Stanford Law School - Robert Crown Law Library

Filed 12/29/11



IN THE SUPREME COURT OF CALIFORNIA



CALIFORNIA REDEVELOPMENT

ASSOCIATION et al.,

Petitioners,

S194861

v.

ANA MATOSANTOS, as Director, etc.,

et al.,

Respondents;

COUNTY OF SANTA CLARA et al.,

Interveners and Respondents. )





Responding to a declared state fiscal emergency, in the summer of 2011 the

Legislature enacted two measures intended to stabilize school funding by reducing

or eliminating the diversion of property tax revenues from school districts to the

state‘s community redevelopment agencies. (Assem. Bill Nos. 26 & 27 (2011-

2012 1st Ex. Sess.) enacted as Stats. 2011, 1st Ex. Sess. 2011-2012, chs. 5-6

(hereafter Assembly Bill 1X 26 and Assembly Bill 1X 27); see also Assem. Bill

1X 26, § 1, subds. (d)-(i); Assem. Bill 1X 27, § 1, subds. (b), (c).) Assembly Bill

1X 26 bars redevelopment agencies from engaging in new business and provides

for their windup and dissolution. Assembly Bill 1X 27 offers an alternative:

redevelopment agencies can continue to operate if the cities and counties that

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created them agree to make payments into funds benefiting the state‘s schools and

special districts.

The California Redevelopment Association, the League of California

Cities, and other affected parties (collectively the Association) promptly sought

extraordinary writ relief from this court, arguing that each measure was

unconstitutional. They contended the measures violate, inter alia, Proposition 22,

which amended the state Constitution to place limits on the state‘s ability to

require payments from redevelopment agencies for the state‘s benefit. (See Cal.

Const., art. XIII, § 25.5, subd. (a)(7), added by Prop. 22, as approved by voters,

Gen. Elec. (Nov. 2, 2010).) The state‘s Director of Finance, respondent Ana

Matosantos, opposed on the merits but agreed we should put to rest the significant

constitutional questions concerning the validity of both measures.1 We issued an

order to show cause, partially stayed the two measures, and established an

expedited briefing schedule. We also granted leave to the County of Santa Clara

and its auditor-controller, Vinod K. Sharma (collectively Santa Clara), to intervene

as respondents.

We consider whether under the state Constitution (1) redevelopment

agencies, once created and engaged in redevelopment plans, have a protected right

to exist that immunizes them from statutory dissolution by the Legislature; and

(2) redevelopment agencies and their sponsoring communities have a protected

right not to make payments to various funds benefiting schools and special

districts as a condition of continued operation. Answering the first question ―no‖


1

Two other respondents, state Controller John Chiang and Alameda County

Auditor-Controller Patrick O‘Connell, who was sued on behalf of a putative class
of county auditor-controllers, took no position on the merits. All respondents have
been sued in their official capacities.

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and the second ―yes,‖ we largely uphold Assembly Bill 1X 26 and invalidate

Assembly Bill 1X 27.

Assembly Bill 1X 26, the dissolution measure, is a proper exercise of the

legislative power vested in the Legislature by the state Constitution. That power

includes the authority to create entities, such as redevelopment agencies, to carry

out the state‘s ends and the corollary power to dissolve those same entities when

the Legislature deems it necessary and proper. Proposition 22, while it amended

the state Constitution to impose new limits on the Legislature‘s fiscal powers,

neither explicitly nor implicitly rescinded the Legislature‘s power to dissolve

redevelopment agencies. Nor does article XVI, section 16 of the state

Constitution, which authorizes the allocation of property tax revenues to

redevelopment agencies, impair that power.

A different conclusion is required with respect to Assembly Bill 1X 27, the

measure conditioning further redevelopment agency operations on additional

payments by an agency‘s community sponsors to state funds benefiting schools

and special districts. Proposition 22 (specifically Cal. Const., art. XIII, § 25.5,

subd. (a)(7)) expressly forbids the Legislature from requiring such payments.

Matosantos‘s argument that the payments are valid because technically voluntary

cannot be reconciled with the fact that the payments are a requirement of

continued operation. Because the flawed provisions of Assembly Bill 1X 27 are

not severable from other parts of that measure, the measure is invalid in its

entirety.2


2

Amicus curiae City of Cerritos et al. raises additional constitutional

arguments against the validity of Assembly Bills 1X 26 and 1X 27 based on
provisions neither raised nor briefed by the parties. We do not consider them.

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I. BACKGROUND

A. Government Finance: The Integration of State, School, and

Municipal Financing

For much of the 20th century, state and local governments were financed

independently under the ―separation of sources‖ doctrine. In 1910, the Legislature

proposed, and the voters approved, a constitutional amendment granting local

governments exclusive control over the property tax. (Cal. Const., art. XIII,

former § 10, enacted by Sen. Const. Amend. No. 1, Gen. Elec. (Nov. 8, 1910); see

Simmons, California Tax Collection: Time for Reform (2008) 48 Santa Clara

L.Rev. 279, 285-286; Ehrman & Flavin, Taxing Cal. Property (4th ed. 2011)

§§ 1:9-1:10, p. 1-14.) Each jurisdiction (city, county, special district, and school

district) could levy its own independent property tax. (See, e.g., Temescal Water

Co. v. Niemann (1913) 22 Cal.App. 174, 176 [―It is conceded . . . that a

municipality has the right to assess all real property found within its limits for the

purpose of maintaining the municipal revenues, and that the county taxing officials

have the right to levy upon the same property for county purposes.‖].)

This system of finance had significant consequences for education. Under

the state Constitution, the Legislature is obligated to provide for a public school

system. (Cal. Const., art. IX, § 5; Wells v. One2One Learning Foundation (2006)

39 Cal.4th 1164, 1195.) Seeking to promote local involvement, the Legislature

established school districts as political subdivisions and delegated to them that

duty. (Wells, at p. 1195; Butt v. State of California (1992) 4 Cal.4th 668, 680-681;

see also California Teachers Assn. v. Hayes (1992) 5 Cal.App.4th 1513, 1523.)

Historically, school districts were largely funded out of local property taxes.

(Serrano v. Priest (1971) 5 Cal.3d 584, 592 (Serrano I); Serrano v. Priest (1976)

18 Cal.3d 728, 737-738 (Serrano II); see County of Los Angeles v. Sasaki (1994)

23 Cal.App.4th 1442, 1450.) Under the California system of financing as it

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existed until the 1970‘s, different school districts could levy taxes and generate

vastly different revenues; because of the difference in property values, the same

property tax rate would yield widely differing sums in, for example, Beverly Hills

and Baldwin Park. (Serrano I, at pp. 592-594.)

We invalidated that system of financing in Serrano I and Serrano II,

holding that education was a fundamental interest (Serrano I, supra, 5 Cal.3d at

pp. 608-609; Serrano II, supra, 18 Cal.3d at pp. 765-766) and that financing

heavily dependent on local property tax bases denied students equal protection

(Serrano I, at pp. 614-615; Serrano II, at pp. 768-769, 776). The Serrano

decisions threw ―the division of state and local responsibility for educational

funding‖ into ― ‗a state of flux.‘ ‖ (Los Angeles Unified School Dist. v. County of

Los Angeles (2010) 181 Cal.App.4th 414, 419.) In their aftermath, a ―Byzantine‖

system of financing (California Teachers Assn. v. Hayes, supra, 5 Cal.App.4th at

p. 1525) evolved in which the state became the principal financial backstop for

local school districts. Funding equalization was achieved by capping individual

districts‘ abilities to raise revenue and enhancing state contributions to ensure

minimum funding levels. (Lockard, In the Wake of Williams v. State: The Past,

Present, and Future of Education Finance Litigation in California (2005) 57

Hastings L.J. 385, 388-391; see generally Wells v. One2One Learning Foundation,

supra, 39 Cal.4th at p. 1194 [discussing current funding regime].)

A second event of seismic significance followed shortly after, with the

voters‘ 1978 adoption of Proposition 13. (Cal. Const., art. XIII A, added by

Prop. 13, as approved by voters, Primary Elec. (June 6, 1978).) As noted, before

1978 cities and counties had been able to levy their own property taxes.

Proposition 13 capped ad valorem real property taxes imposed by all local entities

at 1 percent (Cal. Const., art. XIII A, § 1, subd. (a)), reducing the amount of

revenue available by more than half (Stark, The Right to Vote on Taxes (2001)

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96 Nw.U. L.Rev. 191, 198). In place of multiple property taxes imposed by

multiple political subdivisions, it substituted a single tax to be collected by

counties and thereafter apportioned. (Cal. Const., art. XIII A, § 1, subd. (a).)

Significantly, Proposition 13 did not specify how that 1 percent was to be divided,

instead leaving the method of allocation to state law. (See Cal. Const., art. XIII A,

§ 1, subd. (a) [real property tax is ―to be . . . apportioned according to law to the

districts within the counties‖]; Amador Valley Joint Union High Sch. Dist. v. State

Bd. of Equalization (1978) 22 Cal.3d 208, 225-227; County of Los Angeles v.

Sasaki, supra, 23 Cal.App.4th at pp. 1454-1457; City of Rancho Cucamonga v.

Mackzum (1991) 228 Cal.App.3d 929, 945.)

Proposition 13 transformed the government financing landscape in at least

three ways relevant to this case. First, by capping local property tax revenue, it

greatly enhanced the responsibility the state would bear in funding government

services, especially education. (See County of Los Angeles v. Sasaki, supra,

23 Cal.App.4th at pp. 1451-1452; California Teachers Assn. v. Hayes, supra,

5 Cal.App.4th at pp. 1527-1528.) Second, by failing to specify a method of

allocation, Proposition 13 largely transferred control over local government

finances from the state‘s many political subdivisions to the state, converting the

property tax from a nominally local tax to a de facto state-administered tax subject

to a complex system of intergovernmental grants. (See Rev. & Tax. Code, § 95

et seq.; Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization,

supra, 22 Cal.3d at pp. 226-227; Sasaki, at pp. 1454-1455; Stark, The Right to

Vote on Taxes, supra, 96 Nw.U. L.Rev. at p. 198.)3 Third, by imposing a unified,


3

State law dictates the formulas county auditor-controllers are to apply in

allocating the property tax among cities, counties, special districts, and school
districts. Setting aside for the moment the portion of the property tax going to


(footnote continued on next page)

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shared property tax, Proposition 13 created a zero-sum game in which political

subdivisions (cities, counties, special districts, and school districts) would have to

compete against each other for their slices of a greatly shrunken pie.

In 1988, the voters added another wrinkle with Proposition 98, which

established constitutional minimum funding levels for education and required the

state to set aside a designated portion of the General Fund for public schools.

(Cal. Const., art. XVI, § 8; see Los Angeles Unified School Dist. v. County of Los

Angeles, supra, 181 Cal.App.4th at p. 420; California Teachers Assn. v. Hayes,

supra, 5 Cal.App.4th at pp. 1517-1518.) Two years later, the voters revised and

effectively increased the minimum funding requirements for public schools.

(Prop. 111, Primary Elec. (June 5, 1990) amending Cal. Const., art. XVI, § 8; see

County of Sonoma v. Commission on State Mandates (2000) 84 Cal.App.4th 1264,

1289.)

In response to these rising educational demands on the state treasury, the

Legislature in 1992 created county educational revenue augmentation funds

(ERAF‘s). (Stats. 1992, chs. 699, 700, pp. 3081-3125; Rev. & Tax. Code, §§ 97.2,

97.3; see Los Angeles Unified School Dist. v. County of Los Angeles, supra, 181

Cal.App.4th at pp. 420-421; City of El Monte v. Commission on State Mandates

(2000) 83 Cal.App.4th 266, 272-274; County of Los Angeles v. Sasaki, supra,

23 Cal.App.4th at p. 1447.) It reduced the portion of property taxes allocated to

local governments, deposited the difference in the ERAF‘s, deemed the balances

part of the state‘s General Fund for purposes of satisfying Proposition 98


(footnote continued from previous page)

redevelopment agencies, roughly 57 percent of the remainder goes to schools,
21 percent to counties, 12 percent to cities, and 10 percent to special districts.
(Legis. Analyst‘s Off., The 2011-2012 Budget: Should California End
Redevelopment Agencies? (Feb. 9, 2011) p. 10.)

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obligations, and distributed these amounts to school districts. (County of Sonoma

v. Commission on State Mandates, supra, 84 Cal.App.4th at pp. 1275-1276; see

Los Angeles Unified School Dist. v. County of Los Angeles, supra, 181

Cal.App.4th at p. 426 [ERAF‘s are an ― ‗accounting device‘ ‖ for reallocating

property taxes to school districts from other local government entities].)

Periodically thereafter, the Legislature through supplemental legislation required

local government entities to further contribute to the ERAF‘s in order to defray the

state‘s Proposition 98 school funding obligations. (Los Angeles Unified School

Dist., at pp. 420-421.) Local governments had no vested right to property taxes

(id. at p. 425); accordingly, the Legislature could require ERAF payments as ―an

exercise of [its] authority to apportion property tax revenues.‖ (City of El Monte,

at p. 280; see Cal. Const., art. XIII A, § 1, subd. (a).)

B. Redevelopment Agencies

In the aftermath of World War II, the Legislature authorized the formation

of community redevelopment agencies in order to remediate urban decay. (Stats.

1945, ch. 1326, p. 2478 et seq. [Community Redevelopment Act]; Stats. 1951,

ch. 710, p. 1922 et seq. [codifying and renaming the Community Redevelopment

Law, Health & Saf. Code, § 33000 et seq.];4 see Cal. Const., art. XVI, § 16.) The

Community Redevelopment Law ―was intended to help local governments

revitalize blighted communities.‖ (City of Cerritos v. Cerritos Taxpayers Assn.

(2010) 183 Cal.App.4th 1417, 1424; see Marek v. Napa Community

Redevelopment Agency (1988) 46 Cal.3d 1070, 1082.) It has since become a

principal instrument of economic development, mostly for cities, with nearly

400 redevelopment agencies now active in California.

4

All further unlabeled statutory references are to the Health and Safety

Code.

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A redevelopment agency may be (and usually is) governed by the

sponsoring community‘s own legislative body. (§ 33200; Coomes et al.,

Redevelopment in California (4th ed. 2009) pp. 21-23.)5 An agency is authorized

to ―prepare and carry out plans for the improvement, rehabilitation, and

redevelopment of blighted areas.‖ (§ 33131, subd. (a).) To carry out such

redevelopment plans, agencies may acquire real property, including by the power

of eminent domain (§ 33391, subd. (b)), dispose of property by lease or sale

without public bidding (§§ 33430, 33431), clear land and construct infrastructure

necessary for building on project sites (§§ 33420, 33421), and undertake certain

improvements to other public facilities in the project area (§ 33445). While

redevelopment agencies have used their powers in a wide variety of ways, in one

common type of project the redevelopment agency buys and assembles parcels of

land, builds or enhances the site‘s infrastructure, and transfers the land to private

parties on favorable terms for residential and/or commercial development.

(Coomes, pp. 16-19; see, e.g., Marek v. Napa Community Redevelopment Agency,

supra, 46 Cal.3d at p. 1075.)

Redevelopment agencies generally cannot levy taxes. (Huntington Park

Redevelopment Agency v. Martin (1985) 38 Cal.3d 100, 106; City of Cerritos v.

Cerritos Taxpayers Assn., supra, 183 Cal.App.4th at p. 1424; City of El Monte v.

Commission on State Mandates, supra, 83 Cal.App.4th at p. 269.) Instead, they

rely on tax increment financing, a funding method authorized by article XVI,

section 16 of the state Constitution and section 33670 of the Health and Safety

Code. (City of Dinuba v. County of Tulare (2007) 41 Cal.4th 859, 866; City of El


5

According to the Association‘s evidence, more than 98 percent of all

redevelopment agencies are governed by a board consisting of the county board of
supervisors or city council that created the agency.

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Monte, at pp. 269-270.) Under this method, those public entities entitled to

receive property tax revenue in a redevelopment project area (the cities, counties,

special districts, and school districts containing territory in the area) are allocated a

portion based on the assessed value of the property prior to the effective date of

the redevelopment plan. Any tax revenue in excess of that amount—the tax

increment created by the increased value of project area property—goes to the

redevelopment agency for repayment of debt incurred to finance the project.

(Cal. Const., art. XVI, § 16, subds. (a), (b); § 33670, subds. (a), (b); City of

Dinuba, at p. 866.) In essence, property tax revenues for entities other than the

redevelopment agency are frozen, while revenue from any increase in value is

awarded to the redevelopment agency on the theory that the increase is the result

of redevelopment. (City of Cerritos, at p. 1424.)

The property tax increment revenue received by a redevelopment agency

must be held in a special fund for repayment of indebtedness (§ 33670, subd. (b)),

but the law does not restrict the amount of tax increment received in a given year

to that needed for loan repayments in that year. (Marek v. Napa Community

Redevelopment Agency, supra, 46 Cal.3d at p. 1083.) The only limit on the annual

increment payment received is that it may not exceed the agency‘s total debt, less

its revenue on hand. (§ 33675, subd. (g).) Once the entire debt incurred for a

project has been repaid, all property tax revenue in the project area is allocated to

local taxing agencies according to the ordinary formula. (§ 33670, subd. (b).)

A powerful and flexible tool for community economic development, tax

increment financing nonetheless ―has sometimes been misused to subsidize a

city‘s economic development through the diversion of property tax revenues from

other taxing entities . . . .‖ (Lancaster Redevelopment Agency v. Dibley (1993)

20 Cal.App.4th 1656, 1658; see Regus v. City of Baldwin Park (1977) 70

Cal.App.3d 968, 981-983.) This practice became more common in the era of

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constricted local tax revenue that followed the passage of Proposition 13. Some

small cities with blighted areas available for industrial redevelopment ―were able

to shield virtually all of their property tax revenue from other government

agencies,‖ but ―[e]ven in ordinary cities . . . the temptation to use redevelopment

as a financial weapon was considerable. Because it limited increases in property

tax rates, Proposition 13 created a kind of shell game among local government

agencies for property tax funds. The only way to obtain more funds was to take

them from another agency. Redevelopment proved to be one of the most powerful

mechanisms for gaining an advantage in the shell game.‖ (Fulton & Shigley,

Guide to California Planning (3d ed. 2005) pp. 263-264.) Today, redevelopment

agencies receive 12 percent of all property tax revenue in the state. (See Assem.

Bill 1X 26, § 1, subd. (f); Legis. Analyst‘s Off., The 2011-2012 Budget: Should

California End Redevelopment Agencies?, supra, p. 1.)

Addressing these concerns, the Legislature has required redevelopment

agencies to make certain transfers of their tax increment revenue for other local

needs. First, 20 percent of the revenue generally must be deposited in a fund for

provision of low and moderate income housing. (§§ 33334.2, 33334.3, 33334.6;

see City of Cerritos v. Cerritos Taxpayers Assn., supra, 183 Cal.App.4th at

p. 1424.) Second, redevelopment agencies must make a graduated series of pass-

through payments to local government taxing agencies such as cities, counties, and

school districts from tax increment on projects adopted or expanded after 1994.

(§ 33607.5, subd. (a)(2); see Los Angeles Unified School Dist. v. County of Los

Angeles, supra, 181 Cal.App.4th at pp. 421-422.) The payments are distributed

according to the taxing agencies‘ ordinary shares of property taxes. (Id. at

pp. 422-423.)

Of greatest relevance here, the Legislature has often required

redevelopment agencies, like cities and counties, to make ERAF payments for the

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benefit of school and community college districts. (See §§ 33680, 33681.7 to

33681.15, 33685 to 33692; former § 33681 (Stats. 1992, ch. 700, § 1.5, pp. 3115-

3116); former § 33681.5 (Stats. 1993, ch. 68, § 4, pp. 942-944); Los Angeles

Unified School Dist. v. County of Los Angeles, supra, 181 Cal.App.4th at p. 421;

City of El Monte v. Commission on State Mandates, supra, 83 Cal.App.4th at

pp. 272-274.) In each of the 2004-2005 and 2005-2006 fiscal years,

redevelopment agencies were charged amounts intended to generate a combined

$250 million. (§ 33681.12, subd. (a)(2).) In the 2008-2009 fiscal year, the

Legislature required a combined $350 million or 5 percent of the total statewide

tax increment allocated to redevelopment agencies under section 33670,

whichever was greater, to be transferred to ERAF‘s (§ 33685, subd. (a)(2)),

although that revenue shift was ultimately invalidated in litigation. (Cal.

Redevelopment Assn. v. Genest (Super. Ct. Sac. County, 2009, No. 34-2008-

00028334-CU-WM-GDS.) Similar provisions for shifts of tax increment revenue

in the 2009-2010 and 2010-2011 fiscal years (§§ 33690, 33690.5) are the subjects

of pending litigation.

Tax increment financing remains a source of contention because of the

financial advantage it provides redevelopment agencies and their community

sponsors, primarily cities, over school districts and other local taxing agencies.

Additionally, because of the state‘s obligations to equalize public school funding

across districts (Ed. Code, § 42238 et seq.) and to fund all public schools at

minimum levels set by Proposition 98 (Cal. Const., art. XVI, § 8), the loss of

property tax revenue by school and community college districts creates obligations

for the state‘s General Fund. (See Los Angeles Unified School Dist. v. County of

Los Angeles, supra, 181 Cal.App.4th at pp. 419-422; Lefcoe, Finding the Blight

That’s Right for California Redevelopment Law (2001) 52 Hastings L.J. 991, 999

[―[W]here cities and counties shift property taxes from schools to redevelopment

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projects, the state must make up the difference . . . .‖].) The effect of tax

increment financing on school districts‘ property tax revenues has thus become a

point of fiscal conflict between California‘s community redevelopment agencies

and the state itself, a conflict manifesting in the current dispute.

C. Propositions 1A and 22

In addition to sporadically shifting property tax revenue from local

governments to schools via ERAF‘s, the state in 1999 rolled back the vehicle

license fee, a tax traditionally relied on by local governments and constitutionally

allocated to cities and counties. (Supplemental Voter Information Guide, Gen.

Elec. (Nov. 2, 2004) Legis. Analyst‘s analysis of Prop. 1A, p. 5; see Cal. Const.,

art. XI, § 15.) Though the state committed to backfill this lost revenue with

payments from the General Fund, in 2004 it deferred the replacement payments.

(Supplemental Voter Information Guide, Gen. Elec. (Nov. 2, 2004) Legis.

Analyst‘s analysis of Prop. 1A, p. 5.) Also in 2004, the state reduced local

government‘s share of the sales tax by 0.25 percent, while making up for the lost

revenue with additional property tax allocations, in order to permit the issuance of

new state bonds. (See Rev. & Tax. Code, §§ 97.68, 7203.1; Gov. Code, § 99050

et seq.)

Local government interests responded to these fluctuations in their revenue

sources by qualifying for the ballot Proposition 65, a set of constitutional

amendments to restrict such state actions in the future, but they subsequently

agreed to support a compromise measure, Proposition 1A, instead. (Supplemental

Voter Information Guide, Gen. Elec. (Nov. 2, 2004) argument against Prop. 65,

p. 15; see id., Legis. Analyst‘s analysis of Prop. 1A, pp. 4-6.) The voters approved

Proposition 1A and rejected Proposition 65. Among its reforms, Proposition 1A

prevented the state from statutorily reducing or altering the existing allocations of

property tax among cities, counties, and special districts. (Cal. Const., art. XIII,

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§ 25.5, subd. (a)(1), (3).) Unlike Proposition 65, however, Proposition 1A did not

extend its protections to redevelopment agencies. (See Cal. Const., art. XIII,

§ 25.5, subd. (b)(2); Rev. & Tax. Code, § 95, subd. (a) [omitting redevelopment

agencies from the definition of a local agency]; Supplemental Voter Information

Guide, Gen. Elec. (Nov. 2, 2004) Legis. Analyst‘s analysis of Prop. 1A, p. 7

[contrasting the two measures and expressly noting that ―Proposition 1A’s

restrictions do not apply to redevelopment agencies‖]; id., text of Prop. 65, p. 18

[including redevelopment agencies in its definition of protected special districts].)

