Insight

California School District Surplus Property: The Complete 7-11 Committee Guide After AB 130 (2026)

May 20, 2026

How California school districts navigate surplus property, the 7-11 committee process, the Surplus Land Act, and the major AB 130 changes effective 2025 — a complete guide for districts selling or leasing closed schools.

Closing a school is hard. Selling or leasing the empty campus that's left behind is harder. California has one of the most prescriptive surplus property frameworks in the country, and the rules changed materially in 2025 — most existing guidance online is now out of date.

This guide walks every California school district through the full process: when surplus property declarations are required, how to convene a 7-11 committee, what the Surplus Land Act demands after AB 130, how to use sale and lease proceeds, and the specific statutes that govern every decision along the way.

If you are a superintendent, CBO, board member, or facilities director facing a closure or considering monetizing an underused site, this is the reference document.

The big change: what AB 130 did to school district surplus property in 2025

Assembly Bill 130, signed by Governor Newsom on June 30, 2025, removed two longstanding exemptions that California school districts relied on to dispose of property under the Surplus Land Act. This is the single most important regulatory change in this area since the Surplus Land Act became expressly applicable to school districts in 2020.

Before AB 130, surplus property was treated as "exempt surplus land" — bypassing most Surplus Land Act notification requirements — if any of the following applied:

The property had gone through the 7-11 committee process under Education Code 17387 et seq.
The property was being exchanged with another person or entity under Education Code 17536.
The property was being jointly used between a school district and a private entity.

AB 130 eliminated the first two exemptions outright. The 7-11 committee process and property exchanges no longer automatically qualify property as exempt surplus land under the Surplus Land Act. The joint occupancy exemption remained intact, and certain other narrow exemptions — inter-agency transfers necessary for the receiving agency's use and exchanges where the exchanged property is necessary for the agency's work — are still available.

There is one important new exemption that AB 130 introduced for school districts. If the district's governing body formally declares that disposition of the property will be used to invest in or generate revenue that directly furthers the district's educational work or operations, this can qualify as exempt surplus land. Because all school district sale and lease proceeds must legally flow back into facilities or operations, this exemption appears to be broadly available — but it requires a specific written finding adopted by board resolution.

What this means in practice: districts can no longer assume the 7-11 committee process gets them automatically out from under Surplus Land Act notice requirements. Every surplus property transaction now needs a parallel analysis of Surplus Land Act compliance, including the required offers to housing developers and other entities under Government Code 54220 et seq.

When does a California school district have to declare property surplus?

Before any sale, lease longer than 30 days, or rental of district real property, the governing board must determine whether to declare the property surplus. The decision is governed by Education Code sections 17387 through 17391 and 17455 et seq., and triggers a specific procedural sequence.

A district must formally declare property surplus when:

The district intends to sell real property
The district intends to lease real property for longer than 30 days
The property is no longer needed for school district purposes
A closed school site is being considered for non-district use

A 7-11 committee is required for most of these decisions, with three specific exceptions discussed below.

The disposition framework distinguishes between two categories of property:

Property that was used as a school or constructed to be used as a school. This includes closed school sites, former classroom buildings, early childhood education facilities, and similar properties. The full 7-11 committee process applies under Education Code 17388.

Property that was never used as a school and was not constructed to be used as a school. This includes vacant land, maintenance yards, district offices, transportation depots, and similar non-instructional properties. Under SB 820 (2020), a 7-11 committee is optional for these properties — districts may proceed directly to disposition without convening a committee. AB 130 did not change this provision.

What is a 7-11 committee?

The "7-11 committee" — formally known as the District Advisory Committee — is the community body California law requires school districts to appoint before disposing of school real property. The name comes from the committee's required composition under Education Code 17389: not fewer than seven and not more than eleven members.

The 7-11 committee's role is advisory only. The board is not bound by its recommendations. But the committee provides the structured community input that protects the district from legal challenge and political backlash, and its formation is mandatory in most circumstances.

Required committee composition

Education Code 17389 specifies that committee members must be representative of:

The ethnic, age group, and socioeconomic composition of the district
The business community (store owners, managers, supervisors)
Landowners or renters, with preference given to representatives of neighborhood associations
Teachers
Administrators
Parents of students
Persons with expertise in environmental impact, legal contracts, building codes, and land use planning, including knowledge of the zoning and other land use restrictions of the cities and counties in which the surplus property is located

In practice, districts run an application and appointment process. The board adopts a resolution forming the committee, defining its scope of work, and appointing members by formal vote. The appointment process should be documented and the committee composition should demonstrably reflect the statutory criteria.

