Government Code section 54236
(a)
As used in this article, the term “offer” means to solicit proposals prior to sale in a manner calculated to achieve a sale under the conditions specified, and to hold the offer open for a reasonable period of time, which shall be no more than one year, unless the time is extended by the selling agency at its discretion, for a period to be specified by the selling agency.(b)
As used in this article, the term “affordable price” means, the price for residential property for which the purchaser’s monthly payments will not exceed that portion of the purchasing household’s adjusted income as determined in accordance with the regulations of the Department of Housing and Community Development pursuant to subdivision (b) of Section 50052.5 of the Health and Safety Code.(c)
As used in this article, the term “single-family residence” means a real property improvement used, or intended to be used, as a dwelling unit for one family.(d)
(1)As used in this article, the term “surplus residential property” means land and structures owned by any agency of the state that is determined to be no longer necessary for the agency’s use, and that is developed as single-family or multifamily housing, except property being held by the agency for the purpose of exchange.(2)
Surplus residential properties shall only include land and structures that, at the time of purchase by the state, the state had intended to remove the residences thereon and to use the land for state purposes.(e)
As used in this article, the term “displacement” includes, but is not limited to, persons who will have to move from surplus residential property that they occupy when it is sold by a state agency because they are unable to afford to pay the price that the state agency is asking for the residential property.(f)
As used in this article, the term “fair market value” shall mean fair market value as of the date the offer of sale is made by the selling agency pursuant to the provisions of this article and shall reflect the existing “as is” condition of the property, taking into account any repairs required to make the property safe and habitable. This definition shall not apply to terms of sale that are described as mitigation measures in an environmental study prepared pursuant to the Public Resources Code if the study was initiated before this measure was enacted.(g)
As used in this article, the term “affordable rent” means, in the case of an occupant person or family, other than a person or family of low or moderate income, rent for residential property that is not more than 25 percent of the occupant household’s gross monthly income, and in the case of an occupant person or family of low or moderate income, rent for residential property that is not more than the percentage of the adjusted income of the occupant person or family as permitted under regulations of the United States Department of Housing and Urban Development issued pursuant to Section 8 of the United States Housing Act of 1937, but not in excess of the market rental value for comparable property.(h)
As used in this article, the term “area median income” means median household income, adjusted for family size as determined in accordance with the regulations of the United States Department of Housing and Urban Development issued pursuant to Section 235 of the National Housing Act, as amended (Public Law 90-448), for the standard metropolitan statistical area (SMSA), in which surplus residential property to be disposed of pursuant to this article is located, or the county in which the property is located, if it is outside an SMSA.(i)
As used in this article, the term “persons and families of low or moderate income” means persons and families who meet both of the following conditions:(1)
Meet the definition of persons and families of low or moderate income set forth in Section 50093 of the Health and Safety Code.(2)
Have not had an ownership interest in real property in the last three years.(j)
As used in this article, the term “lower income households” means lower income households as defined in Section 50079.5 of the Health and Safety Code.(k)
(1)As used in this article, the term “condition-adjusted price of the fair market value” means the fair market value of the property as of October 13, 2019, as determined by an independent appraiser, and as adjusted as provided in this subdivision. The condition-adjusted fair market value shall be offered for properties for which the sale has not completed.(2)
The appraiser shall adjust the fair market value of the property as of October 13, 2019, to reflect both of the following:(A)
The existing “as is” condition of the property. In determining the existing “as is” condition of the property, the appraiser shall also make adjustments to the valuation that reflect the property’s condition as of October 13, 2019, taking into account deterioration, including deterioration of major structural building components or building systems, defects, deferred or lack of maintenance and other conditions existing as of that date affected the habitability of the structure or the market value of the property. The appraiser may use as a guide an inspection report based on an inspection of the property and other reasonably available evidence concerning the property’s condition as of October 13, 2019. The department shall provide any inspection report and relevant property condition records in its possession to the appraiser.(B)
(i)Standardized depreciation to major structural components or building systems shown to have materially deteriorated since October 13, 2019, according to a standardized depreciation schedule or based on an inspection of the property for material deterioration occurring after October 13, 2019.(ii)
Standardized depreciation shall be calculated using a standardized useful-life and depreciation schedule established by the department for major structural components and building systems. A methodology used for state or federal tax purposes shall not, by itself, establish the amount of an adjustment pursuant to this paragraph. In the development of regulations to implement this section, the department shall consult with and solicit comments from the cities of Los Angeles, Pasadena and South Pasadena and consider any written recommendations or comments submitted by those cities.(3)
The inspections performed under this article shall be performed by a state licensed general contractor or a certified home inspector, if the inspector is also a general contractor.(4)
The cost of the appraisal and the inspection, including the inspection report, shall be borne by the selling agency.(5)
The tenant may obtain their own appraisal and inspection at the tenant’s cost. The inspection shall be performed by a state licensed general contractor or a certified home inspector, if the inspector is also a general contractor. If the tenant submits an appraisal or inspection to the department, the department’s review appraiser shall consider its findings in reviewing and approving the final valuation. If the department’s final valuation materially differs from the tenant’s appraisal or inspection findings, the department shall provide the tenant with a written explanation identifying the material differences and the basis for the department’s determination.(6)
This subdivision applies to a sale that has not completed on the operative date of the act adding this paragraph. A purchaser under an executed sales contract or in an open escrow may elect to have the purchase price recalculated pursuant to this subdivision by providing written notice to the department within 30 days after receiving notice of that right. This subdivision does not reopen a sale for which the sale has completed.(l)
As used in this article, the term “workforce housing” means housing for persons and families whose household income is between 121 percent and 180 percent of the area median income, and shall be rented or sold at the workforce housing price as further described in the guidelines. For-sale units shall have a regulatory agreement requiring a workforce housing sales price or workforce housing rent for a minimum of 55 years for rental and 45 years for owner-occupied workforce housing.(m)
As used in this article, the term “guidelines” means regulations adopted by the legislative body of the city to implement the rental or sale of workforce housing. The guidelines shall include, but not be limited to, provisions related to establishing the parameters for eligibility of persons and families to rent or purchase workforce housing, the determination of rents and sales prices, the monitoring of workforce housing, restrictions regarding the use, resale, transfers, and refinancing related to for-sale units and any other provisions to implement the workforce housing program.
Source:
Section 54236, https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=GOV§ionNum=54236. (updated Sep. 30, 2026; accessed Oct. 5, 2026).
