PROPERTY RIGHTS ADVOCATES REJOICE! BUT BE ON YOUR GUARD.

◼ link - Ashlee Titus, Esq./The Flash Report

From a policy standpoint, this decision is a victory for property rights advocates and for state and local governments struggling to provide basic government services. RDAs are known as prolific abusers of eminent domain, and have suffered from a number of scandals related to misuse and mismanagement of funds. RDAs have been unable to provide proof of any economic advantage from their activities. Instead, they shuffle economic development projects between neighboring communities, but do not generate a net increase in such activity on a statewide basis. State and local governments will now have greater flexibility to craft their budgets because RDA funds will be unencumbered from that specific use, and will be available to pay for basic government services, such as education, police and fire. The state budget will benefit too – while ABX1 27 was expected to relieve the state’s general fund from having to pay $1.7 billion for education, transit and fire districts in the 2011-2012 fiscal year, the Legislative Analyst estimated that the complete elimination of the agencies would free up $3 billion (after repayment of RDA debts and obligations) to provide funding to local governments and offset state general fund costs (mostly for education) during the same time frame.

The California Redevelopment Association is already chirping about the dire economic fallout from the Supreme Court’s decision this morning. As the Legislature prepares to reassemble for the second half of the 2011-2012 session, expect supporters in the Legislature to go to heroic lengths to revive RDAs.