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Governor Vetoes Two Redevelopment Bills

Renently Gov. Jerry Brown vetoed SB 450 (Lowenthal) and SBx1 8 (Budget Committee), two redevelopment bills.


SB 450, which was only one part of a larger package of redevelopment reform bills, addressed specific changes to low and moderate income housing funds managed by redevelopment agencies. Among other redevelopment reform bills, like SB 286 (Wright) and AB 1220 (Alejo), SB 450 was supported by the California Redevelopment Association (CRA).


Some of the reforms contained in SB 450 had already been considered by CRA as early as October 2010, before the Governor’s proposal to eliminate redevelopment agencies surfaced in early 2011. However, after the elimination proposal, housing advocates got behind SB 450 in an attempt to ensure that low and moderate income housing funds would be protected. CRA worked with housing advocates on SB 450 to create specific reforms to the management of low and moderate income housing funds.


At the same time during the legislative session, the Governor’s proposal to eliminate redevelopment agencies all together resulted in the passage of ABx1 26 and ABx1 27. ABx1 26 eliminated all redevelopment agencies, and ABx1 27 allowed agencies that agreed to pay the state $1.7 billion statewide in the first year and $400 million statewide each year thereafter to be exempted from the elimination bill.


Once ABx1 26 and ABx1 27 were passed, SBx1 8 was introduced to make technical clean-ups to the hastily crafted bills. SBx1 8 also sought changes to specific agencies’ contractual agreements, and an extension to the payment deadline for loans taken from low and moderate housing funds in FY 2009-10.


While the Governor has not been shy in expressing his opinions in signature and veto messages this year, his veto messages for both SB 450 and SBx1 8 simply stated that the bills were “premature” given that the California Supreme Court has not ruled on California Redevelopment Association v. Matosantos, the CRA and League backed lawsuit challenging the constitutionality of ABx1 26 and ABx1 27.


The California Supreme Court has agreed to hear this case on an expedited schedule in order for a decision to be reached before Jan. 15, 2012, which is the day the first payments required under AB 1X 27 would be due.