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Cities Look to the Sacramento County Superior Court for Relief from State Redevelopment Money Grab

January 11, 2013

The Sacramento County Superior Court has been flooded since last summer with challenges to AB 1484 (2012), the redevelopment agency dissolution implementation bill, including the case filed by the League of California Cities.

 

As of Jan. 7, 42 cases had been filed with approximately 15 of those already being resolved with mixed results in the adjudicated cases. The vast majority, 36, of the cases filed were by cities and local agencies. The remainder were filed by private entities. It’s important to note that more than half of the cases that have been filed involve challenges to July 2012 true-up payments or issues involving recognized obligation payment schedules (ROPS).

AB 1484 included a meet and confer provision that provided successor agencies an opportunity to engage in face-to-face discussions with representatives of the Department of Finance (DOF). According to a Jan. 4 article in The Bond Buyer, 240 of the 420 successor agencies requested a meet and confer following DOF’s review of the agencies’ ROPS. These meet and confer meetings are also available for disagreements involving the due diligence reviews required by AB 1484.

The League has created a summary of statewide redevelopment litigation, which is now available online. Broadly the disputes at issues in the lawsuits fall into four main categories:

  • True-up payments;
  • ROPS disputes;
  • Constitutional challenges; and
  • Housing related disputes.

Several lawsuits, including the litigation filed by the League, raise constitutional challenges to various provisions of AB 1484. The League’s lawsuit contends that AB 1484 contains unconstitutional property and sales tax claw-back and other provisions that violate the California State Constitution, including both Proposition 1 A (2004) and Prop. 22 (2010). The petition does not seek to invalidate AB 1484 in its entirety, but it is being filed to ensure that the wind-down of redevelopment agencies is executed in an orderly and constitutional fashion without jeopardizing the fiscal stability of cities as they work to faithfully implement the redevelopment dissolution legislation.

The League anticipates additional challenges to AB 1484 will be filed over the coming months as more disputes arise from the implementation of AB 1484. The summary chart will be updated as new cases are filed in the Sacramento County Superior Court.



 
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