Thursday, December 4, 2008

Suit Challenges Redevelopment Fund Raid

According to the Sacramento Bee (here), the California Redevelopment Association, an umbrella organization for local redevelopment agencies has filed a lawsuit challenging the Legislature's attempt in this year's budget trailer bill to "raid" redevelopment funds. The lawsuit is based on Article XVI, Section 16, which provides for the taxation of property located in a redevelopment area. The suit apparently contends that this provision requires that the "tax increment" portion of property located in a redevelopment area--the portion presumably attributable to the redevelopment--be used only for redevelopment related purposes. It's worth noting that previous challenges to the Legislature's attempt to raid local government funds have been unsuccessful.

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