Dibley

The question in this case is whether the Lancaster Redevelopment Agency may issue bonds secured by funds earmarked for low- and moderate-income housing to fund an “improvement” which has little, if anything, to do with the construction of affordable housing for the persons intended to be benefitted by the Community Redevelopment Law (CRL), section 33000 et seq. of the Health and Safety Code. Our answer is no.

Overview of the CRL

A.

In concept, the CRL was intended to help local governments revitalize blighted communities by reversing the decline of urban slum neighborhoods or areas which, due to physical or economic factors, have been rendered economically useless and a liability to the community. In fact, the CRL has sometimes been misused to subsidize a city’s economic development through the diversion of property tax revenues from other taxing entities, a feat made possible by section 33670. As a result, various restrictions are placed on redevelopment under the CRL, to ensure that tax dollars allocated for redevelopment are properly used. For example, the redevelopment power may be exercised only when necessary to alleviate problems associated with blight. (§§…