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Supreme Court Clears New Law That Means Billions for Local Services
A new law that could mean billions in additional general fund dollars for counties, cities, special districts and schools, has been upheld by the California Supreme Court.
On Thursday, the high court let stand a CPF-backed law -- ABx1 26 -- that eliminates local redevelopment agencies. Costly and often corrupt, RDAs siphon upwards of $5 billion in property tax revenue away from basic services, sending that money to developers for special interest construction projects.
“Every dollar diverted into redevelopment projects is a dollar that is not available for critical services like fire, police and education,” said CPF President Lou Paulson. “At a time when layoffs and station closures are crippling public safety, the court’s ruling will insure that critical dollars won’t be diverted to developer subsidies.”
The court ruling was a stinging defeat for the League of California Cities and the state’s Redevelopment Association, who challenged the new law despite their own previous admission in legislative testimony that the agencies could, in fact, be abolished.
Cities’ Bad Legal Gamble Fails
At the same time it upheld the elimination of RDAs, the court also turned a thumbs down to efforts to reconstitute RDAs in a different form.
In a risky and curious legal strategy, the League of California Cities and RDAs also challenged a companion measure -- ABx1 27 -- that would have allowed them to re-create new locally-based agencies, provided they send more money to core services. But in an ironic twist, the court struck down the substitute law by citing, in part, the League’s own Proposition 22.
“If the cities had accepted the compromise measure, they could be creating new local RDAs that could have provided for affordable housing without short-change counties, special districts and schools,” noted Paulson. “Instead, they took a confrontational, high-risk legal stand, forcing the court’s hand. The League’s risky legal gambit put affordable housing at risk … not the Legislature, the governor or the courts.”
What it Means for Firefighters
The court’s decision offers immediate short-term benefit for vital local services, including fire protection. Initially, the decision means that $200 million in diverted property tax money will go back into general fund coffers for counties, cities, fire districts and schools. In the next budget year, that figure could rise to as much as $2 billion -- money that would have been otherwise diverted to developers and unavailable for local services. At the state level, the ruling means that an additional $1 billion allocated for local court services will not be cut.
"Despite the claims of the losing side, this decision will not reduce funding for local services -- it will increase it," concluded Paulson. "All it really means is that developer subsidies won't have a special pot of dedicated money -- they'll have to compete with other vital local services."
CLICK HERE TO READ THE COURT DECISION
