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PALO ALTO, CA—California's local governments and developers received a potentially significant boost on September 29th with passage of Senate Bill 628 (44-31 Assembly; 21-13 Senate). SB 628 gives local governments the authority to establish Enhanced Infrastructure Financing Districts (EFIDs). Adding this new funding mechanism to the state's infrastructure financing toolbox could not have come at a better time, with recent earthquakes, worsening drought conditions, and increasing demands for renewable energy, among other issues stressing California's infrastructure.
While it remains to be seen how this law will function in practice, there are several aspects which may prove to be substantial improvements over existing and past financing schemes. First, unlike existing state law governing infrastructure financing districts, SB 628 does not require specific voter approval to establish EFIDs. In fact, public involvement will be limited to satisfying certain notice and hearing requirements as the local authorities establish the boundaries, the financing plan and the purpose of the EFID.
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