What a 7-11 committee actually does

Under Education Code 17390, the committee must:

Review projected school enrollment and other data provided by the district to determine the amount of surplus space and real property.
Establish a priority list of acceptable community uses for the surplus space and real property.
Cause appropriate notice to be given to the community as part of its public engagement process.
Hold public hearings to gather community input.
Make a final determination of limits of tolerance for use of the space and real property.
Forward a report to the board recommending uses of the surplus space and real property.

The committee must follow all Brown Act requirements. Meetings must be noticed at least 72 hours in advance, agendas must be posted, and public comment must be permitted.

The committee process typically takes four to six months from formation to final report. Districts that try to compress this timeline often produce reports that are vulnerable to legal challenge.

The three exceptions to the 7-11 committee requirement

Three narrow exceptions allow a district to skip the 7-11 committee process:

Exception 1 — Property never used as a school. Under SB 820 (2020), if the property has not previously operated, and was not constructed to operate, as a K-12 school or early childhood education facility, the 7-11 committee is optional. This applies to vacant land, maintenance yards, district offices, and similar properties.

Exception 2 — Lease to a private summer school. Under Education Code 17391, leases of surplus property to private summer schools are exempt from the 7-11 committee requirement.

Exception 3 — Teacher and district employee housing. AB 1157 (effective January 1, 2018) exempted surplus property declarations for properties to be used for teacher or district employee housing from the 7-11 committee requirement. The exemption was added in response to California's housing affordability crisis.

If none of these exceptions applies, the 7-11 committee is mandatory.

The Surplus Land Act layer (and what AB 130 changed)

Even after the 7-11 committee process is complete, school district surplus property dispositions must comply with California's Surplus Land Act (Government Code sections 54220 et seq.). The Act became expressly applicable to school districts in 2020.

The Surplus Land Act requires local agencies — including school districts — to:

Declare the property as either "surplus land" or "exempt surplus land" by formal board action in a public meeting.
For "surplus land," issue a notice of availability to specified housing sponsors, including affordable housing developers, in addition to other public agencies.
For "exempt surplus land," make written findings explaining why the property qualifies for exemption and submit those findings to the California Department of Housing and Community Development (HCD) at least 30 days prior to disposition, per HCD's April 2021 guidelines.
Notify the local city or county planning agency if the local agency has adopted a general plan affecting the area.
Conduct good-faith negotiations for any entity that responds to the notice of availability.

After AB 130, the path to "exempt surplus land" classification is narrower than it used to be. Districts that previously relied on the 7-11 committee process or property exchange exemptions to bypass Surplus Land Act notice requirements now need a different exemption — most commonly the new exemption for property dispositions where proceeds will directly further the district's work.

The practical answer for most districts: build the Surplus Land Act analysis into the 7-11 committee process in parallel. The committee evaluates community uses; district counsel evaluates SLA compliance. Both tracks need to be complete before the board can act on a disposition.

The Naylor Act: a separate offer requirement

Education Code 17485 through 17489 — collectively known as the Naylor Act — imposes an additional layer of requirements when surplus property includes outdoor recreational space.

The Naylor Act applies when all or a portion of the property is used for school playground, playing field, or other outdoor recreational purposes, or is open-space land particularly suited for recreational purposes. When triggered, the district must offer the recreational portions in priority order:

First priority to any city within which the land is situated
Second priority to any park or recreation district within the area
Third priority to any regional park authority with jurisdiction
Fourth priority to any county within which the land is situated

Each eligible entity has 60 days to respond after receiving written notification from the district. The Act limits the price at which the recreational portions can be sold — generally at a fraction of fair market value — to ensure recreational uses remain affordable to public agencies.

Districts can seek a waiver of Naylor Act requirements from the California Department of Education in specific circumstances. The waiver process is its own discipline and typically requires district counsel involvement.

Statutory offer process to other public agencies

In addition to the Naylor Act, Education Code 17464 requires districts to offer surplus property to other specified public agencies before offering it to the general public.

SB 820 simplified the statutory offer process. Districts may now make a simultaneous offer to all applicable entities, rather than offering in a strict priority sequence. The applicable entities typically include:

Other school districts in the area
The county office of education
The Director of General Services (for state agencies)
California universities
The city and county in which the property is located
Park and recreation departments
Specified housing entities under the Surplus Land Act

If none of the notified entities responds within the statutory window, the district may proceed to sell or lease the property to the general public.

What can a school district do with the proceeds?

This is where most district decisions get complicated. The rules governing how surplus property proceeds can be spent are restrictive, and the consequences of using funds in the wrong category can include forfeiting state facilities funding eligibility for multiple years.

Default rule: proceeds go to capital outlay or maintenance

Under Education Code 17462, proceeds from a sale or lease-with-option-to-purchase of school district property must generally be deposited into one of two restricted funds:

The Special Reserve Fund for Capital Outlay. Used for facility construction, modernization, land acquisition, and related capital expenditures.

A restricted maintenance fund for routine repair of district facilities for up to five years, as defined by the State Allocation Board.

