January 08, 2012 3:14 PM
Brooke Edwards Staggs, City Editor
VICTORVILLE • Even before the state axed redevelopment agencies to bolster its budget, the viability of Victorville’s RDA was in question, according to an annual audit released this week.
A $5.3 million deficit in assets and millions more in interfund loans had caused the city’s RDA to have liquidity problems, which the auditor stated “raise substantial doubt about the agency’s ability to continue as a going concern.”
Victorville established its first redevelopment area 31 years ago to rehabilitate and develop some 1,686 acres along Bear Valley Road and Hook Boulevard. The city added a smaller RDA in 1998 to clean up the blighted Old Town area, using the additional tax revenue to buy up property and improve aesthetics.
In September and October of 2009, the city loaned a total of $11.8 million from its redevelopment agency to its Southern California Logistics Airport Authority. The funds were needed for activities at the airport and to make debt service on bonds taken out for improvements there.
With SCLAA carrying a $101 million deficit and recently hit with default notices for missing debt payments, the airport authority doesn’t appear to have means to pay back those loans in the foreseeable future. Still, City Manager Doug Robertson said Victorville had intended to temporarily loan another $7.5 million from its RDA to SCLAA to make debt service Dec. 1, but held off due to state legislation pending at the time.
Last summer, Gov. Jerry Brown decided to eliminate all RDAs and redirect their tax revenue to support schools and local services. On Dec. 29, the California Supreme Court up held that decision.
When asked Thursday how Victorville’s RDA could have loaned the money to cover SCLAA’s debt given the liquidity issues outlined in the audit, Robertson said the money actually would have been pulled from a pooled city account and paid back by April as new tax revenue came in.
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