market value, and shall not be greater than fair market value. When a single-family residence is offered to present occupants at a price that is less than fair market value, the selling agency shall impose terms, conditions, and restrictions to ensure that the housing will remain available to persons and families of low or moderate income and households with incomes no greater than the incomes of the present occupants in proportion to the area median income. The Department of Housing and Community Development shall provide to the selling agency recommendations of standards and criteria for these prices, terms, conditions, and restrictions. The selling agency shall provide repairs required by lenders and government housing assistance programs, as well as repairs required in paragraph (2), or, at the option of the agency, provide the present occupants with a replacement dwelling pursuant to Section 54237.5.
(2) For single-family residences, which includes any applicable locally-designated historic homes as defined in Section 54239, and historic homes that are located within the State Route 710 corridor in the City of South Pasadena and subject to the priorities in Section 54239, the selling agency shall also provide repairs identified by an independent licensed inspection company, which shall include repairs typically required in real estate transactions, and repairs required to ensure those residences are compliant with federal, state, and local historic preservation laws.
(c) If single-family residences are offered to their present occupants pursuant to paragraphs (2) and (3) of subdivision (a), the occupants shall certify their income and assets to the selling agency. When a single-family residence is offered to present occupants at a price that is less than fair market value, the selling agency may verify the certifications, in accordance with procedures used for verification of incomes of purchasers and occupants of housing financed by the California Housing Finance Agency and with regulations adopted for the verification of assets by the United States Department of Housing and Urban Development. The income and asset limitations and term of residency requirements of paragraphs (2) and (3) of subdivision (a) shall not apply to sales that are described as mitigation measures in an environmental study prepared pursuant to the Public Resources Code, if the study was initiated before this measure was enacted.
(d) (1) Except as otherwise provided in paragraph (2), all other surplus residential properties and all properties described in paragraphs (1), (2), and (3) of subdivision (a) that are not purchased by the former owners or the present occupants shall be then offered as follows:
(A) Except as required by subparagraph (B), the property shall be offered to a housing-related private or public entity at a reasonable price, which is best suited to economically feasible use of the property as decent, safe, and sanitary housing at affordable rents and affordable prices for persons and families of low or moderate income, on the condition that the purchasing entity shall cause the property to be rehabilitated and used as follows:
(i) If the housing-related entity is a public entity, the entity shall dedicate profits realized from a subsequent sale, as specified in subdivision (b) of Section 54237.7, to the construction of affordable housing within the Cities of Pasadena, South Pasadena, Alhambra, La Cañada Flintridge, and the 90032 postal ZIP Code.
(ii) If the entity is a private housing-related entity or a housing-related public entity, the entity shall cause the property to be developed as limited equity cooperative housing with first right of occupancy to present occupants, except that where the development of cooperative or cooperatives is not feasible, the purchasing entity shall cause the property to be used for low and moderate income low- and moderate-income rental or owner-occupied housing, with first right of occupancy to the present tenants. The price of the property in no case shall be less than the price paid by the entity for original acquisition unless the acquisition price was greater than current fair market value and shall not be greater than fair market value. Subject to the foregoing, it shall be set at the level necessary to provide housing at affordable rents and affordable prices for present tenants and persons and families of low or moderate income. When residential property is offered at a price that is less than fair market value, the selling agency shall impose terms, conditions, and restrictions that will ensure that the housing will remain available to persons and families of low or moderate income. The Department of Housing and Community Development shall provide to the selling agency recommendations of standards and criteria for prices, terms, conditions, and restrictions.
(B) (i) If the property is a historic home, the property shall be offered first to a housing-related public entity subject to clause (i) or (ii) of subparagraph (A) or to a nonprofit private entity dedicated to rehabilitating and maintaining the historic home for public and community access and use subject to clause (ii) of subparagraph (A).
(ii) For purposes of this subdivision, “historic home” means single-family surplus residential property that is listed on, or for which an application has been filed for listing on, at least one of the following by January 1, 2015:
(I) The California Register of Historical Resources, as established pursuant to Article 2 (commencing with Section 5020) of Chapter 1 of Division 5 of the Public Resources Code.
(II) The National Register of Historic Places, as established pursuant to Chapter 3021 of Title 54 of the United States Code.
(III) The National Register of Historic Places, as previously established pursuant to the federal National Historic Preservation Act (54 U.S.C. Sec. 300101 et seq.).
(2) This subdivision shall not apply to properties offered for sale pursuant to Section 54239, except as provided in that section.
(e) A surplus residential property not sold pursuant to subdivisions (a) to (d), inclusive, or Section 54239, as applicable, shall then be sold at fair market value, with priority given first to purchasers who are present tenants in good standing with all rent obligations current and paid in full, second to former tenants who were in good standing at the time they vacated the premises, with priority given to the most recent tenants first, and then to purchasers who will be owner occupants. The selling agency may commence the sale of property that former tenants may possess a right to purchase as provided by this subdivision 30 days after the selling agency has done both of the following:
(1) Posted information regarding the sale under this subdivision on the selling agency’s internet website.
(2) Made a good faith effort to provide written notice, by first-class mail, to the last known address of each former tenant.
(f) (1) Tenants in good standing of nonresidential properties shall be given priority to purchase, at fair market value, the property they rent, lease, or otherwise legally occupy.
(2) (A) A tenant in good standing of a nonresidential property shall be given priority to purchase, at the lesser of fair market value or value in use, if the tenant is a city or a nonprofit organization qualified as exempt under Section 501(c)(3) of the Internal Revenue Code.
(B) The Department of Transportation shall not sell a nonresidential property to a tenant described in subparagraph (A) at a value below the minimum sales price, as defined by Section 1476 of Title 21 of the California Code of Regulations as that regulation read on July 1, 2019.
(C) If a nonresidential property is offered at a price that is less than fair market value, the selling agency shall impose appropriate terms, conditions, and restrictions.
(D) As used in this paragraph, “value in use” means the value of a nonresidential property assuming a specific use, that may or may not be the property’s highest and best use on the effective date of the property’s appraisal.

