Cohen

A few months before the 2011 enactment of legislation leading to the “Great Dissolution” of California’s redevelopment agencies, the Petaluma Community Development Commission issued bonds to fund certain projects. The commission was the redevelopment agency (Agency) for the City of Petaluma (City), and the newly funded projects included an interchange and roadway undercrossing-of U.S. Highway 101 (the Rainier Project).

The City, as successor to the Agency, submitted various recognized obligation payment schedules (ROPS) that included expenditures of bond proceeds for the Rainier Project. The Department disapproved certain of these expenditures because they were pursuant to contracts to which the Agency was not a party. The City brought a petition for a writ of mandate, seeking an order to require the Department to approve these expenditures. The trial court denied the petition.

On appeal, the City contends the Department abused its discretion in disapproving ROPS items relating to the use of bond proceeds for the Rainier Project. It contends the 2011 bonds are enforceable agreements that require the proceeds be spent on specified projects, including the Rainier Project.…