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Thursday, November 10, 2011

Redevelopment Fight Begins In State Supreme Court

Nov. 10, 2011 | Attorneys for the state argued Thursday before the California State Supreme Court morning that the fate of local redevelopment agencies lays within their control. Lawyers representing numerous statewide municipalities claimed the will of the voters who approved Proposition 22 last year were being impugned by the action.

The hearing in San Francisco provided few new details. Reports today, relying solely on the parsing of every morsel of queries and comments by justices, appear to be predicting a victory for the state.

The Los Angeles Times used the tea leaves afforded by the justice's comments today to construe the court would side with the state's argument, but it was less clear whether the funding mechanism of allowing local redevelopment agencies to control if cities paid for the right would survive.

The state budget is predicated on receiving up to $1.7 billion in revenue from the arrangement. If struck down by the court, the state's lawyers said, its budget would be in dire straits. On Wednesday, Controller John Chiang said receipts are already below estimates in tandem with higher expenditure than previously predicted.

Lawyers for the state offered instances were redevelopment agencies misused funds in the past on luxury items and benefits for local officials.

The attorney representing the cities argued against the constitutionality of the state's redevelopment plan in the wake of voter approval last year for Proposition 22. The initiative prohibits the Legislature to use local funds to balance the state's chronic budget woes.
Justice Carol Corrigan, though, latched on to the frequently-used analogy used by cities comparing the state's take of local funds in return for maintaining redevelopment agencies as "ransom."

"It's hard to argue it's a voluntary payment," Corrigan said.

Over 400 city and county redevelopment agencies would be effected. Cities hope the high court will rule on the issue before the first installment of payments to the state begin in mid-January.

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