Section 2003 - Rent or Other Consideration(a) Rent or other consideration for the various categories of uses shall be in the best interest of the State and may be based on one or more of the following methods: (1) 9% of the appraised value of the leased land;(2) A percentage of annual gross income (the percentage being based on an analysis of the market for like uses and other relevant factors);(3) Comparison to rents for other similar land or facilities;(4) $0.05 per diameter inch per lineal foot of pipeline, conduit, or fiber optic cable;(5) Benchmarks for regions where there are large concentrations of similar facilities (benchmark rental rate to be based on analysis of similar or substitute facilities in the local area);(6) For salvage permit operations, the Commission shall agree to a division of the net value of State-owned objects recovered by the permittee, after a deduction of reasonable salvage cost. The percentage of the net value of State-owned objects retained by the Commission shall be based on the complexity of the project and may be negotiated. The State retains ownership of all items recovered until released and has a first right to select objects and may retain any or all of the objects recovered. If the State elects to retain objects with a value greater than its agreed percentage share, it shall reimburse the permittee to the extent of the agreed division of value;(7) For archaeological permits, artifacts collected shall remain State property, except that the Commission may authorize the transfer of title to artifacts for the purposes of research or display to museums, educational institutions, or other appropriate locations available to the public, or to a culturally affiliated Native American tribe;(8) For Forest Management Agreements: Rent may constitute enhancement of the land's value resulting from the use;(9) Other such methods or information that are based on commonly-accepted appraisal practices and principles;(10) For leases for a recreational pier or buoy, rent shall be based on local conditions and local fair annual rental values;(b) Notwithstanding section (a) above, minimum annual rents for the various lease/permit categories shall be as follows:(1) Commercial Use: $600;(2) Industrial Use: $600;(3) Right of Way Use: $450;(8) Protective Structure: $125;(10) All other General Lease or Permits: $125.(c) Effective July 1, 2014, the minimum annual rents for the various lease/permit categories will be recalculated every five (5) years, at the end of June, using the adjustment formula identified in section 1900(m). Regardless of whether the application of the Adjustment Formula results in an adjusted minimum annual rent that is greater or lesser value than the previous year's rent, the adjusted minimum annual rent will never be lower than the minimum annual rents set in section 2003(b).(d) The following may be considered by the Commission in determining which rent method should apply: (1) The amount of rent the State would receive under various rental methods;(2) Whether relevant, reliable and comparable data is available concerning the value of the land proposed to be leased;(3) Whether a particular method or amount of rent would effectively cause an applicant to use more competitive substitute land or to abandon its project altogether;(4) Whether the land proposed to be leased has been classified as having significant environmental value pursuant to Public Resources Code Section 6370.2 and Title 2, California Code of Regulations, Section 2952;(5) The monetary value of actual or potential environmental damage anticipated from an applicant's proposed use to the extent such damage is quantifiable;(6) The appropriateness of the proposed rental method.(e) Other factors in determining rent or other consideration: (1) Authority for rent adjustment during the lease term shall be provided and may include application of the California Consumer Price Index.(2) Lease areas may include a reasonable impact area beyond the footprint of the actual facilities or improvements occupying State land, based on local conditions. Rent may be charged only for those impact areas directly associated with the docking and mooring of vessels, such as catwalks, boat hoists, and cleats, or where public access or use is clearly restricted by the facilities. The Commission may consider the seasonal use and other local conditions when establishing the impact area and rent for that impact area.(3) In addition to the annual rent or other consideration, for General Lease -- Commercial Use, Industrial Use, and Right-of-Way Use, the Commission may require the lessee/permittee to pay an annual administrative fee for the reimbursement of staff costs associated with, but not limited to, lease/permit compliance; enforcement; periodic rent reviews, insurance or surety review; or other such activities as may be reasonably required over the term of the lease/permit. The annual administrative fee may be charged as either a flat rate or as a percentage of the rent.(4) Rent may be discounted or waived for use of sovereign lands if the Commission, at its sole discretion, determines that a significant regional or statewide public benefit is provided or accrues from such use.Cal. Code Regs. Tit. 2, § 2003
1. Editorial correction of printing error in subsection (a) (Register 92, No. 22).
2. Amendment of section heading, section and NOTE filed 3-10-2014; operative 7-1-2014 (Register 2014, No. 11). Note: Authority cited: Sections 6105, 6108, 6218, 6309, 6321.2, 6503 and 6503.5, Public Resources Code. Reference: Sections 6218, 6321.2, 6503 and 6503.5, Public Resources Code.
1. Editorial correction of printing error in subsection (a) (Register 92, No. 22).
2. Amendment of section heading, section and Note filed 3-10-2014; operative 7-1-2014 (Register 2014, No. 11).