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Return Of The Jedi: Will Redevelopment Agencies Be Revived In California?

In 2011, the California Legislature, at the urging of Governor Jerry Brown, dissolved all California redevelopment agencies (RDAs). The first bill that Brown signed into law prevented RDAs from engaging in new activities and outlined a process for winding down their financial affairs. The second bill allowed individual RDAs to avoid dissolution if they made "substantial" annual payments into a Special District Allocation and Educational Revenue Augmentation Fund.

The League of California Cities, along with other interested parties brought suit against the state in response. The California Supreme Court upheld the constitutionality of the first bill, but struck down the second.

Given the huge financial stakes involved, it is no surprise that these powerful interests were not going to take this ruling lying down. Now Californians will be asked to vote on the California "Jobs and Education Development Initiative" (JEDI) on the November 4, 2014 ballot to see if they want to revive California's Community Redevelopment Law.

California RDAs had been around for over 60 years before their dissolution. The idea behind the creation of redevelopment districts was to convert "blighted" districts into more desirable areas. Those more desirable developments would then increase a city's tax base.

Those opposed to California's redevelopment system claimed that appointed and therefore, unelected redevelopment governing boards, or RDAs, were corrupt, exacerbated California's fiscal problems, and were exploitative. The main argument they proffered against the system was that RDAs were given too much latitude in deciding which properties or even whole neighborhoods were considered "blighted" and could then be condemned under eminent domain. Charges of corruption were leveled when redevelopment projects were handed to politically connected corporations and developers.

California had a reputation for being one of the worst states in the nation for eminent domain abuse prior to the dissolution of RDAs in 2011.

Proponents of redevelopment claim that California lost $40.79 billion in economic activity; lost over 300,000 jobs; and gave up $2 billion in state and local tax revenues after the RDAs were dissolved. The non-partisan Legislative Analyst's Office debunked those numbers saying that they were "seriously flawed."

The JEDI Act would expand the old redevelopment system by expanding the physical and economic conditions that constitute blight. Some contend that under the JEDI provisions, much of the state of California could be considered blighted.

The eminent domain attorneys at the Peterson Law Group will be following the developments of JEDI as it draws nearer to a vote by the people of California. We are dedicated to protecting the rights of private property owners who are facing eminent domain condemnations. If you require legal representation concerning a property that is facing eminent domain condemnation, please call us at (213) 236-9720 or contact us online to set up a consultation concerning your case.

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