City governments across the state knew the dissolution of local redevelopment agencies would lead to some confusion and loss of money for the cities, but a $17.1 million bill from the state wasn't on the radar for the city of Cerritos.
The California Department of Finance has completed a review of the city's records and determined the amount is due to the state by the city.
According to a city-issued statement by Mayor Jim Edwards, "The City strongly disagrees with the State's findings," and the City will be requesting a meeting with Finance staff to ask the State to reconsider its decision.
An independent auditor had prepared a due diligence review of the Successor Agency to the Cerritos Redevelopment Agency Low and Moderate Income Housing Fund to determine the amount of money available from the fund for distribution to various taxing agencies, such as the city, County of Los Angeles and the state. The auditor determined no cash or cash equivalents were available for distribution.
It is this review that the State then reviewed.
"Finance disagreed with the conclusions and Finance staff has demanded that the City make a cash payment of $17.1 million to the State of California," the mayor wrote.
At the meeting with Finance staff, the City will present information it believes supports its position that the money is not required to be paid to the state and other taxing entities.
In December, the California Supreme Court ruled unanimously in favor of a state law passed in the summer of 2011 that abolished redevelopment agencies. According to an article published in the Los Angeles Times, at the time, more than 400 redevelopment agencies, which controlled about $5 billion in tax revenue annually, would cease to exist.
$3 Million losses at the CCPA, $3 Million dollar losses at the Magnolia Power Plant shows the obvious fiscal ignorance that goes on at city hall. The city council needs to explain to residents how they lost tens-of-millions of dollars of city money, on bad loans to redevelopment. In a nut shell, they gambled with city money to use as corporate welfare and lost. Now residents are being asked to pay for fiscal incompetence with higher fees. It's time city council members give up their lifetime benefits.