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State: Safety doesn’t count

The state has killed any hope that the county can recoup redevelopment funds to finish the Highway 12 project through the Springs.

Three times the county has submitted the Highway 12 project to the state’s Department of Finance as part of its recognized obligation payment schedule, which was required after a state Supreme Court decision dissolved redevelopment agencies statewide.

In a letter dated Monday from Steve Szalay, DOFs local government consultant, to John Haig, the county’s redevelopment manager, the state denied $9.5 million in funding for the Highway 12 project along with denying $6.6 million in funding for the Roseland shopping center in Santa Rosa.

The letter is in response to a second face-to-face meeting county officials had with Department of Finance officials earlier this month.

First District Supervisor Valerie Brown doesn’t know what the next steps will be.

“The board (of Supervisors) will have to decide what we want to do in terms of either moving forward with a lawsuit or backing the project in some other say,” Brown said. “I don’t know what the board will decide. We’re disappointed and we’re going to do what can do to get that project done.”

In his letter to Haig, Szalay says that agreements of contracts between the county and the redevelopment agency are not valid and are not enforceable agreements.

The county’s Oversight Board, that was created to dispose of property and projects from the former redevelopment agency, reentered into a contract for the Highway 12 project, but Szalay’s letter says the Oversight Board had no authority to do that.

Haig isn’t giving up yet.

“I think they’re misreading the statute,” he said. “Their letter seems to say that when our obligations were ruled invalid, they were invalid for all time regardless of the Oversight Board action.”

Haig said his read on the statute is that the Oversight Board can take a dissolved obligation and make it an enforceable obligation again.

“We’re looking at our options to continue to fight,” he said. “We want to have this conversation (with DOF) again.”

Haig added that while the deck may be stacked in DOFs favor, it doesn’t mean the agency is right.

Steve Cox, former chair of the now-dissolved Springs Redevelopment Advisory Committee, said “I continue to hold the opinion that the state’s decisions are contrary to the legislation that dissolved redevelopment. The Department of Finance’s decision is an illegal seizure of local funds. I have heard that Sonoma County is considering filing a lawsuit against the State and I encourage doing so.”

Cox, who is also the chair of the Springs Community Alliance, added, “I think the best course of action for the Springs community is to let its diverse voices be heard and protest against this illegal action, civilly and respectfully.”

While Brown is stepping down from the Board of Supervisors, both of her would-be replacements, Susan Gorin and John Sawyer, support the Highway 12 project.

“Highway 12 is absolutely a top priority,” Gorin said. “I serve on the Association of Bay Area Governments, we’ve identified this area as a priority development area, and there is funding available through that process for infrastructure and planning. I’m optimistic that … we will make this happen. It’s not going to be as quickly as if we had the $7 million that we think the state owes us, but I’m committed to making it happen.”

Sawyer was equally emphatic.

“We need to work together to take all those available funds that were generated through redevelopment or that are available through the final shakeout of redevelopment – we still don’t know what that’s going to look like. The state has handled it so poorly. I’ve never seen such mismanagement of the dissolution of a program. It’s just pitiful what they’ve done.”

The project in question would complete the installation of sidewalks, gutters and streetlights, among other things, in a section of Highway 12 from Boyes Boulevard in the south to Agua Caliente Road on the north.

The first phase of the project from Encinas Avenue to Boyes Boulevard was finished in 2010.

When the redevelopment agencies were dissolved as of Feb. 1, the county was just weeks away from putting the project for Phase 2 out to bid. All of the utility undergrounding had been done and all of the rights-of-way had been acquired.

The county sold $15 million in bonds in 2008 to pay for the entire project.

Szalay’s letter to Haig says, “Finance is not allowed to make decisions on the basis of economic viability, public safety or any other socioeconomic factors. We review many projects listed as enforceable obligations that may have substantial merit and potential benefits to the community in which the former RDA resides. Unfortunately, we cannot take these criteria into consideration when making decisions.”