CITY HALL — Several redevelopment projects planned for Santa Monica are in immediate danger of being cut due to a ruling announced Tuesday which will allow Gov. Arnold Schwarzenegger to take $2.05 billion from cities to fund public schools.
Of that amount, the ruling requires $1.7 billion to be paid during this fiscal year.
Santa Monica’s contribution to this total adds up to $21 million, said Andy Agle, director of Housing and Economic Development for City Hall. The city’s Redevelopment Agency currently has approximately $35 million in funds that are not tied up for housing or debt payments. Santa Monica’s redevelopment agency, along with all others across the state, is required to make its first payment by May 10.
This drastic 60 percent reduction will result in a number of projects being cut, including the creation of new parks, the building of a new library, the revitalization of facilities at Santa Monica High School, transportation improvements related to the Exposition Light Rail, the updating of the city’s traffic signal master plan, the enhancement of pathways and streetscapes, and the creation of an early childhood center, Agle said.
Additional money for affordable housing and the Civic Auditorium will consequently be lost as well.
In his ruling, Sacramento Superior Court Judge Lloyd Connelly wrote that “the use of tax increment revenues to maintain the operations of schools serving redevelopment projects could reasonably be found by the Legislature to serve a proper redevelopment purpose.”
Though the state intends to redirect these funds to school operations within each district, agencies statewide have denounced the decision as a blow to their local economies.
“It’s not providing any money for schools; it’s reducing the state’s obligation to the schools,” said Agle. “Taking away a huge portion of agency funds severely limits our ability to implement the programs that the city needs.”
In light of the decision, the California Redevelopment Association (CRA) announced that its board of directors voted to appeal the judge’s ruling. The association filed earlier this week for a temporary stay on payments with the Court of Appeals in order to buy local redevelopment agencies more time while the appeal is being considered.
Tuesday’s ruling marked a disappointing end to the CRA’s second lawsuit against the state over redevelopment funds.
In April 2009, the association won a lawsuit against the state, which resulted in the removal of 2008 budget language that would have allowed the state to take $350 million in redevelopment funds.
However, the state budget trailer bill authorizing the shifting of $2.05 billion passed as part of the 2009-10 state budget in July 2009 during a special session called to address California’s fiscal emergency. In October 2009, the CRA filed another lawsuit to stop the bill, maintaining its position that the state’s raiding of redevelopment funds is unconstitutional.
“Lawmakers ignored the state Constitution and attempted to write state budget legislation around it,” said CRA Executive Director John Shirey in a statement. “That’s simply irresponsible policy-making, and it illustrates why many have concluded state government is broken and needs fixing.”
The CRA hopes to have a decision about the temporary stay request by the end of the week.
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