City believes Davis’ budget proposals may be illegal
The city is scrambling to find a way to keep the state from taking more than a hundred million dollars away from Santa Monica.
Officials think that by selling parking garages to the city’s redevelopment agency, the city can lock in $170 million already planned to overhaul the structures. The move is an attempt to protect the city’s money from being taken by the state so it can plug its $34.8 billion deficit.
By selling the garages to the redevelopment agency, it would be responsible for maintaining them, which includes a planned $97-million overhaul. That money is in jeopardy because Gov. Gray Davis is considering taking the redevelopment funds away from Santa Monica.
The City Council has called an emergency meeting scheduled for tonight in the Main Library auditorium to discuss plans that may hinder Davis from using Santa Monica’s redevelopment money.
Davis on Friday is expected to propose taking back redevelopment money given to cities to repair facilities that were damaged in the 1994 Northridge earthquake. The money Santa Monica is entitled to is intended to pay for senior and low-income housing, capital improvements to the city’s downtown parking structures, as well as the new library, a proposed plan to overhaul the Civic Center area and reinforcing Palisades Bluffs to prevent future mudslides and collapses.
Parts of the state budget were leaked this week to city officials, who believe Davis’ proposal could appear before the Assembly Budget Committee by next week.
City Resource Management Director Jeff Mathieu said he and his colleagues are trying to find ways to thwart the state’s efforts.
“We play by the rules of the game and follow the laws to the letter,” Mathieu said. “And suddenly there are changes that are not anticipated and weren’t discussed and so we are doing everything we can to protect the plans that we have committed to the community.”
Cities across the state are scrambling to keep money in their redevelopment accounts so the state can’t take it away, according to officials with the California League of Cities.
“Cities are looking across the board, and if they have dollars that are sitting around, they are trying to do the prudent thing that anybody else would do,” said Ann Marie Wallace, a Los Angeles County regional representative of the league. “They are trying to prevent the worst from happening.”
But it may be too late for Santa Monica to protect its cash.
“We are trying to do this as fast as we can.” — said City Councilman Ken Genser
“The redevelopment agency would incur the debt and obligate it to finish the structures,”
City officials are anticipating Davis to take back funds cities were given months ago.
“We believe the state will go back and do this retroactively,” said Genser.
A Davis spokesman wouldn’t confirm that. If Davis did make seizure of redevelopment money retroactive, it would make Santa Monica’s plan futile.
“They are free to do whatever they feel they need to do,” said Davis’ spokesman Byron Tucker of Santa Monica’s tactics. “However, Gov. Davis is looking out for the best interests of the entire state, and his budget reflects a balanced and responsible approach to this massive deficit.
“Whatever needs to be done, this deficit will be closed.”
Mathieu said city officials argue Davis’ proposal to take money away from cities may violate several state laws and the California constitution.
“There are questions regarding whether what the state is proposing is legal,” Mathieu said. “From our perspective, what they are proposing seems unconstitutional.”
“There are questions regarding whether what the state is proposing is legal. From our perspective, what they are proposing seems unconstitutional.” — — JEFF MATHIEU Resource Management Director
Santa Monica’s redevelopment agency receives about $19 million annually from the state through property taxes to help repair earthquake damage.
Since its inception nine years ago, the agency has issued more than $70 million in bonds. Davis’ proposal also could forbid redevelopment agencies from issuing any more bonds for 18 months.
Under the city’s proposal, the redevelopment agency would enter into a cooper-ation agreement making it legally responsible to pay for the $170-million worth of capital improvements planned for downtown Santa Monica.
“Our ability to comply with what we have promised the community is dependent upon these funds,” Mathieu said.
Originally published in the Santa Monica Daily Press print edition on January 9, 2003. Read the original PDF.