FAIRFIELD — Fairfield has provided the latest information on how much money it is owed by its soon-to-be-defunct redevelopment agency — $82.3 million.
The previous figure of $87.6 million came from a state-required redevelopment agency report for the 20110-11 fiscal year ending June 30, 2011. The City Council approved the report at its Dec. 20, 2011, meeting. The updated figure released late Wednesday goes beyond the end of the fiscal year, after some of the money got paid back.
In addition, the city reported that this $82.3 million owed because of city loans breaks down to $19.9 million in principal and $62.4 million in interest. City officials fear that this money will be lost with the demise of redevelopment agencies, prompting further cuts in the city’s day-to-day operations.
Fairfield loaned this $19.9 million to its redevelopment agency over the years to jump-start development in the Cordelia redevelopment project area. This project area, formed by the city in 1983, has yielded such development as the Costco store, the Copart building, the NorthBay Healthcare building and Homewood Suites. The agency has bought and sold land for development and made such improvements as building Westamerica Drive.
The city made the loans to the agency at various interest rates over the years, such as 12 percent. Fairfield had been counting on the agency repaying $54.8 million of this money through 2018-19 to keep its general fund in balance.
But the state is dissolving the 400 or so redevelopment agencies in various communities as of Feb. 1. Fairfield officials fear the city will lose the annual loan repayments to the general fund for the $82.3 million. That threatens to lead to further general fund budget cuts.
In addition, the city could lose $2 million to $3 million annually in redevelopment money used to help pay city staff in such areas as economic development and housing.
City Councilman John Mraz at Tuesday’s meeting said the situation is dire.
“I’m not so concerned about redevelopment as I am about the jobs that are attached for the people who work for the city,” he said.
City Manager Sean Quinn said that the city will present a plan for dealing with the situation at the City Council workshop Jan. 28 and Jan. 29.
Reach Barry Eberling at 427-6929, or firstname.lastname@example.org.