Salaries and benefits cannot be paid from surplus property proceeds. This is a hard line.

The general fund exception under Education Code 17462

A district can deposit surplus property sale or lease-with-purchase-option proceeds into the general fund if both of the following are true:

The school district governing board and the State Allocation Board determine that the district has no anticipated need for additional sites or building construction for the ten years following the sale or lease.
The district has no major deferred maintenance requirements.

Districts using this option are prohibited from participating in any State Allocation Board–administered programs for five years following the transfer. This includes School Facility Program new construction and modernization grants — the largest source of state facilities funding. The forfeiture period was previously longer; current law sets it at five years.

The Education Code is explicit that general fund proceeds must be used for one-time expenditures. Recurring costs — salaries, benefits, general operating expenses — are prohibited.

The expanded flexibility under Education Code 17463.7

Education Code 17463.7 was revived through SB 98 in 2020 in response to COVID-19 fiscal stress. The original 17463.7 sunset in January 2016; SB 98 brought it back. SB 820 (September 2020) further refined it.

Under 17463.7, school districts could deposit surplus property proceeds — including from sales and from leases with an option to purchase — into the general fund for one-time purposes without the ten-year and deferred maintenance restrictions of 17462. The trade-off: the State Allocation Board reduces any financial hardship apportionment by the amount of the general fund expenditure.

The 17463.7 flexibility had an inoperative date of July 1, 2024. Districts that initiated sale or lease transactions before June 30, 2024 may still use proceeds received after that date under the 17463.7 framework, but new transactions initiated after June 30, 2024 fall back to the 17462 framework.

This is a significant change. Districts that began surplus property processes during the COVID-era flexibility window have different rules than districts starting fresh in 2026.

Traditional leases without purchase options

One important distinction: ongoing rental income from traditional leases — without options to purchase — is generally not subject to the 17462 use restrictions. A district that leases a closed school site to a private school for an annual rent stream may treat that revenue with more flexibility than a sale or lease-with-purchase-option.

This is why so many districts with closed sites have shifted from sale strategies to long-term lease strategies. Pasadena Unified's Burbank Elementary site, for example, is leased to a private school at $1.2 million annually — generating ongoing operating revenue without the use restrictions that would apply to sale proceeds.

The committee report and board action

After the 7-11 committee completes its work, it forwards a report to the board recommending uses of the surplus property. The board considers the committee's recommendations — which are advisory and not binding — and then takes formal action.

If the board decides to lease the property, Education Code requires a resolution adopted at a regular open meeting declaring the intent to lease by a two-thirds vote of all board members. If the board decides to sell, the resolution process is similar but governed by different sections.

The board's resolution should:

Describe the property to be declared surplus
Declare the property as either "surplus land" or "exempt surplus land" under the Surplus Land Act
Make any required Surplus Land Act findings (especially after AB 130)
Authorize statutory offers to other public agencies
Adopt the plan for use of proceeds, if invoking Education Code 17462 or 17463.7
Authorize district staff to proceed with the disposition

After the resolution, district staff issue the required notices, conduct any required appraisals, and manage the disposition process. Appraisals must comply with the Uniform Standards of Professional Appraisal Practices as promulgated by the Appraisal Standards Board.

CEQA and environmental considerations

A sale or lease of surplus property may trigger review under the California Environmental Quality Act. The general standard is that disposition is exempt from detailed CEQA review if it can be said with certainty that there is no possibility the transaction will have a significant environmental effect.

If the property's prospective use will result in significant changes — new construction, change of use, demolition — CEQA review may be required for the underlying project, though the disposition itself may remain exempt.

Districts should not assume CEQA does not apply. The right time to evaluate is during the 7-11 committee process, with the option to adopt a Notice of Exemption simultaneously with the disposition resolution if appropriate.

A defensible disposition timeline

For a district considering disposition of a closed school site, the realistic timeline:

Months 1-2 — Pre-committee planning. Board adopts resolution forming the 7-11 committee with defined scope. Member application and appointment. Legal counsel review of property history, appraisal initiation, Surplus Land Act analysis begins.

Months 3-6 — Committee work. Four to six public meetings. Community input gathered. Site visits. Review of enrollment projections and facility data. Naylor Act analysis if recreational property is involved.

Month 7 — Committee report and board consideration. Final committee report submitted. Board reviews and decides whether to declare property surplus.

Months 8-9 — Statutory offers and Surplus Land Act notice. Simultaneous offers to all applicable public agencies. Surplus Land Act notice of availability to housing sponsors. Sixty-day response windows run in parallel.

Months 10-12 — Negotiations and disposition. Negotiations with responding entities or, if none respond, marketing to general public. Board action to approve final sale or lease. Recording and close.

A complete disposition typically takes twelve to fifteen months. Districts often underestimate the time required.

