SB 77 (End to redevelopment) in session

As I type this I am watching the State Assembly stream the debate over SB 77, a bill that would ostensibly end redevelopment as we know going forward. Sponsors and critics are speaking now, including numerous Democrats who are voting for the bill despite having reservations over its effect on the future availability of affordable housing. Republicans seem to be voting no. Will it go party-line or will some of the Republicans cross over? Introductory text of the bill reads as follows:

(1) The Community Redevelopment Law authorizes the establishment of redevelopment agencies in communities to address the effects ofblight, as defined. Existing law provides that an action may be brought to review the validity of the adoption or amendment of a redevelopment plan by an agency, to review the validity of agency findings or determinations, and other agency actions.
This bill would revise the provisions of law authorizing an action to be brought against the agency to determine or review the validity of specified agency actions.

(2) Existing law also requires that if an agency ceases to function, any surplus funds existing after payment of all obligations and indebtedness vest in the community.
The bill would repeal this provision. The bill would suspend various agency activities and prohibit agencies from incurring
indebtedness commencing on the effective date of this act. Effective July 1, 2011, the bill would dissolve all redevelopment agencies and community development agencies in existence and designate successor agencies, as defined, as successor entities. The bill would impose various requirements on the successor agencies and subject successor agency actions to the review of oversight boards, which the bill would establish.
The bill would require county auditor-controllers to conduct an agreed-upon procedures audit of each former redevelopment agency by October 1, 2011. The bill would require the county auditor-controller to determine the amount of property taxes that would have been allocated to each redevelopment agency if the agencies had not been dissolved and deposit this amount in a Redevelopment Property Tax Trust Fund in the county. Revenues in the trust fund would be allocated to various taxing entities in the county and to cover specified expenses of the former agency. The sum of $1,700,000,000 of these moneys would be allocated to the various counties for deposit in a Public Health and Safety Fund, which would be used to reimburse the state for health and trial court services in the county. The bill would authorize the county to elect not to administer this fund, in which case the Director of Finance would be required to designate a different entity to administer this fund. Under the bill, if the county elects not to dminister the fund, it would not receive moneys remaining in the Redevelopment Property Tax Trust Fund, which would otherwise be distributed to taxing entities in the county. The bill would also require, for the 2012-13 fiscal year and each subsequent fiscal year in which funds are available, each county auditor-controller to allocate to various educational entities a specified amount. By imposing additional duties upon local public officials, the bill would create a state-mandated local program.

(3) Under the California Constitution, the Legislature is prohibited, except by a 2/3 vote, from changing the pro rata shares in which ad valorem property tax revenues are allocated among local agencies in a county.
Because this measure would provide property tax revenues that would otherwise be received by enterprise special districts from
former redevelopment tax increment allotments instead be received by the respective county, and may result in property tax moneys in the Redevelopment Property Tax Trust Fund not being allocated to the county if it declines to administer the Public Health and Safety Fund, the bill would constitute a change in the pro rata share of property tax allocations in that county and require the passage of the bill by a 2/3 vote.

(4) The bill would appropriate $500,000 to the Department of Finance from the General Fund for administrative costs associated
with the bill.

(5) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.

(6) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

More as the vote is taken. Passage requires a two-thirds approval.

4:10 PM – District 16 (Oakland) Councilman Sandré R. Swanson is speaking in favor of the bill and will apparently vote yes. The Dems are talking about holding Governor Brown to a promise of setting up whatever the proper successor to RDAs is.

4:14 PM – Closing statements happening now.

4:18 PM – 50-21 Aye, 8 abstentions. They are four short of the necessary absolute two-thirds thanks to the abstentions, putting the bill on “call” or hold. Bill may come back after the other three budget bills are addressed.

5:02 PM – Call lifted on SB 77. One additional No vote, 50-22. Can no one else be whipped into voting for this? Apparently not, bill placed on call again.

5:54 PM – Still don’t have the additional four votes. Republicans are calling for a caucus.

6:25 PM – The Assembly is now taking up a few Assembly bills. Looks like AB 77 will have to wait until the end of the night, whenever that is.

6:57 PM – Call lifted. Vote is now 53 AYE, 23 NO. 3 holdouts remain. All four Assembly members who represent ballpark areas (Wieckowski – Fremont, Beall/Campos – San Jose, Swanson – Oakland) have voted to approve.

7:09 PM – Still can’t get that last vote, bill moved to call yet again. Tally remains 53-23.

