10:00 PM PDT on Wednesday, July 20, 2011

By DARRELL R. SANTSCHI
The Press-Enterprise

Grand Terrace may have to surrender $2.8 million to the state of California this year and more than $670,000 a year in the future to keep the city’s redevelopment agency alive.

The City Council voted preliminary approval July 12 of an ordinance re-starting the agency after state budget legislation abolished local redevelopment agencies. The state left the door open to reinstate them on a voluntary basis, provided local governments pay the state hefty shares of the money they raise.

The Grand Terrace council is expected to take up final approval of the ordinance Tuesday.

City Manager Betsy Adams told the council that Grand Terrace will appeal the $2,850,665 amount it owes this year to the state’s Director of Finance, who could rule on the appeal by Sept. 15 and has the option of extending the deadline another month.

The city is also hoping the state legislation will be overturned by the courts as a result of a lawsuit filed on behalf of local redevelopment agencies.

“This is a money grab. That’s all this is,” Grand Terrace Mayor Walt Stanckiewitz told his fellow council members. “The state is extorting $2.8 million out of Grand Terrace.”

He said that without redevelopment, 22 cents on every tax dollar paid by Grand Terrace residents would come to the city. With redevelopment, 64 cents comes to the city, he said.

Councilman Bernardo Sandoval said that if the state wanted to abolish redevelopment for the benefit of taxpayers, it would have lowered property taxes to refund the money.

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