When State Assembly bill 1484 became effective on June 27, it required cities to remit payment to the state by July 12 of this year, continuing the execution of Governor Brown’s budget package order in 2011, calling for the displacement of redevelopment agencies.
The total due, for 71 cities in L.A. County, is almost $151 million. Until this act, Community Redevelopment Agencies received the lion’s share of new property taxes generated from new buildings. Some cities, like Monrovia and Alhambra (perennially voted one of the state’s most business friendly cities) have made big money from redevelopment and must now fork over said moneys to the State.
“As cities give money to the state, this is a reflection of a dysfunctional state government and failure of the state to get its own financial house in order that has created more pain for cities,” said Tony Bell, spokesperson for L.A. County Supervisor Mike Antonovich.
In April the California Supreme Court entertained giving cities the right to keep their agencies afloat with a “pay to play” option, whereby cities would have the right to continue with business as usual on the condition that cities pay the state a large up-front sum, followed by annual residuals. That option was declared to be unconstitutional. What was not considered unconstitutional was the destruction of redevelopment agencies.
What is important to note is that the $151 million due July 12 is just a portion of proceeds that cities are generating, through liquidation and other means, to the state of California. The following is a brief list of L.A. County cities and the amounts they owe: city of L.A., $51.8 million; Santa Monica, $12 million; Industry, $6.1 million and Long Beach, $8.2 million.
Here are the types of moneys the state is receiving from cities: liquidation of real estate, revenue from leases, insurance premiums and maintenance money for properties. A more complete list of what cities owe in the meantime is available online at www.sanmarinotribune.com.
Some cities owe much more than others. Monrovia, Arcadia, Burbank, Carson and Alhambra, as examples, will pay the state very little in payment demand compared to those mentioned above because the moneys given to them by the county have already been used and no longer need to be returned. The $150 million total quoted above represents money that has not been used by those cities before a deadline set out by the state. In lieu of a “redevelopment agency” in Alhambra, the city has recently created a smaller-scale development agency with similar features to its predecessor but lacking the power or authority to do what the previous one had done.
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