City Gives In to State 'Extortion' on Redevelopment

The Lake Forest City Council's interest in keeping its Redevelopment Agency running means it will pay the state annually to do so.

With much gnashing of teeth, the Lake Forest City Council voted Tuesday evening to save the city's Redevelopment Agency from dissolution by agreeing to annually cut the state a check for a portion of the money it collects.

"[State legislators] have mismanaged the state and run it into the ground from a budgetary standpoint," Mayor Peter Herzog said. "And their response is to eliminate our ability to improve housing and the business community."

In past months, Herzog has frequently called Gov. Jerry Brown's attempt to shut down the state's hundreds of redevelopment agencies and redirect the property taxes the local agencies collect to the state a form of "extortion."

As part of California's new state budget, cities must hand over all their redevelopment money to the state—unless they pay an annual "community remittance" fee.

For Lake Forest, that fee for 2011-12 is estimated at slightly more than $2 million. 

"The state demonizes redevelopment agencies," Councilman Mark Tettemer said at Tuesday's meeting. "We are using those funds to help improve our community."

To avoid a potential stoppage in redevelopment activities, the council voted first 4-0 to push through an urgency ordinance, which puts the decision into effect more rapidly than usual. (Councilman Scott Voigts abstained.)

The second vote in favor of paying the state and keeping the agency running was unanimous.

Had the council voted against paying the state fee, the Lake Forest Redevelopment Agency would have ceased to exist Oct. 1.

According to city staffers, the shutdown of the city's redevelopment activities, including the revitalization of multiple El Toro Road shopping centers, would significantly diminish the city's improvement efforts.

The next council meeting is Aug. 16.

Read the full article at: https://patch.com/california/lakeforest-ca/city-gives-in-to-state-extortion-on-redevelopment