Hogar Dulce Hogar v. Community Development Commission

Under the Community Redevelopment Law (Health & Saf. Code, § 33000 et seq.) (CRL), local redevelopment agencies receive so-called tax increment funds generated by redevelopment projects they have initiated. The CRL requires that 20 percent of such tax increment funds be placed in a Low and Moderate Income Housing Fund (Housing Fund). The Legislature has directed that, in general, Housing Fund proceeds should be used to increase, improve or preserve a community’s supply of housing affordable to very-low-low-, and moderate-income individuals and families.

In this case an unincorporated association, plaintiff and appellant Hogar Dulce Hogar (Hogar), challenged the manner in which defendant and appellant Community Development Commission of the City of Escondido (the agency) calculated payment to its Housing Fund. In its 1997 complaint, Hogar alleged that in calculating the amount it paid into the Housing Fund, the agency had unlawfully deducted from its gross tax increment receipts amounts it had agreed to pay the County of San Diego (the county) and then paid the Housing Fund 20 percent of its net tax increment receipts. Hogar asserted the CRL requires that 20 percent of…