Appeals court rules against City of Galt in fight over redevelopment agency funds

By John Myers | Jun 12, 2017

The California Third District Court of Appeal recently ruled against the City of Galt, upholding a lower court’s decision to block a cooperative agreement between the city and a redevelopment agency.

SACRAMENTO — The California Third District Court of Appeal recently ruled against the City of Galt, upholding a lower court’s decision to block a cooperative agreement between the city and a redevelopment agency.

In 2011, Gov. Jerry Brown proposed a plan to quash redevelopment agencies. But before the plan, dubbed “the Dissolution Law,” went into effect, the City of Galt struck a $22 million deal with a redevelopment agency for several projects, including the Central Galt Corridor Rehabilitation and Union Pacific Railroad parking lot.

The new law, however, “renders unenforceable any agreement between a local agency and its former redevelopment agency… during a specified period of time before dissolution took place,” the appeals court said in its decision.

Though the city reached the agreement before the law went into effect, the California Department of Finance (DOF) held that the deal with the redevelopment agency was unenforceable because it fell within that timeframe. The city then filed suit, but a trial court sided with DOF.

The city appealed, arguing the deal was enforceable and that the DOF did not have the legal authority to bar the deal. The appeals court, however, disagreed, ruling that “none of [the] City of Galt’s contentions has merit.”

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