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More Manteca job cuts possible
Demise of RDA could force loss of additional city jobs
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Manteca municipal layoffs may not be over after all.

The California Supreme Court ruling giving the legislature the power to pull the plug on redevelopment agencies plus striking down a “pay to play” scheme to keep such agencies going in some form is jeopardizing City of Manteca jobs.

City Manager Karen McLaughlin confirmed Monday that there are five full time equivalent positions on city staff funded by redevelopment agency money. That doesn’t include other jobs that are funded indirectly when the RDA is charged for services that other city general fund departments provide such as finance, administration, and community development.

As things stand now, Manteca is likely not to receive enough of a bump in property tax revenue flowing into the general fund from the demise of the RDA to fund all of the positions.

“We will have to look at other funding sources,” McLaughlin said.

The city manager added that additional layoffs might be needed.

Most experts representing RDAs as well as the state believe that regardless of what happens the state must cover debt payments accumulated by redevelopment agencies first. That is about all that seems to be certain.

• There is a move afoot in the legislature to extend RDAs beyond Feb.1 when the plug is officially scheduled to be pulled until at least May. That would give the California Legislature time to possibly allow a reconstituted redevelopment agency law to be put in place that gives the state the money they want and lets RDAs continue with specific projects such as infrastructure for economic stimulus and affordable housing.

• There is some question about where money in RDA accounts would now go. The state at the moment would have county auditor controllers receive the money for redistribution.

• The status of RDA funds committed to exiting city projects is also up in the air.

McLaughlin noted there is a general belief that the majority of the California Legislature would favor RDAs being continued in some form. That is the message that was conveyed last year when the legislature adopted the two measures - one to extract money from RDAs and the other requiring them to pay the state in future years in order to continue functioning. McLaughlin said there is talk to allow RDAs to continue doing infrastructure investment for economic stimulus and affordable housing.

“That fits into exactly what we have been doing with RDA money,” McLaughlin said.

Even if RDAs are allowed to continue, McLaughlin said “RDA as we now know it will no longer exist.”

McLaughlin noted that there has been abuse of RDA funds in some jurisdictions but most - like Manteca - have complied with state law.

She added that just like the corruption in the City of Bell managed to mar the reputations of cities that operated within the law, bad apples in the barrel of RDA agencies have given everyone a black eye when they have done things by the book.

Manteca’s impact on personnel with the loss of RDA funds won’t be as hard as in some cities. Oakland, for example, has dozens of police officers paid by RDA funds because they patrol exclusively in areas within that city’s RDA boundaries.

McLaughlin said city staff is closely monitoring the situation with RDA funds as it will have a major impact on the overall municipal budget.

Manteca RDA debt at $458M

Manteca RDA in mid-2011 had a $458 million debt. It includes $255 million in pass through payments to various taxing entities in the area including the Manteca Unified School District and San Joaquin County that the Manteca RDA is under obligation to honor over the next 20 plus years.

The next biggest chunk is almost $138 million in bond payments for money the RDA borrowed. The single biggest project bond proceeds were used for was the $30 million Big League Dreams sports complex. State law required RDAs to go onto debt in order to exist. They money borrowed is paid back from future property tax revenue.

The Manteca RDA had a balance of $76.7 million in borrowed funds as of July 1, 2010. That money is committed to numerous projects ranging from interchanges to community improvements. That amount has since been whittled down due to payments the state has demanded and other projects.

RDA leverages economic growth

The RDA has provided money the city has used in the past to help make it possible to turn the shuttered Spreckels Sugar plan into a teeming business park that attracted $250 million in private sector investment using an outright $1 million RDA investment and an $8 million RDA loan for infrastructure that was repaid with interest years ahead of schedule.

It is the same money that built the BLD sports complex, put in infrastructure to make the Stadium Retail Center possible and has provided hundreds upon hundreds Manteca residents with affordable housing opportunities whether it is subsidized low-income housing for seniors and families or grants to help low-income senior homeowners to make health and safety improvements to their houses.