In November 2010, following further legislative requirements that

redevelopment agencies make ERAF payments, the voters approved Proposition

22. Among the initiative‘s many statutory and constitutional revisions, one is

most central to the Association‘s argument: the addition of section 25.5,

subdivision (a)(7) to article XIII of the state Constitution. That provision limits

what the Legislature may do with respect to redevelopment agency tax increment:

―(a) On or after November 3, 2004, the Legislature shall not enact a statute to do

any of the following: [¶] . . . [¶] (7) Require a community redevelopment agency

(A) to pay, remit, loan, or otherwise transfer, directly or indirectly, taxes on ad

valorem real property and tangible personal property allocated to the agency

pursuant to Section 16 of Article XVI to or for the benefit of the State, any agency

of the State, or any jurisdiction; or (B) to use, restrict, or assign a particular

purpose for such taxes for the benefit of the State, any agency of the State, or any

jurisdiction,‖ with two exceptions not pertinent here. We address section 25.5,

subdivision (a)(7) in more detail below. (See post, pts. II.B.1., II.C.)

D. Assembly Bills 1X 26 and IX 27

In December 2010, then Governor Schwarzenegger declared a state fiscal

emergency. (See Cal. Const., art. IV, § 10, subd. (f)(1).) On January 20, 2011,

incoming Governor Brown renewed the declaration and convened a special

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session of the Legislature to address the state‘s budget crisis. (Legis. Counsel‘s

Digest, Assem. Bill 1X 26; see also Professional Engineers in California

Government v. Schwarzenegger (2010) 50 Cal.4th 989, 1001-1002 [detailing the

ongoing crisis].)

As a partial means of closing the state‘s projected $25 billion operating

deficit, Governor Brown originally proposed eliminating redevelopment agencies

entirely. (See Legis. Analyst‘s Off., Governor‘s Redevelopment Proposal

(Jan. 18, 2011) p. 4.) Parallel bills were introduced in the Senate and Assembly to

―eliminate[] redevelopment agencies (RDAs) and specif[y] a process for the

orderly wind-down of RDA activities . . . .‖ (Sen. Rules Com., Off. of Sen. Floor

Analyses, analysis of Sen. Bill No. 77 (2011-2012 Reg. Sess.) as amended

Mar. 15, 2011, p. 1; Sen. Rules Com., Off. of Sen. Floor Analyses, 3d reading

analysis of Assem. Bill No. 101 (2011-2012 Reg. Sess.) as amended Mar. 15,

2011, p. 1.) Ultimately, however, the Legislature took a slightly different

approach; in June 2011 it passed, and the Governor signed, the two measures we

consider here.

Assembly Bills 1X 26 and IX 27 consist of three principal components,

codified as new parts 1.8, 1.85 (both Assem. Bill 1X 26) and 1.9 (Assem. Bill

1X 27) of division 24 of the Health and Safety Code. Part 1.8 (§§ 34161 to

34169.5) is the ―freeze‖ component: it subjects redevelopment agencies to

restrictions on new bonds or other indebtedness; new plans or changes to existing

plans; and new partnerships, including joint powers authorities (§§ 34162 to

34165). Cities and counties are barred from creating any new redevelopment

agencies. (§ 34166.) Existing obligations are unaffected; redevelopment agencies

may continue to make payments and perform existing obligations until other

agencies take over. (§ 34169.) Part 1.8‘s purpose is to preserve redevelopment

agency assets and revenues for use by ―local governments to fund core

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governmental services‖ such as fire protection, police, and schools. (§ 34167,

subd. (a).)

Part 1.85 (§§ 34170 to 34191) is the dissolution component. It dissolves all

redevelopment agencies (§ 34172) and transfers control of redevelopment agency

assets to successor agencies, which are contemplated to be the city or county that

created the redevelopment agency (§§ 34171, subd. (j), 34173, 34175, subd. (b)).

Part 1.85 requires successor agencies to continue to make payments and perform

existing obligations. (§ 34177.) However, unencumbered balances of

redevelopment agency funds must be remitted to the county auditor-controller for

distribution to cities, the county, special districts, and school districts in proportion

to what each agency would have received absent the redevelopment agencies.

(See §§ 34177, subd. (d), 34183, subd. (a)(4), 34188.) Proceeds from

redevelopment agency asset sales likewise must go to the county auditor-controller

for similar distribution. (§ 34177, subd. (e).) Finally, tax increment revenues that

would have gone to redevelopment agencies must be deposited in a local trust

fund each county is required to create and administer. (§§ 34170.5, subd. (b),

34182, subd. (c)(1).) All amounts necessary to satisfy administrative costs, pass-

through payments, and enforceable obligations will be allocated for those

purposes, while any excess will be deemed property tax revenue and distributed in

the same fashion as balances and assets. (§§ 34172, subd. (d), 34183, subd. (a).)

Part 1.9 (§§ 34192 to 34196), however, offers an exemption from

dissolution for cities and counties that agree to make specified payments to both

the county ERAF and a new county special district augmentation fund on behalf of

their redevelopment agencies. Each city or county choosing this option must

notify the state it will do so and pass an ordinance to that effect. (§§ 34193, subd.

(b), 34193.1.) If it does, its redevelopment agency will be permitted to continue in

operation without interruption, as is, under the Community Redevelopment Law.

16

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(§ 34193, subd. (a).) The amounts owed are to be calculated annually by the

state‘s Director of Finance based on the fractional share of net and gross statewide

tax increment each redevelopment agency has received in prior years, multiplied

by $1.7 billion for this fiscal year and $400 million for all subsequent fiscal years.

(§ 34194, subds. (b)(2), (c)(1)(A).)6

Payments are due on January 15 and May 15 each year. (§ 34194, subd.

(d)(1).) While remittances are nominally owed by cities and counties, the measure

authorizes each community sponsor to contract with its redevelopment agency to

receive tax increment in the amount owed, so that payments may effectively come

from tax increment. (§ 34194.2.) Finally, any lapse in payments will result in a

redevelopment agency‘s dissolution. (§ 34195.)

On August 17, 2011, we stayed parts 1.85 and 1.9, with minor exceptions,

to prevent redevelopment agencies from being dissolved during the pendency of

this matter. (Health & Saf. Code, div. 24, pts. 1.85, 1.9.)

II. DISCUSSION

A. Jurisdiction

Santa Clara pleads as an affirmative defense that we lack jurisdiction.

Though it does not further argue the point, we have an independent obligation in

this as in every matter to confirm whether jurisdiction exists. (See Walker v.

Superior Court (1991) 53 Cal.3d 257, 267; Abelleira v. District Court of Appeal


6

It follows that, if all redevelopment agency sponsors opted in and paid their

pro rata shares, Assembly Bill 1X 27 would generate $1.7 billion in 2011-2012
and $400 million in each subsequent fiscal year. Of these sums, $4.3 million is
scheduled to go to transit and fire districts in 2011-2012 and $60 million in each
subsequent year, with the balance going to schools and community colleges via
the ERAF. (§ 34194.4, subd. (a).) ERAF payments in 2011-2012 count against
the state‘s Proposition 98 obligations; in future years, they do not. (§ 34194.1,
subds. (b), (c).)

17

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(1941) 17 Cal.2d 280, 302-303; Linnick v. Sedelmeier (1968) 262 Cal.App.2d 12,

12; see also Marbury v. Madison (1803) 5 U.S. 137, 173-175.) Assembly Bill

1X 26 provides that ―[n]otwithstanding any other law, any action contesting the

validity of this part [1.8] or Part 1.85 . . . or challenging acts taken pursuant to

these parts shall be brought in the Superior Court of the County of Sacramento.‖

(§ 34168, subd. (a).) We conclude this provision does not deprive us of

jurisdiction.

In filing a petition for writ of mandate with this court in the first instance,

the Association has asked us to invoke our original jurisdiction. That jurisdiction

is constitutional. (Cal. Const., art. VI, § 10 [vesting the Supreme Ct. with original

jurisdiction ―in proceedings for extraordinary relief in the nature of mandamus,

certiorari, and prohibition‖].) It may not be diminished by statute. (Chinn v.

Superior Court (1909) 156 Cal. 478, 480 [―[W]here the judicial power of courts,

either original or appellate, is fixed by constitutional provisions, the legislature

cannot either limit or extend that jurisdiction.‖]; see also Modern Barber Col. v.

Cal. Emp. Stab. Com. (1948) 31 Cal.2d 720, 731; Standard Oil Co. v. State Board

of Equal. (1936) 6 Cal.2d 557, 562; Lemen v. Edmunson (1927) 202 Cal. 760,

762.)

The Legislature does retain the power to regulate matters of judicial

procedure. (Powers v. City of Richmond (1995) 10 Cal.4th 85, 98-110; Modern

Barber Col. v. Cal. Emp. Stab. Com., supra, 31 Cal.2d at p. 731.) In some

instances, the exercise of that power may appear to ―defeat or interfere with the

exercise of jurisdiction or of the judicial power‖ and thus come into tension with

the general prohibition against impairing a constitutional grant of jurisdiction.

(Garrison v. Rourke (1948) 32 Cal.2d 430, 436.) We avoid such constitutional

conflicts whenever possible by construing legislative enactments strictly against

the impairment of constitutional jurisdiction: ― ‗[A]n intent to defeat the exercise

18

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of the court‘s jurisdiction will not be supplied by implication.‘ ‖ (County of San

Diego v. State of California (1997) 15 Cal.4th 68, 87, quoting Garrison, at p. 436;

see also Garrison, at p. 435 [―The jurisdiction thus vested [by Cal. Const., art. VI]

may not lightly be deemed to have been destroyed.‖].)

To avoid intrusion on our constitutional jurisdiction, section 34168,

subdivision (a) is best read narrowly as applying only to, and designating a forum

for, ―action[s]‖ (ibid.), over which we retain appellate jurisdiction, while having

no bearing on jurisdiction over ―special proceedings‖ such as petitions for writs of

mandate (see Public Defenders’ Organization v. County of Riverside (2003) 106

Cal.App.4th 1403, 1409; compare Code Civ. Proc., pt. 2, § 307 et seq. [regulating

civil actions] with Code Civ. Proc., pt. 3, § 1063 et seq. [regulating special

proceedings of a civil nature]). It follows that, notwithstanding the fact the

Association‘s petition challenges the validity of parts 1.8 and 1.85 of division 24

of the Health and Safety Code, we have jurisdiction to address it.

We will invoke our original jurisdiction where the matters to be decided are

of sufficiently great importance and require immediate resolution. (E.g., Strauss v.

Horton (2009) 46 Cal.4th 364, 398-399; Raven v. Deukmejian (1990) 52 Cal.3d

336, 340; Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization,

supra, 22 Cal.3d at p. 219.) Those circumstances are present here: Assembly

Bills 1X 26 and 1X 27 place the state‘s nearly 400 redevelopment agencies under

threat of imminent dissolution, while the Association‘s petition calls into question

the proper allocation of billions of dollars in property tax revenue.

B. The Constitutionality of Assembly Bill 1X 26

We turn now to the merits. In assessing the validity of Assembly Bills

1X 26 and 1X 27, we are mindful that ―all intendments favor the exercise of the

Legislature‘s plenary authority: ‗If there is any doubt as to the Legislature‘s

19

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power to act in any given case, the doubt should be resolved in favor of the

Legislature‘s action. Such restrictions and limitations [imposed by the

Constitution] are to be construed strictly, and are not to be extended to include

matters not covered by the language used.‘ [Citations.]‖ (Methodist Hosp. of

Sacramento v. Saylor (1971) 5 Cal.3d 685, 691.)

1. The Dissolution of Redevelopment Agencies Under Part 1.85 of

Division 24 of the Health and Safety Code

In enacting Assembly Bill 1X 26, the Legislature asserted that

―[r]edevelopment agencies were created by statute and can therefore be dissolved

by statute.‖ (Assem. Bill 1X 26, § 1, subd. (h).) We conclude the Legislature was

correct.

At the core of the legislative power is the authority to make laws.

(Nougues v. Douglass (1857) 7 Cal. 65, 70 [―The legislative power is the creative

element in the government . . . . [It] makes the laws . . . .‖].) The state

Constitution vests that power, except as exercised by or reserved to the people

themselves, in the Legislature. (Cal. Const., art. IV, § 1; McClung v. Employment

Development Dept. (2004) 34 Cal.4th 467, 472; Nougues, at p. 69 [―[I]n all cases

where not exercised and not reserved, all the legislative power of the people of the

State is vested in the Legislature . . .‖ (italics omitted)].)

Of significance, the legislative power the state Constitution vests is plenary.

Under it, ―the entire law-making authority of the state, except the people‘s right of

initiative and referendum, is vested in the Legislature, and that body may exercise

any and all legislative powers which are not expressly or by necessary implication

denied to it by the Constitution.‖ (Methodist Hosp. of Sacramento v. Saylor,

supra, 5 Cal.3d at p. 691; see also Marine Forests Society v. California Coastal

20

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Com. (2005) 36 Cal.4th 1, 31; People v. Tilton (1869) 37 Cal. 614, 626 [under the

state Const., ―[f]ull power exists when there is no limitation.‖].)7

We thus start from the premise that the Legislature possesses the full extent

of the legislative power and its enactments are authorized exercises of that power.

Only where the state Constitution withdraws legislative power will we conclude

an enactment is invalid for want of authority. ―In other words, ‗we do not look to

the Constitution to determine whether the legislature is authorized to do an act, but

only to see if it is prohibited.‘ ‖ (Methodist Hosp. of Sacramento v. Saylor, supra,

5 Cal.3d at p. 691, quoting Fitts v. Superior Court (1936) 6 Cal.2d 230, 234;

accord, State Personnel Bd. v. Department of Personnel Admin. (2005) 37 Cal.4th

512, 523; County of Riverside v. Superior Court (2003) 30 Cal.4th 278, 284.)

A corollary of the legislative power to make new laws is the power to

abrogate existing ones. What the Legislature has enacted, it may repeal. (See

People v. Superior Court (Romero) (1996) 13 Cal.4th 497, 518 [if a ―power is

statutory, the Legislature may eliminate it‖]; Estate of Potter (1922) 188 Cal. 55,

63 [rights that ―are creatures of legislative will‖ may be withdrawn by the

Legislature]; County of Sacramento v. Lackner (1979) 97 Cal.App.3d 576, 589

[― ‗ ―Every legislative body may modify or abolish the acts passed by itself or its

predecessors.‖ ‘ ‖].)

In particular, if a political entity has been created by the Legislature, it can

be dissolved by the Legislature, barring some specific constitutional obstacle to a

particular exercise of the legislative power. ―In our federal system the states are


7

In this regard, the state and federal Constitutions operate in very different

ways. Whereas under the federal Constitution, Congress has only those powers
that are expressly granted to it, under the state Constitution, the Legislature has all
legislative powers except those that are expressly withdrawn from it. (Methodist
Hosp. of Sacramento v. Saylor, supra, 5 Cal.3d at p. 691.)

21

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sovereign but cities and counties are not; in California as elsewhere they are mere

creatures of the state and exist only at the state‘s sufferance.‖ (Board of

Supervisors v. Local Agency Formation Com. (1992) 3 Cal.4th 903, 914; see also

City of El Monte v. Commission on State Mandates, supra, 83 Cal.App.4th at

p. 279 [―Only the state is sovereign and, in a broad sense, all local governments,

districts, and the like are subdivisions of the state.‖].) It follows from the

fundamental nature of this relationship between a state and its political

subdivisions that ― ‗states have ―extraordinarily wide latitude . . . in creating

various types of political subdivisions and conferring authority upon them.‖

[Citation.]‘ ‖ (Board of Supervisors, at pp. 915-916.) As the United States

Supreme Court has recognized in the context of municipal corporations: ―The

number, nature and duration of the powers conferred upon these corporations and

the territory over which they shall be exercised rests in the absolute discretion of

the State. . . . The State, therefore, at its pleasure may modify or withdraw all such

powers, . . . expand or contract the territorial area, unite the whole or a part of it

with another municipality, [or] repeal the charter and destroy the corporation.‖

(Hunter v. Pittsburgh (1907) 207 U.S. 161, 178-179, quoted with approval in

Board of Supervisors, at p. 915.) The state (and, in particular, the Legislature) has

―plenary power to set the conditions under which its political subdivisions are

created‖ (Board of Supervisors, at p. 917); equally so, it has plenary power to set

the conditions under which its political subdivisions are abolished (Curtis v. Board

of Supervisors (1972) 7 Cal.3d 942, 951; Petition East Fruitvale Sanitary Dist.

(1910) 158 Cal. 453, 457).8


8

The Legislature has in the past lawfully exercised this authority by

dissolving municipal corporations formerly established under state law. (See, e.g.,
Stats. 1972, ch. 650, § 2, p. 1209 [disincorporating the Town of Hornitos].) As


(footnote continued on next page)

22

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Redevelopment agencies are political subdivisions of the state and creatures

of the Legislature‘s exercise of its statutory power, the progeny of the Community

Redevelopment Law. (See § 33000 et seq.; 11 Miller & Starr, Cal. Real Estate

(3d ed. 2001) § 30B:2, p. 6 [―The redevelopment agency is solely a creature of

state statute, exercising powers delegated to it by the state legislature in matters of

state concern, and the scope of its authority is, therefore, defined and limited by

the Community Redevelopment Law . . . .‖].) Consistent with that nature, the

Legislature has in the past routinely narrowed and expanded redevelopment

agencies‘ various rights. (E.g., Stats. 1976, ch. 1337, p. 6061 et seq. [imposing

low income housing requirements]; Stats. 1993, ch. 942, p. 5334 et seq.

[Community Redevelopment Law Reform Act of 1993, enacting wide-ranging

reforms]; Stats. 2001, ch. 741 [amending redevelopment sunset provisions].) Most

significantly, the Legislature has mandated that redevelopment plans receiving tax

increment have finite durations. (§ 33333.2; Community Redevelopment Agency v.

County of Los Angeles (2001) 89 Cal.App.4th 719, 722.)

The Association offers a twofold argument for why, notwithstanding the

legislative authority over redevelopment agencies historically inherent in the state

Constitution, the dissolution provisions of Assembly Bill 1X 26 are invalid. First,

the Association posits that Assembly Bill 1X 26 is inconsistent with article XVI,

section 16 of the state Constitution, governing tax increment revenue. Second, the


(footnote continued from previous page)

well, we have recognized the power to dissolve with respect to school districts:
―[T]he local-district system of school administration, though recognized by the
Constitution and deeply rooted in tradition, is not a constitutional mandate, but a
legislative choice. [Citation.] The Constitution has always vested ‗plenary‘ power
over education not in the districts, but in the State, through its Legislature, which
may create, dissolve, combine, modify, and regulate local districts at pleasure.‖
(Butt v. State of California, supra, 4 Cal.4th at p. 688.)

23

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Association argues that Proposition 22 (as approved by voters, Gen. Elec. (Nov. 2,

2010)) amended the state Constitution to effectively withdraw from the

Legislature the power to dissolve community redevelopment agencies for the

financial benefit of the state.

What is now article XVI, section 16 was added by initiative in 1952,9

shortly after the Legislature enacted the Community Redevelopment Law.10 It

made express the Legislature‘s authority to authorize property tax increment

financing of redevelopment agencies and projects. However, nothing in its text

creates an absolute right to an allocation of property taxes. (See Cal. Const.,

art. XVI, § 16 [―The Legislature may provide that any redevelopment plan may

contain a provision‖ diverting tax increment to redevelopment agencies (italics

added)].)11 Nor does anything in the text of the section mandate that

redevelopment agencies, once created, must exist in perpetuity. On its face, the

provision is not self-executing and conveys no rights; rather, it authorizes the


9

It was originally adopted as article XIII, section 19 and, as part of a

constitutional restructuring, was subsequently moved without material change to
its present location.

10

A principal purpose of the proposed constitutional amendment was to

remove any doubt about the legality of the Community Redevelopment Law:
―All of the provisions of the Community Redevelopment Law, as amended in
1951, which relate to the use or pledge of taxes or portions thereof as herein
provided, or which, if effective, would carry out the provisions of this section or
any part thereof, are hereby approved, legalized, ratified and validated and made
fully and completely effective and operative upon the effective date of this
amendment.‖ (Cal. Const., art. XIII, former § 19, added by initiative, Gen. Elec.
(Nov. 4, 1952).)

11

In the same vein, article XVI, section 16 specifies that it does ―not affect

any other law or laws relating to the same or a similar subject but is intended to
authorize an alternative method of procedure governing the subject to which it
refers.‖ (Italics added.) In other words, it permits, but does not require, tax
increment financing as one new option for funding redevelopment.

24

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Legislature to enact statutes, and local governments to adopt redevelopment plans,

that are consistent with its scope.

What is apparent from the constitutional provision‘s text is confirmed by its

history. The ballot materials provided to the voters gave no hint that the proposed

amendment was intended to make redevelopment agencies or tax increment

financing a permanent part of the government landscape. Rather, consistent with

the text‘s use of the permissive ―may,‖ the Legislative Counsel explained that the

proposed amendment was intended simply to ―authorize‖—but not require—the

Legislature to provide for tax increment financing for redevelopment. (Proposed

Amendments to Constitution: Propositions and Proposed Laws, Gen. Elec.

(Nov. 4, 1952) Legis. Counsel‘s analysis of Assem. Const. Amend. No. 55, p. 19.)

The arguments in favor of the proposed amendment similarly emphasized its

nonmandatory character: ―This constitutional amendment . . . is in effect an

enabling act to give the Legislature authority to enact legislation which will

provide for the handling of the proceeds of taxes levied upon property in a

redevelopment project. It is permissive in character and can become effective in

practice only by acts of the Legislature and the local governing body, the City

Council or Board of Supervisors. It will make possible the passage of laws

providing that tax revenues derived from any increase in the assessed value of

property within a redevelopment area because of new improvements, shall be

placed in a fund to defray all or part of the cost of the redevelopment project that

would otherwise have to be advanced from public funds.‖ (Id., argument in favor

of Assem. Const. Amend. No. 55, p. 20.)

Against these indicia of intent, the Association emphasizes the final

sentence of article XVI, section 16: ―The Legislature shall enact those laws as

may be necessary to enforce the provisions of this section.‖ (Italics added.) The

word ―shall,‖ however, depending on the context in which it is used, is not

25

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necessarily mandatory. (People v. Lara (2010) 48 Cal.4th 216, 227; Nunn v. State

of California (1984) 35 Cal.3d 616, 625; see Garner‘s Dict. of Legal Usage (3d ed.

2011) pp. 952-953.) Moreover, consistent with its character as an ―enabling act‖

(Proposed Amendments to Constitution: Propositions and Proposed Laws, Gen.

Elec. (Nov. 4, 1952) argument in favor of Assem. Const. Amend. No. 55, p. 20),

the final sentence directs only passage of those laws ―as may be necessary.‖ This

portion of the text confirms the Legislature‘s authority to pass legislation it deems

necessary to carry out the ends of redevelopment, but imposes no obligation to

enact any particular law. It does not mandate that redevelopment agencies, or the

allocation of tax increment to them, be made permanent.

