The California Redevelopment Assn., which represents 350 agencies and more than 300 private development firms, is on the brink of filing a lawsuit against the state after its board voted in October to officially oppose the price tag cities are being asked to pay, said John Shirey, executive director of the association.
If Burbank is asked to pay the funds, which amounts to 33% of the capital improvement budget, development projects will likely be affected in the short term, Community Development Director Sue Georgino said.
“It obviously has implications for us,” she said.
Burbank and the California Redevelopment Assn. have long objected, mostly on constitutional grounds, to the state taking funds for capital improvement projects.
The state is not legally entitled to take redevelopment funds, Shirey said, citing Article 16, Section 16 of the California constitution, which reads: “All property in a redevelopment project . . . [shall] not subject to taxation.”
“We feel what the state, as local governments have to do, is find ways to balance budgets by cutting its expenses or raising revenue or both,” Shirey said. “The solution is not to take money from someone else. Once state takes the money, this isn’t going to stop.”
Georgino also fears that state officials will continue to tap local funds as California continues to face a fiscal problem.
“We have a very strong concern that it’s not just one year as an illegal take, but that it’s an ongoing take,” she said.
But state officials have maintained that the $350-million payment is a one-time fee.