Summary of SB 5: Enhanced Infrastructure Financing Districts and Agricultural Land Exclusion

Bill Overview

Bill Number: SB 5

Title: Enhanced infrastructure financing districts and community revitalization and investment areas: allocation of taxes: agricultural land exclusion

Introduced: December 02, 2024

Status: In Senate; consideration of Governor's veto pending

Author: Cabaldon

Purpose and Intent

SB 5 aims to amend existing laws regarding enhanced infrastructure financing districts (EIFDs) and community revitalization and investment areas (CRIAs) in California. The primary intent of the bill is to protect agricultural land by excluding certain tax revenues from being allocated to these districts when the land is under the California Land Conservation Act of 1965, commonly known as the Williamson Act.

Key Provisions

• Tax Exclusion: The bill specifically excludes taxes levied on parcels of land that are enrolled in or subject to a Williamson Act contract or a farmland security zone contract from allocations to EIFDs and CRIAs. This means that local governments cannot use tax revenues from these agricultural lands to finance public capital projects or community revitalization efforts.

• Amendment to Government Code: The bill amends Section 53398.75 of the Government Code, detailing how taxes are allocated within enhanced infrastructure financing districts. It clarifies that taxes from agricultural lands under the Williamson Act will not be included in the calculations for funding these districts.

• Conditional Changes: The bill incorporates additional changes proposed by SB 516, which will only take effect if both SB 5 and SB 516 are enacted, with SB 5 being enacted last.

Impact

• Agricultural Landowners: The bill is designed to protect agricultural landowners by ensuring that their properties are not subjected to tax allocations that could undermine their agricultural use. This could encourage the preservation of farmland in California.

• Local Governments: Local governments may face limitations in financing public projects if they rely on tax revenues from agricultural lands, potentially affecting their ability to fund infrastructure improvements in areas that include such lands.

• Community Revitalization Efforts: The exclusion of agricultural land tax revenues may impact the funding available for community revitalization projects, particularly in areas where agricultural land is prevalent.

Procedural Aspects

• Legislative Journey: SB 5 has undergone several readings and amendments in both the Senate and Assembly. It was passed by the Assembly with a vote of 67-2 and is currently awaiting consideration of a veto by the Governor after being enrolled and presented to him on September 16, 2025.

• Voting Requirements: The bill requires a majority vote for passage and does not involve appropriations or local programs.

Conclusion

SB 5 represents a significant legislative effort to balance the needs of agricultural land preservation with the financing of public infrastructure projects. By excluding agricultural tax revenues from EIFDs and CRIAs, the bill seeks to protect farmland while potentially limiting local governments' funding sources for community development. The outcome of the Governor's veto consideration will determine the bill's future and its implications for California's agricultural and urban landscapes.