Jerry Brown, State Lawmakers Assert Right To Eliminate Community Redevelopment Agencies
By Judy Lin and Paul Elias, Associated Press
SAN FRANCISCO (AP) -- Gov. Jerry Brown and state lawmakers asserted their right to eliminate community redevelopment agencies and divert billions of tax dollars to fund schools and other services in oral arguments Thursday before the California Supreme Court.
Deputy Attorney General Ross Moody, who represented the state, said redevelopment agencies were created by the Legislature, so lawmakers have the power to dissolve them and impose new requirements if they want to continue operating.
Steven Mayer, the attorney representing cities and redevelopment agencies, told justices the state's actions this year are illegal because they constitute the type of raid on local government money that voters banned in 2010.
The case has long-term implications for state budgeting. The state is counting on $1.7 billion from the agencies in this year's budget and $400 million a year thereafter.
It also will determine the fate of about 400 redevelopment agencies, which primarily are controlled by cities and counties and are used to promote construction projects and rehabilitate downtrodden business districts. Critics say many of those agencies have strayed from that intent and audits have revealed some misuse of funds, a portion of which is intended to be used for low-income housing.
The Supreme Court is expected to rule before Jan. 15.
During an hour-long hearing before the justices, Mayer argued that Proposition 22, passed by voters in November with 61 percent of the vote, protects redevelopment agencies from tampering by the Legislature. He said the state violated the measure in eliminating redevelopment agencies.
Mayer said the Legislature's offer to keep the agencies in business if they give up a large portion of their funding is unconstitutional. He compared that option to a bank teller receiving a note from a robber saying, "The money or your life." He said most agencies will make payments so they can continue to operate.
Justice Carol Corrigan picked up on the bank robber analogy when she asked Moody if the state was demanding "ransom" from the agencies to stay in business.
"It's hard to argue it's a voluntary payment," Corrigan said.
Moody contended lawmakers had the authority to eliminate the agencies despite Proposition 22. He said the measure did not strip control of redevelopment agencies from the Legislature, which passed legislation in 1945 allowing cities and counties to establish redevelopment agencies.
"Proposition 22 had an extremely limited purpose," Moody said.
He said Brown was confronted with a historic deficit when he took office and had to make tough budget choices immediately after assuming office in January.
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Lin reported from Sacramento.
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First Posted: 11/10/11 07:29 PM ET Updated: 11/10/11 07:37 PM ET