Frank V. Zerunyan | Public CEO
On June 28, 2011, Governor Jerry Brown signed into law two bills that effectively dissolved all California Redevelopment Agencies (RDAs). Through the California Redevelopment Association and the League of California Cities, local governments challenged the constitutionality of the two laws (ABx1 26 and ABx1 27) at the California Supreme Court. Unfortunately for local governments, the Court ruled in favor of the state, holding that what the state created it could legally dissolve. Despite several attempts to delay and change the rules of dissolution, there has been no indication that the Governor or the Legislature is intent in changing the status quo.
The California Legislature enacted the Community Redevelopment Act in 1945. The Act permitted cities and counties to set up redevelopment agencies (RDAs) in order to assist local governments in eliminating blight through development, reconstruction, and rehabilitation of residential, commercial, industrial, and retail districts. The Act was codified in 1951 and made part of the California Constitution, as well as the Health and Safety Code. At that point, it became known as the Community Redevelopment Law (CRL). The most important component of the CRL was the authority of local governments to use future increases in property taxes to subsidize or pay for current infrastructures and improvements. Tax increment financing (TIF) made it possible for local governments to use this public financing method to pay for community improvement projects. Read more