California used to have over 400 redevelopment agencies, they are obviously gone now.
What remains is this ordeal of the leftover funding, which took a big step forward to being resolved yesterday via an appeals court ruling.
So to help anyone out of the loop catch up, when the redevelopment agencies got the axe, the leftover funds were to be put toward finishing local redevelopment projects already in progress and pay off debts. Remaining monies were to be passed along to the counties to redistribute to schools and other county-level programs.
Naturally, folks were weary of the potential for misuse of those leftover funds. In anticipation of the hundreds of disputes that resulted, the 2011 abolishment of redevelopment agencies also funneled those disputes to Sacramento courts. But a 2012 law allowed state finance officials to decide if a city was improperly withholding funds and then allowed them to impose tax penalties on cities with disputed funds cases.
On Thursday, the Third District Court of Appeal passed down a 3-0 ruling with Justice George Nicholson saying, “The people took away from the Legislature the authority to withhold (local) tax revenue from local governments.”
The court found the authority held by the State’s finance officials to be a violation of Prop 22, which prohibited the legislature from redirecting local tax funds to fill state budget deficits.
Nine communities around the state were a part of the case disputing monies totally roughly $24 million.
Justice Nicholson noted that the state could still take cities to court over the wrongful withholding of redevelopment funds.
This ruling could be a watershed moment, as Michael Colentuono, a lawyer representing 13 other cities challenging the state, said that there are still a large number of cities appealing decisions on redevelopment funding. Some of which, he said, would have been ready to settle if Thursday’s ruling had gone the other way.
CityNews will track this for any further development.
More on Thursday’s ruling here.