SR 08-23-2011 7B~® Supplemental City Council
~~tvof Report
Santa Monica
City Council Meeting: August 23, 2011 qq
Agenda Item: ~"' °-`.u
Ta Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Ordinance Authorizing the City of Santa Monica to Participate in the
Alternative Voluntary Redevelopment Program, Subject to Certain
Conditions and Reservations
Recommended Action
Staff recommends that the City Council adopt the attached ordinance.
Executive Summary
At its meeting on August 9, 2011, the City Council introduced for first .reading the
attached ordinance, which is now presented to the City Council for adoption. After first
reading, on August 11 and 17, 2011, respectively, the California Supreme Court issued
a Partial Stay and Modification of its Partial Stay Order ("Partial Stay") in California
Redevelopment Association v Matosantos (S194861) .(Matosantos). The Matosantos
lawsuit challenges recent state legislation which would dissolve Redevelopment
Agencies. This supplemental report apprises the City Council why the ordinance's
adoption is consistent with developments in the Matosantos litigation.
Discussion:
As part of the State's budget bills, ABX1 26 (AB 26) and ABX1 27 (AB 27) became law.
AB 26 would suspend all activities (except enforceable obligations) of the Santa Monica
Redevelopment Agency (the Agency) as of June 29, 2011, dissolve the Agency as of
October 1, 2011, and liquidate the assets of the Agency subsequent to dissolution,
unless the City timely adopts an "opt-in" Ordinance that continues the Agency's
existence under Section 34193(a) of AB 27, by authorizing the City to participate in the
statute's "Alternative Voluntary Redevelopment Program" and agreeing to make
remittance payments. AB 27 was stayed in its entirety by the Supreme Court's initial
stay order of August 11th, but the sections involved in the State Director of Finance's
determination of the remittance amount due under AB 27 were revived by the
1
subsequent modification of the Partial Stay on August 17th. Notwithstanding the
Supreme Court's August 17th modification, the Partial Stay suspends the effectiveness
of that portion of AB 27 which authorizes the adoption of continuation ordinances.
Staff is concerned that the Agency not be subject to interruption in the performance of
its obligations and programs, and that it be in a position to continue operation, in the
event that AB 26 and AB 27 are ultimately upheld as constitutional or relevant portions
of the Partial Stay of AB 27 are dissolved beforehand. It is difficult to predict the effect
the Partial Stay may have on AB 27 statutory compliance dates, including the
enactment of the opt-in ordinance or payment of the remittance amount, if both statutes
are upheld. Special Counsel for the Agency and City have advised that to ensure the
least possible disruption in light of the Partial Stay and litigation, that an Ordinance
adopted to participate in the Alternative Voluntary Redevelopment Program be
conditional and operative only if AB 26 and 27 are upheld or the Partial Stay lifted.
Section 4 of the attached ordinance provides for that conditional approval. It states:
"This Ordinance shall only be deemed as 'enacted' within the meaning of Part 1.9 upon (i)
adoption of this Ordinance and (ii) the legally effective date of AB 26 and AB 2T'.
(Emphasis added.) Thus, the Ordinance will be deemed enacted upon a final
determination by the California Supreme Court of the legality of AB 26 and AB 27 or the
lifting of the Stay to allow operation of AB 27. If the state statutes are upheld, the Agency
will be in the best position to continue its existence under this Ordinance. Finally, nothing
in this Ordinance is intended to violate the conditions of the Supreme Court's Stay.
Prepared by: Alan Seltzer, Chief Deputy City Attorney
roved:
Forwarded to Council:
~,
Ma sha J n s Moutri~ Rod Gould
Ci ttor e City Manager
2
City Council Meeting: August 23, 2011
Agenda Item: ~'
To: Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Ordinance Authorizing the City of Santa Monica to Participate in the
Alternative Voluntary Redevelopment Program, Subject to Certain
Conditions and Reservations
Recommended Action
Staff recommends that the City Council adopt the attached ordinance
Executive Summary
At its meeting on August 9, 2011, the City Council introduced for first reading an
ordinance authorizing the City of Santa Monica to participate in the alternative voluntary
redevelopment program, subject to certain conditions and reservations. The ordinance
is now presented to the City Council for adoption.
Prepared by: Marsha Jones Moutrie, City Attorney
Approved: Forwarded to Council:
l ~
Marsha Jone utrie
City Att me
..
Rod Gould
City Manager
Reference Ordinance No.
2368 (CCS)