BY ALEX CANTATORE
Staff Reporter
Turlock may be forced to say “Hasta la vista, baby,” to redevelopment funds for the next five years. Gov. Arnold Schwarzenegger’s recent, unprecedented, third budget proposal includes a scheme to take, not borrow, redevelopment money at a rate of either 5 percent of the city’s total redevelopment funds or $225 million, whichever is greater.
The proposal could cost Turlock more than $400,000 yearly for half a decade.
“The proposal’s impacts could be devastating,” said Tim Lynch of Platinum Advisors, Turlock’s lobbying firm. “A lot of redevelopment funds retail development, and is intended to fund sales tax growth. Why are we taking money out of one pocket to put it in another pocket?”
The ransacking of RDA funds remains a contentious issue in Sacramento.
California voters passed Propositions 1A and 42 in recent years, restricting the government from borrowing city funds. However, a loophole could allow the state to take redevelopment funds despite those measures.
“I expect there will be litigation,” Lynch said. “(The question is) at what point is it redevelopment money, which isn’t specifically called out in the legislation.”
The new budget proposal also calls for a 1 percent sales tax hike for the next three years, to be followed by a 1.25 percent cut. To further make ends meet, the state may borrow against future lottery proceeds.
The Governor is also proposing a comprehensive budget reform to prevent such a stalemate from happening again. The proposal would include a firmer spending cap, a rainy day fund, and would grant the Governor the authority to make mid-year spending reductions based on income.
The state is unlikely to make any budget decisions in the coming weeks as both the Democrats and Republicans have left Sacramento to attend their national conventions.
In other state news, Turlock recently received its first allocation of Proposition 1B street and roads funds from the state, worth $1 million. The second installment is due this fiscal year.
Additionally, a $10 billion bond proposal for high-speed rail looks to be on track to make this November’s ballot, along with a $9.8 billion water bond that may include funding for surface water storage.
Lastly, Assemblyman Tom Berryhill (R-25) has a bill in the works that hopes to reduce metal thefts. The bill requires all junk buyers to document transactions and provide periodic reports to local police.
To contact Alex Cantatore, e-mail acantatore@turlockjournal.com or call 634-9141 ext. 2005.
Originally published in the Turlock Journal 8/29/2008.
Retrieved from the Turlock Journal Web site.