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Cities Make Payments to State

By Jerry Bernstein

The cities of Cerritos, Artesia and Hawaiian Gardens were notified by the state they had to make payment on money it says the cities owe related to the dissolution of their Redevelopment Agencies authorized by an act of the state legislature signed by the Governor on June 27.
Cerritos City Manager Art Gallucci said the city received an e-mail [demand] on July 9 at 5 p.m. calling for a payment of $6 million by July 12 at 5 p.m. He said e-mail arrived just prior to the city council meeting but would not effect the budget because city had anticipated what the amount might be and was prepared for the hit.
The city of Hawaiian Gardens had to pay $74,207. Artesia officials were in a meeting at press time and could not be reached.
At the July 9 city council meeting, Cerritos Assistant City Manager Kathy Matsumoto gave a brief report on AB1484, the Redevelopment Budget Trailer Bill that was signed by the Governor on June 27. The 73 page document expanded the powers of the Department of Finance, empowering them to suspend the payment of sales taxes and property taxes to successor agencies if they do not make a payment of property taxes to other local taxing agencies by July 12. The $6 million allegedly will be paid to the local taxing agencies.
Matsumoto said the bill also allows the Department to impose $10,000 a day in fines to the successor agencies. She said the League of California Cities has called the bill unconstitutional as sales taxes that are used at the local level and the reallocation of property taxes requires a 2/3 vote of the legislature which AB1484 did not receive