3.3.7.4 Enhanced Infrastructure Financing Districts
Approved by Senate Bill 628 (Chapter 785, Statutes of 2014) and modified by Assembly Bill 313 (Chapter 320, Statutes of 2015), the “EIFD Act,” California Government Code Section 53398.50 et seq., enhanced infrastructure financing districts (EIFDs) build upon the existing infrastructure finance district law. Traditional public works such as transportation, transit, parks and libraries, water and sewer facilities, solid waste disposal, and flood control and drainage may be financed by EIFDs. The EIFDs may also be used for environmental mitigation, low income housing, transit priority projects, and projects intended to “implement a sustainable community’s strategy.” Establishing a district begins with adoption of a resolution of intention by the legislative body of a city or county describing boundaries (which need not be contiguous), the type of facilities and development to be financed, the need for and goals of the district, the incremental property tax from the city or county, and some or all affected taxing entities in the district (if approved by resolution), and fixing the date and time for a hearing.
The initial step in forming the district is for the preparation of an infrastructure plan by the city or county engineer or another appropriate official. The plan must describe boundaries, projects, financial assistance, and the maximum portion of incremental tax of the city or county and each affected taxing entity proposed to be committed to the district each year and propose a plan of finance. Copies are to be sent to each land owner, to each affected taxing entity (together with any California Environmental Quality Act reports), and to the planning commission. After a public hearing, a resolution approving the plan must be adopted by the governing body of each affected taxing entity (a portion of the tax increment of which is to be allocated to the district), which must not include any school district, county board of education, or community college district. The plan can be amended to exclude any affected taxing entity that does not approve the plan. No city or county that formed a redevelopment agency can participate until the redevelopment agency has completed its winding up, either by receipt of a finding of completion from the Department of Finance or after certain enumerated steps have been taken. Bonds may be payable from tax increment but must be approved by a vote of 55% of the electors.
The new EIFD is governed by a “public financing authority” consisting of members of the legislative bodies of the participating taxing entities (comprising a majority) plus at least two members of the public chosen by their legislative bodies.