LOS ANGELES -- Santa Clara, Calif. must return approximately $273 million it received from its now dissolved redevelopment agency, State Controller John Chiang found in a
Chiang’s office has been conducting reviews of asset transfers of each of the state’s dissolved redevelopment agencies as they go through the wind-down process following the shutdown of redevelopment in early 2012.
The review of Santa Clara found that the RDA transferred $373 million in assets to the city, which included unallowable transfers totaling $279 million that should have been turned over to the successor agency.
In May 2012, Santa Clara transferred $5.9 million of funds to the successor agency under a short-term, no-interest cash flow loan agreement, bringing the remaining unallowable assets to a total of $273 million, according to the review.
Dan Beerman, a spokesperson for Santa Clara, said the city could not comment specifically on the review due to ongoing litigation, but that they look forward to meeting with state officials to resolve this issue as soon as possible.
The controller’s review is mandated by legislation that dissolved all redevelopment agencies in California by February 2012 and created “successor agencies” to pay off any RDA-related debts.
The successor agencies, which are governed by a locally appointed oversight board, are in charge of servicing the former agencies’ debt.
“Moving away from a long-time dependence on redevelopment funds and now sharing those funds with other local programs has been a difficult transition for many cities,” Chiang said in a statement. “My office will continue to work closely with these cities to ensure that they understand their responsibilities and successfully comply with new state laws.”