SEC. 2.

 Section 54237.7 of the Government Code is amended to read:

54237.7.
 (a) Notwithstanding Section 183.1 of the Streets and Highways Code, the Department of Transportation shall deposit proceeds from the sale of surplus residential property from the department to a new owner pursuant to this article into the SR-710 Rehabilitation Account, which is hereby created. Notwithstanding Section 13340, funds in the account are hereby continuously appropriated to the department without regard to fiscal years for the purpose of providing repairs required pursuant to subdivision (b) of Section 54237. The total funds maintained in the account shall not exceed five one million two hundred thousand dollars ($500,000). ($1,200,000). Funds exceeding that amount, less any reimbursements due to the federal government, shall be transferred to the State Highway Account in the State Transportation Fund to be used for allocation by the California Transportation Commission (commission) exclusively to fund projects located in Pasadena, South Pasadena, Alhambra, La Cañada Flintridge, and the 90032 postal ZIP Code. Projects shall be selected and prioritized by the affected communities in consultation with the Los Angeles County Metropolitan Transportation Authority, pursuant to guidelines developed by the commission. The Los Angeles County Metropolitan Transportation Authority shall submit a proposed program of projects and the commission shall have final authority to approve the projects. Eligible projects may include, but are not limited to: sound walls; transit and rail capital improvements; bikeways; pedestrian improvements; signal synchronization; left turn signals; and major street resurfacing, rehabilitation, and reconstruction. The funds shall not be used to advance or construct any proposed North State Route 710 tunnel. Any funds remaining in the SR-710 Rehabilitation Account on the date that final payment due for the last of the properties repaired has been made, less any reimbursements due to the federal government, shall be transferred to the State Highway Account in the State Transportation Fund, to be used exclusively for the purposes described in this section.
(b) Notwithstanding any other law, the net proceeds from a subsequent market sale of surplus residential property sold pursuant to this article at an affordable or reasonable price, as specified in regulations adopted by the department, shall be deposited into the Affordable Housing Trust Account, which is hereby created within the Housing Finance Fund and, notwithstanding Section 13340, continuously appropriated to the California Housing Finance Agency to carry out any activity authorized by Part 3 (commencing with Section 50900) of Division 31 of the Health and Safety Code for the benefit of persons and families of low and moderate income residing exclusively in Pasadena, South Pasadena, Alhambra, La Cañada Flintridge, and the 90032 postal ZIP Code. The priority for the distribution of proceeds from subsequent sales shall be established pursuant to regulations adopted by the department.

SEC. 2.SEC. 3.

