Anchor ads are not supported on this page.

4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs

Nah, don't want to spend it on low-income housing

City ordered to distribute $12M in unspent funds

The city can no longer stash more than $12 million in former redevelopment money intended for building low- and moderate-income housing, says a January 20 letter from California's Department of Finance.

On April 6, the San Diego City Council must transfer between $12.25 million and $12.61 million from a city account to the former redevelopment agency (now known as the Successor Agency), to be used on low- and moderate-income housing projects or to pay down debt. The city and the Successor Agency must do so before any additional tax money from the Redevelopment Property Tax Trust Fund can be collected and disbursed.

Much has changed since governor Jerry Brown dissolved redevelopment agencies in 2012. Millions of dollars being shuffled around from account to account to be spent on loans, debt, and to build projects is now under the watchful eye of the Department of Finance.

Sponsored
Sponsored

Twice a year, the city council, acting as the Successor Agency, is required to submit a "Recognized Obligation Payment Schedule" listing projects and payments owed to third parties with former redevelopment dollars. California's Department of Finance must sign off on the payment schedule before additional cash is allocated.

On January 20, California's Department of Finance finalized its decision on the so-called "unencumbered funds" of $11,905,560 it found sitting in an account. That amount has increased slightly.

"...the [successor] agency did not expend these funds as anticipated during the respective periods. Therefore the agency's authority to expend the funds has expired," read the January 20 letter from the Department of Finance.

San Diego's winding down of redevelopment has not been pretty. The tug-of-war with the Department of Finance over redevelopment tax dollars has resulted in multiple lawsuits and millions of dollars in outside legal fees.

Part of the problem is that certain loans were made between the City of San Diego and the former redevelopment agency when redevelopment tax agencies were in full swing.

At first, the loans were necessary to get projects started before property-tax revenue was collected. But cities such as San Diego continued to make loans to the redevelopment agency and continued to shuffle money from different accounts to pay for other expenses. As part of the dissolution of redevelopment agencies, the state requires that, before being repaid, the Successor Agency must turn over all unencumbered cash from the former redevelopment agencies to the county so it can be distributed to school districts, county, and other municipal governments.

In the past, the city has responded by filing lawsuits to challenge the determinations of the Department of Finance. According to a recent staff report, the city will not initiate a lawsuit in this matter.

"The housing bond reserve funds are not needed," says the city, "because the bond trustee already holds the required reserve amount and the [Department of Finance] has consistently approved the Successor Agency’s payment of the actual debt service for the pertinent housing bonds…. Therefore, the reclassification of these housing funds for use in paying bond-related enforceable obligations...will not result in any default on existing bond obligations, including any minimum reserve thresholds."

Here's something you might be interested in.
Submit a free classified
or view all
Previous article

Croome Brothers Trio, Jack Tempchin, Ricky, Swami & the Bed Of Nails, Kahlil Nash

Acoustic and electric in Del Mar, La Jolla, Little Italy, and City Heights

The city can no longer stash more than $12 million in former redevelopment money intended for building low- and moderate-income housing, says a January 20 letter from California's Department of Finance.

On April 6, the San Diego City Council must transfer between $12.25 million and $12.61 million from a city account to the former redevelopment agency (now known as the Successor Agency), to be used on low- and moderate-income housing projects or to pay down debt. The city and the Successor Agency must do so before any additional tax money from the Redevelopment Property Tax Trust Fund can be collected and disbursed.

Much has changed since governor Jerry Brown dissolved redevelopment agencies in 2012. Millions of dollars being shuffled around from account to account to be spent on loans, debt, and to build projects is now under the watchful eye of the Department of Finance.

Sponsored
Sponsored

Twice a year, the city council, acting as the Successor Agency, is required to submit a "Recognized Obligation Payment Schedule" listing projects and payments owed to third parties with former redevelopment dollars. California's Department of Finance must sign off on the payment schedule before additional cash is allocated.

On January 20, California's Department of Finance finalized its decision on the so-called "unencumbered funds" of $11,905,560 it found sitting in an account. That amount has increased slightly.

"...the [successor] agency did not expend these funds as anticipated during the respective periods. Therefore the agency's authority to expend the funds has expired," read the January 20 letter from the Department of Finance.

San Diego's winding down of redevelopment has not been pretty. The tug-of-war with the Department of Finance over redevelopment tax dollars has resulted in multiple lawsuits and millions of dollars in outside legal fees.

Part of the problem is that certain loans were made between the City of San Diego and the former redevelopment agency when redevelopment tax agencies were in full swing.

At first, the loans were necessary to get projects started before property-tax revenue was collected. But cities such as San Diego continued to make loans to the redevelopment agency and continued to shuffle money from different accounts to pay for other expenses. As part of the dissolution of redevelopment agencies, the state requires that, before being repaid, the Successor Agency must turn over all unencumbered cash from the former redevelopment agencies to the county so it can be distributed to school districts, county, and other municipal governments.

In the past, the city has responded by filing lawsuits to challenge the determinations of the Department of Finance. According to a recent staff report, the city will not initiate a lawsuit in this matter.

"The housing bond reserve funds are not needed," says the city, "because the bond trustee already holds the required reserve amount and the [Department of Finance] has consistently approved the Successor Agency’s payment of the actual debt service for the pertinent housing bonds…. Therefore, the reclassification of these housing funds for use in paying bond-related enforceable obligations...will not result in any default on existing bond obligations, including any minimum reserve thresholds."

Comments
Sponsored
Here's something you might be interested in.
Submit a free classified
or view all
Previous article

Angry Pete’s goes from pop-up to drive-thru

Detroit Pizza sidles into the husk of a shuttered Taco Bell
Next Article

Making Love to Goats, Rachmaninoff, and Elgar

Comments
Ask a Hipster — Advice you didn't know you needed Big Screen — Movie commentary Blurt — Music's inside track Booze News — San Diego spirits Classical Music — Immortal beauty Classifieds — Free and easy Cover Stories — Front-page features Drinks All Around — Bartenders' drink recipes Excerpts — Literary and spiritual excerpts Feast! — Food & drink reviews Feature Stories — Local news & stories Fishing Report — What’s getting hooked from ship and shore From the Archives — Spotlight on the past Golden Dreams — Talk of the town The Gonzo Report — Making the musical scene, or at least reporting from it Letters — Our inbox Movies@Home — Local movie buffs share favorites Movie Reviews — Our critics' picks and pans Musician Interviews — Up close with local artists Neighborhood News from Stringers — Hyperlocal news News Ticker — News & politics Obermeyer — San Diego politics illustrated Outdoors — Weekly changes in flora and fauna Overheard in San Diego — Eavesdropping illustrated Poetry — The old and the new Reader Travel — Travel section built by travelers Reading — The hunt for intellectuals Roam-O-Rama — SoCal's best hiking/biking trails San Diego Beer — Inside San Diego suds SD on the QT — Almost factual news Sheep and Goats — Places of worship Special Issues — The best of Street Style — San Diego streets have style Surf Diego — Real stories from those braving the waves Theater — On stage in San Diego this week Tin Fork — Silver spoon alternative Under the Radar — Matt Potter's undercover work Unforgettable — Long-ago San Diego Unreal Estate — San Diego's priciest pads Your Week — Daily event picks
4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs
Close

Anchor ads are not supported on this page.