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League Takes an Oppose Unless Amended Position on DOF Redevelopment Dissolution Budget Proposal

Cities Urged to Take Immediate Action

February 25, 2015
The League board of directors last week voted unanimously to oppose unless amended Gov. Jerry Brown’s proposal to make changes to the redevelopment dissolution process as part of the FY 2015-16 budget.
 
The recently released language to the proposal is anticipated to be included in a budget trailer bill. The proposal contains a number of significantly harmful provisions to local agencies that would reverse recent court decisions regarding the redevelopment dissolution process, undo previous incentives and limit transparency, accountability and opportunities for local agencies to protect their legal rights. The League board action occurred in advance of several upcoming hearings on the matter.

The League submitted its official oppose unless amended letter on Feb. 25 to members of the Assembly Budget Subcommittee No. 4 on State Administration, which will hold a hearing on the proposal on March 3. The Senate will consider it on April 9 in the Budget and Fiscal Review Subcommittee No. 4 on State Administration and General Government. Along with the letter the League also included a detailed analysis of the proposal’s provisions.
 
The redevelopment dissolution process has been very difficult for many agencies, although significant progress has been made. To date, the Department of Finance (DOF) issued findings for completions for 329 agencies, of which 177 have been approved. The state budget continues to benefit and the Governor’s Administration projects that from FY 2011-12 through FY 2015-16, the process will produce $5.375 billion in Proposition 98 funds for schools. Ongoing, schools are expected to receive $1 billion.
 
Where disputes remain, the issues are being worked through the Sacramento County Superior Court, which has jurisdiction under the dissolution statute. These are complex issues that will be resolved in due time. The courts are now interpreting the law that DOF helped draft. It is reasonable to expect the state to have to comply with and respect the same laws to which local governments are subject. The aspects of this proposal of most concern would redraft and insert new retroactive provisions into the law to avoid court rulings deemed unfavorable by the state, and stifling the ability of local agencies to protect their legal rights.
 
This proposal in many ways is counter to the Legislature’s recent efforts to help not hurt local agencies with the dissolution process. Legislators last year advanced several bills that provided helpful clean-up to dissolution statute including two of Assembly Speaker Toni Atkin’s bills, AB 471 and AB 1963, which the Governor signed. Several other bills, SB 1129 (Steinberg), AB 2493 (Bloom) and AB 15450 (Garcia), were vetoed.
 
Take Action
 
The League has prepared a sample letter that cities can use to oppose this proposal. Cities can individualize their letters with details about how the proposal would cause harm to their communities.
 
The sample letter is available on a webpage dedicated to redevelopment dissolution at www.cacities.org/redevelopment.
 
Cities negatively affected by this legislation are encouraged to also send a representative to attend the hearing on the matter scheduled for Tuesday, March 3, at 1:30 p.m. in Room 447 of the State Capitol.


 
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