05-10-2011 CC RPT 36a - Laserfiche WebLink

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`Meeting' Continued from Page 1... The officers expressed appreciation to Sens. Tom Berryhill (R- Stanislaus), Anthony Canella (R- Ceres), Republican Leader Bob Dutton (R- Inland Empire), Bill Emerson (R- Riverside), Tom Harman (R- Huntington Beach), Bob Huff (R- Diamond Bar), Ted Lieu (D- Torrance) and Rod Wright (D -Los Angeles), and Assembly Members Bill Berryhill (R- Stockton), Paul Cook (R- Yucaipa), Kristin Olsen (R- Modesto) and Cameron Smyth (R -Santa Clarita) for their strong opposition to the Governor's proposal to eliminate redevelopment agencies. The officers also commended Sen. Wright for his strong leadership in opposing the Governor's efforts to eliminate redevelopment and in crafting SB 286, a comprehensive redevelopment reform measure supported by the California Redevelopment Association. The full League board of directors will consider supporting SB 286 on Monday, May 2. In the meeting with Gov. Brown, President Ridenour and Past President Loveridge restated the critical importance of redevelopment to the state's and local economies and renewed the League's offer to work with him on a compromise to his elimination proposal. The delegation briefly presented the redevelopment reforms contained in SB 286 (Wright) (which the League board will review next Monday) and expressed the League's support for the CRA's /League's voluntary funding alternative to the Governor's proposal. The meeting closed with a discussion of the need for pension reform at the state and local levels, with the Governor asking probing questions about the fiscal challenges facing cities with burgeoning pension obligations. In separate meetings with the Speaker and Assembly Member Luis Alejo (D- Salinas), the officers delivered the same message that the League is supporting the CRA/League funding alternative to the Governor's redevelopment elimination proposal and that the full board will be taking action on the reform bill, SB 286, next week. The Speaker and Assembly Member Alejo expressed strong interest in working with the League and CRA on redevelopment reforms that will forge a stronger state -local partnership on job creation and other important priorities. The Speaker, a former redevelopment commissioner in Los Angeles, indicated that he expected to begin work on a reform package in the very near future and that he would engage the League and other key stakeholders as part of that process. The League will report the outcome of the board meeting on Monday and the League's position with regard to SB 286. `AB 506' Continued from Page 1... AB 506 is an unnecessary intrusion into what is fundamentally a local government's fiscal decision. Municipal bankruptcy has always been an option of last resort. Since the adoption of Chapter 9 of the Federal Bankruptcy Code in 1949, only two cities, and one county, in California have ever used the option. AB 506 undermines the benefits of federal bankruptcy protection by rendering the automatic stay of financial obligations meaningless by delaying the process of filing a petition with the court. Cities will no longer have the immediate "breathing space" necessary to formulate a debt readjustment plan. Most importantly, without immediate access to the bankruptcy court the state is putting local services at risk. AB 506 purports to offer assistance to cities by intervening before Chapter 9 Municipal Bankruptcy protection is filed and requiring, what is being called, "mediation." The bill would require local agencies seeking bankruptcy protection to first be reviewed by a State commission comprised of elected officials and then be subject to "mediation" to determine whether bankruptcy is the appropriate course of action. However, in reality, the bill would subvert the existing bankruptcy process, which is neutral, in favor of a new process which is clearly biased against local agencies. • The League opposes AB 506 for the following reasons: • Impedes local government finance authority. It creates obstacles to the Municipal Bankruptcy process rather than assistance and only serves to impede a local agency from being able to file Chapter 9 bankruptcy protection. 2 36a -2