A recent decision of the California Court of Appeal may make your private development a “public work” if you get any government support, such as the proceeds of bonds from community facilities districts — often referred to as Mello-Roos bonds.
In the recent case of Azusa Land Partners v. Department of Industrial Relations, the court held that an entire 1,200-unit housing tract is a “public work” under California’s prevailing wage law because the proceeds of the Mello-Roos bonds would be used to pay for some of the public infrastructure. The court required that prevailing wages be paid for all of the public infrastructure, whether or not funded by the Mello-Roos bonds.
The applicability of prevailing wages to private development projects has been uncertain since 2001, when parts of the statutory definitions were revised. Although Azusa Land arose in the context of prevailing wages, the court’s premise that “public” money transforms a private development into a “public work” could affect everything from reimbursement agreements to due process obligations.
Richard Schulman, a land use partner at HechtSolberg, will be a panelist at a special seminar sponsored by the Building Industry Association of San Diego on February 17, 2011, discussing how the Azusa Land decision affects private developments. If you are interested in attending this event, contact Karla Valeri of the BIA at 858.514.7026.
For specific questions concerning the effect of the Azusa Land decision on your projects, you may reach Richard Schulman at 619.239.3444.