The Association also looks to our decision in Marek v. Napa Community

Redevelopment Agency, supra, 46 Cal.3d 1070. There, we determined that

―indebtedness,‖ the term used to measure how much property tax increment

should be allocated to a redevelopment agency (see Cal. Const., art. XVI, § 16,

subd. (b); §§ 33670, 33675), should be interpreted broadly (Marek, at pp. 1081-

1086). We cautioned that neither article XVI, section 16 nor the Community

Redevelopment Law, as then written, contemplated that ―other tax entities [would]

share in tax increment revenues at any time before the agency‘s total indebtedness

has been paid or the amount in its ‗special fund‘ is sufficient to pay its total

indebtedness.‖ (Marek, at p. 1087.) The Association contends Assembly Bill

1X 26 is invalid because it fails to continue allocating tax increment for existing

indebtedness as broadly as in the past, most notably by allocating tax increment

for only some, but not all, obligations owed by redevelopment agencies to their

community sponsors. (See §§ 34171, subd. (d)(2), 34178, subd. (b).)12

12

As Matosantos noted at oral argument, the Legislature could well recognize

that because of the conjoined nature of the governing boards of redevelopment


(footnote continued on next page)

26

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This argument misperceives both the role of article XVI, section 16 of the

state Constitution and the nature of the issue we resolved in Marek v. Napa

Community Redevelopment Agency, supra, 46 Cal.3d 1070. Article XVI, section

16 does not protect the receipt of tax increment funds up to the amount of a

redevelopment agency‘s total indebtedness, nor does it grant a constitutional right

to continue to receive tax increment for as long as redevelopment agencies have

debt; rather, it authorizes the Legislature to statutorily grant redevelopment

agencies rights to tax increment up to the amount of their total indebtedness.

As the Legislature may extend that authorization (and did, in the Community

Redevelopment Law), so it may limit or withdraw that authorization (as it has, in

Assem. Bill 1X 26) without violating article XVI, section 16. In Marek, we

addressed only the scope of the statutory term ―indebtedness‖ and the

corresponding scope of the constitutional authorization for redevelopment

agencies to be granted statutory rights to tax increment; that issue has no bearing

on the question we face here—whether article XVI, section 16 limits the

Legislature‘s power to dissolve existing redevelopment agencies in the midst of

ongoing projects. Marek thus is inapposite.

Finally, the Association draws our attention to the first two sentences of an

uncodified section (§ 9) of Proposition 22, which, it contends, confirms that article

XVI, section 16 is a guarantee of tax increment funding and a protection against

dissolution. That section begins: ―Section 16 of Article XVI of the Constitution

requires that a specified portion of the taxes levied upon the taxable property in a

redevelopment project each year be allocated to the redevelopment agency to


(footnote continued from previous page)

agencies and their community sponsors, such obligations often were not the
product of arm‘s-length transactions.

27

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repay indebtedness incurred for the purpose of eliminating blight within the

redevelopment project area. Section 16 of Article XVI prohibits the Legislature

from reallocating some or that entire specified portion of the taxes to the State, an

agency of the State, or any other taxing jurisdiction, instead of to the

redevelopment agency.‖ (Prop. 22, Gen. Elec. (Nov. 2, 2010) § 9.) Whether or

not article XVI, section 16 originally required tax increment allocations to be

made to redevelopment agencies, rather than simply authorizing the Legislature to

pass legislation approving such allocations, the Association contends that after this

voter-approved statement, article XVI, section 16 must now be read to so provide.

We reject this contention. The assertion in Proposition 22, section 9 that

tax increment allocations to redevelopment agencies are constitutionally

mandated, rather than constitutionally authorized and statutorily mandated, is a

clear misstatement of the law as it stood prior to the passage of Proposition 22.

Moreover, section 9 of Proposition 22 does not purport to amend article XVI,

section 16 or to change existing law concerning the source of redevelopment

agencies‘ entitlement, if any, to tax increment.13 Accordingly, we decline to treat

its immaterial misstatement of law as a basis for silently amending the state

Constitution.


13

The purpose of section 9, instead, is simply to explain that the Legislature

had been requiring the transfer of redevelopment agency tax increment, and that
Proposition 22 was intended to eliminate future transfers: ―The Legislature has
been illegally circumventing Section 16 of Article XVI in recent years by
requiring redevelopment agencies to transfer a portion of those taxes for purposes
other than the financing of redevelopment projects. A purpose of the amendments
made by this measure is to prohibit the Legislature from requiring, after the taxes
have been allocated to a redevelopment agency, the redevelopment agency to
transfer some or all of those taxes to the State, an agency of the State, or a
jurisdiction; or to use some or all of those taxes for the benefit of the State, an
agency of the State, or a jurisdiction.‖ (Prop. 22, Gen. Elec. (Nov. 2, 2010) § 9.)

28

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The various ways in which the Association contends Assembly Bill 1X 26

is inconsistent with article XVI, section 16 of the state Constitution all flow from

the assumption that section 16 establishes for redevelopment agencies an absolute

right to continued existence. Because we can find no such right in the

constitutional provision, article XVI, section 16 does not invalidate Assembly Bill

1X 26.

The Association‘s alternate constitutional argument rests on article XIII,

section 25.5, subdivision (a)(7) of the state Constitution, added in 2010 by

Proposition 22. Examining both the text and the various ballot arguments in

support of and against that initiative, we find nothing in them that would limit the

Legislature‘s plenary authority over the existence vel non of redevelopment

agencies.

Article XIII, section 25.5, subdivision (a)(7)(A) of the state Constitution

generally prohibits the Legislature from requiring a redevelopment agency to pay

property taxes ―allocated to the agency pursuant to Section 16 of Article XVI to or

for the benefit of the State‖ or its agencies and jurisdictions,14 or otherwise

restricting or assigning such taxes for the state‘s benefit. The provision, the

Association reasons, both presumes and protects the existence of redevelopment

agencies. Dissolving redevelopment agencies would entail an impermissible

diversion of their tax increment to third parties, in contravention of section 25.5,

subdivision (a)(7)(A). Moreover, if the state cannot assign tax increment to third

parties, that increment must go to redevelopment agencies; hence, redevelopment

agencies must be entitled to exist to receive it.


14

―Jurisdiction‖ as used here includes both special districts and school

districts. (See Cal. Const., art. XIII, § 25.5, subd. (b)(3); Rev. & Tax. Code, § 95,
subds. (a), (b).)

29

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This argument suffers from a surface implausibility. The

constitutionalization of a political subdivision—the alteration of a local

government entity from a statutory creation existing only at the pleasure of the

sovereign state to a constitutional creation with life and powers of independent

origin and standing—would represent a profound change in the structure of state

government. Municipal corporations, though of far more ancient standing than

redevelopment agencies, have never achieved such status. (See Cal. Const.,

art. XI, § 2, subd. (a) [specifying the Legislature‘s authority over city formation

and powers].) Proposition 22 contains no express language constitutionalizing

redevelopment agencies. (Cf. Cal. Const., art. XXXV, § 1, added by initiative,

Gen. Elec. (Nov. 2, 2004) [creating the Cal. Institute for Regenerative Medicine as

a constitutional entity]; id., art. XXI, § 2, added by initiative, Gen. Elec. (Nov. 4,

2008) [creating the Citizens Redistricting Com. as a constitutional entity].) It

would be unusual in the extreme for the people, exercising legislative power by

way of initiative, to adopt such a fundamental change only by way of implication,

in an initiative facially dealing with purely fiscal matters, in a corner of the state

Constitution addressing taxation. As the United States Supreme Court has put it,

the drafters of legislation ―do[] not, one might say, hide elephants in mouseholes.‖

(Whitman v. American Trucking Assns., Inc. (2001) 531 U.S. 457, 468.)

The principle of inclusio unius est exclusio alterius applies here.

Proposition 22 expressly adds numerous limits to the Legislature‘s statutory

powers (Prop. 22, Gen. Elec. (Nov. 2, 2010) §§ 3-5, 5.3, 6-6.1, 7), and in one

instance withdraws from the Legislature a preexisting constitutional power (id.,

§ 5.6 [repealing Cal. Const., art. XIX, former § 6]), but makes no mention of any

intent to divest the Legislature of the power to dissolve redevelopment agencies.

If the initiative proponents and voters had intended to strip the Legislature of that

30

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power or to alter the Legislature‘s article XVI, section 16 permissive authority, it

stands to reason they would have said so expressly.

Had the voters in fact intended to amend the Constitution to fundamentally

alter the relationship between the state and this class of political subdivision, we

would, moreover, expect to find at least a single mention of such an intention in

the various supporting and opposing ballot arguments. Instead, we find silence.

The Legislative Analyst‘s review of the initiative identifies no such anticipated

effect. (Voter Information Guide, Gen. Elec. (Nov. 2, 2010) pp. 30-35.) Indeed,

the ballot argument in favor of Proposition 22 and the rebuttal to the argument

against it do not even mention redevelopment. (Voter Information Guide, at

pp. 36-37.) Only the opposing arguments highlight redevelopment and then only

to criticize the initiative for how it secretly channels tax dollars to redevelopment

agencies. (Ibid.)

The Association suggests it is not asserting an absolute right to perpetual

existence, only a right for some form of agency to exist to receive redevelopment

funds for as long as there is an active redevelopment plan and indebtedness. This

framing does not change the analysis or conclusions. It would mean the

Legislature‘s power to dissolve vanished as soon as a redevelopment agency was

created; thereafter, an agency or its similarly tasked successor effectively could

expire only of natural causes, after every project it might undertake in its

jurisdiction had been completed and paid off. No hint of such a right is disclosed

in the text or history of either article XVI, section 16 or article XIII, section 25.5,

subdivision (a)(7) of the state Constitution.

Contrary to the Association‘s contention, declining to imply into article

XIII, section 25.5, subdivision (a)(7) a constitutional guarantee of continued

existence for redevelopment agencies does not render the subdivision a nullity.

Though the Legislature retains the broad power to dissolve redevelopment

31

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agencies, Proposition 22 strips it of the narrower power to insist on transfers to

third parties of property tax revenue already allocated to redevelopment agencies,

as it had done on numerous previous occasions. (See §§ 33680, 33681.7 to

33681.15, 33685 to 33692; former § 33681 (Stats. 1992, ch. 700, § 1.5, pp. 3115-

3116); former § 33681.5 (Stats. 1993, ch. 68, § 4, pp. 942-944).) It is precisely

such ―raids‖ the text of Proposition 22 and the arguments in support of it

denounce. (Voter Information Guide, Gen. Elec. (Nov. 2, 2010) p. 36; see

Prop. 22, Gen. Elec. (Nov. 2, 2010) §§ 2, subds. (e), (g), 2.5, 9.) The protection so

granted is not insignificant simply because it is conditioned on redevelopment

agencies‘ existing and having property tax increment allocated to them.

Accordingly, we discern no constitutional impediment to the Legislature‘s

electing to dissolve the state‘s redevelopment agencies under part 1.85 of division

24 of the Health and Safety Code.

2. Freezing Redevelopment Agency Transactions Under Part 1.8 of

Division 24 of the Health and Safety Code

As a means of facilitating dissolution under division 24, part 1.85, the

Legislature in division 24, part 1.8 has suspended redevelopment agencies‘ ability

to make free use of their funds. (See, e.g., §§ 34161 [prohibiting new or expanded

debts except as provided in pt. 1.8], 34162 [limiting new indebtedness], 34167,

subd. (a) [―provisions of this part shall be construed as broadly as possible to . . .

restrict the expenditure of funds to the fullest extent possible‖].) The purpose of

these restrictions is ―to preserve, to the maximum extent possible, the revenues

and assets of redevelopment agencies so that those assets and revenues that are not

needed to pay for enforceable obligations may be used by local governments to

fund core governmental services including police and fire protection services and

schools.‖ (§ 34167, subd. (a); see also Assem. Bill 1X 26, § 1, subd. (j)(1) [the

intent of pt. 1.8 is to bar new obligations pending dissolution].) The Association

32

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contends these limits violate article XIII, section 25.5, subdivision (a)(7)(B) of the

state Constitution, prohibiting restrictions on the use of property taxes allocated to

redevelopment agencies for the benefit of the state or its agencies.15 We conclude

this portion of Assembly Bill 1X 26 is valid as well.

The power to abolish an entity necessarily encompasses the incidental

power to declare its ending point.16 If Proposition 22, as we have concluded, was

not intended to strip the Legislature of the power to terminate redevelopment

agencies, then it could not have been intended to deprive the Legislature of the

ability to decide when redevelopment agencies could cease to exist as legal entities

or at what point, as part of winding up and dissolving, they would be relieved of

the ability to make new binding commitments and engage in new business. As a

practical and perhaps constitutional matter, to require an existing entity that has

entered into a web of current contractual and other obligations to dissolve

instantaneously is not possible; doing so would inevitably raise serious impairment

of contract questions. (See U.S. Const., art. I, § 10; Cal. Const., art. I, § 9.)

As Matosantos argues, and we agree, Proposition 22‘s limit on state

restrictions of redevelopment agencies‘ use of their funds is best read as limiting

the Legislature‘s powers during the operation, rather than the dissolution, of

redevelopment agencies. Article XIII, section 25.5, subdivision (a)(7)(B)

prohibits, with minor exceptions, further legislative restrictions on the use of


15

California Constitution, article XIII, section 25.5, subdivision (a)(7)

prohibits the Legislature from ―[r]equir[ing] a community redevelopment agency
. . . (B) to use, restrict, or assign a particular purpose for such taxes for the benefit
of the State, any agency of the State, or any jurisdiction,‖ with exceptions not
applicable here.

16

The Legislature has already wielded an analogous power by imposing time

limits on the life spans of agencies‘ redevelopment plans. (§ 33333.2.)

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property taxes allocated to redevelopment agencies under article XVI, section 16.

Article XVI, section 16, in turn, creates no absolute right to an allocation of

property taxes. (See Cal. Const., art. XVI, § 16 [―The Legislature may provide

that any redevelopment plan may contain a provision‖ diverting tax increment to

redevelopment agencies (italics added)].) Thus, if the Legislature exercises its

constitutional power to authorize allocation of property taxes to redevelopment

agencies, and if a redevelopment plan so provides, then those taxes so allocated to

an operating redevelopment agency may not be restricted to benefit the state by

further legislative action.

The Legislature in fact exercised that constitutional power when adopting

and subsequently amending the Community Redevelopment Law (see §§ 33670,

33675), but the right of redevelopment agencies to tax increment funding thereby

created was statutory, not constitutional. In turn, Assembly Bill 1X 26 revises

those statutory rights. The Legislature has determined that tax increment should

no longer be allocated to redevelopment agencies (Assem. Bill 1X 26, § 1, subd.

(i) [upon agencies‘ dissolution, property taxes are no longer to be deemed tax

increment and allocated to redevelopment agencies]), except insofar as necessary

to satisfy existing obligations. The measure exercises the Legislature‘s

constitutional power to authorize property tax increment revenue for, or to

withdraw that authorization from, redevelopment agencies. (See Cal. Const.,

art. XVI, § 16.) As such, the measure modifies the constitutional predicate for the

operation of article XIII, section 25.5, subdivision (a)(7)(B) of the state

Constitution. In the absence of property tax increment allocated under article

XVI, the latter subdivision has no force or effect.

Redevelopment agencies, moreover, have a conditional right to the

allocation of tax increment only to the extent of any existing indebtedness.

(§§ 33670, 33675; Cal. Const., art. XVI, § 16, subd. (b); cf. Marek v. Napa

34

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Community Redevelopment Agency, supra, 46 Cal.3d at p. 1082 [interpreting

―indebtedness‖ to include all existing obligations, including executory ones].)

They have no particular right to incur additional future indebtedness. The

provisions of part 1.8 of division 24 the Health and Safety Code, which respect the

need to satisfy existing indebtedness (see § 34167) while precluding the creation

of additional indebtedness (§§ 34162-34163), invade no rights protected by article

XIII, section 25.5, subdivision (a)(7)(B) of the state Constitution.

Accordingly, we conclude Proposition 22 does not invalidate the freeze

portions of Assembly Bill 1X 26 as they apply to dissolving redevelopment

agencies.17

C. The Constitutionality of Assembly Bill 1X 27

We turn to Assembly Bill 1X 27. The measure conditions the future

operation of redevelopment agencies on continuation payments. (§§ 34193,

subd. (a), 34193.2, subd. (a).) Analyzing its operation in light of the constitutional

limitations adopted by Proposition 22, we conclude the condition the measure

imposes is unconstitutional and Assembly Bill 1X 27 is, accordingly, facially

invalid.

The Legislature may not ―[r]equire a community redevelopment agency

(A) to pay, remit, loan, or otherwise transfer, directly or indirectly, taxes on ad

valorem real property and tangible personal property allocated to the agency

pursuant to Section 16 of Article XVI to or for the benefit of the State, any agency

of the State, or any jurisdiction . . . .‖ (Cal. Const., art. XIII, § 25.5, subd. (a)(7),


17

We need not consider any constitutional objections to the freeze portions as

they apply to redevelopment agencies whose community sponsors avail
themselves of the provisions of Assembly Bill 1X 27 to continue operations
because, as discussed below, we conclude Assembly Bill 1X 27 is invalid.

35

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added by Prop. 22, Gen. Elec. (Nov. 2, 2010).) That the continuation payments

called for by Assembly Bill 1X 27 will benefit the state and its jurisdictions, i.e.,

special districts and school districts, is uncontested; for fiscal year 2011-2012,

they replace funding the state otherwise would have to supply under Proposition

98 (see § 34194.1, subd. (b)), and in this and future years they go to funds

supporting school districts and special districts (§§ 34194, subd. (a), 34194.1,

subd. (e), 34194.4).

Moreover, as we shall explain, Assembly Bill 1X 27‘s continuation

payments involve the ―direct[] or indirect[]‖ payment, remittance, loan, or transfer

of tax increment allocated to community redevelopment agencies. (Cal. Const.,

art. XIII, § 25.5, subd. (a)(7).) In interpreting the scope of that constitutional

provision, added by initiative, we ― ‗apply the same principles that govern

statutory construction,‘ ‖ beginning with the text as the best indicator of intent.

(Professional Engineers in California Government v. Kempton (2007) 40 Cal.4th

1016, 1037.) Where the text is ambiguous we must turn to extrinsic sources, such

as the context of adoption and the ballot materials presented to the voters. (Ibid.)

Here, the text of article XIII, section 25.5, subdivision (a)(7) does not define

clearly the intended scope of its prohibition against requiring ―direct[] or

indirect[]‖ payment, transfer, etc. of tax revenue. Presented with an ambiguity, we

examine the historical backdrop against which the provision was drafted and

adopted to discern its meaning.

In the two decades preceding passage of Proposition 22, redevelopment

agencies were the subject of repeated ERAF shifts—directives to transfer money

to county ERAF‘s. Each ERAF shift calculated the amount every redevelopment

agency owed as a fraction of the tax increment it received. (§§ 33681.7, subd.

(a)(2), 33681.9, subd. (a)(2), 33681.12, subd. (a)(2), 33685, subd. (a)(2), 33690,

subd. (a)(2), 33690.5, subd. (a)(2); former § 33681, subd. (a)(2) (Stats. 1992,

36

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ch. 700, § 1.5, p. 3115); former § 33681.5, subd. (a)(2) (Stats. 1993, ch. 68, § 4,

pp. 942-943).) Notably, however, the shifts did not require payments to come

specifically from tax increment; rather, they provided, in language the Legislature

copied from year to year: ―To make the allocation required by this section, an

agency may use any funds that are legally available and not legally obligated for

other uses, including, but not limited to, reserve funds, proceeds of land sales,

proceeds of bonds or other indebtedness, lease revenues, interest, and other earned

income.‖ (§ 33690.5, subd. (b), italics added [2010-2011 ERAF legislation];

accord, §§ 33681.7, subd. (c), 33681.9, subd. (c), 33681.12, subd. (c), 33685,

subd. (c), 33690, subd. (b) [same language in 2002-2003, 2003-2004, 2004-2005,

2008-2009, and 2009-2010 ERAF legislation]; former § 33681, subd. (c) (Stats.

1992, ch. 700, § 1.5, p. 3116) [same language in 1992-1993 ERAF legislation];

former § 33681.5, subd. (c) (Stats. 1993, ch. 68, § 4, p. 943) [same language in

1993-1994 and 1994-1995 ERAF legislation]; see Los Angeles Unified School

Dist. v. County of Los Angeles, supra, 181 Cal.App.4th at p. 421 & fn. 3.) Thus,

although ERAF remittances were calculated as a portion of redevelopment agency

tax increment, the Legislature was not particular about the source of funds actually

used to make the payments.

Nor was the Legislature concerned with whether it was the redevelopment

agencies or their community sponsors that actually made the payments. Beginning

with the fiscal year 2003-2004 ERAF legislation, the Legislature included in each

annual measure a provision allowing city councils and county boards of

supervisors to agree to make the payments on behalf of their redevelopment

agencies. (§§ 33681.11, subd. (a), 33681.14, subd. (a), 33687, subd. (a), 33692,

subds. (a), (b); see, e.g., Sen. Budget & Fiscal Revenue Com., 3d reading analysis

of Sen. Bill No. 1045 (2003-2004 Reg. Sess.) as amended July 29, 2003, p. 1 [the

ERAF legislation ―[a]llows any sponsor city or county to pay their RDA‘s ERAF

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contribution in lieu of [the] RDA‖].) Here, too, the Legislature did not specify the

source of the funds to be used; a legislative body could apply ―any funds that are

legally available for this purpose.‖ (§§ 33681.11, subd. (b), 33681.14, subd. (b),

33687, subd. (b), 33692, subd. (c); see, e.g., Sen. Budget & Fiscal Revenue Com.,

3d reading analysis of Sen. Bill No. 1045 (2003-2004 Reg. Sess.) as amended

July 29, 2003, pp. 1-2.)

As enacted in the years preceding Proposition 22, then, state ERAF

legislation had at least two consistent and defining features: (1) each payment was

calculated in proportion to the amount of net and gross tax increment received by a

redevelopment agency, operating in effect as a levy on the receipt of tax increment

funds, and (2) the legislation was indifferent as to the actual source of payment, be

it from the tax increment itself, other assets a redevelopment agency might have,

or any available funds a community sponsor might have.

This indifference made a certain practical sense. Redevelopment agencies

and their community sponsors are conjoined to the extent that, in virtually all

instances, the same individuals constitute both the redevelopment agency

governing board and the city council or county board of supervisors that created

the agency. The Legislature had no particular reason to care where ERAF

payments might come from, and no reason to preclude local governments and

redevelopment agencies from deciding in a given year whether the agency or its

community sponsor might be better positioned to make payment.

This, then, was the historical context in which the backers of Proposition 22

drafted article XIII, section 25.5, subdivision (a)(7) of the state Constitution.

Proposition 1A‘s passage in 2004 curtailed ERAF shifts aimed at cities and

counties, but redevelopment agencies remained subject to them. Consequently,

Proposition 22 was drafted with the specific intent of ending further ERAF shifts

of the sort previously imposed on the agencies, and restricting the state‘s ability to

38

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demand back, for schools or other state purposes, a percentage of the money

county auditors allocated to redevelopment agencies. Section 2 of Proposition 22

identified among the past practices targeted by the initiative‘s constitutional

amendments ERAF shifts from redevelopment agencies to schools. (Prop. 22, § 2,

subd. (d)(3); see also Voter Information Guide, Gen. Elec. (Nov. 2, 2010) Legis.

Analyst‘s analysis of Prop. 22, p. 33.) Section 2.5 of the initiative declared the

intent to end such shifts. (Prop. 22, §§ 2, subd. (g), 2.5; see also id., § 9; Voter

Information Guide, Gen. Elec. (Nov. 2, 2010) Legis. Analyst‘s analysis of

Prop. 22, p. 34 [―Reduces State Authority. This measure prohibits the state from

enacting new laws that require redevelopment agencies to shift funds to schools or

other agencies.‖].)

The text of Proposition 22 mandates that ―[t]he provisions of this act shall

be liberally construed in order to effectuate its purposes.‖ (Prop. 22, § 11.)