9:25 PM – Last motion to lift call and vote. No 54th vote. Tally remains 53-23. Assembly adjourns for the night, will reconvene tomorrow at 11 AM. (Thanks for interfering with my NCAA tourney quality time, pols.)

Note: Let’s keep the discussion to redevelopment and the impact of it going away.

21 thoughts on “SB 77 (End to redevelopment) in session

  1. RM,
    My two comments were about RDA and the budget. Why the deletions? Anyhow, no worries brah; I’ll stay off this thread.

  2. This would move to the senate if passed, yes? Is 2/3 needed there?

  3. @gojohn10 – Yes, though the Senate is considered a slam dunk to pass. They were onboard with the Governor from the beginning.

  4. ML, can you enlighten me on why assembly members who represent ballpark areas are voting for this? Why are so many members for this…I was always under the impression that California needed Redevelopment funds, or at least liked having them…

  5. If the SB77 doesn’t pass, which looks likely, I assume that the cities will still push hard to get their proposal adopted. If they don’t, a deal could still be reached with the “rogue 5” republicans that could get them to switch their vote and kill redevelopment.

  6. @LeAndre – My guess is that they made a deal with the Governor on the scope of those successor agencies in exchange for not getting cuts on other things that they believe in. The Assembly was thought to be the hardest fight since they’re supposed to be closer to ground level than the Senate. This time they’ve manged to separate themselves. Two of the mentioned Bay Area Assembly members, Bob Wieckowski and Nora Campos, worked in Fremont and San Jose City Councils last year, respectively.

  7. @LeAndre I was wondering the same thing. This doesn’t seem like that much of a partisan issue. My guess is that they are being strong armed by their state party’s leader. Still, they likely pledged their support for the proposal before it went public.

  8. Quick note that will be added to the post shortly: The chances of getting that last vote are slim at best. If it doesn’t happen by 8:30, everyone heads home and reconvenes tomorrow.

  9. The only Republican vote so far to end Redevelopment is Chris Norby of Fulerton. Over 10 years ago he founded an organization named Municipal Officials for Redeveloopment Reform (MORR). Norby served on the Fullerton City Council and Orange County Board of Supervisors before being elected to the Assembly in a Special Election in late 2009 (following the abrupt resignation of an Assembly Member who was caught on-tape bragging of his personal relationship with a lobbyist).

    Four Assembly Members have not voted, inlcuding several Republicans.

  10. ML–trying to find out whether the city of SJ and the county reached any sort of agreement–believe today was the day for a deal otherwise the county pushes forward with its injunction-any update there? Seems as if this could be pretty significant if redevelopment agencies go away–

  11. thx ML–assumed they would work it out–seems like a reasonable solution—any sense of how the special districts would hold up against SB77 assuming it passes?

  12. @GoA’s – Anything entered into agreement since the beginning of the year is subject to review for validity. There is a large section devoted to restrictions on cities incurring new debt. Here’s the relevant bit:

    Section 34177 Successor agencies are required to do all of the following: …
    (e) Dispose of assets and properties of the former redevelopment agency as directed by the oversight board; provided, however, that the oversight board may instead direct the successor agency to transfer ownership of certain assets pursuant to subdivision (a) of Section 34181. The disposal is to be done expeditiously and in a manner aimed at maximizing value. Proceeds from asset sales and related funds that are no longer needed for approved development projects or to otherwise wind down the affairs of the agency, each as determined by the oversight board, shall be transferred to the county auditor-controller for distribution as property tax proceeds under Section 34188.

    A county-based auditor will work to audit each constituent RDA and then figure out where the tax increment should go. Then an oversight board will figure out the validity part on a project-by-project basis. Some of SJRA’s assets may have to be sold – one to maintain some liquidity to pay for existing obligations, two to get rid of things that aren’t ideal. However I think the SJDDA may be an intentional gray area in that it includes land that may be used for transportation infrastructure. That might make it hard for the state to strike down SJDDA. It’s sort of funny that SJRA was picked to undergo the state controller’s audit, since it came out relatively clean from an operational standpoint in the report. The wild card may be the county. Given the fact that they were just able to get a deal done and the county has a huge interest in the Diridon transit hub, county may not be inclined to look at SJRA in highly punitive manner.

  13. Maybe the timing of the vote was intended to demonstrate that sports are no longer important in California 😉

  14. Right… Contract this, Bud.

  15. So what’s the status of the vote on redevelopment? Is it still stalled out?

  16. The A’s are going to be contracted nor is Wolff buying the Dodgers.

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