(a)  If all, or a substantial portion, of the territory included within a project area selected pursuant to Section 33322 or 34004 is subsequently annexed to a city or included within the boundaries of a new city, the territorial jurisdiction of the creating agency over all, or a substantial portion, of the territory in that project area may be transferred from the creating agency to the receiving agency pursuant to this section. If all, or a substantial portion, of the noncontiguous territory of a project area of a creating agency is subsequently annexed to a city or included within the boundaries of a new city, the jurisdiction of the creating agency over all, or a substantial portion, of the noncontiguous territory may be transferred to the receiving agency pursuant to this section.

(b)  The transfer of territorial jurisdiction described in subdivision (a) is not effective unless all of the following occur:

(1)  The creating agency and the receiving agency enter into the agreement described in subdivision (c), and their respective legislative bodies both adopt a resolution approving that agreement.

(2)  The legislative body of the receiving agency adopts, or has adopted, both of the following ordinances:

(A)  An ordinance pursuant to Section 33101 declaring the need for an agency to function in the city.

(B)  An ordinance adopting the same redevelopment plan for the project area that was previously adopted by the legislative body of the creating agency.

(c)  The agreement required to be entered into between the creating agency and the receiving agency pursuant to paragraph (1) of subdivision (b) shall contain all of the provisions described in paragraphs (1), (2), (3), and (4), and may contain the provisions described in paragraphs (5) and (6):

(1)  A provision specifying that all of the territory included within the project area is transferred from the creating agency to the receiving agency, or a provision specifying the portions of the project area over which each agency will have territorial jurisdiction.

(2)  (A)  If all of the territory included within the project area is transferred from the creating agency to the receiving agency, a provision for the allocation of all of the taxes payable from the project area pursuant to subdivision (b) of Section 33670 to the receiving agency.

(B)  If a substantial portion of the territory included within the project area is transferred from the creating agency to the receiving agency, a provision for the allocation of taxes payable from the project area pursuant to subdivision (b) of Section 33670 between the receiving agency and the creating agency. That allocation of taxes shall be reasonably related to the costs that the community of the creating agency and the community of the receiving agency expect to incur in carrying out the redevelopment plan and the outstanding indebtedness that the creating agency has incurred in carrying out the redevelopment plan. That indebtedness shall include repayment of expenditures to, or on behalf of, the redevelopment project area from other resources or borrowing of the creating agency. That allocation of taxes may differ from the allocation that would have been made if the portion of the project area under the territorial jurisdiction of the creating agency and the portion of the project area under the territorial jurisdiction of the receiving agency had been separate project areas at the time of adoption of the redevelopment plan by the legislative body of the creating agency.

(3)  A requirement that all taxes payable from the project area pursuant to subdivision (b) of Section 33670 that are allocated to the receiving agency, as required by subparagraph (B) of paragraph (2), shall be available if necessary to pay any indebtedness incurred by the creating agency prior to the effective date of the transfer of jurisdiction in connection with the project area and the redevelopment plan if that indebtedness was secured by the taxes payable from the project area pursuant to subdivision (b) of Section 33670.

(4)  If a substantial portion of the territory included within the project area is transferred from the creating agency to the receiving agency, a requirement that any amendment to the redevelopment plan for that portion of the territory of the project area under the jurisdiction of the creating agency shall, in addition to any other requirements under this part, be approved by an ordinance adopted by the legislative body of the receiving agency, and that any amendment to the redevelopment plan for that portion of the territory of the project area under the jurisdiction of the receiving agency shall, in addition to any other requirements under this part, be approved by an ordinance adopted by the legislative body of the creating agency.

(5)  If a substantial portion of the territory included within the project area is transferred from the creating agency to the receiving agency, a provision permitting the creating agency to undertake activities to implement the redevelopment plan in portions of the project area under the territorial jurisdiction of the receiving agency or for the receiving agency to undertake activities to implement the redevelopment plan in portions of the project area under the territorial jurisdiction of the creating agency.

(6)  Any other terms and conditions that the creating agency, the receiving agency, or their respective legislative bodies mutually determine to be necessary or desirable to facilitate the transfer of territorial jurisdiction over all, or a substantial portion, of the project area and the implementation of the redevelopment plan.

(d)  The effective date of the transfer of territorial jurisdiction is the first day of the fiscal year that begins following the effective date of the resolution adopted pursuant to paragraph (1) of subdivision (b), or the effective date of the later enacted of the ordinances adopted pursuant to paragraph (2) of subdivision (b), whichever date is later.

(e)  On and after the effective date of the transfer of territorial jurisdiction:

(1)  Except as otherwise provided by the agreement entered into pursuant to paragraph (1) of subdivision (b), the receiving agency and its legislative body shall have all of the rights, powers, and responsibilities provided by this part with respect to all, or the portion, of the project area for which the territorial jurisdiction has been transferred to the receiving agency and with respect to all, or the portion, of the redevelopment plan for all, or that portion, of the project area.

(2)  The debts and any other obligations of the creating agency or its legislative body in connection with the project area, or a substantial portion of the project area transferred to the receiving agency, as the case may be, or the redevelopment plan for that project area, or portion of the project area, shall be assumed by the receiving agency.

(3)  For the purposes of this part, including Section 33670, the redevelopment plan for all, or a substantial portion, of the project area for which territorial jurisdiction is transferred from the creating agency to the receiving agency pursuant to this section shall be considered to have been adopted by the legislative body of the receiving agency on the date the redevelopment plan was originally adopted by the legislative body of the creating agency.

(Amended by Stats. 2000, Ch. 610, Sec. 4. Effective January 1, 2001.)