Accordingly, we must interpret article XIII, section 25.5, subdivision (a)(7) of the

state Constitution in light of the declared intent to end further shifts. Clearly the

drafters meant the provision to be at least broad enough to foreclose ERAF

legislation of the sort previously enacted, or else the new constitutional protection

would amount to an empty gesture, as the Legislature could continue to enact the

same legislation. As the voters were explicitly apprised of this intent in both the

Legislative Analyst‘s analysis of the initiative and in the initiative text, they can be

regarded as having approved a constitutional prohibition against ERAF shifts like

those enacted before 2010.

Given the directive that we adopt a liberal construction as necessary to

ensure the purposes of Proposition 22 are carried out, it follows that the

constitutional prohibition against ―directly or indirectly‖ requiring transfers of tax

increment (Cal. Const., art. XIII, § 25.5, subd. (a)(7)) must extend to legislation

that imposes a levy on the receipt of tax increment funds, even if the legislation

39

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does not specify that payment must come directly from the redevelopment agency

or from its tax increment funds. The prohibition against even ―indirect[]‖ transfers

must reasonably be read to extend to legislation that, like the ERAF shifts

Proposition 22 was intended to prohibit, gives redevelopment agencies and their

community sponsors latitude to decide the source of any payment.

Assembly Bill 1X 27 is such legislation. Like all prior ERAF legislation, it

operates as a levy on the receipt of tax increment funds. That is, for each dollar a

redevelopment agency receives, a set percentage must be paid back into ERAF‘s.

(See § 34194 [calculating continuation payment as a fraction of the net and gross

tax increment each redevelopment agency receives].) In 2011-2012, the levy rate

is roughly 34 percent ($1.7 billion out of $5 billion in tax increment); in future

years, it is substantially lower ($400 million out of $5 billion equates to 8 percent).

That Assembly Bill 1X 27 allows payment to come either from community

sponsors (§ 34194.1, subd. (a)), or from redevelopment agencies pursuant to

reimbursement agreements (§ 34194.2), does not distinguish it from past ERAF

legislation. Nor does the leeway Assembly Bill 1X 27 grants redevelopment

agencies and community sponsors to decide the source from which to make

payments diminish the payments‘ character as a levy on tax increment funds.

Reasoning by analogy, income tax is income tax, even if a taxpayer may pay the

government out of nonincome assets rather than directly return a portion of his or

her income; so too, section 34194 is a levy on the receipt of tax increment for the

benefit of the state‘s subdivisions, whether the levy is paid directly out of the tax

increment the redevelopment agency receives, or indirectly out of other assets it or

its community sponsor may possess. The source of payment is a distinction

without a difference in light of the Legislature‘s historic indifference to ERAF

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payment sources and Proposition 22‘s broad prohibition on even ―direct[] or

indirect[]‖ transfers.18

As construed by the dissent, however, Proposition 22 would prohibit only

funding schemes the Legislature has not employed for nearly a decade, while

permitting the very schemes its adoption history plainly demonstrates the initiative

was intended to prohibit. The dissent identifies as the saving grace of Assembly

Bill 1X 27 the provision allowing community sponsors to make continuation

payments. (Conc. & dis. opn., post, at p. 15; see § 34194.1.) But every ERAF

scheme since 2003 has included that feature. (Ante, at p. 37).19 Consequently,

every such ERAF scheme would, under the dissent‘s construction, remain valid in

its entirety even after Proposition 22,20 and the Legislature could simply have


18

In light of this conclusion, we need not consider the Association‘s alternate

arguments that other provisions of the state Constitution also broadly constrain the
Legislature‘s ability to direct the reallocation of community sponsor funds. (See
Cal. Const., art. XIII, §§ 24, subd. (b), 25.5, subd. (a)(1), (3); id., art. XIII B, § 6,
subd. (b)(3).)

19

The Legislature last passed ERAF legislation without such a ―community

sponsor pays‖ option in 2002. (Stats. 2002, ch. 1127, §§ 15-16; see also Stats.
1992, chs. 699, 700, pp. 3081-3125; Stats. 1993, ch. 68, pp. 939-955.)

20

The dissent implies that under its interpretation Proposition 22 would still

materially constrain the Legislature in crafting ERAF legislation. Not so.
Because under that interpretation a ―sponsor pays‖ option is not prohibited by
Proposition 22, no part of any ERAF funding scheme that includes such a
provision is invalid. That is, so long as the Legislature includes in its funding
scheme one nonprohibited option for payment, all other payment alternatives
become optional, and thus lawful. Proposition 22, under that view, would do
nothing to prohibit passage of any of the statutes identified by the dissent as
potentially invalid (conc. & dis. opn., post, at pp. 11-14) so long as they were
accompanied by a ―sponsor pays‖ statute like section 33692.

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reenacted without change 2009‘s scheme.21 Such an interpretation cannot be

squared with the available evidence of the drafters‘ and voters‘ intent, which was

to prohibit these modern raids. (See Voter Information Guide, Gen. Elec. (Nov. 2,

2010) Legis. Analyst‘s analysis of Prop. 22, pp. 33-34 [singling out recent ERAF

shifts as the sort of raid on tax increment Prop. 22 was intended to foreclose];

Prop. 22, §§ 2, subd. (d)(3), 2.5, 9 [same].)

The dissent justifies this rejection of expressed intent by relying on the

grammar and syntax of Proposition 22. (Conc. & dis. opn., post, at pp. 15-16.)

However, ―[t]he rules of grammar and canons of construction are but tools,

‗guides to help courts determine likely legislative intent. [Citations.] And that

intent is critical. Those who write statutes seek to solve human problems. Fidelity

to their aims requires us to approach an interpretive problem not as if it were a

purely logical game, like a Rubik‘s Cube, but as an effort to divine the human

intent that underlies the statute.‘ ‖ (Burris v. Superior Court (2005) 34 Cal.4th

1012, 1017-1018.) Grammar and syntax thus are a means of gleaning intent, not a

basis for preventing its effectuation. Where, as here, ballot materials clearly

demonstrate the drafters‘ and voters‘ intent, syntax is not dispositive.

Moreover, nothing in the grammar of article XIII, section 25.5, subdivision

(a)(7) of the state Constitution precludes giving the provision its intended effect.

A required ―indirect[]‖ transfer of tax increment by a redevelopment agency may

include circumstances where the redevelopment agency, governed by the same

people as its community sponsor (see ante, p. 9 & fn. 5), must persuade that


21

That the Legislature did not, and instead believed it needed to add the

purported option of dissolution to render its scheme constitutional, suggests the
Legislature read Proposition 22 just as we do on this point.

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sponsor to pay, with or without reimbursement, a specified percentage of the tax

increment the agency receives as the price for that receipt.

In her briefing, Matosantos does not focus on whether Assembly Bill 1X 27

involves ―direct[] or indirect[]‖ payments of tax increment funds, but instead on

the argument that Assembly Bill 1X 27 does not ―[r]equire‖ payment within the

meaning of article XIII, section 25.5, subdivision (a)(7).22 She acknowledges that

Proposition 22 forbids the Legislature from directly requiring payment to special

districts and school districts on the state‘s behalf. She contends, however, that the

payments provided for under Assembly Bill 1X 27 are not required but are

voluntary and constitutional, because the measure affords local governments an

option between payment and dissolution.

This is indeed the way in which Assembly Bill 1X 27 is most distinct from

the past ERAF legislation Proposition 22 specifically targeted. Effectively,

however, the difference is only a change in the sanction for nonpayment. Before,

nonpayment resulted in a range of limitations on a redevelopment agency‘s

operations (see, e.g., §§ 33686, subd. (e), 33691, subd. (e)); now, it will result in

dissolution (§ 34195).

This is another distinction without a difference. Assembly Bill 1X 27 on its

face imposes not an optional condition but an absolute requirement: going

forward, every redevelopment agency must have its community sponsor annually

pay the portion of its tax increment assessed by the state under Assembly Bill


22

Similarly, when asked at oral argument whether ―were [payment] not

voluntary,‖ the various constitutional provisions relied on by the Association
―would cover the community sponsor funds‖ and shield them from the state‘s
reach, Matosantos‘s counsel replied, ―I think that‘s right,‖ but went on to defend
Assembly Bill 1X 27 as giving community sponsors a choice whether or not to
pay.

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1X 27. Cities and counties operating redevelopment agencies, whether agencies

that existed before Assembly Bill 1X 27 or agencies they establish for the first

time to address new blight, must pay without exception in this and every future

year. (See §§ 34194, 34195.) A condition that must be satisfied in order for any

redevelopment agency to operate is not an option but a requirement.23 Such

absolute requirements Proposition 22 forbids. (See Cal. Const., art. XIII, § 25.5,

subd. (a)(7)(A).)

The Association argues that this conclusion is sufficient to invalidate not

only Assembly Bill 1X 27, but also the dissolution provisions of Assembly Bill

1X 26. Not necessarily. How broadly the taint of the invalid exercise of

legislative power extends is a question of severability. (See, e.g., Sonoma County

Organization of Public Employees v. County of Sonoma (1979) 23 Cal.3d 296,

319-320 [preserving the state‘s bailout of local governments notwithstanding an

unconstitutional condition placed on that bailout because the one could be severed

from the other].) Accordingly, we turn to an analysis of severability and the

impact of the invalid continuation payment program (Assem. Bill 1X 27, § 2;

Health & Saf. Code, div. 24, pt. 1.9) on the remaining provisions of Assembly Bill

1X 27 and on Assembly Bill 1X 26.

D. Severability

We conclude Assembly Bill 1X 27 is invalid in its entirety, while Assembly

Bill 1X 26 may be severed and enforced independently.


23

Whether to establish a redevelopment agency is voluntary, but that has

always been the case. Now, however, if a city or county does establish a
redevelopment agency, the agency must through its community sponsor make the
payments required under Assembly Bill 1X 27.

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In determining whether the invalid portions of a statute can be severed, we

look first to any severability clause. The presence of such a clause establishes a

presumption in favor of severance. (Santa Barbara Sch. Dist. v. Superior Court

(1975) 13 Cal.3d 315, 331 [― ‗Although not conclusive, a severability clause

normally calls for sustaining the valid part of the enactment . . . .‘ ‖].) We will,

however, consider three additional criteria: ―[T]he invalid provision must be

grammatically, functionally, and volitionally separable.‖ (Calfarm Ins. Co. v.

Deukmejian (1989) 48 Cal.3d 805, 821.) Grammatical separability, also known as

mechanical separability, depends on whether the invalid parts ―can be removed as

a whole without affecting the wording‖ or coherence of what remains. (Id. at

p. 822; see also Santa Barbara, at pp. 330-331.) Functional separability depends

on whether ―the remainder of the statute ‗ ―is complete in itself . . . .‖ ‘ ‖ (Sonoma

County Organization of Public Employees v. County of Sonoma, supra, 23 Cal.3d

at p. 320.) Volitional separability depends on whether the remainder ― ‗would

have been adopted by the legislative body had the latter foreseen the partial

invalidation of the statute.‘ ‖ (Santa Barbara, at p. 331; accord, Gerken v. Fair

Political Practices Com. (1993) 6 Cal.4th 707, 714.)

With respect to the portions of Assembly Bill 1X 27 apart from the

section 2 continuation payment program, the Legislature in section 5 included a

nonseverability clause: ―If Section 2 of this act, or the application thereof, is held

invalid in a court of competent jurisdiction, the remaining provisions of this act are

not severable and shall not be given, or otherwise have, any force or effect.‖

(Assem. Bill 1X 27, § 5.) Such a clause conclusively negates the possibility of

volitional separability: the Legislature would not have enacted the rest of

Assembly Bill 1X 27 without the invalid section 2. Accordingly, the remaining

provisions of Assembly Bill 1X 27 cannot be severed and are unenforceable as

well.

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In direct contrast, the Legislature in section 4 of Assembly Bill 1X 27

expressed in a severability clause its intent to preserve Assembly Bill 1X 26: ―The

provisions of Section 2 of this act [Assem. Bill 1X 27] are distinct and severable

from the provisions of Part 1.8 (commencing with [Section] 34161) and Part 1.85

(commencing with Section 34170) of Division 24 of the Health and Safety Code

[enacted by Assem. Bill 1X 26] and those provisions shall continue in effect if any

of the provisions of this act are held invalid.‖ (Assem. Bill 1X 27, § 4.)

Grammatically and mechanically, Assembly Bill 1X 26 can be separated from

Assembly Bill 1X 27: it was passed as a distinct measure and is codified in a

different portion of the Health and Safety Code. Functionally as well, it is

separate: the freeze (pt. 1.8) and dissolution (pt. 1.85) procedures can be

implemented whether or not the continuation payment program (pt. 1.9) is valid.

(Indeed, invalidating pt. 1.9 alone would produce a result no different than if each

redevelopment agency and sponsoring local government entity had elected not to

make payments and had instead chosen to dissolve.)

The Association concedes grammatical separability but contends Assembly

Bills 1X 26 and 1X 27 are neither functionally nor volitionally separable. As to

functional separability, the Association posits that the Legislature likely expected

Assembly Bill 1X 27 to be upheld and Assembly Bill 1X 26 thus to come into play

only for those redevelopment agencies that elected to dissolve. Speculation as to

what the Legislature may have expected is immaterial here; the issue under this

prong is simply whether Assembly Bill 1X 26 is complete in itself such that it can

be enforced notwithstanding Assembly Bill 1X 27‘s invalidity. Assembly Bill

1X 26 outlines an independent mechanism for redevelopment agency dissolution

that does not depend in any way on Assembly Bill 1X 27.

Alternatively, the Association identifies a small handful of provisions in

Assembly Bill 1X 26 that are meaningful only if Assembly Bill 1X 27 is valid.

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(See §§ 34172, subd. (a)(2) [permitting communities to create new redevelopment

agencies provided they make Assem. Bill 1X 27 continuation payments], 34178.7,

34188.8, 34191, subd. (a) [governing redevelopment agencies that fail to keep up

with continuation payments].) The provision allowing communities to establish

new redevelopment agencies subject to continuation payments under Assembly

Bill 1X 27 is invalid for precisely the same reasons applicable generally to

Assembly Bill 1X 27. Its invalidity does not, however, affect the rest of Assembly

Bill 1X 26, as the provision is grammatically, functionally, and volitionally

separable from the rest of Assembly Bill 1X 26. (See Assem. Bill 1X 26, § 12

[providing for internal severability for Assem. Bill 1X 26].) Those provisions

applicable only to redevelopment agencies that start but then cease continuation

payments are not invalid, but are simply irrelevant; in light of Assembly Bill

1X 27‘s invalidity, no redevelopment agency will ever become subject to them.

Neither set of provisions impairs Assembly Bill 1X 26‘s functional separability.

As for volitional separability, the Association points to evidence that the

Legislature rejected Governor Brown‘s proposal simply to end redevelopment

agencies in favor of the two-bill package it ultimately passed. The Association

further quotes statements from various individual legislators during the June 15,

2011, floor debates suggesting they (1) viewed Assembly Bills 1X 26 and 1X 27

as a package deal (remarks of Sen. Steinberg; remarks of Assemblyman

Blumenfield) and (2) preferred to mend redevelopment rather than end it (remarks

of Sen. Hancock).

We may accept that the Legislature treated Assembly Bills 1X 26 and

1X 27 as a package, and accept as self-evident that the Legislature preferred

dissolution with an option to buy a reprieve over dissolution without any such

option; after all, it passed Assembly Bill 1X 27 in addition to Assembly Bill

1X 26, when it could have opted for some variation of Governor Brown‘s outright

47

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dissolution proposal. We need not further consider what weight, if any, to accord

the statements of individual legislators because this evidence goes to answering

the wrong question. The issue, when assessing volitional separability, is not

whether a legislative body would have preferred the whole to the part; surely it

would have, and the legislative history the Association points to tells us no more

than that. Instead, the issue is whether a legislative body, knowing that only part

of its enactment would be valid, would have preferred that part to nothing, or

would instead have declined to enact the valid without the invalid. (See, e.g.,

Gerken v. Fair Political Practices Com., supra, 6 Cal.4th at p. 719; Calfarm Ins.

Co. v. Deukmejian, supra, 48 Cal.3d at p. 822; Sonoma County Organization of

Public Employees v. County of Sonoma, supra, 23 Cal.3d at p. 320.)

As to that question, the interstatutory severability clause the Legislature

enacted is conclusive. (See Assem. Bill 1X 27, § 4.) It is no generic severability

clause, providing nonspecifically that if any provision of a measure is invalidated

the remaining portions of an act should remain in force. (Cf. § 34168, subd. (b).)

Rather, it deals with the precise severability question we face: whether, if

section 2 of Assembly Bill 1X 27 were to be invalidated, the Legislature would

have wanted the provisions of Assembly Bill 1X 26 to remain in force. The

interstatutory severability clause answers that question unequivocally in the

affirmative: Assembly Bill 1X 27, section 2 is severable from Assembly Bill

1X 26, and the Legislature intended the freeze and dissolution provisions to

continue in effect notwithstanding the invalidation of the continuation payment

program. (Assem. Bill 1X 27, § 4; see also Assem. Budget Com., Conc. in Sen.

Amend., analysis of Assem. Bill 1X 27 (2011-2012 1st Ex. Sess.) as amended

June 14, 2011, p. 4 [highlighting that while most provisions of Assem. Bill 1X 27

were not severable, the bill was severable from ―[Assem. Bill 1X 26], which

eliminates redevelopment. Thus, if provisions of this bill are found invalid, the

48

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provisions of the first bill could remain in effect.‖]; Sen. Rules Com., Off. of Sen.

Floor Analyses, 3d reading analysis of Assem. Bill 1X 27 (2011-2012 1st Ex.

Sess.) as amended June 15, 2011, p. 6 [same].)24 Accordingly, whatever

individual legislators may have said at one point or another, what the Legislature

actually did establishes it would have passed Assembly Bill 1X 26 irrespective of

the passage of Assembly Bill 1X 27, and that Assembly Bill 1X 26 is volitionally

separable. Consequently, it is severable.

We summarize our conclusions concerning the constitutional landscape.

The Legislature, pursuant to its plenary power to establish or dissolve local

agencies and subdivisions as it sees fit, may, but need not, authorize

redevelopment agencies. (Cal. Const., art. IV, § 1.) If it does choose to authorize

such agencies, it may, but need not, authorize their receipt of property tax

increment. (Id., art. XVI, § 16.) However, if it authorizes such agencies and,

moreover, authorizes their receipt of tax increment, it may not thereafter require

that such allocated tax increment be remitted for the benefit of schools or other

local agencies. (Id., art. XIII, § 25.5, subd. (a)(7)(A).) Assembly Bill 1X 26


24

As discussed, Assembly Bill 1X 27 contains, in addition to an interstatutory

severability clause (Assem. Bill 1X 27, § 4), an intrastatutory nonseverability
clause that invalidates the remainder of Assembly Bill 1X 27 if Assembly Bill
1X 27‘s section 2 is struck down. (Assem. Bill 1X 27, § 5.) The Association and
amicus curiae Community Redevelopment Agency of the City of Los Angeles
suggest the intrastatutory nonseverability clause invalidates the interstatutory
severability clause. But the clear intent of an intrastatutory nonseverability clause
like section 5 of Assembly Bill 1X 27 is to prevent the other substantive
provisions of an enactment from taking effect; it is not to invalidate other
metaprovisions of an enactment—such as section 5 itself—that speak to the
effectiveness of provisions of an enactment in the event of partial invalidation.
The section 4 interstatutory severability clause, another metaprovision, is likewise
exempt from the invalidating reach of section 5.

49

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respects these narrow limits on the Legislature‘s power; Assembly Bill 1X 27 does

not.

E. The Future Implementation of Assembly Bill 1X 26

When we accepted jurisdiction over the Association‘s petition, we stayed

implementation of the provisions of part 1.85 of division 24 of the Health and

Safety Code. (§§ 34170-34191.) Numerous critical deadlines contained in that

part have passed and can no longer be met. (See §§ 34170, subd. (a) [all

provisions in pt. 1.85 are operative on Oct. 1, 2011, unless otherwise specified],

34172, subd. (a)(1) [dissolving redevelopment agencies], 34173 [creating

successor agencies], 34175, subd. (b) [transferring redevelopment agency assets to

successor agencies], 34177, subd. (l)(2)(A) [requiring successor agency to prepare

a draft obligation payment schedule by Nov. 1, 2011].)

This impossibility ought not to prevent the Legislature‘s valid enactment

from taking effect. As Matosantos urges, and the Association does not contest, we

have the power to reform a statute so as to effectuate the Legislature‘s intent

where the statute would otherwise be invalid. (Kopp v. Fair Pol. Practices Com.

(1995) 11 Cal.4th 607, 660-661.) Here, the problem is not invalidity but

impossibility: the need, recognized by both sides, to put to rest constitutional

questions concerning these measures, when combined with a stay issued to

preserve the court‘s jurisdiction to issue meaningful relief, has rendered it

impossible for the parties and others affected to comply with the legislation‘s

literal terms. By exercising the power of reform, however, we may as closely as

possible effectuate the Legislature‘s intent and allow its valid enactment to have

its intended effect. Reformation is proper when it is feasible to do so in a manner

that carries out those policy choices clearly expressed in the original legislation,

and when the legislative body would have preferred reform to ineffectuality. (Id.

50

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at p. 661.) We think it clear that (1) the Legislature would have preferred

Assembly Bill 1X 26 to take effect on a delayed basis, rather than not at all, and

(2) the timeline provided for in Assembly Bill 1X 26 can be reformed in a fashion

that cleaves sufficiently to legislative intent.

In recognition of the eventuality that upholding any part of Assembly Bill

1X 26 or 1X 27 would require us to address the impact of our stay on their

statutory deadlines, we solicited input from the parties as to appropriate new

deadlines. Because we have invalidated Assembly Bill 1X 27, we need consider

only the extent to which deadlines in part 1.85 must be extended to account for the

stay, while taking effect as promptly as the Legislature intended.

The parties‘ proposals involve elaborate schedules shifting each deadline in

part 1.85 by a varying number of days. We decline to adopt any of the proposed

schedules, whose implementation would overly complicate future compliance.

Instead, we note that our stay of part 1.85 has been in place for four months and

has delayed operation of that part of Assembly Bill 1X 26 by a like amount. By

reforming Assembly Bill 1X 26 to extend each of its deadlines by the duration of

our stay, we retain the relative spacing of events originally intended by the

Legislature and simplify compliance for all affected parties.

Accordingly, we exercise our power of reformation and revise each

effective date or deadline for performance of an obligation in part 1.85 of division

24 of the Health and Safety Code (§§ 34170-34191) arising before May 1, 2012, to

take effect four months later.25 By way of example, under section 34170,


25

We make an exception for actions that were to be taken by September 1,

2011. (See, e.g., § 34173, subd. (d)(1).) There, we extend the deadline to 15 days
after the issuance of our opinion and lifting of the stay, i.e., January 13, 2012,
rather than January 1.

51

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subdivision (a), all provisions in part 1.85 were to be operative on October 1,

2011, unless otherwise specified; our reformation makes them operative on

February 1, 2012. The draft obligation payment schedules due on November 1,

2011, under section 34177, subdivision (l)(2)(A), are now due March 1, 2012.26

Successorship agency board membership, required to be determined by January 1,

2012 (§ 34179, subd. (a)), must be complete by May 1, 2012. Similar

reformations apply to all other imminent obligations throughout part 1.85. In

contrast, no reformation is needed for future obligations to be carried out in

subsequent fiscal years. (E.g., §§ 34179, subds. (j)-(l) [provisions for

successorship agency boards in 2016 and later], 34182, subd. (c)(3) [ongoing

county auditor-controller obligation to prepare estimates of allocations and

distributions every Nov. 1 and May 1].)

