Thursday, August 11, 2011

BREAKING: State Supreme Court Halts Raid of RDA Funds

Looks like California's redevelopment agencies won't have to make those "Guido payments" just yet; the San Jose Mercury News is reporting that the State Supreme Court has put a temporary halt to Sacramento's raid of RDA funds, in response to a lawsuit challenging the legality of the plan. While the agencies cannot incur new debt, enter new contracts, or purchase property until the suit is resolved, arguments before the Court won't begin until October, and the case isn't likely to be decided until January.

Our RDA plan is unconstitutional, but only by this much!
While we're not fans of the RDAs or their work, we've thought their case was strong since the lawsuit was announced, as the revenue-backfill component of the Legislature's plan seems to be a cut-and-dried violation of Prop 22. More importantly, the Court's action today presents yet another serious problem for the state's beleaguered budget. With voter referenda casting the Amazon tax and fire fees in doubt, and a struggling economy blowing holes in the ludicrous revenue expectations needed to avoid billions in "trigger cuts", the last thing Jerry Brown wanted to hear was that the state might not get $1.7 billion from the RDAs. It also makes it far more likely that we'll be debating this year's budget again this winter. Leave it to Sacramento to not even know how to kick a can down a road effectively.


Post a Comment