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Redevelopment Asset Reviews

Background

Hercules Redevelopment Agency Asset Transfer Review

Local Redevelopment Agencies (RDAs) in the past received more than $5 billion annually in property taxes. But the Governor and State Legislature, in passing the 2011-12 State Budget, decided to dissolve those agencies and redirect the tax dollars to other local services such as schools, healthcare, fire and public safety services.

The Governor and Legislature, through the provisions of AB1X 26 and AB 1484, require local governments to create successor agencies to take care of any outstanding RDA debt, and then use the remaining assets to support local public services. The successor agency is controlled by an independent oversight board made up of local appointees.

The budget-related law that dissolves RDAs requires any RDA assets transferred to a city, county or other local agency after January 1, 2011, to be sent back to successor agencies. This ensures that any remaining RDA assets are used only to pay off local debt or to provide funding for locally delivered public services.

The Governor and Legislature also directed the Controller's Office to review all RDA asset transfers made to a city, county or other local agency after January 1, 2011. Any asset transferred to a public agency that was not contractually committed to a third party by June 28 must be sent to the RDA's successor agency and be used to retire debt or support local services.

Oversight boards may send an asset back to a local government if it serves a legitimate governmental purpose and there is no objection by the Governor's Department of Finance. In addition, the oversight board may transfer RDA housing assets to the local housing authority.

See a list of RDA reviews completed by the Controller’s Office as well as those in progress.

For more information, see the Controller's 2011 Redevelopment Review, developed for the California State Legislature.

Read the Controller's April 2012 letter on asset transfers.

The Controller's Office also has issued a list of agreed-upon procedures for the asset reviews, developed with county Auditor- Controllers across the state.

The Department of Finance has created a website dedicated to RDA information and procedures following the 2011-12 State Budget.