Redevelopment Agencies Sue State

The California League of Cities, the California Redevelopment Association and the cities of San Jose and Union City filed suit in the California Supreme Court on Monday alleging that new laws requiring redevelopment agencies to pay the state in order to survive are unconstitutional.

The coalition is also asking the court to prevent the laws from going into effect until judges can render a ruling on the case itself, City News Service reported.

According to the lawsuit, assembly bills 1X 26 and 1X 27 violate Proposition 22, a constitutional amendment approved by voters in November. The two bills, which were signed by Gov. Jerry Brown in late June, dissolve redevelopment agencies unless they agree to pay the state a combined $1.7 billion by the end of the 2011 calendar year.

"California voters overwhelmingly passed Proposition 22 just eight months ago to stop state raids, shifts and diversions of local redevelopment funds," League of California Cities Executive Director Chris McKenzie said. "The governor and Legislature have blatantly ignored the voters and violated the state constitution.

"We must now go to the Supreme Court to uphold the voters' will and the constitution by overturning this unconstitutional legislation. We are confident the court will uphold the will of the voters."

Opponents of redevelopment agencies, including Brown, say the agencies siphon property tax dollars away from schools and public safety.

Though Redondo Beach did not specifically file suit, the city is a member of the California League of Cities and the California Redevelopment Association, according to City Manager Bill Workman.

"We would expect a court ruling in favor of Union City and San Jose would be in favor of all cities, including Redondo Beach," Workman said.

If the suit is unsuccessful, Redondo Beach would have to pay $947,840 for the fiscal year 2011-2012 and $223,021 for the fiscal year 2012-2013 or dissolve its redevelopment agency by Oct. 1.

"The state legislature is flat-out irresponsible," said Councilman Steven Diels, who heads Redondo's redevelopment agency, at a June 30 City Council meeting.

During the final meetings of the redevelopment agency for the 2010-2011 fiscal year, agency members voted to set aside existing housing dollars and loans payable to the agency, as well as future agency income, in cooperation with the city to protect the money from the state.

City News Service contributed to this report.