Redevelopment agency battle returns to court

September 26, 2012

The California law banning redevelopment agencies faces another challenge in court.

The League of California Cities announced Monday that it filed a lawsuit in Sacramento County Superior Court against the state Department of Finance, Board on Equalization and Controller on the grounds that implementation of AB 1484 is unconstitutional.

AB 1484, signed into law by Governor Jerry Brown in June, 2011, called for the dismantling of community redevelopment agencies and the transfer of their funds back to the state to close the budget deficit. The California Supreme Court upheld the law last December, so the league is not seeking to eradicate it, but rather curtail its implementation and help communities recover some funds.

Executive Director Chris McKenzie says the implementation of AB 1484 is unconstitutional due to the power it gives the state to withhold money from cities for public safety and basic services, as protected by voter approved Proposition 1A (2004) and Proposition 22 (2010). The League of California Cities was one of the primary backers of Proposition 22.

San Luis Obispo County cities have lost millions in the dismantling of redevelopment agencies. Arroyo Grande, in particular, faces financial hardships. Standard & Poor’s downgraded Arroyo Grande’s credit rating last month from an A- to BBB due in part to its failure to set aside funds to compensate for the cash flow lost from its folded redevelopment agency.


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11 Comments

  1. SLOBIRD says:

    Actually, this was a pure and simple raid on Cities = it is called redistribution! Take from the cities and give to the schools because money dedicated to the redevelopment agency was removed from the tax base and therefore schools lost out because as a rule these agencies built up an area where commerical downturn has taken a hit. BUT, wait, now that the State has the money they are going to reinvent redevelopement agencies and the new term is ” Infrastructure financing districts” which means a city can sell bonds and then use it’s property tax to pay them off.

    There is never going to be enough money for schools because the schools are failing in all aspects. We know that knows are not there for the students, just look at the situation in Cambria. Understand they will take a “hit” if the Cayucos kids go to Morro Bay, but is this about what is the best for the stuents or is it for the cambria school district. My vote if, has been, and will always be what is best for the kids. The time spent traveling, the connecting to their friends in Morro Bay, after school activities (sports, dances, etc.) should be the key in making this better for the students. Parents currently are having to hide, lie and act like criminals to make the best decisions for their kids which is the right thing to do. Let the superintendent of Cambria fire his wife, put his kids back on low income status so the schools can get extra money, and take a pay cut and then you can allow the students of Cayucos have the better choice – their choice, not yours…

    (6) 8 Total Votes - 7 up - 1 down
    • BeenThereDoneThat says:

      AMEN about the kids. Unforunately they always take a back seat to politics.

      Yea the Cambria thing is a JOKE!! What a waste of time and gas to drag your kids fifteen miles out of the way, rather than drive three miles. Only a bureaucrat could come up with that kind of stupidity!!

      (8) 10 Total Votes - 9 up - 1 down
  2. kayaknut says:

    So if CA cities fail at balancing their budgets and living within their means, then go to court instead of changing the tax and spend mentality that got them into the mess they created

    (9) 9 Total Votes - 9 up - 0 down
    • BeenThereDoneThat says:

      While I agree that I don’t like the tax and spend mentality when it comes to Gov. on this one your arguement is skewed.

      This isn’t a case of spending and taxing more. A Redevelopment Agency is usually formed to help fix blight in a city. Here in Paso, I remember when they formed it back in the early ninties. The down town core was DEAD. I remember when they closed 11th street through from Pine to Railroad to make extra space for the Theater. I remember when it helped get the old meat packing plant behind Albertson’s taken down. It has done this and MANY more. In return the city keeps some of the taxes that would have gone to Sacremento, here local for up to fifty years to pay for the improvements.

      They (cities) are NOT taxing more. They are NOT spending more. They are helping to attract business by giving some tax breaks and cleaning up areas to help get them here. I don’t see anything negative about them in this case.

      To your point, it was Sacremento not balanceing their books as usual and rather than do their job, they did what they have been doing for the last twenty years. Robbing counties and cities of their tax basis that go WAY back, to help pay the states bills. THAT is where your arguement should be.

      (0) 6 Total Votes - 3 up - 3 down
      • kayaknut says:

        While I’ll agree the idea of a Redevelopment Agency was a good thing many cities abused it and used the money in questionable deals. I have to think this part of the reason Brown wanted to eliminate them, that and Brown has the same tax and spend mentality and will do anything to get more money instead of spending less. Once again and good idea was destroyed when elected and appointed offcials failed, on all levels, and abused something and it got to the point they either couldn’t or didn’t want to return it to it’s original intent.

        (11) 11 Total Votes - 11 up - 0 down
        • BeenThereDoneThat says:

          I do agree that abuse always seems to ruin things. I have heard mudderings of it not working else where. That’s to bad, because here in S.L.O. County I think it was doing well and no signs of abuse from what I could see.

          (-4) 6 Total Votes - 1 up - 5 down
          • SLOBIRD says:

            Well, “…no signs of abuse from what I could see.” is not exactly true. What has happened in most agencies using this process, which in theory is a good idea, is the abuse that has occurred. For those in the know, our financial is several years in play now (8 to 10) and as this was happening government stated to get very “creative”. San Luis passed a sales tax increase on a song and dance for capital and community programs and while $15 M or more has come in on this tax, no great projects have been done. Atascadero started collecting money from the redevelopment agency to pay salaried/expenses for Council members and City employees, and actually this was happening almost to every City that has a redevelopment agency. San Diego was probably the worst in this corruption. If there is anything good that a government program can do it doesn’t take long before it becomes corrupt which is the biggest problem we have today – CORRUPTION!!!!

            (5) 5 Total Votes - 5 up - 0 down
            • BeenThereDoneThat says:

              Notice I said from what I can see. I.e. I hadn’t read anything. NEVER stated that it was true or not.

              Where is it that you got your information on Atasacadero? I read that they used Redev. money to help get the theater off the ground over by highway 41 but must have missed the use of monies elsewhere, i.e. salaries???

              (-2) 2 Total Votes - 0 up - 2 down
          • kayaknut says:

            Though I don’t know all the details Grover Beach was trying what appeared to be a questionable deal. They were trying to sell a piece of city property for redevelopment to plug a hole in their budget instead of fxing the budget by itself. Plus the figures on the property price looked iffy when based on true land values, the priced to be paid seemed high but city officials didn’t have a problem with it because it was going to be redevelopment money and not “real” tax dollars. Weren’t there also rumblings in Atascadero with it’s use of redevelopment money?

            (3) 3 Total Votes - 3 up - 0 down
            • photocal says:

              Last I heard….. Atascadero mis spent about $13,000,000.00 of FEMA grant funds.

              (3) 3 Total Votes - 3 up - 0 down
              • photocal says:

                Its now the 27th of September…. and this morning We find the City of Atwater is bankrupt…. is this surprizing ? I think Atascadero is just waiting in line to file ? How long can they hide the problems ?

                (1) 1 Total Votes - 1 up - 0 down

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