In a landmark victory for private property owners in the Golden State, the California Supreme Court today upheld a statute abolishing the nearly 400 redevelopment agencies across the state. The court also struck down a law that would have allowed these agencies to buy their way back into existence. The final outcome of the case is that, in 2012, California’s decades-long redevelopment nightmare will finally come to an end.
California redevelopment agencies have been some of the worst abusers of eminent domain for decades, violating the private property rights of tens of thousands of home, business, church and farm owners. The Institute for Justice has catalogued more than 200 abuses of eminent domain across California during the past ten years alone. In California Scheming: What Every Californian Should Know About Eminent Domain Abuse, the Institute for Justice exposed the enormous amounts of taxpayer money used to fund these illegitimate land grabs. In fiscal year 2005-2006 alone, redevelopment agencies’ revenues were an astonishing $8.7 billion. In other words, 12 percent of all property taxes in California that year were sent to these bureaucrats.
As part of the state’s response to its fiscal emergency and to stop this drain on the state’s resources, the legislature passed, and Governor Jerry Brown signed, two laws: Assembly Bill 1X 26, which dissolves redevelopment agencies, and Assembly Bill 1X 27, which exempted agencies that agreed to make payments into funds benefiting the state’s schools and special districts. The California Redevelopment Association and the League of California Cities, among others, challenged both laws, arguing that they violated the California Constitution.
The court held that AB 1X 26, the law barring the agencies from engaging in new business and providing for their windup and dissolution, was “a proper exercise of the legislative power vested in the Legislature by the state Constitution.” The court concluded that the Legislature has both the power to create such agencies “and the corollary power to dissolve those same entities when the Legislature deems it necessary and proper.” In contrast, the court concluded that AB 1X 27, which allowed the agencies to continue to exist if they made certain payments, violated a provision of the California Constitution that prohibits the Legislature from requiring payments from redevelopment agencies to the state.
“This decision represents the worst of all worlds for California redevelopment agencies—and the best of all worlds for California property owners and renters,” said Dana Berliner, a senior attorney with the Institute for Justice. “The agencies managed to achieve a decision that upholds their dissolution while striking down a law that gave these agencies a way to stay in existence. The agencies’ arrogance, so often employed against property owners, finally proved their undoing.” The Institute for Justice is a public interest law firm that is the nation’s leading defender of victims of eminent domain abuse—when the government seizes perfectly fine property not for public use, but for private development—across the country, including in California.
While the decision focused on specific provisions of the California Constitution, its practical effect represents a significant victory for California property owners. “Redevelopment in California has been a billion-dollar, state-subsidized boondoggle that has completely eroded private property rights through the abuse of eminent domain for private gain,” said Christina Walsh, the Institute’s director of activism and coalitions. “With the court’s decision, redevelopment has finally met its long-overdue end, and property owners who have been living in terror across the state can finally rest safe in what they’ve worked so hard to own.”
IJ attorney Bill Maurer said, “Today’s decision reaffirms the common-sense conclusion that state agencies do not have a constitutional right to perpetual existence. More importantly, it means that California is no longer lagging behind the rest of the country in respecting private property. Rather than interfering with California’s recovery, this decision should encourage it, as people considering moving to or staying in California now know that their property cannot be seized and transferred to a private entity by out-of-control, unaccountable redevelopment agencies.”
Christina Walsh
Director of Activism and Coalitions
Institute for Justice
901 N. Glebe Road, Suite 900
Arlington, VA 22203
(703) 682-9320
(703)-682-9321 (fax)
www.ij.org
www.castlecoalition.org
Bill Gram-Reefer is Editor & Publisher of Halfway To Concord, founded in 2004. Halfway To Concord is the leading online source for community-driven political news, events, and opinion for Contra Costa County and the San Francisco East Bay.
{ 8 comments… read them below or add one }
There has to be roads, schools, the community benefit projects such as the University and Research Center/Library, parks and the like. These need to be paid for and done. Some sort of control over these needs to be established and the money found to do it.
There you go spending money you don’t got, Edi. RDAs borrow money they don’t have on the promise of using incremental tax revenue to pay off instead of existing tax dollars to go to paying for schools and fire departments. Let Pfizer build the research lab on their own dime. You don’t need an RDA for this sort of development.
My concern is for the development of the Concord Weapon Station which is a poster child for blight and the sort of thing that you might exactly want a Redevelopment Agency for. Possibly a similar structure will be created just to handle
CNWS.
Edi, the idea of CNWS is to get it out of government hands into those that can develop it per BRAC process and its subsequent agreements. The last thing we need is for Concord to try to own CNWS and parcel it out to political cronies, otherwise it would be just a huge recycling center and training center for Concord cops.
Good Riddance!!! Enough of the corporate welfare, giving developers billions of dollars to develop pet projects for politicians, new grandiose city halls (like Pittsburg), and even a Casino in San Pablo’s Case. Enough is enough, tax payers are sick of these government agencies infringing on their private property rights for the “greater good” and diverting tax dollars from schools and other essentials services. I don’t think that the average tax payer in California is going to loose any sleep over this ruling, contrary to what the politicians tell us.
This may really change the looks of Contra Costa. Redevelopment allows for perk projects on top of supplementing public services. Poor Pittsburg will feel this badly. This will result in serious local changes. I hope we do not see a barage of new tax measures or increased fees. Government’s solution to poor spending habits always results in more taxes and or fees instead of fiscal responsibility. On a brighter side state employees will see daylight and more perk projects for our kids to bail out. If only all government had to adhere to spending only what it has rather what it thinks it might get.
If you abuse it, you lose it.
No more raiding of redevelopment funds to pay public parasites (a.k.a. government employees) in completely unrelated departments.
Eagerly awaiting the cries of unfairness from the public parasites (a.k.a. government employees) as agencies beg them to pay 0.5% of their pension costs due to the lost piggy bank, (while the taxpayers pay 99.5% of the pension costs).
Redevelopment agencies don’t necessary mean eminent domain, (e.g. Concord and the weapons station). It would have been better to address areas of abuse rather than knee-jerk all agencies out of existence, these bodies have contractual and bond obligations, who will take these on, the state or (more likely) the cash strapped cities who were forced down the redevelopment path to stay solvent? What you are chalking up as a victory is in fact the start of a long process of unraveling obligations and relationships which will leave us all poorer as we pick up the pieces.