Can A Redevelopment Agency Board Approve The Repayment Of An Agency Loan To A Local Business With Revenue From The City’s General Fund?
At the Last City Council Meeting, the Council, meeting and acting as the Redevelopment Agency, approved a loan in the amount of $150,000.00 to a new business called London’s Bar & Grille (London’s), 419 South Myrtle Avenue. The terms of the loan called for the loan to be repaid with funds from the sales tax revenues generated back to the city by that business which are paid into the general fund.
I do not believe that state law allows the redevelopment agency to take or earmark money for payment to the agency from the city’s general fund.
I do not believe that the City Council can even approve such a transfer of funds to the Redevelopment Agency for repayment of a loan to a business by the Agency.
I will be pursuing a definitive answer to this transaction through other county and state agencies and will keep all of you informed as to the answer.
[...] Cyrus Kemp over at Monrovia City Watch asks just that question. “Can A Redevelopment Agency Board Approve The Repayment Of An Agency Loan To A Local Business With Revenue From The City’s General Fund? Full post HERE. [...]
This is more then comingling of funds.
This is an agency that has no governance over the city’s general fund or approving the payment of money from that fund. Even though the council in our city acts as the redevelopment agency they are separate entities and a redevelopment agency does not necessarily have to be the city council. It may be made up of members appointed by the city council, in either case the redevelopment agency would not be able to approve payments from the city’s general fund.
These questions were submitted to the California First Amendment Coalition Legal Hotline on 06/09/09
Can Redevelopment Agency Board approve the repayment of an Agency Loan to a local business using sales tax credit revenue generated by that business from the city’s General Fund? The Redevelopment Agency Board is our City Council but they were meeting and taking action as the redevelopment agency.
Can the City Council approve such a loan repayment to the Redevelopment Agency from the city’s general fund?