Where a provision imposes obligations in both this and subsequent fiscal

years, we reform the provision only as it relates to obligations arising before

May 1, 2012. Thus, for example, section 34183 requires certain calculations from

county auditor-controllers by January 16, 2012, and June 1, 2012, for this fiscal

year, and on January 16 and June 1 in subsequent years. (§ 34183, subd. (a).) We

reform the January 16, 2012, deadline by extending it to May 16, 2012, and leave

the remaining deadlines unchanged. Likewise, section 34185 provides for

distributions on each January 16 and June 1; we reform the first distribution

deadline by extending it to May 16, 2012, and leave all subsequent deadlines

unchanged, so that future distributions may occur on the schedule, and in the same

fiscal year, originally contemplated by the Legislature.


26

In contrast, the period to be covered by these schedules—through July 1,

2012, the end of the fiscal year—is not an obligation and is thus unchanged by our
reformation. (See § 34177, subd. (l)(2)(A).)

52

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III. DISPOSITION

For the foregoing reasons, we discharge the order to show cause, deny the

Association‘s petition for a peremptory writ of mandate with respect to Assembly

Bill 1X 26, except for Health and Safety Code section 34172, subdivision (a)(2),

and grant its petition with respect to Assembly Bill 1X 27. We direct issuance of a

peremptory writ compelling the state Director of Finance and state Controller not

to implement Health and Safety Code sections 34172, subdivision (a)(2) and

34192-34196. We extend all statutory deadlines contained in Health and Safety

Code, division 24, part 1.85 (§§ 34170-34191) and arising before May 1, 2012, by

four months. Given the urgency of the matters addressed by the Association‘s

petition, our judgment is final forthwith. (See, e.g., Senate of the State of Cal. v.

Jones (1999) 21 Cal.4th 1142, 1169.)

WERDEGAR, J.

WE CONCUR:

KENNARD, J.
BAXTER, J.
CHIN, J.
CORRIGAN, J.
LIU, J.


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CONCURRING & DISSENTING OPINION

BY CANTIL-SAKAUYE, C. J.

I concur in parts II.A., II.B., and II.E. of the majority opinion, but

respectfully dissent from the remainder of the opinion concerning the

constitutionality of Assembly Bill 1X 27.1 The majority concludes that Assembly

Bill 1X 27 is unconstitutional because it violates article XIII, section 25.5,

subdivision (a)(7)(A) of the California Constitution (added by Prop. 22, approved

by voters, Gen. Elec. (Nov. 2, 2010)). I part with the majority on this point

because, although it may be possible that Assembly Bill 1X 27 may cause some

community sponsors2 to utilize funds otherwise protected by Proposition 22,

petitioners have not met their burden of supporting this contention. In fact, they

provide documentation that suggests quite the opposite. Moreover, on its face,

nothing in Assembly Bill 1X 27 compels community sponsors to violate

Proposition 22. Ultimately, the majority‘s conclusion rests on an impermissibly


1

This bill added part 1.9 to division 24 of the Health and Safety Code and

enacted 14 statutes, Health and Safety Code sections 34192, 34192.5, 34193,
34193.1-34193.3, 34194, 34194.1-34194.5, 34195, 34196. For sake of
consistency, I will use the same designation used by the majority, Assembly
Bill 1X 27, in making general references to these statutes.

2

Also consistent with the majority‘s terminology, I will use the term

―community sponsor‖ to describe the local government body, such as a city or
county, that may elect to make payments required by Assembly Bill 1X 27 in
order to continue redevelopment practices.

1

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broad reading of Proposition 22 plain language, on unsupported assumptions

concerning the intent behind Proposition 22, and on speculation that constitutional

problems could result from the implementation of Assembly Bill 1X 27. In doing

so, the majority does not apply well-settled rules of statutory and constitutional

construction.

I. Facial Challenges and the Rules of Statutory

and Constitutional Construction

I first address the applicable rules concerning petitioners‘ facial challenge

of Assembly Bill 1X 27 and the interpretative framework governing challenges to

the constitutionality of the statutes enacted by this bill.

A. Facial Challenges versus “As Applied” Challenges

Generally, a facial challenge to the constitutionality of legislation

―considers only the text of the measure itself, not its application to the particular

circumstances of an individual.‖ (Tobe v. City of Santa Ana (1995) 9 Cal.4th

1069, 1084.) In contrast, an ―as applied‖ challenge to the constitutionality of

legislation involves an otherwise facially valid measure that has been applied in a

constitutionally impermissible manner. This type of challenge ―contemplates

analysis of the facts of a particular case or cases to determine the circumstances in

which the [measure] has been applied and to consider whether in those particular

circumstances the application deprived the individual to whom it was applied of a

protected right.‖ (Ibid.)

Petitioner California Redevelopment Association concedes that it is making

a facial challenge to Assembly Bill 1X 27.3 ―A facial challenge to a legislative


3

Given the procedural posture of this case — an application to declare the

statutes enacted by Assembly Bill 1X 26 and Assembly Bill 1X 27
unconstitutional after we have substantially stayed their enforcement — it seems


(footnote continued on next page)

2

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Act is, of course, the most difficult challenge to mount successfully, since the

challenger must establish that no set of circumstances exists under which the Act

would be valid.‖ (United States v. Salerno (1987) 481 U.S. 739, 745.) The

circumstance that an act ―might operate unconstitutionally under some

conceivable set of circumstances is insufficient to render it wholly invalid‖ under a

facial challenge. (Ibid.)

B. Petitioners’ Burden Under a Facial Challenge

In describing petitioners‘ burden, we have sometimes articulated differing

standards. Under the strictest standard, ― ‗[t]o support a determination of facial

unconstitutionality, voiding the statute as a whole, petitioners cannot prevail by

suggesting that in some future hypothetical situation constitutional problems may

possibly arise as to the particular application of the statute . . . . Rather,

petitioners must demonstrate that the act‘s provisions inevitably pose a present

total and fatal conflict with applicable constitutional prohibitions.‘ ‖ (Arcadia

Unified School Dist. v. State Dept. of Education (1992) 2 Cal.4th 251, 267,

quoting Pacific Legal Foundation v. Brown (1981) 29 Cal.3d 168, 180-181.)

Under the more lenient standard, petitioners need only demonstrate that the

measure ―conflicts with [the Constitution] ‗in the generality or great majority of

cases.‘ [Citations.]‖ (Guardianship of Ann S. (2009) 45 Cal.4th 1110, 1126.)


(footnote continued from previous page)

very difficult, if not impossible, for petitioners to perfect an ―as applied‖ challenge
by arguing that the measures have been or will be enforced in an unconstitutional
manner in any particular case. (Tobe v. City of Santa Ana, supra, 9 Cal.4th at
pp. 1092-1093.) In any event, as I will explain in greater detail in part II.D., the
documentation that petitioner presents does not establish that the enforcement of
Assembly Bill 1X 27 necessarily will result in a violation of Proposition 22 in any
particular case.

3

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It is unclear which standard the majority employs, but, as I will explain, I

believe petitioners have not met their burden under either standard concerning the

alleged unconstitutionality of the statutes enacted by Assembly Bill 1X 27.

C. The Applicable Interpretative Rules of Constitutional and Statutory

Construction

In assessing the merits of petitioners‘ facial challenge, we are governed by

a specific interpretative framework that constrains how we must view the

interaction between the statutes enacted by Assembly Bill 1X 27 and Proposition

22.

As the majority notes, Proposition 22, which added subdivision (a)(7)(A) to

section 25.5 of article XIII of the California Constitution, limits what the

Legislature may do with respect to redevelopment agency tax increment funds.

Respondent Matosantos correctly argues that Proposition 22 imposes a

constitutionally based limitation on the powers of the Legislature, and we must

construe such limits strictly. (White v. Davis (2003) 30 Cal.4th 528, 539-540;

Pacific Legal Foundation, supra, 29 Cal.3d at p. 180.) This strict construction of

the constitutional limits on legislative power is required because ― ‗ ―we do not

look to the Constitution to determine whether the legislature is authorized to do an

act, but only to see if it is prohibited.‖ [Citation.]‘ ‖ (White v. Davis, supra, at

p. 539, quoting Methodist Hosp. of Sacramento v. Saylor (1971) 5 Cal.3d 685,

691.) Given that legislative power is ― ‗ ―practically absolute,‖ ‘ ‖ any

constitutional limitations on this power are strictly construed and may not be given

effect as against the general power of the Legislature ― ‗ ―unless such limitations

clearly inhibit the act in question.‖ ‘ ‖ (Amwest Surety Ins. Co. v. Wilson (1995)

11 Cal.4th 1243, 1255 (Amwest).) Accordingly, in the face of a constitutionally

based limitation on its power, ― ‗ ―[i]f there is any doubt as to the Legislature‘s

power to act in any given case, the doubt should be resolved in favor of the

4

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Legislature‘s action.‖ ‘ ‖ (White v. Davis, supra, at p. 539, quoting Methodist

Hosp. of Sacramento v. Saylor, supra, at p. 691.)

Furthermore, although ― ‗[t]he judiciary‘s traditional role of interpreting

ambiguous statutory language or ―filling in the gaps‖ of statutory schemes is . . . as

applicable to initiative measures as it is to measures adopted by the Legislature,‘ ‖

we have warned that ―the initiative power is strongest when courts give effect to

the voters‘ formally expressed intent, without speculating about how they might

have felt concerning subjects on which they were not asked to vote.‖ (Ross v.

RagingWire Telecommunications, Inc. (2008) 42 Cal.4th 920, 930, quoting

Evangelatos v. Superior Court (1988) 44 Cal.3d 1188, 1202.) Therefore, unless

―the text is ambiguous and supports multiple interpretations,‖ our court must rely

upon ―the text as the first and best indicator of intent.‖ (Kwikset Corp. v. Superior

Court (2011) 51 Cal.4th 310, 321.) Even ―a command that a constitutional

provision or a statute be liberally construed ‗does not license either enlargement or

restriction of its evident meaning‘ ‖ because unambiguous language requires no

need for engaging in liberal construction.4 (Apartment Assn. of Los Angeles

County, Inc. v. City of Los Angeles (2001) 24 Cal.4th 830, 844, quoting People v.

Cruz (1974) 12 Cal.3d 562, 566.)

As for our interpretation of the statutes enacted by Assembly Bill 1X 27,

we presume the constitutionality of a legislative act, resolving all doubts in its

favor, and we must uphold it unless a ― ‗conflict with a provision of the state or

federal Constitution is clear and unquestionable.‘ ‖ (Amwest, supra, 11 Cal.4th at

p. 1252.) This presumption is particularly appropriate when, as here, ―the statute


4

In interpreting Proposition 22, the majority opinion fails to acknowledge

this particular rule of interpretation.

5

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represents a considered legislative judgment as to the appropriate reach of the

constitutional provision.‖ (Pacific Legal Foundation v. Brown, supra, 29 Cal.3d

at p. 180; see Legis. Analyst‘s Off., The 2011-12 Budget: Should California End

Redevelopment Agencies? (Feb. 9, 2011) p. 12 [warning the Legislature that

Prop. 22 and other measures limit ―the state‘s authority to shift property taxes

and/or redirect tax increment revenues‖ and that ―[d]rafting a plan for local

governments to carefully unwind their redevelopment programs and successfully

navigate the many legal, administrative, and financial factors will be complex‖].)

From these principles, I conclude that our analysis must begin with the

presumption that Assembly Bill 1X 27 is constitutionally valid unless it conflicts

with the state Constitution in a clear and unquestionable manner. Because

Proposition 22 restricts the Legislature‘s power, it must be strictly construed. But

even though Proposition 22 contains a demand that it be liberally construed, as

with any statute, we cannot give Proposition 22 an interpretation beyond its

formally expressed intent if its language is clear.

II. Interpreting Proposition 22

I conclude that, even assuming the circumstances most favorable to

petitioners — applying the more lenient standard for facial challenges and broadly

construing Proposition 22 — petitioners have failed to sustain their burden to

show that Assembly Bill 1X 27 is unconstitutional.

A. Proposition 22 and Assembly Bill 1X 27 Generally

Proposition 22 prohibits the Legislature from requiring ―a community

redevelopment agency . . . to pay, remit, loan, or otherwise transfer, directly or

indirectly, taxes on ad valorem real property and tangible personal property

allocated to the agency pursuant to Section 16 of Article XVI [i.e., its tax

increment funds].‖ (Cal. Const., art. XIII, § 25.5, subd. (a)(7)(A).) Given the

6

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rules of interpretation described ante, it is important to note what, exactly, this

constitutional provision expressly prohibits: the Legislature cannot require a

redevelopment agency to directly or indirectly reallocate its tax increment funds.

In contrast, Assembly Bill 1X 27 does not require or compel any

redevelopment agency to make any payment. It specifically provides that the

community sponsor, whether it be a city, county, or other local government entity,

―may use any available funds not otherwise obligated for other uses‖ to make a

payment. (Health & Saf. Code, § 34194.1, subd. (a).)5 The payments required by

Assembly Bill 1X 27 to establish or continue redevelopment agencies are to be

made by community sponsors, not redevelopment agencies. Although Assembly

Bill 1X 27, through the enactment of section 34194.2, permits a community

sponsor to enter into an agreement with its redevelopment agency to use its tax

increment to fund the payment, such agreements are not compelled or required by

Assembly Bill 1X 27.6 Moreover, nothing in Assembly Bill 1X 27 requires that a


5

Unless otherwise noted, all further statutory references are to the Health

and Safety Code.

6

Petitioner County of Santa Clara argues that one of the statutes enacted by

Assembly Bill 1X 27 is unconstitutional because section 34194.2 allows loans of
tax increment funds to finance Assembly Bill 1X 27 payments in violation of
article XVI, section 16, of the state Constitution, which mandates that tax
increment funds be used to finance redevelopment projects. But section 34194.2
cannot be facially unconstitutional because its language is permissive — ―a city or
county may enter into an agreement with the redevelopment agency‖ to make such
loans of local tax increment funds. (Italics added.) This provision, therefore, does
not ―inevitably pose a present total and fatal conflict with applicable constitutional
prohibitions.‖ (Pacific Legal Foundation v. Brown, supra, 29 Cal.3d 168, 181.)
Moreover, even under the more liberal standard for facial challenges, as I will
explain in part II.D., petitioners have failed to show that section 34194.2 will
generate potential violations of the state Constitution ― ‗in the generality or great
majority of cases.‘ ‖ (Guardianship of Ann S., supra, 45 Cal.4th 1110, 1126.)

7

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redevelopment agency‘s tax increment be reallocated, either directly or indirectly,

to satisfy the payments. Instead, the measure is neutral as to the source of funds

for the Assembly Bill 1X 27 payments.7

B. The Applicable Language of Proposition 22 Does Not Require a

Liberal Construction

The majority asserts that California Constitution article XIII, section 25.5,

subdivision (a)(7) (as added by Prop. 22) is ambiguous, thereby requiring an

examination of its history to ascertain its intended meaning. The majority

identifies as ambiguous Proposition 22‘s use of the words ―indirectly‖ and

―directly,‖ especially in view of prior statutory shifts involving ERAF‘s pursuant


7

For this same reason, Assembly Bill 1X 27‘s revenue-neutral provision,

clarifying that a community sponsor ―may use any available funds not otherwise
obligated for other uses‖ to make the Assembly Bill 1X 27 payments (Health &
Saf. Code, § 34194.1, subd. (a)), also forecloses petitioners‘ facial challenge based
on other provisions of Proposition 22 and on Proposition 1A (as approved by
voters, Gen. Elec. (Nov. 2, 2004)). Proposition 1A amended the state Constitution
to limit the Legislature‘s ability to reallocate property taxes unless passed by a
two-thirds vote, but nothing in Assembly Bill 1X 27 requires the payments to
come from this source. In addition, the mere fact that section 34194.1, subdivision
(b) labels its payments as ―property taxes‖ for a single fiscal year, for the purpose
of offsetting the state‘s school funding obligations in that year, does not violate
Proposition 1A as petitioner County of Santa Clara argues. No provision of
Assembly Bill 1X 27 alters the existing distribution of local property tax revenue
actually collected by counties, and section 34194.1‘s terminology is simply an
extension of the ―accounting device‖ established by the Educational Revenue
Augmentation Funds (ERAF‘s). (Los Angeles Unified School Dist. v. County of
Los Angeles (2010) 181 Cal.App.4th 414, 426.) Similarly, another provision of
Proposition 22 amended the state Constitution to ensure that the Legislature could
not ―reallocate, transfer, borrow, appropriate, restrict the use of, or otherwise use
the proceeds of any tax imposed or levied by a local government solely for the
local government‘s purposes.‖ (Cal. Const., art. XIII, § 24, subd. (b).) But
nothing in Assembly Bill 1X 27 redirects the proceeds of an otherwise dedicated
local tax toward making the Assembly Bill 1X 27 payments.

8

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to which the Legislature diverted redevelopment agency tax increment revenue to

fund schools.

The majority notes that a distinct provision in each of those prior ERAF

shifts, going back to 2003, allowed the shift to be funded in a revenue-neutral and

source-neutral manner and without necessarily using tax increment funds. For

instance, in the legislation enacting the last ERAF shift, which directly led to

Proposition 22‘s placement on the November 2010 ballot, the Legislature included

statute that did not require the ERAF shift payment to come specifically from tax

increment funds, but instead provided that in order ―[t]o make the allocation

required by this section, an agency may use any funds that are legally available

and not legally obligated for other uses, including, but not limited to, reserve

funds, proceeds of land sales, proceeds of bonds or other indebtedness, lease

revenues, interest, and other earned income.‖ (Health & Saf. Code, § 33690.5,

subd. (b), italics added.) It also included a ―catch-all‖ statute that allowed a local

legislative body, in lieu of the redevelopment agency, to make the ERAF payments

―from any funds that are legally available for this purpose.‖ (Health & Saf. Code,

§ 33692, subd. (c), italics added.) Accordingly, the majority reasons that

Proposition 22‘s language, prohibiting the direct or indirect transfer of tax

increment funds, is specifically intended to stop the kind of payments described by

Assembly Bill 1X 27.

However, Proposition 22‘s plain language simply does not prohibit the kind

of payments described by Assembly Bill 1X 27.

Proposition 22 prohibits the Legislature from requiring ―a community

redevelopment agency . . . to pay, remit, loan, or otherwise transfer, directly or

indirectly,‖ its tax increment funds. (Cal. Const., art. XIII, § 25.5, subd. (a)(7)(A),

italics added.) As previously described, however, the Assembly Bill 1X 27

payments must be made by community sponsors, not redevelopment agencies.

9

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Nothing in Assembly Bill 1X 27 requires a redevelopment agency ―to pay, remit,

loan, or otherwise transfer, directly or indirectly,‖ its tax increment funds. If

Proposition 22 intended to prohibit the payments described by Assembly Bill 1X

27, it could have been written to prohibit the Legislature from requiring a local

government body or community sponsor ―to pay, remit, loan, or otherwise transfer,

directly or indirectly,‖ its tax increment funds. But it was not drafted that way.

Additionally, nothing in Proposition 22 restricts the Legislature from using

tax increment funds as the basis for a particular calculation. Certainly, Assembly

Bill 1X 27 uses the size of tax increment funds as a ―yardstick‖ or, as the majority

characterizes it a ―levy,‖ to determine the size of the described payments, but such

use is not prohibited by Proposition 22‘s plain language.

Pointedly, the word ―levy‖ appears nowhere in Proposition 22. Instead, the

drafters of Proposition 22 listed a very specific catalog of actions, prohibiting the

Legislature from requiring a redevelopment agency ―to pay, remit, loan, or

otherwise transfer‖ its tax increment funds. (Cal. Const., art. XIII, § 25.5,

subd. (a)(7)(A), italics added.) ― ‗[W]hen a statute contains a list or catalogue of

items, a court should determine the meaning of each by reference to the others,

giving preference to an interpretation that uniformly treats items similar in nature

and scope. [Citations.] In accordance with this principle of construction, a court

will adopt a restrictive meaning of a listed item if acceptance of a more expansive

meaning would make other items in the list unnecessary or redundant, or would

otherwise make the item markedly dissimilar to the other items in the list.

[Citations.]‘ ‖ (Commission on Peace Officer Standards & Training v. Superior

Court (2007) 42 Cal.4th 278, 294, quoting Moore v. California State Bd. of

Accountancy (1992) 2 Cal.4th 999, 1011-1012.) Placing aside the problem that

the list of verbs applies only to redevelopment agencies, expansively reading the

word ―levy‖ into the list of prohibited actions would conflict with the other words

10

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in the list describing actions that ―otherwise transfer‖ tax increment funds, making

the remaining words unnecessary or redundant. If Proposition 22 truly intended to

prevent the Legislature from using tax increment funds as the basis for calculating

certain payments or as the basis of a levy, it could have been written to prohibit the

Legislature from requiring ―a community redevelopment agency to pay, remit,

loan, or otherwise transfer, directly or indirectly,‖ its tax increment funds ―or to

levy such revenues or use them as the basis for certain remittances.‖ But again, it

was not drafted that way.

C. A Liberal Construction of Proposition 22 Does Not Render

Assembly Bill 1X 27 Facially Unconstitutional

Even if Proposition 22‘s use of the words ―directly‖ or ―indirectly‖ is

ambiguous and raises colorable questions of whether Proposition 22 might apply

to community sponsors or whether it might prohibit the use of tax increment funds

as a ―yardstick‖ or ―levy,‖ I still cannot agree with the majority‘s conclusion that

Assembly Bill 1X 27 is unconstitutional.

1. A Broad Construction of the Word “Indirectly”

The express obligation to make the payments to establish or continue

redevelopment agencies rests on community sponsors, and not on redevelopment

agencies themselves and Assembly Bill 1X 27 does not expressly compel the use

of tax increment funds to make the Assembly Bill 1X 27 payments. However, the

majority relies on the history of prior ERAF legislation and apparently infers that

Proposition 22 intended its use of the word ―indirectly‖ to cover the entire

scenario posed by the Assembly Bill 1X 27 payments. But a careful dissection of

the 2009 ERAF legislation, much of which was the immediate trigger for

Proposition 22, illustrates why this reasoning is erroneous.

As relevant here, the 2009 ERAF shift legislation covered two fiscal years

and was comprised of four different statutes. (Assem. Bill No. 26 (2009-2010 4th

11

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Ex. Sess.) enacted as Stats. 2009, 4th Ex. Sess., ch. 21, §§ 6-9; §§ 33690 [for fiscal

year 2009-2010], 33690.5 [for fiscal year 2010-2011], 33691, and 33692.)8 A

review of the first three of these statutes reveals that the Legislature clearly

targeted redevelopment agencies and their tax increments as the funding source for

the ERAF shifts. But the fourth statute, section 33692, was a stand-alone, catch-

all provision that, unlike the other three statutes, expressed a revenue-neutral

stance as to the money used to fund the ERAF shifts. As I will explain, no liberal

construction of Proposition 22 can stretch to prohibit similar revenue-neutral

provisions enacted by Assembly Bill 1X 27.

The first two statutes specify that a redevelopment agency ―shall remit‖ the

ERAF shifts, and that payments were to be based directly on a proportion of the

redevelopment agency‘s net tax increment. (§§ 33690, subd. (a), 33690.5,

subd. (a), italics added.) Both statutes state that the ERAF remittance for each

fiscal year is ―declared to be an indebtedness of the redevelopment project to

which they relate, payable from‖ tax increment funds. (§§ 33690, subd. (e),

33690.5, subd. (e).) Each statute also states, however, that the redevelopment

agency could make the payment by using any of the redevelopment agency‘s other

available revenue sources. (§§ 33690, subd. (b), 33690.5, subd. (b).) Each further

declares, ―[i]t is the intent of the Legislature, in enacting this section, that these


8

Over a year later, the Legislature added a fifth statute, section 33691.5, that

allowed indebted redevelopment agencies to enter into a long-term payment plan
with the state to eventually pay off any outstanding ERAF remittances for fiscal
years 2009-2010 and 2010-2011. (Sen. Bill No. 863 (2009-2010 Reg. Sess.)
enacted as Stats. 2010, ch. 722, § 8.) Because this measure was signed into law on
October 19, 2010, well after Proposition 22 qualified for placement on the
November 2, 2010 election ballot, section 33691.5 could not have affected the
intent of the drafters of Proposition 22. Accordingly, it bears no relevance to our
analysis of what Proposition 22 intended to prohibit.

