Thesis

California Supreme Court decides to eliminate redevelopment agencies. Now what?

This project consists of a study of the Redevelopment Agencies (RDAs) throughout California and the most recent actions from the Supreme Court shutting down more than 400 RDAs. Prior to the dissolution, RDAs “received over $5 billion in property tax revenues annually and had tens of billions of dollars of outstanding bonds, contracts, and loans.” (O’Malley, 3) Due to the most recent ruling by the California Supreme Court, approximately 400 RDAs has been eliminated, leaving many questions unanswered. The purpose of RDAs was to promote local economic development in blighted urban areas. Redevelopment activities create jobs and expand businesses opportunities, provide housing for families most in need, and help reduce crime. However, many state audits throughout California concluded cities were not spending the RDAs funds correctly. On December 29, 2011, the Supreme Court upheld its decision in the California Redevelopment Association v. Ann Matosantos case, finding Assembly Bill X1 26 (AB X1 26). This meant RDAs throughout California had to “…freeze any new debt, loans, grants or acquiring any new assets or new contracts.” (O’Malley, 9) The primary role of the successor agency is to make sure payments and any pending obligations with projects must be paid. An “Oversight Board” consist of seven members to assist as the successor agency. With the elimination of the redevelopment agencies leaves many worries for cities to see growth and job increases without the assistances of the state.

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