City to lose $11.2 million?

State is poised to snag billions in local redevelopment funds

The city of Chico learned Tuesday (May 4) that it could lose as much as $11.2 million in redevelopment funds. That’s because Sacramento Superior Court Judge Lloyd Connelly ruled that the state can appropriate more than $2 billion from local redevelopment agencies and transfer the funds to school operations.

That’s good news for the state budget but bad news for local agencies, which will have to put many infrastructure projects on hold. The California Redevelopment Association vowed to appeal the decision and seek a stay to block a transfer of $1.7 billion scheduled for next week.

In Chico, the funding loss would delay several capital-improvement projects, City Manager Dave Burklund said. He worries that the state will raid RDA funds again and again if it’s deemed to be legal. The only silver lining is that, with the beast fed, it’s less likely to raid the city’s general fund, he said.