12

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allocations directly or indirectly assist in the financing or refinancing, in whole or

in part, of the community‘s redevelopment project pursuant to Section 16 of

Article XVI of the California Constitution.‖ (§§ 33690, subd. (f), 33690.5,

subd. (f), italics added.)

Under both the plain language of Proposition 22 and a liberal construction

of its use of the word ―indirectly,‖ the Legislature is clearly prohibited from

enacting future legislation identical to these first two statutes. Because these first

two statutes, sections 33690 and 33690.5, compelled redevelopment agencies to

make the ERAF remittances and defined the revenue shifts, whether from tax

increment funding or other available revenue, as part of the redevelopment

agency‘s indebtedness, payable from tax increment funds, the drafters of

Proposition 22 responded by including language that would prohibit the

Legislature from enacting future legislation requiring ―a community

redevelopment agency . . . to pay, remit, loan, or otherwise transfer, directly or

indirectly,‖ its tax increment funds. (Cal. Const., art. XIII, § 25.5, subd. (a)(7)(A),

italics added.)

To the extent that sections 33690 and 33690.5 also provide that the

redevelopment agency could make the ERAF remittances by using any of the

agency‘s other revenue sources not related to tax increment funds, a liberal

construction of Proposition 22 also would forbid similar measures in the future.

Although a redevelopment agency‘s use of otherwise available, non-tax-increment

revenue cannot be a compelled direct remittance of its tax increment funds, such

use may constitute an indirect remittance of its tax increment funds by imposing

an additional, immediate financial obligation on the redevelopment agency‘s

otherwise fixed budget. Thus, the provisions in these first two statutes allowing

the ERAF remittance to be funded by other redevelopment agency revenue would

be prohibited by Proposition 22 because such a provision would require ―a

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community redevelopment agency . . . to pay, remit, loan, or otherwise transfer,

directly or indirectly,‖ its tax increment funds. (Cal. Const., art. XIII, § 25.5,

subd. (a)(7)(A), italics added.)

A third statute from the 2009 ERAF legislation allows a redevelopment

agency to make partial ERAF remittances if its existing indebtedness made it

impossible for the agency to fund the entire ERAF shift. (§ 33691.) ―Existing

indebtedness‖ is defined in this section as a financial obligation incurred by the

redevelopment agency that required ―the payment of which is to be made in whole

or in part, directly or indirectly, out of‖ tax increment funds. (§ 33691,

subd. (a)(1), italics added.) This section contains a provision allowing the

redevelopment agency to obtain a loan from its local government for the ERAF

payment, but it also specifies that this loan becomes part of the agency‘s

indebtedness that ―shall be payable from tax revenues apportioned to the agency

pursuant to Section 33670 [i.e., tax increment funds], and any other funds received

by the agency.‖ (§ 33691, subd. (d)(2), italics added.)

Again, both the plain language of Proposition 22 and a liberal construction

of it would prohibit this kind of statute in the future. The loan anticipated by

section 33691 must be directly tied into a redevelopment agency‘s tax increment

funds, and the loan also is indirectly tied to tax increment funding by virtue of

continued reliance on ―other funds received by the agency.‖ (§ 33691, subd.

(d)(2).) Pointedly, Proposition 22 mirrors the same ―directly or indirectly‖

language used by section 33691, subdivision (a)(1). A future version of this third

statute, therefore, would be prohibited under Proposition 22 because it would

require ―a community redevelopment agency . . . to pay, remit, loan, or otherwise

transfer, directly or indirectly,‖ its tax increment funds. (Cal. Const., art. XIII,

§ 25.5, subd. (a)(7)(A), italics added.)

14

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Finally, a fourth statute from the 2009 ERAF legislation is markedly

different from its sister statutes. This fourth statute contains a catch-all phrase

allowing a local ―legislative body‖ to make the ERAF remittances on behalf of the

redevelopment agency using ―any funds that are legally available for this

purpose.‖ (§ 33692, subd. (c).) The statute‘s revenue source is neutral and allows

payment with ―no strings attached,‖ in the sense that it contains no provision,

unlike section 33691, subdivision (d), that converts the payment into an

redevelopment agency debt that is payable, either directly or indirectly, through its

tax increment funds. To use the majority‘s terminology, this fourth statute acts as

a kind of ―levy‖ on tax increment funds that can be paid by a local government

body using any available revenue source.

Here, I expose the Achilles‘ heel of the majority‘s reasoning concerning the

unconstitutionality of Assembly Bill 1X 27. Proposition 22‘s plain language

simply says nothing about the ―yardstick‖ or ―levy‖ scenario posed by this fourth

statute in section 33692. The language of Proposition 22 constrains the

Legislature from requiring ―a community redevelopment agency‖ from making

certain allocations of its tax increment, either ―directly or indirectly.‖ (Cal.

Const., art. XIII, § 25.5, subd. (a)(7)(A).) Proposition 22 does not address a local

―legislative body‖ nor does it address in any respect the use of otherwise unrelated

local revenue to pay a ―levy‖ on tax increment funds.

Even a liberal construction of Proposition 22 yields no different conclusion.

The only possible ambiguity in the relevant language concerns the use of the word

―indirectly,‖ but that word is bound to the otherwise precise transitive verbs,

―pay,‖ ―remit,‖ ―loan,‖ and ―transfer,‖ all of which are bound to the subject, ―a

community redevelopment agency,‖ and the constitutionally protected object, tax

increment funds. Simple rules of grammar, therefore, necessarily limit how

liberally we may construe the word ―indirectly.‖ (Civ. Code, § 13; Busching v.

15

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Superior Court (1974) 12 Cal.3d 44, 52 [―ordinary rules of grammar‖ normally

―must be applied unless they lead to an absurd result‖].) Therefore, the word

―indirectly‖ in plain language prohibits any compulsion being placed on a

redevelopment agency to make certain reallocations (not levies) of its tax

increment funds (but not other sources of local revenue).

As petitioner California Redevelopment Association conceded at oral

argument, there are several sources of local revenues not protected by either

Proposition 1A or Proposition 22, including, among other things, rental income,

lease income, interest income, sales of government-owned assets, sales of bonds,

investment income, and fines, fees, and penalties. Given that such revenues bear

no relation to any financing received by a redevelopment agency, it seems

impossible to conclude on a facial challenge, as the majority does, that Assembly

Bill 1X 27 payments funded by these revenues could ever cause a redevelopment

agency to indirectly transfer tax increment funds already allocated to it.

Certainly, as previously described, a liberal construction of the word

―indirectly‖ can be applied to prohibit the first three statutes of the 2009 ERAF

legislation because they each contained mandates directed at redevelopment

agencies and either directly targeted agencies‘ tax increment funds or indirectly

targeted their tax increment funds by assigning the ERAF shift as indebtedness

payable from the redevelopment agency‘s revenue sources. Sections 33690

through 33691 express the premise that the ERAF remittances must come from the

redevelopment agency, and, to the extent they do not, the nonpayment becomes

part of the redevelopment agency‘s debt. In fact, the legislation specifically

defines a redevelopment agency‘s preexisting debt as redevelopment agency

payments that have to be made, directly or indirectly, out of tax increment funds.

Further, the 2009 ERAF legislation asserts that the ERAF remittances were

intended to directly or indirectly further redevelopment projects within the

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meaning of article XVI of the Constitution. Accordingly, article XVI, section

25.5, subdivision (a)(7)(A) of the Constitution, as enacted by Proposition 22, is

completely responsive to the circumstances contemplated by sections 33690

through 33691 by prohibiting the Legislature from requiring ―a community

redevelopment agency . . . to pay, remit, loan, or otherwise transfer, directly or

indirectly, taxes on ad valorem real property and tangible personal property

allocated to the agency pursuant to Section 16 of Article XVI [i.e., its tax

increment funds].‖

But the fourth statute — section 33692 — poses an entirely different

scenario, one that does not require a redevelopment agency to do anything, let

alone require it to reallocate its tax increment funds, either directly or indirectly. It

contemplates a situation not addressed by Proposition 22, even under a broad

construction of that measure. Nevertheless, simply because section 33692 has an

analog in Assembly Bill 1X 27 in the form of section 34194.l,9 the majority hastily

concludes that Proposition 22 prohibits similar levies on tax increment funds. The

plain language, however, of section 25.5, subdivision (a)(7)(A) of article XIII of

the California Constitution, as enacted by Proposition 22, does not support such a

conclusion, even when liberally construed.

The majority criticizes my reliance on the grammar and syntax of

Proposition 22 and cites our decision in Burris v. Superior Court (2005) 34

Cal.4th 1012 (Burris) for the notion that the normal rules of grammar must yield

to the drafters‘ intent ― ‗to solve human problems‘ ‖ and that we should approach


9

Like section 33692 from the 2009 ERAF legislation, section 34194.1

likewise explains that the Assembly Bill 1X 27 payments can be funded from any
available city or county ―funds not otherwise obligated for other uses.‖
(§ 34194.1, subd. (a).)

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― ‗an interpretive problem not as if it were a purely logical game, like a Rubik‘s

Cube, but as an effort to divine the human intent that underlies the statute.‘ ‖

(Id. at p. 1017, quoting J.E.M. AG Supply v. Pioneer Hi-Bred (2001) 534 U.S. 124,

156 (dis. opn. of Breyer, J.).) Placing aside the fact that the quote originally came

from a dissenting opinion by Justice Breyer that had nothing to do with rules of

grammar or syntax,10 any exception to the rules of grammar or syntax might have

some justification if we have been presented with the same scenario we faced in

Burris, where the disputed language ―could readily refer‖ to two different

circumstances, and the legislative history of the measure supplied no ―evidence the

Legislature chose a particular construction in order to implement one rule or the

other.‖ (Burris v. Superior Court, supra, 34 Cal.4th 1012, 1018.) But as I have

already explained, the relevant language of Proposition 22 is hardly ambiguous,

and, to the extent that it is ambiguous, any ambiguity cannot be stretched to give

the meaning the majority now assigns to it.11

The only way the majority‘s interpretation of Proposition 22 could be

reconciled with its conclusion that it renders Assembly Bill 1X 27 unconstitutional

would be if Proposition 22 had been written with a different subject and a different

object, stating that the Legislature shall not: ―Require a community

redevelopment agency local government body . . . to pay, remit, loan, levy or


10

Instead, Justice Breyer used this language as a reason to take exception to

―interpretive canon that disfavors repeal by implication.‖ (J.E.M. AG Supply v.
Pioneer Hi-Bred, supra, 534 U.S. 124, 155 (dis. opn. of Breyer, J.).)

11

More importantly, even ignoring the measure‘s actual language, in part

II.C.2., I will explain that the drafters‘ express intent behind Proposition 22 does
not support the majority‘s broad ―human intent‖ interpretation, but instead is
entirely consistent with the measure‘s plain language. Thus, my reliance on the
syntax and grammar of Proposition 22 is but one additional reason, among others,
that causes me to depart from the views of my colleagues.

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otherwise transfer, directly or indirectly, funds based on taxes on ad valorem real

property and tangible personal property allocated to the its redevelopment agency

pursuant to Section 16 of Article XVI to or for the benefit of the State, any agency

of the State, or any jurisdiction . . . .‖ But Proposition 22 was not written that way.

If the proponents of Proposition 22 had intended to preclude a future version of

section 33692, the fourth statute in the 2009 ERAF legislation and its catch-all

allowing a ―local legislative body‖ to make remittances on behalf of the

redevelopment agency by using ―any funds that are legally available for this

purpose,‖ they had every opportunity to draft such language, but they did not.

Therefore, the plain language of Proposition 22 does not cover a section 33692

scenario, in which a city, county, or other local government body makes the

payment described by Assembly Bill 1X 27, nor can it properly be ―liberally

construed‖ as doing so.12


12

In a footnote (maj. opn., at p. 41, fn. 20), the majority claims that my

interpretation would not prohibit the Legislature from implementing in the future
any of the same statutes that were part of the 2009 ERAF legislation as long as it
also was accompanied by the fourth statute containing a catch-all option not
expressly prohibited by Proposition 22. This contention misconstrues both the
precise language of the 2009 ERAF statutes and the nature of facial challenges to
an individual statute. As previously described, on their face, the first three statutes
of the 2009 ERAF legislation are not ―options,‖ and each contains mandatory
language prohibited by Proposition 22. Because these three statutes either require
the redevelopment agency to remit its tax increment funds or require loans to be
backed by its tax increment funds, then their future iterations would be facially
barred under Proposition 22. By itself, any future iterations of the fourth catch-all
statute, section 33692, would never pose a problem of facial unconstitutionality as
measured against Proposition 22, because it is the only one of the four statutes that
truly presents an ―option‖ under its plain language.

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2. The History of Proposition 22

In some circumstances involving constitutional amendments, ―[t]he literal

language of enactments may be disregarded to avoid absurd results and to fulfill

the apparent intent of the framers. [Citations.]‖ (Amador Valley Joint Union High

Sch. Dist. v. State Bd. of Equalization (1978) 22 Cal.3d 208, 245.) Proposition 22,

however, does not present such circumstances.

Nothing in the history of Proposition 22 suggests that its plain language

must bend to some greater intention to shield tax increment funds from being used

as a mere yardstick or ―levy‖ for certain ERAF payments or that to hold otherwise

would generate an absurd result. Uncodified sections of Proposition 22 refer to

protecting against the reallocation of tax increment funds in a manner not more

expansive than, and entirely consistent with, the language it enacted in article XIII,

section 25.5, subdivision (a)(7)(A) of the state Constitution. (Prop. 22, Gen. Elec.

(Nov. 2, 2010) §§ 2, subd. (d)(3) [noting that the Legislature has previously

―[t]aken local community redevelopment funds on numerous occasions‖], 9

[asserting that the ―[t]he Legislature has been illegally circumventing Section 16

of Article XVI in recent years by requiring redevelopment agencies to transfer a

portion of those taxes for purposes other than the financing of redevelopment

projects‖ (italics added)].) Nothing in Proposition 22‘s history suggests that a

broader reading — one that applies to and prohibits other entities‘ legislative

bodies, or community sponsors, being compelled to make certain ERAF payments

or prohibits using tax increment funds as a ―levy‖ or yardstick to measure the size

of those payments — is required. Nor is this result absurd because the plain

language of section 25.5 (a)(7)(A) in article XIII of the California Constitution, as

enacted by Proposition 22, fully encompasses the clearly stated purpose of

Proposition 22 — ―to prohibit the Legislature from requiring, after the taxes have

been allocated to a redevelopment agency, the redevelopment agency to transfer

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some or all of those taxes to the State, an agency of the State, or a jurisdiction; or

to use some or all of those taxes for the benefit of the State, an agency of the State,

or a jurisdiction.‖ (Prop. 22, § 9.) Proposition 22 succeeds in ensuring that a

redevelopment agency‘s largest source of revenue, the tax increment, cannot be

reallocated by the state.

Nor does anything in the history of Proposition 22 suggest that its plain

language must be construed to accommodate any hypothesized intention to protect

all conceivable local government revenues or that to hold otherwise would

generate an absurd result. Although uncodified sections of Proposition 22

complain that ―state politicians in Sacramento have seized and borrowed billions

of dollars in local government and transportation funds‖ (Prop. 22, § 2, subd. (c))

and broadly state that ―[t]he purpose of this measure is to conclusively and

completely prohibit state politicians in Sacramento from seizing, diverting,

shifting, borrowing, transferring, suspending, or otherwise taking or interfering

with revenues that are dedicated to funding services provided by local government

or funds dedicated to transportation improvement projects and services‖ (id.,

§ 2.5), the actual express limits that Proposition 22 imposes on the Legislature are

quite discrete.

In addition to its language protecting tax increment funds, Proposition 22

provides that ―[t]he Legislature may not reallocate, transfer, borrow, appropriate,

restrict the use of, or otherwise use the proceeds of any tax imposed or levied by a

local government solely for the local government‘s purposes.‖ (Cal. Const., art.

XIII, § 24, subd. (b), as added by Prop. 22, Gen. Elec. (Nov. 2, 2010) § 3.) Thus,

Proposition 22 protects local taxes specifically earmarked for local government

purposes. It also prohibits the Legislature from borrowing from certain funds

related to transportation programs, reduces or eliminates the Legislature‘s

authority to change the distribution of state fuel taxes and vehicle license fees, and

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ends the Legislature‘s ability to order temporary ERAF loans of local property

taxes during state financial hardships. (Prop. 22, §§ 4-7.)

The majority broadly concludes that Proposition 22 was drafted with the

intent of ending ERAF shifts similar to those that had occurred before, but this

history of Proposition 22 does not allow us to paint with such a broad brush.

Although the majority assumes the drafters of Proposition 22 and the voters who

endorsed it must have intended to preclude the kinds of ERAF shifts that had taken

place since 2003, it is noteworthy that the term ―ERAF‖ appears nowhere in either

the voter guide or the text of the measure itself and that it is only vaguely

referenced as to redevelopment agencies in the Legislative Analyst‘s summary of

Proposition 22. (Voter Information Guide, Gen. Elec. (Nov. 2, 2010) Legis.

Analyst‘s analysis of Prop. 22, p. 33 [―Recently, the state required redevelopment

agencies to shift $2 billion of revenues to schools over two years‖].) Nor was

there any explanation of how the prior ERAF shifts were both revenue and source

neutral. To the extent these materials explicitly refer to state-mandated shifts of

local revenues to schools, the materials were precise as to Proposition 22‘s

intentions — it prevents compelling a redevelopment agency to use its tax

increment funds to make future payments to schools and it ends the state‘s ability

to take loans of local property taxes to make temporary payments to schools in

state fiscal emergencies.

Proposition 22‘s language and history evince nothing more, yet the

majority somehow concludes that the drafters of Proposition 22 fully informed the

voters that the measure carried the intent of precluding every previously expressed

method of funding the prior ERAF shifts. But what part of Proposition 22, in

either its history or codified its language, informed voters that the measure

intended to also protect ―any funds that are legally available for‖ funding future

ERAF payments? (§ 33692, subd. (c).) By assuming such an intended protection,

22

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the majority broadly conflates the circumstances leading to Proposition 22‘s

placement on the ballot with the clear expressed intent of its drafters as

documented in both its history and its codified language.

Given the specificity with which Proposition 22 expressly curtails the

Legislature‘s ability to seize and/or borrow local government revenue, it is far

more reasonable to conclude that Proposition 22 was narrowly intended to protect

specific local government revenues and not, expansively, to cover ―any funds that

are legally available for‖ funding the Assembly Bill 1X 27 payments. (§ 33692,

subd. (c).) More important, it would be improper to rely upon uncodified sections

of Proposition 22 to support an unspoken intent to preclude the use of any

otherwise available local funds to make the payments required by Assembly Bill

1X 27. (Burden v. Snowden (1992) 2 Cal.4th 556, 562 [―Where the words of the

statute are clear, we may not add to or alter them to accomplish a purpose that

does not appear on the face of the statute or from its legislative history‖].) Indeed,

it would be an absurd result if we interpreted Proposition 22 to protect all

conceivable local revenues in light of its otherwise clear language discretely

isolating specific local revenue sources for protection.

Finally, I note that, in many ways, the payments described by Assembly

Bill 1X 27 are not inconsistent with Proposition 22‘s expressly stated intent to

prevent ―[s]tate raids of revenues dedicated to funding vital local government

services and transportation improvement projects and services.‖ (Prop. 22, Gen.

Elec. (Nov. 2, 2010) § 2, subd. (b).) The statutes governing Assembly Bill 1X 27

payments for every fiscal year after 2011-2012 provide that the payments are

directed solely toward fire, transit, and school districts within the redevelopment

project area. (§§ 34194, subds. (a), (c), 34194.1, subds. (b), (c), 34194.4,

subds. (a)-(c).) In particular, the portions of Assembly Bill 1X 27 payments used

to fund schools in the redevelopment project area are made in addition to any

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funding provided to those schools by the state, potentially resulting in more

funding for schools in financially troubled areas. (§ 34194.1, subds. (b), (c).) Far

from being a ―raid‖ of local revenues dedicated to essential government services,

it seems apparent the Legislature had in mind the needs of local communities

when deciding how to best balance the continued benefits of redevelopment.

D. Petitioners Fail to Show That Assembly Bill 1X 27 Conflicts with

the Constitution “in the Generality or Great Majority of Cases”

Even assuming the broadest possible construction of Proposition 22 and

applying the more lenient standard for facial challenges, petitioners have failed to

provide evidence to support a finding that Assembly Bill 1X 27 is

unconstitutional.

Petitioners provide declarations on behalf of only seven of California‘s 482

incorporated cities and only one of its 58 counties. Given such a small sampling,

even if they all described identical inevitable conflicts between Assembly

Bill 1X 27 and the state Constitution, this evidence would fail to establish a

constitutional violation ― ‗in the generality or great majority of cases.‘ ‖

(Guardianship of Ann S., supra, 45 Cal.4th 1110, 1126.) This showing is

insufficient to establish that Assembly Bill 1X 27 payments must come, either

directly or indirectly, from redevelopment agencies‘ tax increment funds in the

generality or great majority of cases.

Moreover, the declarations provided by petitioners actually show quite the

opposite. The declaration from the executive director of the California

Redevelopment Association explains that the tax increment funds of most

redevelopment agencies are tied up with existing debt, and that, as a result, ―many

redevelopment agencies will be unable to fund the required [Assembly Bill 1X 27]

payments.‖ The great majority of the other declarants make similar statements

about their respective redevelopment agencies. Only one declarant, Mayor Jean

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Quan, City of Oakland, unequivocally states that her city ―can make the Assembly

Bill1X 27 payment by utilizing its current property tax increment [funds] and all

of its remaining reserves. . . .‖ If these declarations are accepted as true, then they

suggest that neither community sponsors nor most redevelopment agencies will

actually be compelled to use their tax increments funds to make the Assembly Bill

1X 27 payments and there is no violation of Proposition 22.

Thus, petitioners‘ own evidence defeats the very notion that Assembly

Bill 1X 27 will compel a violation of Proposition 22 in the generality or great

majority of cases. Given this lack of evidence, the best we can conclude is that it

could be possible that the statutes enacted by Assembly Bill 1X 27 might cause

some redevelopment agencies to waive their constitutional protections as they

relate to tax increment funds. But such speculation on a facial challenge cannot

render legislation unconstitutional.

This evidentiary failure is unsurprising given that counsel for petitioner

California Redevelopment Association candidly admitted at oral argument that his

clients‘ worst case scenario would be a world where Assembly Bill 1X 26 is found

constitutional and Assembly Bill 1X 27 is not. Implicit in that admission is the

recognition that an overly broad interpretation of Proposition 22‘s protections

would forever place petitioners‘ largest and most critical revenue source, tax

increment financing, under lock and key. Given that we agree that, under

Assembly Bill 1X 26, redevelopment agencies can be dismantled and their

previously allocated tax increment revenue can be redistributed, how can they now

ever be reconstituted and refinanced unless Assembly Bill 1X 26 itself is wholly

reversed? The irony of these circumstances concerning Proposition 22 should not

be ignored — the very measure that was crafted to protect financing for new

redevelopment projects has been broadly interpreted in a manner that effectively

25

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ends all financing for new redevelopment projects. This cannot be a necessary

result intended by the proponents of Proposition 22 concerning redevelopment.

III.

Conclusion

Given the procedural posture of this case, the rules of statutory and

constitutional construction, and the nature of petitioners‘ burden of proof, I believe

we cannot declare Assembly Bill 1X 27 unconstitutional in the manner articulated

by the majority.

