It isn't good news for cities that California is taking more than $1 billion in redevelopment money from their budgets, and local city leaders say they must now look to the future to try to figure out how to get out of a financial mess.
"It's a black day," said Vacaville Mayor Steve Hardy of a decision Thursday by the state Supreme Court to allow the state to dismantle redevelopment agencies. "There is nothing we can do but stay focused to get the city through the next year. It's frustrating that the state government has chosen this path."
Elimination of the redevelopment agency in Vacaville is an impact to the general fund of nearly $4 million. This news comes at a time when the city was already projecting a $1.2 million deficit for next year's budget, according to City Manager Laura Kuhn.
The city will still be able to pay any debt associated with current contracts that involved redevelopment funds, but that source of revenue has essentially stopped.
Redevelopment has helped renew Vacaville's Town Square, CreekWalk and Andrews Park, and the Nut Tree. It also made it feasible for the city to attract major employers like State Compensation Insurance Fund, Kaiser and Genentech. The police station and newer freeway overpasses also used redevelopment funds.
In other words, many of the things that have resulted in the high quality of life Vacaville residents enjoy can in one way or another be attributed to redevelopment, city officials said.
Projects like Opportunity Hill and affordable housing will have to be put on hold until other funds are available.
Hardy said the state's decision will have "catastrophic" consequences for all of California.
"How this will play out is left to be seen, but I believe no good will come from it," he said. "There was no thought given to this as far as I'm concerned."
Kuhn shared similar sentiments.
"I already felt like my hands were tied, now they've tied my legs," she said. "There is an extreme level of frustration on our part."
Still, Kuhn said the city has a good team that will look carefully at every possibility to make sure the city is financially whole.
For Suisun City, Thursday's Supreme Court decision brings it the "worst-case scenario."
Marketing Manager Scott Corey said in a press release that the elimination of the Redevelopment Agency will require cutting the current Suisun City budget by $1.4 million, which the City Council has discussed in theory for several months. Because the option to pay annually to retain the Redevelopment Agency was eliminated, Suisun City stands to lose approximately $13 million in additional cash and assets, he said.
"We're still digesting the court's decision," said City Manager Suzanne Bragdon. "But from reading the basic background provided by the court, it's clear that those not at the local level -- people not on the ground -- miss the whole concept that redevelopment provides tools to make new development and new projects happen that wouldn't happen by private investment alone.
"Instead, they describe redevelopment as a big shell game that allows cities to grab property taxes from other entities, rather than a tool to grow the overall property tax pool -- not to mention the creation of other tax revenues and jobs -- which benefits everyone, including schools and the state," she continued. "This decision has severely limited future business development in a community like Suisun City."
Assemblymember Mariko Yamada, D-Solano, said in a prepared statement that now is the time to work together to ensure that more cuts aren't made.
"We've turned the page on redevelopment as we once knew it," she said. "The state's difficult choices under a continuing no-new-revenue environment forced us to prioritize and work to prevent further cuts to education, healthcare and public safety. Let us resume our discussions in the new year and find ways to support communities that struggle with blight and the need for affordable housing."
Although Solano County doesn't have an immediate fiscal impact since it doesn't have a redevelopment agency, Supervisor Mike Reagan said the "sad saga" of the state trying to solve its problems at the local level continues.
"It's another example of the state ignoring the will of the voters," he said. "They (voters) clearly wanted this money to stay in city hands. This was the last remaining tool (cities) had to spark job creation and boost the economy."
"It's a black day," said Vacaville Mayor Steve Hardy of a decision Thursday by the state Supreme Court to allow the state to dismantle redevelopment agencies. "There is nothing we can do but stay focused to get the city through the next year. It's frustrating that the state government has chosen this path."
Elimination of the redevelopment agency in Vacaville is an impact to the general fund of nearly $4 million. This news comes at a time when the city was already projecting a $1.2 million deficit for next year's budget, according to City Manager Laura Kuhn.
The city will still be able to pay any debt associated with current contracts that involved redevelopment funds, but that source of revenue has essentially stopped.
Redevelopment has helped renew Vacaville's Town Square, CreekWalk and Andrews Park, and the Nut Tree. It also made it feasible for the city to attract major employers like State Compensation Insurance Fund, Kaiser and Genentech. The police station and newer freeway overpasses also used redevelopment funds.
In other words, many of the things that have resulted in the high quality of life Vacaville residents enjoy can in one way or another be attributed to redevelopment, city officials said.
Projects like Opportunity Hill and affordable housing will have to be put on hold until other funds are available.
Hardy said the state's decision will have "catastrophic" consequences for all of California.
"How this will play out is left to be seen, but I believe no good will come from it," he said. "There was no thought given to this as far as I'm concerned."
Kuhn shared similar sentiments.
"I already felt like my hands were tied, now they've tied my legs," she said. "There is an extreme level of frustration on our part."
Still, Kuhn said the city has a good team that will look carefully at every possibility to make sure the city is financially whole.
For Suisun City, Thursday's Supreme Court decision brings it the "worst-case scenario."
Marketing Manager Scott Corey said in a press release that the elimination of the Redevelopment Agency will require cutting the current Suisun City budget by $1.4 million, which the City Council has discussed in theory for several months. Because the option to pay annually to retain the Redevelopment Agency was eliminated, Suisun City stands to lose approximately $13 million in additional cash and assets, he said.
"We're still digesting the court's decision," said City Manager Suzanne Bragdon. "But from reading the basic background provided by the court, it's clear that those not at the local level -- people not on the ground -- miss the whole concept that redevelopment provides tools to make new development and new projects happen that wouldn't happen by private investment alone.
"Instead, they describe redevelopment as a big shell game that allows cities to grab property taxes from other entities, rather than a tool to grow the overall property tax pool -- not to mention the creation of other tax revenues and jobs -- which benefits everyone, including schools and the state," she continued. "This decision has severely limited future business development in a community like Suisun City."
Assemblymember Mariko Yamada, D-Solano, said in a prepared statement that now is the time to work together to ensure that more cuts aren't made.
"We've turned the page on redevelopment as we once knew it," she said. "The state's difficult choices under a continuing no-new-revenue environment forced us to prioritize and work to prevent further cuts to education, healthcare and public safety. Let us resume our discussions in the new year and find ways to support communities that struggle with blight and the need for affordable housing."
Although Solano County doesn't have an immediate fiscal impact since it doesn't have a redevelopment agency, Supervisor Mike Reagan said the "sad saga" of the state trying to solve its problems at the local level continues.
"It's another example of the state ignoring the will of the voters," he said. "They (voters) clearly wanted this money to stay in city hands. This was the last remaining tool (cities) had to spark job creation and boost the economy."
