AgdaPkt 2008-08-25 Joint City Council, HHCC and Redevelopment

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8A Page 11 'Budget' Continued from Page 1... Details of Budget Proposal Remain Sketchy Rumors emerged mid-week about a possible budget agreement between Senate Pro Tem Don Perata (0- Oakland) and Gov. Arnold Schwarzenegger. Although the details of this agreement have not been released, some of the themes remain: a temporary sales tax increase, additional cuts, some budget reform, etc. The good news for cities is that so far the Pro Tem has repeatedly told the press that the deal does not involve any borrowing. The League is still working to determine if this budget deal includes a $200 million on-going take from redevelopment funds. Such a proposal would have significant impact on cities and the state as a whole because redevelopment funds provide vital economic stimulus and local infrastructure investments. With the state's commitment to meeting the goals of AB 32, the seizure of 5 percent of redevelopment funds would only cause the state to lose vital ground in reducing greenhouse gas emissions. Redevelopment agencies are the only local infrastructure and economic development tool that focuses on rebuilding urban cores and expanding infill development-the type of development that is essential to altering land use planning patterns to reduce emissions. The California Building Industry Association (CBIA) and the Major Home Builders Council (MHBC) have been actively working the Administration and Republican legislators in opposition to a redevelopment shift. The League appreciates their focused efforts to try to prevent this terrible budget solution. The letter from the CBIA underscores the fact the state will lose $20,000 in revenue for every unit of housing not constructed, and redevelopment agencies are responsible for the construction of 10,000 affordable units each year-a potential loss to the state of $160 million to the state. Deadlines and Other Factors There are some upcoming key deadlines and other factors which may impact the culmination of a budget deal: · California Secretary of State Debra Bowen set Saturday, Aug. 16 as the deadline (that often slips) for measures to qualify for the November 2008 ballot. Changes to the high speed rail bond, any Constitutional budget reform, and a possible water bond must be placed on the November ballot. While lawmakers can change statutory deadlines that apply to placing issues on the ballot, the cost of delay escalates and practical problems are created for election officials producing ballot pamphlets. · The Democratic National Convention starts Aug. 25 in Denver, Colo. and many Democratic legislators had planned to attend. Senate Pro Tem Perata instructed his caucus to cancel their trips without a budget. Some Assembly members, however, appear to be making plans to attend. · Aug. 31 is the Constitutional deadline for the end of the 2007-08 legislative session. The Legislature could continue in an emergency session after that deadline. · The Governor has also vowed to veto all bills that reach his desk until a budget agreement is reached. This may become more significant as the Aug. 31, adjournment date approaches. League Engages City Officials, City Managers and Board This week the League held several special meetings to update members and energize participation in the budget process. League Executive Director Chris McKenzie convened several conference calls on Tuesday, Aug. 12, with city managers statewide to alert them to some facts and myths about the budget. The concem is that the state budget could rely on mandatory "loans" of local government and transportation funds that may never be repaid and a seizure of redevelopment funds. 2