Although the system of redevelopment in this state has been far from

perfect, it certainly is worth noting redevelopment projects like the restored Public

Market Building in downtown Sacramento, the Bunker Hill project in downtown

Los Angeles, Horton Plaza and the Gaslamp Quarter in downtown San Diego, HP

Pavilion in San Jose, and Yerba Buena Gardens in downtown San Francisco.

When faithfully administered and thoughtfully invested in the interests of the

community, a redevelopment agency can successfully create jobs, encourage

private investment, build local businesses, reduce crime and improve a

community‘s public works and infrastructure.

A close reading of Assembly Bill 1X 27 indicates that the Legislature

sought to preserve these benefits by carefully attempting to craft legislation that

did not run afoul of our state Constitution. As noted earlier (see ante, pp. 23-24),

it even sought to redress some of the inequity the prior system had created by

funneling additional money into schools and fire and transit districts within each

redevelopment project area. (§§ 34194, subds. (a), (c), 34194.1, subds. (b), (c),

34194.4, subds. (a)-(c).) In advocating for the constitutionality of Assembly Bill

1X 27, the California Teachers Association and the state‘s largest school district,

Los Angeles Unified School District, both point out that Assembly Bill 1X 27

would provide schools with an additional $340 million per year, beginning with

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every fiscal year following 2011-2012. But today, the Legislature‘s attempt to

balance the benefits of continued redevelopment with the need to fund vital local

government services has apparently failed with little or no alternative to continued

redevelopment available.

For the reasons set forth above, I conclude that petitioners fail to establish

that Assembly Bill 1X 27 is unconstitutional on its face.

CANTIL-SAKAUYE, C. J.

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See last page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion California Redevelopment Association v. Matosantos
__________________________________________________________________________________

Unpublished Opinion
Original Appeal
Original Proceeding XXX
Review Granted
Rehearing Granted

__________________________________________________________________________________

Opinion No. S194861
Date Filed: December 29, 2011
__________________________________________________________________________________

Court:
County:
Judge:

__________________________________________________________________________________

Counsel:

Howard Rice Nemerovski Canady Falk & Rabkin, Steven L. Mayer and Emily H. Wood for Petitioners.

Richards, Watson & Gershon, Sayre Weaver, Steven R. Orr, Toussaint S. Bailey and Andrew J. Brady for
the Association of Bay Area Governments and Various California Cities and Redevelopment Agencies as
Amici Curiae on behalf of Petitioners.

Carmen A. Trutanich, City Attorney (Los Angeles), Kelly Martin, Assistant City Attorney; Kane, Ballmer
& Berkman, Murray O. Kane, Susan Y. Cola and Donald P. Johnson for Community Redevelopment
Agency of the City of Los Angeles, Southern California Association of Non-Profit Housing and Betty Yee
as Amici Curiae on behalf of Petitioners.

Rutan & Tucker, William M. Marticorena, Philip D. Kohn, Jeffrey T. Melching, Bill Ihrke and Jennifer
Farrell for City of Irvine as Amicus Curiae on behalf of Petitioners.

Rutan & Tucker, Jeffrey M. Oderman, Dan Slater, Mark J. Austin, Bill Ihrke and Megan K. Garibaldi for
City of Cerritos, Cerritos Redevelopment Agency, City of Carson, Carson Redevelopment Agency, City of
Commerce, Commerce Community Development Commission, City of Cypress, Cypress Redevelopment
Agency, City of Downey, Community Development Commission of the City of Downing, City of
Lakewood, Lakewood Redevelopment Agency, City of Paramount, Paramount Redevelopment Agency,
City of Placentia, Redevelopment Agency of the City of Placentia, City of Santa Fe Springs, Community
Development Commission of the City of Santa Fe Springs, City of Signal Hill, Signal Hill Redevelopment
Agency, Cuesta Villas Housing Corporation and Bruce W. Barrows as Amici Curiae on behalf of
Petitioners.

Wallin, Kress, Reisman & Kranitz, Peter J. Wallin; Law Offices of Robert V. Wadden, Jr., and Robert V.
Wadden, Jr., for Long Beach Central, West and North Project Area Committees as Amici Curiae on behalf
of Petitioners.

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Page 2 – S194861 – counsel continued

Counsel:

Michael W. Rawson, Deborah Collins, Craig Castellanet, Roland Chang, Ilene J. Jacobs, Mona Tawatao,
Shashi Hanuman, Remy De La Peza, Richard Rothschild and S. Lynn Martinez for the Public Interest Law
Project, California Rural Legal Assistance, Inc., Legal Services of Northern California, Public Counsel and
Western Center on Law & Poverty as Amici Curiae on behalf of Petitioners.

Pamela J. Walls, County Counsel, and Anita C. Willis, Deputy County Counsel, for County of Riverside as
Amicus Curiae on behalf of Petitioners.

Jean-Rene Basel, County Counsel, and Michelle D. Blakemore, Chief Assistant County Counsel, for
County of San Bernardino as Amicus Curiae on behalf of Petitioners.

Woodruff, Spradlin & Smart, M. Lois Bobak and Thomas F. Nixon for Association of California Cities-
Orange County as Amici Curiae on behalf of Petitioners.

Kamala D. Harris, Attorney General, Manuel M. Medeiros, State Solicitor General, Douglas J. Woods,
Assistant Attorney General, Peter A. Krause, Seth E. Goldstein and Ross C. Moody, Deputy Attorneys
General, for Respondents Ana Matosantos, as Director of the California Department of Finance, and State
Controller John Chiang.

Miguel Márquez, County Counsel, Orry P. Lorb, Assistant County Counsel, Lizanne Reynolds and James
R. Williams, Deputy County Counsel, for Respondents Vinod K. Sharma, Auditor-Controller of the County
of Santa Clara and the County of Santa Clara.

Miguel Márquez, County Counsel (Santa Clara), Lori E. Pegg, Assistant County Counsel, Lizanne
Reynolds and James R. Williams, Deputy County Counsel, for Santa Clara Unified School District as
Amicus Curiae on behalf of Respondents.

Remcho, Johansen & Purcell, Karen Getman and Margaret R. Prinzing for California‘s Teachers
Association as Amicus Curiae on behalf of Respondents.

Catherine A. Rodman for Affordable Housing Advocates as Amicus Curiae on behalf of Respondents.

Bell, McAndrews & Hiltachk, Thomas Hiltachk and Ashlee N. Titus for California Professional
Firefighters as Amicus Curiae on behalf of Respondents.

Law Office of Christopher Sutton and Christopher Sutton for Municipal Officials for Redevelopment
Reform and Assembly Member Chris Norby as Amici Curiae on behalf of Respondents.

David Holmquist, John F. Walsh; Strumwasser & Woocher, Gregory G. Luke, Byron F. Kahr; and Abe
Hajela for Los Angeles Unified School District and California School Board Association as Amici Curiae
on behalf of Respondents.

John C. Eastman, Anthony T. Caso and Karen J. Lugo for Center for Constitutional Jurisprudence and
California Alliance to Protect Private Property Rights as Amici Curiae.

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Counsel who argued in Supreme Court (not intended for publication with opinion):

Steven L. Mayer
Howard Rice Nemerovski Canady Falk & Rabkin
Three Embarcadero Center, 7th Floor
San Francisco, CA 94111-4024
(415) 434-1600

Ross C. Moody
Deputy Attorney General
455 Golden Gate Avenue, Suite 11000
San Francisco, CA 94102-7004
(415) 703-1376

James R. Williams
Deputy County Counsel
70 West Hedding Street, East Wing, 9th Floor
San Jose, CA 95110
(408) 299-5900

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Original proceeding. The court issued an order to show cause directing the parties to show cause why the relief prayed for in the petition for writ of mandate should not be granted. This case involves the validity of recent legislation (Stats. 2011, 1st Ex. Sess. 2011-2012, ch. 5 [Assem. Bill No. 26 X1]; Stats. 2011, 1st Ex. Sess. 2011-2012, ch. 6 [Assem. Bill No. 27 X1]) dissolving and reenacting with changes the statutory framework for redevelopment agencies.

Opinion Information

Date:	Citation:	Docket Number:	Category:	Status:
Thu, 12/29/2011	53 Cal. 4th 231, 267 P.3d 580, 135 Cal. Rptr. 3d 683	S194861	Original Proceeding - Civil	closed; remittitur issued

Opinion Authors
Opinion	Justice Carol A. Corrigan, Justice Goodwin Liu, Justice Joyce L. Kennard, Justice Kathryn M. Werdegar, Justice Marvin R. Baxter, Justice Ming W. Chin
Concur	Chief Justice Tani Cantil-Sakauye
Dissent	Chief Justice Tani Cantil-Sakauye

Disposition
Dec 29 2011	Opinion: OSC discharged

Dockets
Jul 18 2011	Petition for writ of mandate/prohibition with request for stay filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer   Stay requested by August 15, 2011 (implementation of AB1X 26 and 27)
Jul 18 2011	Informal response requested   from respondents Dear Counsel: The court has directed that I request an informal response in the above-referenced matter, the petition was served on your office today. The response is to be served upon Steven Mayer, counsel for petitioner, by personal service or by facsimile at (415) 434-1600, and filed in this court no later than noon on July 27, 2011. The response may be filed by facsimile at (415) 865-7183 with original and 13 hard copies to follow by mail. The answer should address all issues presented in the petition for writ of mandate. Petitioner will have to until 5 p.m. on July 29, 2011, in which to file a reply to the informal response. The reply may be filed by facsimile at (415) 865-7183 with original and 13 hard copies to follow by mail. The request for an informal response should be expedited by your office, and no requests for extension of time are contemplated.
Jul 19 2011	Received:   amended proof of service on the Attorney General from counsel for petitioners.
Jul 19 2011	Received:   amended proof of service on Brian Washington, from counsel for petitioners.
Jul 19 2011	Letter sent to:   revised letter sent to all counsel. Dear Counsel: The court has directed that I request a preliminary opposition in the above-referenced matter, concerning the petition that was served on your office today. The preliminary opposition is to be served upon Steven Mayer, counsel for petitioner, by personal service or by facsimile at (415) 434-1600, and filed in this court no later than noon on July 27, 2011. The preliminary opposition may be filed by facsimile at (415) 865-7183 with original and 13 hard copies to follow by mail. (See Cal. Rules of Court, rule 8.68.) The preliminary opposition should address all issues presented in the petition for writ of mandate. Petitioner will have until 5 p.m. on July 29, 2011, in which to serve and file a reply to the preliminary opposition. The reply may be filed by facsimile at (415) 865-7183 with original and 13 hard copies to follow by mail. (See Cal. Rules of Court, rule 8.68.) The request for a preliminary opposition should be expedited by your office, and no requests for extension of time are contemplated.
Jul 22 2011	Filed:   notification that the Attorney General is representing Ana Matosantos, Director of the California Department of Finance, and John Chiang, California State Controller, respondents; by Ross C. Moody, Deputy Attorney General.
Jul 22 2011	Received:   amended proof of service for the letter notifying the court that Attorney General is representing Ana Matosantos and John Chiang, respondents; from Ross C. Moody, Deputy Attorney General.
Jul 25 2011	Preliminary opposition to writ petition filed Respondent: O'Connell, PatrickAttorney: Claude F. Kolm   *informal*
Jul 27 2011	Preliminary opposition to writ petition filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody   By Noon *informal*
Jul 29 2011	Reply to preliminary opposition filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer   By 5:00 p.m. *informal*
Aug 1 2011	Received:   Stipulation Re Prosed Briefing Schedule, submitted by counsel for petitioners; by Steven L. Mayer, counsel for petitioners & Ross C. Moody, Deputy Attorney General.
Aug 10 2011	Received:   letter dated August 10, 2011, from the Office of the County Counsel, County of Santa Clara, as notice of intent to object the designation of Alameda County Auditor-Controller and in opposition to petitioner's request for stay; by James R. Williams, deputy counsel counsel.
Aug 11 2011	Order to show cause issued   The request for a stay of chapter 5, Statutes 2011, First Extraordinary Session (Assembly Bill No. 26 X1) is granted, except that the request to stay Division 24, Part 1.8 of the Health and Safety Code (Health & Saf. Code, ?? 34161-34167) is denied. The request for a stay of chapter 6, Statutes 2011, First Extraordinary Session (Assembly Bill No. 27 X1) is granted. Ana Matosantos, Director of the California Department of Finance, John Chiang, Controller of the State of California, and Patrick O'Connell, Auditor-Controller of the County of Alameda, are ORDERED TO SHOW CAUSE before this court, when the above matter is called on calendar, why the relief sought by petitioners should not be granted. The return is to be served and filed by respondents on or before September 9, 2011. A reply may be served and filed by petitioners on or before September 24, 2011. Any application to file an amicus curiae brief, accompanied by the proposed brief, may be served and filed on or before September 30, 2011. Any reply to an amicus brief may be served and filed on or before October 7, 2011. The court does not contemplate extending any time set out above. The briefing schedule is designed to facilitate oral argument as early as possible in 2011, and a decision before January 15, 2012. Kennard, J., is of the opinion a stay should not be issued. Votes: Cantil-Sakauye, C.J., Kennard, Baxter, Werdegar, Chin and Corrigan, JJ.
Aug 15 2011	Motion filed   from County of Santa Clara and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to Intervene to Represent Itself in this Action; by Lizanne Reynolds, Deputy County Counsel.
Aug 17 2011	Order filed   The court's order of August 11, 2011, is modified to read as follows: The request for a stay of chapter 5, Statutes 2011, First Extraordinary Session (Assembly Bill No. 26 X1) is granted, except that the request to stay Division 24, Part 1.8 of the Health and Safety Code (Health & Saf. Code, ?? 34161-34169.5) is denied. The request for a stay of chapter 6, Statutes 2011, First Extraordinary Session (Assembly Bill No. 27 X1) is granted, except that the request to stay Health and Safety Code section 34194, subdivision (b)(2) is denied. Ana Matosantos, Director of the California Department of Finance, John Chiang, Controller of the State of California, and Patrick O'Connell, Auditor-Controller of the County of Alameda, are ORDERED TO SHOW CAUSE before this court, when the above matter is called on calendar, why the relief sought by petitioners should not be granted. The return is to be served and filed by respondents on or before September 9, 2011. A reply may be served and filed by petitioners on or before September 23, 2011. Any application to file an amicus curiae brief, accompanied by the proposed brief, may be served and filed on or before September 30, 2011. Any reply to an amicus brief may be served and filed on or before October 7, 2011. The parties are directed to address, in the return and reply, the following questions: Assuming solely for the sake of argument that the court's decision upholds both statutes and dissolves the existing stay, what effect would the stay have on the statutory dates for compliance, including those for enactment of an ordinance (Health & Saf. Code, ? 34193, subd. (a)) and payment of the remittance amount (id., ? 34194, subd. (d))? If it becomes necessary to postpone the statutory compliance dates, what should the new dates be? The court does not contemplate extending any time set out above. The briefing schedule is designed to facilitate oral argument as early as possible in 2011, and a decision before January 15, 2012. Without expressing any opinion on the merits, the court intends that Assembly Bills No. 26 X1 and 27 X1 will, if upheld, be implemented with as little delay as possible. Kennard, J., is of the opinion a stay should not be issued. Votes: Cantil-Sakauye, C.J., Kennard, Baxter, Werdegar, Chin and Corrigan, JJ.
Aug 18 2011	Order filed   Good cause appearing, pursuant to California Rules of Court, rule 8.68, the time in which to respond to the motion of the County of Santa Clara and Vinod K. Sharma to intervene in this matter is shortened. Opposition, if any, must be filed by 10 a.m. on August 22, 2011.
Aug 19 2011	Filed:   Statement of non-opposition to Motion of Santa Clara County and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to Intervene in this action. Statement submitted by Claude F. Kolm, attorney for respondent, Patrick O'Connell, Auditor-Controller of the County of Alameda, does not oppose the motion of the County of Santa Clara and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to intervene in this action.
Aug 19 2011	Filed:   Statement of non-opposition to Motion of Santa Clara County and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to Intervene in this action. Submitted by Steven L. Mayer counsel for petitioners, California Redevelopment Association et al., does not oppose the motion of the County of Santa Clara and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to intervene in this action.
Aug 19 2011	Filed:   Statement of non-opposition to Motion of Santa Clara County and Vinod K. Sharma, County of Santa Clara Auditor-Controller, to Intervene in this action. Submitted by Ross C. Moody, Deputy Attorney General, counsel for respondents, Ana Matosantos, Director of the California Department of Finace and State Controller, John Chiang do not oppose the motion of the County of Santa Clara and Vinod K. Sharma, County of Santa Clara, to intervene in this action.
Aug 22 2011	Motion for leave to intervene granted   The motion of the County of Santa Clara and its auditor-controller, Vinod K. Sharma, (collectively County) to intervene as respondents in this matter is granted. Consistent with the briefing schedule previously established, the County's return is to be served and filed on or before September 9, 2011. Any reply by the County to an amicus curiae brief may be served and filed on or before October 7, 2011.
Aug 22 2011	Motion filed   for clarification and modification of stay from petitioners; by Steven L. Mayer, counsel.
Aug 29 2011	Opposition filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds   to petitioner's motion for clarification and modification of stay by County of Santa Clara Auditor-Controller, et al.
Aug 31 2011	Opposition filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody   to motion for clarification and modification of stay.
Aug 31 2011	Filed:   letter dated August 29, 2011, from counsel for Ana matosantos, respondent, and counsel for petitioners, jointly requesting that the court issue an order directing all amicus curiae to serve briefs on the parties via e-mail or fax by 5pm on the day of filing with Court; by Steven L. Mayer, counsel for petitioners, and Ross C. Moody, Deputy Attorney General.
Sep 1 2011	Received:   application requesting permission to file reply to motion for clarification and modification of stay; by Steven L. Mayer, counsel for petitioners. (reply attached to application) (with the court)
Sep 2 2011	Order filed   The joint request of petitioners California Redevelopment Association et al. and Respondent Matosantos for clarification of the service requirements for amicus briefs, if any, is granted. Any amici curiae desiring to file briefs in this matter must serve all parties with copies of their applications for leave and proposed amicus briefs by facsimile or email no later than 5:00 p.m. on September 30, 2011.
Sep 6 2011	Written return filed Respondent: O'Connell, PatrickAttorney: Claude F. Kolm
Sep 6 2011	Received:   amended proof of service, addressing copy to Lizanne Reynolds at the Office of County Counsel, Santa Clara County.
Sep 9 2011	Written return filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody
Sep 9 2011	Request for judicial notice filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody
Sep 9 2011	Written return filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds
Sep 14 2011	Order filed   The request for modification of the stay is denied. Kennard, J., is of the view that the request for modification of the stay should be granted.
Sep 23 2011	Filed:   reply to return filed by California Redevelopment Association, League of California Cities, City of Union City, City of San Jose and John F. Shirey, petitioners; by Steven L. Mayer, counsel.
Sep 23 2011	Request for judicial notice filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer
Sep 23 2011	Opposition filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer   Petitioner's partial opposition to respondent's Matosantos' request for judicial notice; by Steven L. Mayer, counsel.
Sep 28 2011	Supplemental brief filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody   notifying the court of related case.
Sep 30 2011	Application to file amicus curiae brief filed   by Community Redevelopment Agency of the City of Los Angeles, et al., by Donald R. Johnson, counsel.
Sep 30 2011	Application to file amicus curiae brief filed   County of San Bernardino, by Michelle D. Blakemore, Chief Assistant County Counsel.
Sep 30 2011	Application to file amicus curiae brief filed   by Thomas W. Hiltachlk, attorney for California Professional Firefighters
Sep 30 2011	Application to file amicus curiae brief filed   by Karen Getman, attorney for California Teachers Association
Sep 30 2011	Application to file amicus curiae brief filed   by Sayre Weaver, attorney for Association of Bay Area Governments.
Sep 30 2011	Application to file amicus curiae brief filed   for Coalition of Cities, et al., by Mark J. Austin, counsel.
Sep 30 2011	Application to file amicus curiae brief filed   Affordable Housing Advocates, by Catherine A. Rodman, counsel.
Sep 30 2011	Application to file amicus curiae brief filed   County of Riverside, by Anita Willis, Deputy Counsel Counsel.
Sep 30 2011	Application to file amicus curiae brief filed   City of Irvine, by William M. Marticorena, counsel
Sep 30 2011	Application to file amicus curiae brief filed   Public Interest Law Project, et al., by Michael Rawson, counsel.
Sep 30 2011	Application to file amicus curiae brief filed   for Long Beach Central, West and North Project Areas; by Peter Wallin, counsel.
Sep 30 2011	Application to file amicus curiae brief filed   Santa Clara Unified School District, by James R. Williams, Deputy Counsel Counsel.
Sep 30 2011	Application to file amicus curiae brief filed   Association of California Cities, by M. Lois Bobak, counsel.
Oct 3 2011	Received:   awaiting amended proof of service showing electronic service of amicus curiae brief, from City of Irvine.
Oct 3 2011	Received:   awaiting amended proof of service showing electronic service of application to file an amicus curiae brief, from counsel for the City of Irvine.
Oct 3 2011	Received:   awaiting amended proof of service from Association of Bay Area Governments, et al., from counsel.
Oct 3 2011	Received:   amended proof of service from County of San Bernardino.
Oct 3 2011	Received:   awaiting amended proof of service for amicus curiae from Long Beach Central, West and North Project Areas; by Peter Wallin, counsel.
Oct 3 2011	Received:   amended proof of service for Community Redevelopment Agency of the City of Los Angeles, et al.,from counsel.
Oct 3 2011	Received:   amended proof of service for amicus curiae application from Coalition of Cities,et al., from counsel.
Oct 3 2011	Received:   amended proof of service for amicus curiae brief from Coalition of Cities,et al., from counsel.
Oct 3 2011	Received:   amended proof of service for motion for judicial notice from Coalition of Cities,et al., from counsel.
Oct 3 2011	Received:   amended proof of service for amicus application/brief/judicial notice, for California Professional Firefighters, from counsel.
Oct 3 2011	Application to file amicus curiae brief filed   for Center for Constitutional Jurisprudence, et al.; by Anthony T. Caso, counsel.
Oct 3 2011	Application to file amicus curiae brief filed   Municipal Officials for Redevelopment Reform, et al.; by Christopher Sutton, counsel.
Oct 3 2011	Application for relief from default filed   for Los Angeles Unified School District, et al., to file amicus curiae application and brief; by Gregory Luke, counsel.
Oct 3 2011	Application to file amicus curiae brief filed   Los Angeles Unified School District, et al., by Gregory Luke, counsel.
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Association of Bay Area Governments, City of Artesia, Artesia Redevelopment Agency, Brea Redevelopment Agency, City of Buena Park Community Redevelopment Agency, City of Calimesa, Calimesa Redevelopment Agency, Fairfield Redevelopment Agency, City of Hawthorne, Hawthorne Community Redevelopment Agency, La Mirada Redevelopment Agency, Manteca Redevelopment Agency, City of Monterey, Palm Desert Redevelopment Agency, Rancho Cucamonga Redevelopment Agency, Rancho Palos Verdes Redevelopment Agency, City of Seal Beach, Seal Beach Redevelopment Agency, Temecula Redevelopment Agency, Turlock Redevelopment Agency, and Whittier Redevelopment Agency for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Association of Bay Area GovernmentsAttorney: Sayre Weaver Amicus curiae: The City of ArtesiaAttorney: Sayre Weaver Amicus curiae: Artesia Redevelopement AgencyAttorney: Sayre Weaver Amicus curiae: The Brea Redevelopement AgencyAttorney: Sayre Weaver Amicus curiae: City of Buena Park Community Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of CalamesaAttorney: Sayre Weaver Amicus curiae: Calimesa Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of HawthorneAttorney: Sayre Weaver Amicus curiae: Hawthorne Community Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Manteca Rdecevelopement AgencyAttorney: Sayre Weaver Amicus curiae: City of MontereyAttorney: Sayre Weaver Amicus curiae: Palm Desert Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Rancho Cucamonga Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Rancho Palos Verdes Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of Seal BeachAttorney: Sayre Weaver Amicus curiae: Seal Beach Redeloveopment AgencyAttorney: Sayre Weaver Amicus curiae: Temecula Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Turlock Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Whittier Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Fairfield Redevelopment AgencyAttorney: Sayre Weaver
Oct 3 2011	Permission to file amicus curiae brief granted   The application of California Professional Firefighters for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: California Professional FirefightersAttorney: Thomas W. Hiltachk
Oct 3 2011	Request for judicial notice filed Amicus curiae: California Professional FirefightersAttorney: Thomas W. Hiltachk
Oct 3 2011	Permission to file amicus curiae brief granted   The application of County of San Bernardino for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: County of San BernardinoAttorney: Michelle D. Blakemore
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Affordable Housing Advocates for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Affordable Housing AdvocatesAttorney: Catherine A. Rodman
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Public Interest Law Project, California Rural Legal Assistance, Inc., Legal Services of Northern California, Public Counsel and Western Center on Law & Poverty for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Public Interest Law ProjectAttorney: Michael Rawson Amicus curiae: California Rural Legal Assistance, Inc.Attorney: Michael Rawson
Oct 3 2011	Permission to file amicus curiae brief granted   The application of The City of Irvine for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: City of IrvineAttorney: William M. Marticorena
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Long Beach Central, West and North Project Areas for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Long Beach Central, West and North Project Area CommitteesAttorney: Peter L. Wallin
Oct 3 2011	Permission to file amicus curiae brief granted   The application of California Teachers Association for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: California Teachers AssociationAttorney: Karen Getman
Oct 3 2011	Request for judicial notice filed Amicus curiae: California Teachers AssociationAttorney: Karen Getman
Oct 3 2011	Permission to file amicus curiae brief granted   The application of County of Riverside for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: County of RiversideAttorney: Anita C. Willis
Oct 3 2011	Received:   declaration in support of amicus curiae brief for county of riverside, by Anita Willis, counsel.
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Santa Clara Unified School District for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Santa Clara County Unified School DistrictAttorney: James R. Williams
Oct 3 2011	Permission to file amicus curiae brief granted   The application of Community Redevelopment Agency of the City Los Angeles, The Southern California Association of Non-Profit Housing and Betty Yee, for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Community Redevelopment Agency of the City of Los AngelesAttorney: Donald Paul Johnson Amicus curiae: Southern California Association of Non-Profit HousingAttorney: Donald Paul Johnson Amicus curiae: Yee, BettyAttorney: Donald Paul Johnson
Oct 3 2011	Request for judicial notice filed Amicus curiae: Community Redevelopment Agency of the City of Los AngelesAttorney: Donald Paul Johnson Amicus curiae: Southern California Association of Non-Profit HousingAttorney: Donald Paul Johnson Amicus curiae: Yee, BettyAttorney: Donald Paul Johnson
Oct 4 2011	Permission to file amicus curiae brief granted   The application of Municipal Officials for Redevelopment Reform and Chris Norby for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 4 2011	Amicus curiae brief filed Amicus curiae: Municipal Officials for Redevelopment ReformAttorney: Christopher A. Sutton Amicus curiae: Norby, ChrisAttorney: Christopher A. Sutton
Oct 4 2011	Received:   amended service from Association of California Cities-Orange County; from counsel.
Oct 5 2011	Permission to file amicus curiae brief granted   The application of Coalition of Cities, City of Cerritos, Cerritos Redevelopment Agency, City of Carson, Carson Redevelopment Agency, City of Commerce, Commerce Community Redevelopment Commission, City of Cypress, Cypress Redevelopment Agency, City of Downey, Community Development Commission for the City of Downey, City of Lakewood, Lakewood Redevelopment Agency, City of Paramount, Paramount Redevelopment Agency, City of Placentia, Redevelopment Agency for the City of Placentia, Community Redevelopment Commission of the City of Santa Fe Springs, City of Santa Fe Springs, City of Signal Hill, Signal Hill Redevelopment Agency, Cuesta Villas Housing Corporation, Bruce W. Barrows, for permission to file an amicus curiae brief in support of petitioner is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Coalition of CitiesAttorney: Mark Jason Austin Amicus curiae: City of CerritosAttorney: Mark Jason Austin Amicus curiae: Cerritos Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of CarsonAttorney: Mark Jason Austin Amicus curiae: City of CommerceAttorney: Mark Jason Austin Amicus curiae: Commerce Community Redevelopment CommissionAttorney: Mark Jason Austin Amicus curiae: City of CypressAttorney: Mark Jason Austin Amicus curiae: Cypress Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of DowneyAttorney: Mark Jason Austin Amicus curiae: Community Development Commission of the City of DowneyAttorney: Mark Jason Austin Amicus curiae: City of LakewoodAttorney: Mark Jason Austin Amicus curiae: Lakewood Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of ParamountAttorney: Mark Jason Austin Amicus curiae: Paramount Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Ciyt of PlacentiaAttorney: Mark Jason Austin Amicus curiae: Redevelpment Agency for the City of PlacentiaAttorney: Mark Jason Austin Amicus curiae: City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: Community Redevelopment Commission of the City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: City of Signal HillAttorney: Mark Jason Austin Amicus curiae: Signal Hill Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Cuesta Villas Housing CorporationAttorney: Mark Jason Austin Amicus curiae: Barrows, Bruce W.Attorney: Mark Jason Austin
Oct 5 2011	Request for judicial notice filed Amicus curiae: Coalition of CitiesAttorney: Mark Jason Austin Amicus curiae: City of CerritosAttorney: Mark Jason Austin Amicus curiae: Cerritos Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of CarsonAttorney: Mark Jason Austin Amicus curiae: City of CommerceAttorney: Mark Jason Austin Amicus curiae: Commerce Community Redevelopment CommissionAttorney: Mark Jason Austin Amicus curiae: City of CypressAttorney: Mark Jason Austin Amicus curiae: Cypress Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of DowneyAttorney: Mark Jason Austin Amicus curiae: Community Development Commission of the City of DowneyAttorney: Mark Jason Austin Amicus curiae: City of LakewoodAttorney: Mark Jason Austin Amicus curiae: Lakewood Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of ParamountAttorney: Mark Jason Austin Amicus curiae: Paramount Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Ciyt of PlacentiaAttorney: Mark Jason Austin Amicus curiae: Redevelpment Agency for the City of PlacentiaAttorney: Mark Jason Austin Amicus curiae: City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: Community Redevelopment Commission of the City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: City of Signal HillAttorney: Mark Jason Austin Amicus curiae: Signal Hill Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Cuesta Villas Housing CorporationAttorney: Mark Jason Austin Amicus curiae: Barrows, Bruce W.Attorney: Mark Jason Austin
Oct 5 2011	Permission to file amicus curiae brief granted   The application of Los Angeles Unified School District and California School Board Association for permission to file an amicus curiae brief in support of respondents is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Los Angeles Unified School DistrictAttorney: Gregory Garnsey Luke Amicus curiae: California School Board AssociationAttorney: Gregory Garnsey Luke
Oct 5 2011	Permission to file amicus curiae brief granted   The application of Center for Constitutional Jurisprudence and California Alliance to Protect Private Property Rights for permission to file an amicus curiae brief is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Center for Constitutional JurispudenceAttorney: Anthony T. Caso Amicus curiae: California Alliance to Protect Private Property RightsAttorney: Anthony T. Caso
Oct 5 2011	Permission to file amicus curiae brief granted   The application of Association of California Cities-Orange County for permission to file an amicus curiae brief in support of petitioners is hereby granted. An answer thereto may be served and filed by any party on or before October 7, 2011.
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Association of California Cities- Orange CountyAttorney: M. Lois Bobak
Oct 5 2011	Received:   amended proof of service from Municipal Officials for Redevelopment Reform, et al., amicus curiae; from Christopher Sutton, counsel.
Oct 5 2011	Received:   amici curiae's response to notice of related case from Coalition of Cities, City of Cerritos, et al.; by Mark J. Austin, counsel.
Oct 7 2011	Response to amicus curiae brief filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds   *consolidated response*
Oct 7 2011	Response to amicus curiae brief filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody   *consolidated response*
Oct 7 2011	Response to amicus curiae brief filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer
Oct 7 2011	Request for judicial notice filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer   *supplemental motion for Judicial Notice*
Oct 11 2011	Received:   amended proof of service from Los Angeles Unified School District, for amicus curiae brief.
Oct 13 2011	Note: Mail returned and re-sent   incorrect address on envelope; address corrected and re-sent.
Oct 17 2011	Supplemental brief filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer
Oct 19 2011	Opposition filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds   to petitioner's supplemental brief.
Oct 19 2011	Case ordered on calendar   to be argued on Thursday, November 10, 2011, at 9:00 a.m., in San Francisco.
Oct 20 2011	Filed:   reply to opposition to supplemental brief from petitioners; by Steven L. Mayer, counsel.
Oct 24 2011	Request for extended media coverage filed   by The California Channel.
Oct 25 2011	Filed:   Letter from Ross Moody, counsel for respondent, dated 10/25/11, requesting to divide oral argument time.
Oct 26 2011	Request for extended media coverage granted   The request for extended media coverage, filed by The California Channel on October 24, 2011, is granted, subject to the conditions set forth in rule 1.150, of the California Rules of Court.
Oct 27 2011	Order filed   The request of counsel for respondents in the above-referenced cause to allow two counsel to argue on behalf of respondents at oral argument is hereby granted. The request of respondents to allocate to Ana Matosantos et al. 20 minutes and County of Santa Clara et al. 10 minutes of respondents' 30-minute allotted time for oral argument is granted.
Oct 31 2011	Request for judicial notice granted   Respondent Ana Matosantos's request for judicial notice, filed September 9, 2011, is granted. Petitioners' motion for judicial notice, filed September 23, 2011, and supplemental motion for judicial notice, filed October 7, 2011, are each granted. Amicus curiae California Teachers' Association's request for judicial notice, filed October 3, 2011, is granted in part as to exhibits D through L, and denied in part as to exhibits A, B, and C. Amicus curiae California Professional Firefighter's request for judicial notice, filed October 3, 2011, is granted. Amicus curiae Community Redevelopment Agency of the City of Los Angeles et al.'s motion for judicial notice, filed October 3, 2011, is granted. Amicus curiae City of Cerritos et al.'s motion for judicial notice, filed October 5, 2011, is granted.
Nov 1 2011	Received:   letter from Lizanne Reynolds, counsel for respondents Vinod Sharma and County of Santa Clara, dated 10/31/11 opposing amici City of Cerritos et al. request for oral argument.
Nov 1 2011	Note: Mail returned and re-sent   incorrect zip code on envelope.
Nov 2 2011	Note: Mail returned (unable to forward)   return to sender/attempted - not known; unable to forward.
Nov 2 2011	Note: Mail returned and re-sent   returned to sender; re-sent with corrected zip code.
Nov 7 2011	Note: Mail returned and re-sent   to updated address.
Nov 10 2011	Cause argued and submitted
Dec 28 2011	Notice of forthcoming opinion posted   To be filed Thursday, December 29, 2011 at 10 a.m.
Dec 29 2011	Opinion filed: Order to show cause discharged   For the foregoing reasons, we discharge the order to show cause, deny the Association's petition for a peremptory writ of mandate with respect to Assembly Bill 1X 26, except for Health and Safety Code section 34172, subdivision (a)(2), and grant its petition with respect to Assembly Bill 1X 27. We direct issuance of a peremptory writ compelling the state Director of Finance and state Controller not to implement Health and Safety Code sections 34172, subdivision (a)(2) and 34192-34196. We extend all statutory deadlines contained in Health and Safety Code, division 24, part 1.85 (?? 34170-34191) and arising before May 1, 2012, by four months. Given the urgency of the matters addressed by the Association's petition, our judgment is final forthwith. (See, e.g., Senate of the State of Cal. v. Jones (1999) 21 Cal.4th 1142, 1169.) Majority Opinion by Werdegar, J. -- joined by Kennard, Baxter, Chin, Corrigan, and Liu, JJ. Concurring and Dissenting Opinion by Cantil-Sakauye, C. J.
Dec 29 2011	Letter sent to counsel: opinion now final
Jan 17 2012	Received:   Letter from counsel for Amici, Public Interest Law Project, Michael Rawson, correcting name on opinion.

