Successor Agency

On December 29, 2011, the California Supreme Court ("Court") published its decision in the California Redevelopment Association v. Matosantos case finding that AB 1X 26 (the "Dissolution Act") constitutional and AB 1X 27 (the "Alternative Redevelopment Program Act") unconstitutional. This decision means that all redevelopment agencies in the State of California were dissolved as of February 1, 2012, and none will have the opportunity to continue operating under the alternative program.

As provided for under the new law, each former redevelopment agency is to be governed by a "Successor Agency" and an "Oversight Board". On January 10, 2012, the Stanton City Council voted to assume the responsibilities of the Successor Agency for the former Stanton Redevelopment Agency.

In general, all of the assets, properties, contracts, leases and records of the former Redevelopment  Agency are to be transferred to the Successor Agency. The Successor Agency will in turn, be responsible for overseeing and winding down the remaining legal and contractual obligations ("enforceable obligations") of the agency. Essentially that obligation amounts to ensuring: the implementation of all existing contracts and agreements; payment of all existing indebtedness and financial obligations; and performing any required asset transfers or liquidations. Additionally, the Successor Agency will be responsible for preparing an annual administrative budget and paying any unencumbered fund balances to the County Auditor-Controller for distribution to the local taxing districts.

UPDATE - Effective July 1, 2018 the Orange Countywide Oversight Board was established by California Senate Bill 107 and pursuant to California Health and Safety Code § 34179(j) to oversee and direct the Successor Agencies within the County of Orange.
Each Successor Agency will be subject to oversight from an Oversight Board which shall have fiduciary responsibilities to the holders of enforceable obligations and the taxing entities that benefit from distributions of property tax and other revenue. Each Oversight Board will consist of seven (7) members and are to be composed of one member each appointed by the County Board of Supervisors, Mayor, the largest special district by property tax share (Orange County Sanitation District), the Orange County Superintendent of Education, the Chancellor of the California Community Colleges, a public member appointed by the County Board of Supervisors, and a member representing former employees of the RDA appointed by the Mayor. The Oversight Board must report their chairperson and members to the Department of Finance by May 1, 2012. 

Redevelopment was a valuable tool used by local governments to create jobs, build housing, improve local infrastructure, develop or renovate shopping centers in local communities, and raise the value of commercial and residential properties.  Funding used by redevelopment agencies were local funds, not new taxes, generated by the appreciation of the assessed value of properties located in a special district called the “Project Area.”  The Tax Increment generated by the increased property values funded public projects to the benefit of local communities. Through countless examples of projects across the State of California, redevelopment agencies created tens of thousands of jobs and generated billions of dollars of revenue for the State and local economy used to fund various public services throughout its history.  Unfortunately, on February 1, 2012, redevelopment agencies were abolished by the State Legislature and Governor Jerry Brown through the enactment of AB1X 26.  As a result, most of these local funds previously used for revitalization will now be used by the State to fund its budget deficit.