State Takeover Could Create a $13 Million per Year Hole in City Budget


In June of 2011, in an effort to balance the State’s budgetary woes, the State of California abolished local Redevelopment Agencies. Hundreds of redevelopment agencies throughout the State – including the City of Santa Clara – were required to shut down and liquidate their assets to fund State obligations or go to other government entities. The City of Santa Clara anticipates having to transfer tens of millions of dollars out of the City to meet the State’s requirements. These are funds that were to go towards local affordable housing projects, community economic development and job creation, and other projects to revitalize the local community.

Prior to the passage of the law abolishing Redevelopment Agencies, the Redevelopment Agency for Santa Clara legally transferred property to the City of Santa Clara that had been developed by the agency.  The estimated value of these assets and properties is $300 million.  The transfer of these assets and properties took place months before the new law took effect and the City of Santa Clara believes the State has no right to the properties.  Some of the properties that the State may force the City to transfer and/or liquidate include:

• Santa Clara Convention Center

• California’s Great America

• TechMart

• Hyatt Hotel

• Hilton Hotel

Rent and land leases from these assets total approximately $13 million per year.  This income goes directly to the City budget to pay for such services as Police, Fire, Libraries and Parks & Recreation.  If the State forces the City to transfer/liquidate the properties, the impact will be detrimental to services that are already on a severely limited budget.

The Chamber strongly opposes this takeover by the State and is asking our members to do the same.  The Mayor and Council for the City of Santa Clara have written an open letter to the citizens and businesses, it is available for review. We have also included links to this page in recent email blasts to our membership.  The Chamber encourages you to take a moment to let your local legislators know your feelings on this ill-advised attempt by the State to take over City assets.  The State Controller will soon be releasing a report that will detail what properties and assets the State will be requiring cities to hand over.  Let your legislators and the Governor know your feelings on this critical issue-the time to act is NOW before the report is released!


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