AB 2226 – FEDERATION OPPOSED

On June 19, in a 3-2 vote, the State Senate Judiciary Committee voted down AB 2226! Senator Noreen Evans (Chair) and Senators Leno and Corbett voted not to send the bill on to the Natural Resources Committee, while Senators Blakeslee and Harman voted to do so.

Assemblymember Hueso, the bill’s author, testified that AB 2226 was, “fairness legislation.” (See list of his big business supporters below).

Now, we’ll need to watch for reconsideration requests and for amending other bills, etc.

Thanks to all who participated in seeing that this special interest bill was opposed and defeated!

See details and other posts in regard to AB 2226 below…

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Controversial AB 2226 will be heard on June 19 by the Senate Judiciary Committee. The Las Virgenes Homeowners Federation is opposed to this special interest bill (see our letter and link above) which in effect is a scheme for developers to maximize development by shielding the true identity of property ownership from State agencies like the California Coastal Commission, so the true environmental impacts cannot be considered.

Despite all of the creative language used by the bill’s author(s) to confuse and disguise the actual intent of AB 2226, the Senate Judiciary staff had no problem in nailing it:  …”by effectively decreasing transparency of property ownership, could facilitate the use of corporations by applicants to maximize development potential.That potential abuse of the presumption could arguably undermine the process by which state agencies and local governments make decisions regarding land use.”

Here is a list of supporters of the proposed special interest legislation and a list of those who join the Federation in OPPOSING AB 2226:

It’s been several months since the Coastal Commission denied David Evans – aka “The Edge” – permission to grade a highway 1700’ up the ridge east of Malibu Lagoon so he could build five mega-mansions on the most prominent coastal ridgeline between Santa Monica and Point Mugu, a ridgeline that can be seen from coastal viewpoints all around Santa Monica Bay.

The project was denied because, though the five applications were filed under five different names, the Coastal Commission staff uncovered evidence that the five applicants were business associates or in-laws in Ireland and, therefore, shared a unity of interest and were in fact proposing what amounted to a tract of five mansions complete with water line and access road.

Things were quiet for a while after the denial, but they didn’t stay that way for long. AB 2226 slipped through the Assembly by a one-sided 53-11 vote (Coastal/Mountain Assemblymember Julia Brownley was one of the 11 no votes but Calabasas’ new Assemblymember Bob Blumenfield counted as one of the yes votes for AB 2226). (Calabasas was carved into the San Fernando Valley Assembly District by the Redistricting Commission with strong lobbying efforts from the Valley Industry and Commerce Association). If AB 2226 becomes law, it would eliminate the grounds by which the Coastal Commission had turned down The Edge project.

At first glance the Assembly bill seems harmless enough; AB 2226 would amend the Government Code to require state agencies to refer to the Evidence Code to determine who owns full title to a piece of property rather than referring  to the “threshold of substantial evidence”, a less demanding standard state agencies now use.

The difference between the standards of the Evidence Code and the “threshold of substantial evidence” may be difficult for laymen to grasp, but it is great enough for three state agencies that deal in land use issues – the Coastal Commission, the State Lands Commission, and the San Francisco Bay Conservation and Development Commission, to write a strongly worded letter to Assemblyman Ben Hueso, the author of AB 2226, urging him to reconsider his support for the bill, on the grounds that the bill increases the burden of proof of ownership required of state agencies without providing those agencies with the legal tools, such as subpoenas, powers of discovery, and sworn testimony to obtain that proof of ownership. The letter from the three state land use agencies claims this would “have a chilling effect on the state’s ability to effectively carry out their statutory land use planning activities and other regulatory proceedings”.

The letter continues, “We have noted with increasing frequency the practice of landowners shielding their identity from state agencies through the formation of Limited Liability Corporations (LLCs) and other similar corporate entities … AB 2226 would make it demonstrably more difficult for state agencies to pierce the corporate veil or otherwise determine the actual business realities behind mere record title to land ownership …”

“Increasing the burden of proof that state agencies must meet without the commensurate tools of discovery would have a chilling effect on the state’s ability to effectively carry out their statutory land use planning activities and other regulatory proceedings.”

The letter concludes, “We can foresee that this bill may have far-reaching impacts on numerous other state agencies …”

The Federation is very familiar with this strategy of developer landowners shielding their “unity of interest” and true ownership under cover of different LLCs etc. and therefore the true environmental, cumulative impacts of a project are hidden.

AB 2226 will be heard by the Senate Judiciary Committee on Tuesday, June 19. The Committee Chair is Senator Noreen Evans.

To oppose this bill, click on the link at the beginning of this article and send e-mails to the addresses listed at the end of the Federation’s letter of opposition. Author of the Bill is Assemblymember Ben Hueso.