Frequently asked questions

What is a 7-11 committee in California school districts?

A 7-11 committee is the District Advisory Committee that California school districts must appoint, under Education Code 17387 et seq., before selling or leasing real property for longer than 30 days. The name comes from the required composition of not fewer than seven and not more than eleven community members. The committee's role is advisory: it reviews the property, gathers community input, and recommends uses to the board.

Can a California school district sell a closed school?

Yes, but the disposition must follow a specific statutory process. The board must convene a 7-11 committee (unless an exemption applies), comply with the Surplus Land Act including required offers to housing sponsors and other public agencies, comply with the Naylor Act if recreational property is involved, and follow Education Code 17455 et seq. governing sale or lease procedures. The process typically takes twelve to fifteen months.

What is exempt surplus land for a California school district?

Exempt surplus land is property that qualifies for an exemption from the standard Surplus Land Act notification requirements under Government Code 54221(b). After AB 130 (effective 2025), the exemptions previously available based on the 7-11 committee process or property exchanges were removed. A new exemption was added for property dispositions where proceeds will directly further the district's work — which appears broadly available to school districts. Joint occupancy and certain inter-agency transfer exemptions remain.

Can a school district use surplus property proceeds for the general fund?

Yes, under specific conditions. Education Code 17462 allows general fund use only if the district has no anticipated facility construction need for ten years and no major deferred maintenance requirements, and the district is barred from State Allocation Board–administered programs for five years afterward. Education Code 17463.7 (active for transactions initiated before June 30, 2024) allowed more flexible one-time general fund use with reduced consequences. Salaries and ongoing operating costs cannot be paid from surplus property proceeds.

What is the Naylor Act?

The Naylor Act, found in Education Code 17485 through 17489, requires school districts to offer outdoor recreational portions of surplus property to specified public agencies — cities, park districts, regional park authorities, and counties — in a priority order, at limited prices, before disposing to the general public. Districts can seek a waiver of Naylor Act requirements from the California Department of Education in specific circumstances.

Does a 7-11 committee have to be formed for vacant land or a district office?

No. Under SB 820 (2020), the 7-11 committee process is optional for surplus property that has not previously operated, and was not constructed to operate, as a K-12 school or early childhood education facility. This applies to vacant land, maintenance yards, district offices, and similar non-instructional properties. AB 130 did not change this provision.

How long does the 7-11 committee process take?

A complete 7-11 committee process — from formation to final report — typically takes four to six months. Compressed timelines produce reports that are vulnerable to legal challenge.

Are 7-11 committee recommendations binding on the school board?

No. The committee's recommendations are advisory only. The board may accept, modify, or reject the committee's recommendations. However, boards that depart significantly from committee recommendations should document their rationale carefully to protect against legal and political challenges.

Does the 7-11 committee process satisfy the Surplus Land Act after AB 130?

No longer. Before AB 130 (signed June 30, 2025), going through the 7-11 committee process exempted the property from most Surplus Land Act notice requirements. AB 130 removed that exemption. Districts must now run the Surplus Land Act analysis in parallel with the 7-11 committee process and identify which other SLA exemption — if any — applies.

What is the difference between selling and leasing surplus school property?

The procedural requirements are largely the same — both require 7-11 committee review (if applicable), Surplus Land Act compliance, and statutory offers. The financial treatment differs. Sale proceeds and lease-with-option-to-purchase proceeds are subject to Education Code 17462 use restrictions. Pure lease income — without a purchase option — is generally not subject to the same restrictions and can flow more flexibly into district operations. This is why many districts with closed schools prefer long-term leases over sales.

Can a school district sell surplus property to a charter school?

Yes, but the disposition is subject to the same 7-11 committee, Surplus Land Act, Naylor Act, and statutory offer processes that apply to any other buyer. Charter schools do not have automatic priority over other public agencies in the statutory offer sequence.

Three questions for your board

Before initiating any surplus property process, three governance questions deserve direct answers:

Do we understand the post–AB 130 framework? If your last surplus property transaction predates June 30, 2025, your institutional muscle memory is based on rules that no longer apply.
What is our intended use of proceeds, and have we mapped the consequences? General fund use under Education Code 17462 costs the district five years of State Allocation Board program eligibility — including Prop 2 access. That trade-off should be conscious, not accidental.
Have we built a defensible timeline? Fifteen months from board action to disposition is typical. Boards that try to compress to six months produce records vulnerable to legal challenge.

School Leaders supports California school districts through 7-11 committee processes, Surplus Land Act compliance, Naylor Act analysis, and surplus property disposition strategy — from initial closure analysis through final disposition. We work alongside boards, superintendents, CBOs, and district counsel to maximize property value while protecting state funding eligibility.

Contact our team for a confidential conversation about your district's surplus property strategy.