City will pay $6 million to state to maintain agency
Jim Steinberg, Staff Writer
Posted: 07/27/2011 03:35:43 PM PDT

RIALTO – The City Council has voted unanimously to stay in the redevelopment game and pay the state what was described as a $6 million “ransom” early next year.

“The city stands to gain, and the residents stand to gain,” Councilman Joe Baca Jr. said after the Tuesday night meeting.

Councilman Ed Scott said the Redevelopment Agency “has been good for us, and we have spent our money wisely.”

The state’s budget includes two bills that require redevelopment agencies to send money to Sacramento if they want to keep their doors open.

In his presentation, Robb Steel, the city’s redevelopment director, injected humor into the meeting with a PowerPoint slide called “Ransom Note,” which said that the legislation means collectively redevelopment agencies will fork over $1.7 billon this year and $400 million “every year forever or you will die.”

That money is meant to go to public schools, courts and other public services.

For Rialto, the price to continue Redevelopment Agency projects is a $6 million payment on Jan. 15 and a payment of $1.4 million in fiscal year 2013, after which the amount will escalate slightly every year thereafter, Steel said.

The council passed a resolution declaring its intent to enact an ordinance saying it would participate in the state’s “voluntary” redevelopment program.

The council also passed on first reading an ordinance saying it would comply and participate in the voluntary redevelopment
program.

Both items were required under the state’s legislative action.

For cash-strapped Rialto, these hefty payments are a nonissue because the Redevelopment Agency will reimburse the city’s general fund.

Steel said that most of the $6 million payment will come from property-tax proceeds sent to the Rialto RDA for the development of low- and moderate- income housing projects.

In subsequent years, the payments will be pulled out of the agency’s general fund, which traditionally has been used to develop new projects.

“We can’t have any detriment to the city,” Steel said in an interview.

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