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$4.6 million bill for city due soon

Posted: Tuesday, May 7th, 2013

WATSONVILLE — A bill will be due for the city of Watsonville by the end of the week, to the tune of $4.6 million.

The amount comes from a 2006 loan from the former Watsonville Redevelopment Agency to the city to build the Civic Plaza on Main Street and the adjacent parking garage on Rodriguez Street.

The city paid back the loan in March 2011, about a month after Gov. Jerry Brown proposed eliminating the state’s 400 redevelopment agencies as a cost-cutting move. The state Supreme Court upheld that decision in December 2011, which called into question property tax funds that were allocated to cities by the state before the end of redevelopment agencies.

In a March 26, 2013, letter to Watsonville, the state Department of Finance stated that the loan was not an “enforceable obligation,” and demanded that the city repay it.

Under the law that dissolved redevelopment agencies, the only enforceable obligations were those that occurred up to two years after the redevelopment agencies were formed, according to California Department of Finance spokesman H.D. Palmer.

Palmer added, however, that if Watsonville meets certain financial obligations — such as completing an audit of its low and moderate housing income fund and transferring the $4.6 million to the county auditor-controller — the city could then request to reclaim the money through future property tax allocations.

For the complete article see the 05-07-2013 issue.

Click here to purchase an electronic version of the 05-07-2013 paper.

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