(a) The Director of General Services may purchase, exchange, or otherwise acquire real property and construct facilities, including any improvements, betterments, and related facilities, in the County of Sacramento, along the Highway 50 corridor in close proximity or contiguous to the Phase I and II sites of the Franchise Tax Board facilities, and may retrofit the existing Phase I and II buildings and infrastructure, for the purpose of acquiring and constructing approximately 1,000,000 square feet of office and warehouse space for use by state agencies. The site shall be within a reasonable distance of an existing or planned light rail station.

The acquisition of property shall be pursuant to the Property Acquisition Law (Part 11 (commencing with Section 15850)). In no event shall the Department of General Services pay more than fair market value for the sites. The award of construction contracts shall be to the lowest responsible bidder. The Department of General Services shall determine which agencies will occupy these facilities after consulting with senior administrative staff of the affected agencies and based on which agencies can make the most cost-effective use of the facilities consistent with the programmatic needs of the agencies.

(b) The Department of General Services may contract for the design, construction, construction management, and other services related to the design and construction of the office, warehouse, infrastructure, and parking facilities authorized to be acquired pursuant to subdivision (a). The Department of General Services shall prepare preliminary plans before entering into a construction contract for the project.

(c) (1) The State Public Works Board may issue revenue bonds, negotiable notes, or negotiable bond anticipation notes pursuant to Chapter 5 (commencing with Section 15830) of Part 10b of Division 3 of Title 2 to finance the acquisition of land and facilities for the purposes of this section. The State Public Works Board and the Department of General Services may borrow funds for project costs from the Pooled Money Investment Account pursuant to Sections 16312 and 16313. In the event the bonds authorized by the project are not sold, the Department of General Services shall commit a sufficient amount of its support appropriation to repay any loans made for the project from the Pooled Money Investment Account. It is the intent of the Legislature that this commitment shall be included in future Budget Acts until all outstanding loans from the Pooled Money Investment Account are repaid either through the proceeds from the sale of bonds or from an appropriation. In the event the bonds authorized by the project are not sold, it is the intent of the Legislature to appropriate sufficient funds from the General Fund to the Department of General Services specifically to repay any loans made for the project from the Pooled Money Investment Account.

(2) The amount of revenue bonds, negotiable notes, or negotiable bond anticipation notes to be sold may equal, but shall not exceed the cost of acquisition, including land, construction, preliminary plans and working drawings, construction management and supervision, other costs relating to the design and construction of the facilities, and any additional sums necessary to pay interim and permanent financing costs. The additional amount may include interest and a reasonable required reserve fund.

(3) Authorized costs of the facilities, including land acquisition, preliminary plans, working drawings, and construction shall not exceed two hundred eleven million dollars ($211,000,000).

(4) Notwithstanding Section 13332.11, the State Public Works Board may authorize the augmentation of the amount authorized under this paragraph by up to, but not exceeding, 10 percent of the amount appropriated.

(5) The net present value of the cost to acquire and operate the facilities authorized by subdivision (a) may not exceed the net present value of the cost to lease and operate an equivalent amount of comparable office space, including the present facilities, over the same time period. The Department of General Services shall perform this analysis, and shall obtain interest rates, discount rates, and Consumer Price Index figures from the Treasurer.

(d) The Director of General Services may execute and deliver a contract with the State Public Works Board for the lease of the facilities described in this section that are financed with the proceeds of the board’s bonds, notes, or bond anticipation notes issued in accordance with this section.

(e) The Director of General Services shall, not later than 45 days prior to entering into any agreement to construct facilities, as specified in subdivision (a), notify the Chairperson of the Joint Legislative Budget Committee of the pending agreement, including the information specified in paragraph (5) of subdivision (c). It is the intent of the Legislature that the Joint Legislative Budget Committee hold a hearing on the pending agreement.

(Amended by Stats. 1998, Ch. 328, Sec. 12. Effective August 21, 1998.)