California can approve $25 million in reimbursements for Huntington Beach for a former redevelopment loan, a Superior Court judge ruled last week.
The judge said California’s Department of Finance “should have treated” a 1988 redevelopment loan for the Waterfront project “as an enforceable obligation.” That means Huntington Beach is eligible for $22.4 million plus additional interest, equating to about $25 million, City Attorney Michael Gates said.
Community redevelopment agencies, meant to help cities revitalize blighted areas by allowing them to keep a greater portion of property-tax revenue for economic development, were axed by the state more than 10 years ago. Cities then worked with the state to sell or transfer ownership of properties that redevelopment agencies had purchased, extract money and pay off the agencies’ debts.
And some cities, like Huntington Beach, sued the state for reimbursements. Judge James Arguelles ordered on Feb. 27 that the Department of Finance treat Huntington Beach’s Waterfront loan — the project included the Waterfront Beach Resort across from Pier Plaza — as an enforceable obligation.
Huntington Beach will now have to follow the department’s process of submitting for reimbursement, expected to occur later this year, Gates said.
“This is a substantial ruling,” Gates said. “Anytime that Huntington Beach can get money back from the state, it’s a good thing. The ruling does represent, frankly though, that the state had been wrongfully withholding Huntington Beach taxpayers’ money for years.”
When the legislature dissolved redevelopment agencies, the Department of Finance was tasked with deciding whether loans qualified for repayment from local property taxes. With the Waterfront loan, the department had originally said no. The department is still reviewing the decision and has not “made a determination yet in terms of how we intend to proceed,” H.D. Palmer, a DOF spokesperson, said.
But,…
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