Umberg measures addressing corrupt Anaheim Stadium sale signed

(Sacramento, CA) – Senate Bill 34 and Senate Bill 229, authored by Senator Thomas J. Umberg (D-Santa Ana), both aimed at addressing the drawn-out Anaheim Stadium debacle and preventing future related controversies, were signed into law by Governor Gavin Newsom last week.

“Since 2019, I have repeatedly expressed concerns about this deal between the Angels and the City of Anaheim – specifically, about the value of the land and the amount of affordable housing within the requirements of the Surplus Lands Act,” said Senator Thomas J. Umberg (D-Santa Ana). 

Senate Bill 34, introduced originally by Senator Umberg last year as SB 361, creates a pilot program that will prohibit any governmental entity within Orange County from disposing of a parcel of land if it is not done in compliance with the Surplus Land Act (SLA). As originally introduced, SB 361 applied this concept on a statewide basis. Relentless lobbying by local governments including cities, counties, and special districts have led to the measure’s narrowing over the last 18 months.

“Despite being disheartened by seeing so many government entities fighting to avoid transparency with the current surplus land law, we have conceded on areas of this measure, in particular, to increase its chance of passage.  At the very least, the people of Anaheim and Orange County deserve accountability with their tax dollars in light of the ongoing stadium mess.”

If there is a violation under SB 34, the California Department of Housing and Community Development will now have authority to require the local entity to rebid the sale.

A companion bill, Senate Bill 229, will require that any agency that receives a notification of SLA violation to hold an open and public meeting to review and consider the substance of the notice of violation. SB 229 would additionally require the governmental entity to give the public 14 days’ notice prior to the public session using platforms such as their website.

California’s SLA is a state law that directs local agencies, such as cities, counties, and districts, to prioritize the development of low-income housing when selling or leasing their surplus land.  Under current law, local agencies that dispose of land in violation of these provisions, liable for a penalty of 30% of the final sale price of the land sold for a first violation; 50% for any subsequent violation(s).

Recent events in Anaheim have shed light on unforeseen consequences within the SLA. In April of 2021, the California Department of Housing and Community Development sent the City of Anaheim a letter, warning that it could be in violation of the SLA. Despite this notification and the possibility of receiving a $96 million fine, the City of Anaheim continued to push the deal through. To accommodate the fine, City officials at the time planned to simply transfer the $96 million from the $123 million for affordable housing that was already included within the stadium land deal – thereby negating the intended effects of the SLA’s fine enforcement mechanism.

“When the Surplus Lands Act was passed, it was because the state recognized the need for more affordable housing,” said Assemblymember Phil Ting (D-San Francisco), who authored legislation on the SLA. “Unscrupulous deals like the one in Anaheim circumvent the purpose of the SLA. It’s clear that legislation is needed so that we aren’t seeing more local governments benefiting from violating the law.”

To further complicate this deal, in May of 2022, the then mayor of Anaheim, Harry Sidhu, announced he would be stepping down from public office, having been accused by the Federal Bureau of Investigations of solicitation, bribery, and obstruction of justice. Last month, Sidhu pled guilty to the majority of the accusations, which were centered on the city’s plan to sell public land to the Anaheim Angels. Investigators allege that the former Mayor of Anaheim hoped to receive $1 million or more in campaign contributions from the team in exchange for assistance in the deal.

“Over the summer in an op-ed, I called for a complete termination of the Anaheim Stadium lease in light of what appears to be repeated, historic, and egregious bad faith negotiations by both the City of Anaheim and the Angels organization,” said Senator Umberg.  “It is painful to watch the trust of the public be so egregiously eroded,” continued the Senator. “SB 34 and SB 229 are just a few steps needed to restore integrity in this matter. I appreciate that my colleagues and the Governor stand beside me on this.”

Both measures will take effect January 1, 2024.