STATE TAKES $116M FROM COUNTY, INCLUDES $4.26M FROM SAN LEANDRO; $5.3M FROM HAYWARDBy STEVEN TAVARES
SACRAMENTO Nearly a year ago, San Leandro Mayor Tony Santos defiantly warned lawmakers in Sacramento hoping to balance the state's finances to "keep your hands out of our budget." After a Sacramento Superior Court judge ordered municipalities last week turn over over $2 billion in redevelopment funds, Santos said Tuesday afternoon, "Well, they got their hands in it now!"
San Leandro's share consists of $4.26 million in funding, already transferred to the Alameda County Auditor. The immediate dilemma for cities and counties is how to fund current and future development projects. In San Leandro, projects such as the city's downtown Town Hall Square project, undergrounding of utilities on East 14th Street, traffic and beautification projects around 150th Avenue and its successful commercial facade program will be hampered by the state's raid of redevelopment dollars.
Santos said the outlook for redevelopment projects in the city looks "dismal" and will likely slow various projects in the planning stages or shovel-ready.
"The state's take of money from local redevelopment agencies who are one of the state's strongest job creating engines, at a time when job creation and economic development are desperately needed, seems short-sighted," said San Leandro Business Development Manager Cynthia Battenberg.
Sacramento Superior Court Judge Lloyd Connelly ruled last week the state's demand for local redevelopment funds was legal, despite ruling against the state on a similar case. The approved transfer will save the state $1.7 billion towards this year's budget. The state is drowning in the red with a $18 billion deficit. News of the ruling stoked already angry local governments across the state who charge Sacramento with failing to make difficult budget decisions in favor of using local dollars.
"The judge was wrong," said Santos. "What can I say?" The California Redevelopment Association plans to appeal the ruling, but Santos says it is unlikely to help. "The belief is that the money is gone," he said. "They have it and its impossible to get it back."
In total, Alameda County is on the hook for over $116 million. Hayward's part includes $5.3 million, which will slow redevelopment of the area surrounding the South Hayward BART station and improvements to the City Center and downtown retail projects.
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