 Section 54239 is added to the Government Code, to read:

54239.
 (a) Notwithstanding Sections 54235 to 54237.8, inclusive, and Section 118 of the Streets and Highways Code, and except as provided in Section 54239.0.1, the following priorities and procedures shall apply:
(1) (A) (i) A surplus single-family residential property, which includes any applicable locally-designated historic home, and any historic home located within the State Route 710 corridor in the City of South Pasadena shall be offered to present occupants pursuant to subdivisions (a) to (c), inclusive, of Section 54237. Those present occupants shall have 274 days from the date the Department of Transportation adopts emergency regulations pursuant to paragraph (2) of subdivision (b) to close on or decline to purchase the property. The Department of Transportation shall, when offering properties for sale pursuant to this clause, also provide the present occupants a complete offer package including purchase terms and conditions within 90 days of adoption of those emergency regulations.
(ii) After the single-family residential property, including any applicable locally-designated historic home, or after the historic home is offered for sale pursuant to clause (i), the property shall then be offered at fair market value to purchasers who are present occupants who have occupied the property for five years or more and whose household income exceeds 150 percent of the area median income. The fair market value shall be the appraised value of the property following any customary repairs less the cost of the repairs. A present occupant under this clause shall have 274 days from the date the Department of Transportation adopts emergency regulations pursuant to paragraph (2) of subdivision (b) to close on or to decline to purchase the property. The Department of Transportation shall, when offering properties for sale pursuant to this clause, also provide the present occupants a complete offer package including purchase terms and conditions within 90 days of adoption of those emergency regulations.
(iii) After the single-family residential property, including any applicable locally-designated historic home, or after the historic home is offered for sale pursuant to clauses (i) and (ii), the property shall then be offered at fair market value to purchasers who are present occupants who have occupied the property for five years or more and who are in good standing with all rent obligations current and paid in full, with first right of occupancy to the present occupants. The fair market value shall be the appraised value of the property following any customary repairs less the cost of the repairs. A present occupant under this clause shall have 274 days of the Department of Transportation adopting emergency regulations pursuant to paragraph (2) of subdivision (b) to close on or to decline to purchase the property. The Department of Transportation shall, when offering properties for sale pursuant to this clause, also provide the present occupants a complete offer package including purchase terms and conditions within 90 days of adoption of those emergency regulations.
(iv) After a surplus single-family residential property, including any applicable locally-designated historic home, or after the historic home located within the State Route 710 corridor in the City of South Pasadena is offered for sale pursuant to clauses (i) to (iii), inclusive, of this subparagraph and the present occupants in the property either decline to purchase or do not qualify and close on the property within the specified time periods, the surplus single-family residential property shall be offered to the City of South Pasadena in accordance with the procedures in paragraph (2) prior to being offered pursuant to paragraph (3).
(v) For purposes of clauses (ii) and (iii), both of the following shall apply:
(I) Customary repairs shall be identified by an independent licensed inspection company and shall include repairs typically required in real estate transactions, and repairs necessary to ensure compliance with federal, state, or local historic preservation laws, if applicable. The independent licensed inspection company shall prepare a line-item repair cost for all repairs identified by the company.
(II) Notwithstanding any other law, properties that are historic homes or locally-designated historic homes shall be sold in a manner that permits the present occupant to accept a credit for repairs that are required to be made to the property pursuant to federal, state, or local historic preservation laws, if the present occupant agrees to enforcement, by lien, by the appropriate entities to ensure the repair work is completed in a timely manner.
(B) (i) A multifamily residential property located within the State Route 710 corridor in the City of South Pasadena shall be offered to present occupants who are in good standing with all rent obligations current and paid in full, who have formed a limited equity cooperative housing entity or an entity for the ownership of common interest developments, including a stock cooperative, with first right of occupancy to the present occupants of the property.
(I) Notwithstanding any other law, the multifamily residential property shall be offered at a price that is determined by combining the values of each individual housing unit in the property. The value of each individual housing unit shall be determined in the manner for valuing single-family residences as described in paragraphs (a) to (c), inclusive, of Section 54237, and removes the costs for any necessary repairs. In no case shall the price of the property be less than the price paid by the selling agency for original acquisition or be greater than fair market value for the property.
(II) Notwithstanding any other law, when a unit within the multifamily residential property is offered to a present occupant at a unit price that is less than fair market value, the selling agency shall impose terms, conditions, and restrictions to ensure that the unit will remain available to persons and families of low or moderate income.
(ii) After a multifamily residential property located within the State Route 710 corridor in the City of South Pasadena is offered for sale pursuant to clause (i) and those present occupants either decline to purchase or do not qualify and close on the property within the specified time periods, the property shall be offered to the City of South Pasadena in accordance with the procedures in paragraph (2) prior to being offered pursuant to paragraph (3).
(C) Notwithstanding any other law, net proceeds from the sale of a property to a present occupant pursuant to subparagraph (A) or (B) shall be transmitted to the City of South Pasadena, which shall use those proceeds in the manner described in subparagraph (E) of paragraph (2).
(D) All other occupied, unoccupied, and unimproved surplus residential property not subject to the priorities and procedures of subparagraphs (A) to (C), inclusive, of this paragraph, shall be offered to the City of South Pasadena in accordance with the procedures in paragraph (2) prior to being offered pursuant to paragraph (3).
(2) The following procedures shall apply to properties offered and sold to the City of South Pasadena pursuant to paragraph (1):
(A) The property shall be offered to the City of South Pasadena for the original acquisition price, not adjusted for inflation, paid by the Department of Transportation.
(B) Property sold pursuant to this paragraph shall be sold in the existing “as is” condition.
(C) For each property purchased under paragraph (1), the city shall do all of the following:
(i) (I) Cause the property to be used for low- or moderate income ownership or rental housing for a term of at least 55 years. The purchase and operation of the property shall be subject to a covenant recorded against the property that requires the property to remain available and affordable for ownership or rental by persons and families of low or moderate income, as defined in Section 50093 of the Health and Safety Code, for a term of at least 55 years.
(II) In the event that the property is sold prior to the expiration of the covenant, the covenant shall remain in effect until the time at which it expires. In the event that the property is sold to a housing-related private or public entity, pursuant to subparagraph (D), and that entity is no longer able to maintain, provide, or otherwise operate the property pursuant to this section, the entity shall sell and transfer title for the property to the City of South Pasadena, or to another city-approved housing-related private or public entity, that will maintain, provide, or otherwise operate the property in compliance with the covenant. The sale and transfer to the city or to another entity, as provided in this subclause, shall be for the cost the entity originally paid to the city for the property, not adjusted for inflation, plus the cost of rehabilitation or improvements made to the property.
(ii) If the property is used for rental housing, provide first right of occupancy to the present occupants of the property. The rental amount shall be in accordance with income certification if the current occupants qualify as low or moderate income. If the current tenant’s income exceeds the limits for that level, the rent for those occupants shall be no less than their current rent, or adjusted no higher than current market rates for the area.
(iii) Cause any additional new units added to the property to be used only for ownership or rental by persons and families of low or moderate income, as defined by Section 50093 of the Health and Safety Code, for a term of at least 55 years.
(iv) Construct one unit of new residential housing that meets the requirements of clauses (i) to (iii), inclusive, on a site that is outside of the State Route 710 corridor in the County of Los Angeles but within the city’s jurisdiction, if either of the following apply to the property:
(I) The purchase and use of the property pursuant to paragraph (1) and this paragraph requires the demolition of existing structures on the property, and the city determines by resolution that it is cost prohibitive for the city to construct a new residential structure on the property that meets the requirements of this paragraph.
(II) The property purchased pursuant to paragraph (1) is unimproved property that was planned to be used for the public benefit, such as a park, community garden, or open space.
(D) (i) In purchasing any property under paragraph (1), the City of South Pasadena shall close on all those properties pursuant to a single closing transaction, in a double escrow, or both. The city shall not close on the properties earlier than 274 days of the Department of Transportation adopting emergency regulations pursuant to paragraph (2) of subdivision (b). The Department of Transportation shall, when offering properties for sale to the City of South Pasadena pursuant to this section, provide the city a complete offer package including purchase terms and conditions within 90 days of adoption of those emergency regulations.
(ii) The city is authorized to sell any property purchased under paragraph (1), for the cost paid by the city to acquire and, if applicable, to rehabilitate the property, to a city-approved housing-related private or public entity that will maintain the property and the operation of the property in compliance with the covenant required in subparagraph (C). The city is also authorized to close on the properties in a double escrow to be transferred to a city-approved housing-related private or public entity.
(iii) Notwithstanding any law, the city may sell an unoccupied historic home to any entity or individual without complying with the requirements of subparagraph (C) if the net proceeds of the sale are used in the manner described in subparagraph (E).
(E) Notwithstanding any law, including Section 54237.7, the City of South Pasadena shall reinvest all proceeds from the city’s sale of any property purchased under paragraph (1) and this paragraph into housing for persons and families of low or moderate income, as defined in Section 50093 of the Health and Safety Code, within its jurisdiction.
(F) For purposes of this subdivision, all of the following definitions apply:
(i) “Historic home” has the same meaning as in subparagraph (B) of paragraph (1) of subdivision (d) of Section 54237.
(ii) “Housing-related private entity” means any individual, joint venture, partnership, limited partnership, trust, community land trust, corporation, an entity for the ownership of common interest developments, including a stock cooperative, as defined in Section 4100 of the Civil Code, cooperative, or other legal entity, or any combination thereof, approved by the city as qualified to either own, construct, acquire, or rehabilitate a housing development or a residential structure pursuant to this section, whether for-profit, nonprofit, or limited profit.
(iii) “Housing-related public entity” means any county, city, city and county, the duly constituted governing body of an Indian reservation or rancheria, or housing authority organized pursuant to Chapter 1 (commencing with Section 34200) of Part 2 of Division 24 of the Health and Safety Code, and includes any state agency, public district, or other political subdivision of the state, and any instrumentality thereof, which is authorized to engage in or assist in the development or operation of housing for persons or families of low or moderate income, as defined in Section 50093 of the Health and Safety Code. “Housing-related public entity” also includes two or more housing-related public entities acting jointly.
(iv) “Locally-designated historic home” means single-family surplus residential property that meets both of the following conditions:
(I) Is not a historic home, as defined in clause (i).
(II) Meets either of the following:
(ia) Has been identified, by January 1, 2022, in the City of South Pasadena’s inventory of cultural resources that has been adopted by the city pursuant to Section 2.63 of the city’s municipal code.
(ib) Has been designated, by January 1, 2022, by the City of South Pasadena as a historic home.
(3) After the surplus residential property is offered for sale pursuant to subdivisions (a) to (c), inclusive, of Section 54237, and paragraphs (1) and (2) of this subdivision, the property shall then be offered in accordance with the priorities and procedures specified in subparagraphs (A) and (B) of paragraph (1) of subdivision (d) and subdivision (e) of Section 54237.
(b) (1) The Legislature finds and declares that the state’s homelessness crisis has compounded the need for affordable housing described in Section 54235. To help mitigate the need for affordable housing and to speed up sales pursuant to this article, the Legislature further finds and declares that an emergency exists for purposes of Sections 11342.545, 11346.1, and 11349.6.
(2) The Department of Transportation shall adopt, within 60 days of the effective date of this section, emergency regulations to implement this section.
(3) Notwithstanding Section 11346.1, the emergency regulations adopted pursuant to paragraph (2) shall remain in effect for two years after adoption or until permanent regulations are adopted, whichever is sooner.

