L.A. Development Agencies Cheat|Schools of Billions, District Says

LOS ANGELES (CN) – The Montebello school district claims that Los Angeles County is illegally letting local development agencies take a “staggering” amount of money that should be going to public schools. The school district claims it will be cheated of more than $200 million, and that other schools and the state itself will be cheated of billions of dollars if the practice is allowed to continue.

     Montebello Unified School District claims that a slew of redevelopment agencies pocketed property tax money that should have gone to schools.
     “This petition presents a multibillion-dollar questions of statutory construction: Do respondents Los Angeles County, Los Angeles County’s Auditor-Controller, and local redevelopment agencies arrogate to cities, counties, and special districts an illegally inflated share of local property tax revenue – thus shortchanging the public schools and the State of California by improperly implementing provisions of the Community Redevelopment Law Reform Act of 1993?”
     The Legislature created Educational Revenue Augmentation Funds in the early 1990s “to reallocate tax revenue to the public schools for the benefit of the state,” according to the complaint in Superior Court.
     The tax money was to be distributed to school districts, reducing the state’s direct obligations, the complaint states. In 1993, the Community Redevelopment Law Reform Act formalized “the financial relationship between local redevelopment agencies and other public entities with the power to levy property taxes.” The law required local redevelopment agencies to contribute, or “pass through,” some of the tax money that came with redevelopment projects.
But Los Angeles County and its auditor-controller let the redevelopment agencies keep the money, the school district says. It says the amount of money involved is “staggering.”
     “Respondents’ sleight-of-hand improperly inflates the amount of property taxes retained by the county, cities, and special districts at the expenses of the public schools and the state,” the complaint states. “In so doing, it contravenes the plain meaning, legislative history, and manifest legislative purpose of all the applicable statutes.
“the amount of tax revenue wrongfully withheld from the public schools as the result of respondents’ above-described tactics is staggering. Petitioner estimates that it stands to lose nearly $200 million over the next 45 years due to respondents’ failure to proceed according to law.”
     Montebello schools seeks writ of mandate and the property tax money the district has been denied since Jan. 1, 1994. It is represented by David Kenney with Kenney & Kropff.
     The dozens of defendants include redevelopment districts, water districts, sanitation districts, and others.

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