Walnut Creek Keeps Lights On At Redevelopment Agency

The Walnut Creek City Council took a step Tuesday night toward continuing the city's redevelopment agency under fiscal terms laid down by the state — referred to as "extortion" several times by city officials.

As the city prepares to vote to continue the Walnut Creek Redevelopment Agency, Mayor Cindy Silva noted, "We built into the ordinance that we will be paying under protest."

The city supports filed with the California Supreme Court Monday that challenges the constitutionality of the state's restructuring of redevelopment. Plaintiffs in that suit include the League of California Cities and the cities of Union City and San Jose.  

Walnut Creek has relatively few redevelopment projects compared to other area cities, but has helped build parking garages and low-income housing in the past.

The council unanimously passed a resolution authorizing staff to forward a continuation ordinance by Nov. 1. The state Department of Finance is due to let the city know by Aug. 1 the amount of the required continuation payment by the city to the state so the city may continue to utilize the benefits of tax-increment financing.

The California Redevelopment Association has estimated Walnut Creek's payment would be $1.3 million for 2011-12, dwindling to $316,000 per year thereafter with the last project due to be paid off by 2014.

The continuation amounts to "keeping the lights on" at the redevelopment agency, said Council member Kish Rajan.
The agency's proposed budget, due to be voted on by the council Aug. 2, shows a revised expenditure level of $4.08 million for 2010-11, dropping to a projected $2.67 million in 2011-12.