SEC. 4.

 Section 54239.0.1 is added to the Government Code, to read:

54239.0.1.
 (a) Notwithstanding any other law, including Sections 54237 and 54239, a surplus residence or property located in the City of South Pasadena that is offered by a selling agency to a present occupant of the residence or property shall be offered at a price based on the appraisal of the residence or property in 2016 if both of the following apply:
(1) The present occupant was an occupant of the residence or property in 2016.
(2) The present occupant received a conditional offer of sale of the residence or property in 2016 from the selling agency.
(b) An offer made or accepted prior to January 1, 2022, that is not in compliance with subdivision (a) shall be corrected so the price complies with subdivision (a).
(c) An offer made based on the 2016 appraisal under subdivision (a) shall only be effective until December 31, 2022.

SEC. 5.

 The Legislature finds and declares that the addition of Sections 54239 and 54239.0.1 to the Government Code by this act serves the public purpose of encouraging the creation and maintenance of affordable rentals and homes, and does not constitute a gift of public funds within the meaning of Section 6 of Article XVI of the California Constitution.

SEC. 3.SEC. 6.

 The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique circumstances in the State Route 710 corridor in the City of South Pasadena.

SEC. 4.SEC. 7.

 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to address the shortage of affordable housing and make surplus residential properties owned by the state available as soon as possible, it is necessary that this act take effect immediately.