Briefs
Sep 9 2011	Written return filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody
Sep 9 2011	Written return filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds
Sep 6 2011	Written return filed Respondent: O'Connell, PatrickAttorney: Claude F. Kolm
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Association of Bay Area GovernmentsAttorney: Sayre Weaver Amicus curiae: The City of ArtesiaAttorney: Sayre Weaver Amicus curiae: Artesia Redevelopement AgencyAttorney: Sayre Weaver Amicus curiae: The Brea Redevelopement AgencyAttorney: Sayre Weaver Amicus curiae: City of Buena Park Community Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of CalamesaAttorney: Sayre Weaver Amicus curiae: Calimesa Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of HawthorneAttorney: Sayre Weaver Amicus curiae: Hawthorne Community Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Manteca Rdecevelopement AgencyAttorney: Sayre Weaver Amicus curiae: City of MontereyAttorney: Sayre Weaver Amicus curiae: Palm Desert Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Rancho Cucamonga Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Rancho Palos Verdes Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: City of Seal BeachAttorney: Sayre Weaver Amicus curiae: Seal Beach Redeloveopment AgencyAttorney: Sayre Weaver Amicus curiae: Temecula Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Turlock Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Whittier Redevelopment AgencyAttorney: Sayre Weaver Amicus curiae: Fairfield Redevelopment AgencyAttorney: Sayre Weaver
Oct 3 2011	Amicus curiae brief filed Amicus curiae: California Professional FirefightersAttorney: Thomas W. Hiltachk
Oct 3 2011	Amicus curiae brief filed Amicus curiae: County of San BernardinoAttorney: Michelle D. Blakemore
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Affordable Housing AdvocatesAttorney: Catherine A. Rodman
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Public Interest Law ProjectAttorney: Michael Rawson Amicus curiae: California Rural Legal Assistance, Inc.Attorney: Michael Rawson
Oct 3 2011	Amicus curiae brief filed Amicus curiae: City of IrvineAttorney: William M. Marticorena
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Long Beach Central, West and North Project Area CommitteesAttorney: Peter L. Wallin
Oct 3 2011	Amicus curiae brief filed Amicus curiae: California Teachers AssociationAttorney: Karen Getman
Oct 3 2011	Amicus curiae brief filed Amicus curiae: County of RiversideAttorney: Anita C. Willis
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Santa Clara County Unified School DistrictAttorney: James R. Williams
Oct 3 2011	Amicus curiae brief filed Amicus curiae: Community Redevelopment Agency of the City of Los AngelesAttorney: Donald Paul Johnson Amicus curiae: Southern California Association of Non-Profit HousingAttorney: Donald Paul Johnson Amicus curiae: Yee, BettyAttorney: Donald Paul Johnson
Oct 4 2011	Amicus curiae brief filed Amicus curiae: Municipal Officials for Redevelopment ReformAttorney: Christopher A. Sutton Amicus curiae: Norby, ChrisAttorney: Christopher A. Sutton
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Coalition of CitiesAttorney: Mark Jason Austin Amicus curiae: City of CerritosAttorney: Mark Jason Austin Amicus curiae: Cerritos Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of CarsonAttorney: Mark Jason Austin Amicus curiae: City of CommerceAttorney: Mark Jason Austin Amicus curiae: Commerce Community Redevelopment CommissionAttorney: Mark Jason Austin Amicus curiae: City of CypressAttorney: Mark Jason Austin Amicus curiae: Cypress Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of DowneyAttorney: Mark Jason Austin Amicus curiae: Community Development Commission of the City of DowneyAttorney: Mark Jason Austin Amicus curiae: City of LakewoodAttorney: Mark Jason Austin Amicus curiae: Lakewood Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: City of ParamountAttorney: Mark Jason Austin Amicus curiae: Paramount Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Ciyt of PlacentiaAttorney: Mark Jason Austin Amicus curiae: Redevelpment Agency for the City of PlacentiaAttorney: Mark Jason Austin Amicus curiae: City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: Community Redevelopment Commission of the City of Santa Fe SpringsAttorney: Mark Jason Austin Amicus curiae: City of Signal HillAttorney: Mark Jason Austin Amicus curiae: Signal Hill Redevelopment AgencyAttorney: Mark Jason Austin Amicus curiae: Cuesta Villas Housing CorporationAttorney: Mark Jason Austin Amicus curiae: Barrows, Bruce W.Attorney: Mark Jason Austin
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Los Angeles Unified School DistrictAttorney: Gregory Garnsey Luke Amicus curiae: California School Board AssociationAttorney: Gregory Garnsey Luke
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Center for Constitutional JurispudenceAttorney: Anthony T. Caso Amicus curiae: California Alliance to Protect Private Property RightsAttorney: Anthony T. Caso
Oct 5 2011	Amicus curiae brief filed Amicus curiae: Association of California Cities- Orange CountyAttorney: M. Lois Bobak
Oct 7 2011	Response to amicus curiae brief filed Non-Title Respondent: County of Santa ClaraAttorney: Lizanne Reynolds Non-Title Respondent: Sharma, Vinod K.Attorney: Lizanne Reynolds
Oct 7 2011	Response to amicus curiae brief filed Respondent: Matosantos, AnaAttorney: Ross C. Moody Respondent: Chiang, JohnAttorney: Ross C. Moody
Oct 7 2011	Response to amicus curiae brief filed Petitioner: California Redevelopment AssociationAttorney: Steven L. Mayer Petitioner: League of California CitiesAttorney: Steven L. Mayer Petitioner: City of Union CityAttorney: Steven L. Mayer Petitioner: City of San JoseAttorney: Steven L. Mayer Petitioner: Shirey, John F.Attorney: Steven L. Mayer

Brief Downloads
1-s194861-pets-pfwom-07-18-11.pdf (5835708 bytes) - Petitioners' Petition for Writ of Mandate Filed on July 18, 2011
2-s194861-resp-oconnell-prel-response-to-pwfom-7-25-11.pdf (124946 bytes) - Respondent, Patrick O'Connell, Preliminary Response to Petition for Writ of Mandate Filed on July 25, 2011
3-s194861-resp-matosantos-and-chiang-informal-opp-to-pfwof-07-27-11.pdf (4971960 bytes) - Respondents, Ana Matosantos and John Chiang, Informal Opposition to Petition for Writ of Mandate Filed on July 27, 2011
4-s194861-pets-informal-reply-support-of-pwfom-07-29-11.pdf (1689511 bytes) - Petitioners' Informal Reply in Support of Petition for Writ of Mandate Filed on July 29, 2011
5-s194861-nontitle-resp-sharma-and-santa-clara-county-opp-08-29-11.pdf (327865 bytes) - Non-Title Respondents, Vinod K. Sharma and County of Santa Clara, Opposition Filed on August 29, 2011
6-s194861-resp-matosantos-and-chiang-opp-08-31-11.pdf (54351 bytes) - Respondents, Ana Matosantos and John Chiang, Opposition Filed on August 31, 2011
7-s194861-resp-oconnell-written-return-09-06-11.pdf (108908 bytes) - Respondent, Patrick O'Connell, Written Return Filed on September 6, 2011
8-s194861-resp-matosantos-and-chiang-written-return-09-09-11.pdf (2725936 bytes) - Respondents, Ana Matosantos and John Chiang, Written Return Filed on September 9, 2011
9-s194861-resp-matosantos-and-chiang-request-judicial-notice-09-09-11.pdf (518293 bytes) - Respondents, Ana Matosantos and John Chiang, Request for Judicial Notice Filed on September 9, 2011
10-s194861-nontitle-resp-sharma-and-santa-clara-county-written-return-09-09-11.pdf (2447667 bytes) - Non-Title Respondents, Vinod K. Sharma and County of Santa Clara, Written Return Filed on September 9, 2011
11-s194861-pets-partial-opp-09-23-11.pdf (89714 bytes) - Petitioners' Partial Opposition Filed on September 23, 2011
12-s194861-pets-opp-09-23-11.pdf (3356431 bytes) - Petitioners' Opposition Filed on September 23, 2011
13-s194861-resp-matosantos-and-chiang-sup-brief-09-28-11.pdf (175364 bytes) - Respondents, Ana Matosantos and John Chiang, Supplemental Brief Filed on September 28, 2011
14-s194861-pets-request-jud-notice-10-07-11.pdf (226570 bytes) - Petitioners' Request for Judicial Notice Filed on October 7, 2011
15-s194861-pets-sup-brief-10-17-11.pdf (246202 bytes) - Petitioners' Supplemental Brief Filed on October 17, 2011
16-s194861-nontitle-resp-sharma-and-santa-clara-county-opp-10-19-11.pdf (89040 bytes) - Non-Title Respondents, Vinod K. Sharma and County of Santa Clara, Opposition Filed on October 19, 2011
17-s194861-acb-assoc-bayarea-gov-100311.pdf (370874 bytes) - Amicus Curiae Brief of Association of Bay Area Governments et al., Filed on October 3, 2011
18-s194861-acb-ca-prof-firefighters-100311.pdf (393239 bytes) - Amicus Curiae Brief of California Professional Firefighters Filed on October 3, 2011
19-s194861-acb-county-san-bernardino-100311.pdf (246583 bytes) - Amicus Curiae Brief of County of San Bernardino Filed on October 3, 2011
20-s194861-acb-housing-advocates-100311.pdf (272757 bytes) - Amicus Curiae Brief of Affordable Housing Advocates Filed on October 3, 2011
21-s194861-acb-public-interest-law-100311.pdf (447685 bytes) - Amicus Curiae Brief of Public Interest Law Project et al., Filed on October 3, 2011
22-s194861-acb-city-irvine-100311.pdf (377336 bytes) - Amicus Curiae Brief of City of Irvine Filed on October 3, 2011
23-s194861-acb-long-beach-100311.pdf (463297 bytes) - Amicus Curiae Brief of Long Beach Central, West and North Project Area Committees Filed on October 3, 2011
24-s194861-acb-ca-teachers-assoc-100311.pdf (454385 bytes) - Amicus Curiae Brief of California Teachers Association Filed on October 3, 2011
25-s194861-acb-county-riverside-100311.pdf (464484 bytes) - Amicus Curiae Brief of County of Riverside Filed on October 3, 2011
26-s194861-acb-santaclara-unified-school-100311.pdf (251585 bytes) - Amicus Curiae Brief of Santa Clara Unified School District Filed on October 3, 2011
27-s194861-acb-comm-redev-agency-100311.pdf (338381 bytes) - Amicus Curiae Brief of Community Redevelopment Agency of the City of Los Angeles Filed on October 3, 2011
28-s194861-acb-municipal-officials-100411.pdf (169034 bytes) - Amicus Curiae Brief of Municipal Officials for Redevelopment Reform et al., Filed on October 4, 2011
29-s194861-acb-coalition-cities-100511.pdf (509127 bytes) - Amicus Curiae Brief of Coalition of Cities et al., Filed on October 5, 2011
30-s194861-acb-la-unified-school-dist-100511.pdf (400649 bytes) - Amicus Curiae Brief of Los Angeles Unified School District Filed on October 5, 2011
31-s194861-acb-center-const-juris-100511.pdf (281751 bytes) - Amicus Curiae Brief of Center for Constitutional Jurisprudence Filed on October 5, 2011
32-s194861-acb-assoc-ca-cities-100511.pdf (947788 bytes) - Amicus Curiae Brief of Association of California Cities - Orange County Filed on October 5, 2011
33-s194861-resp-acb-sharmasantaclara-100711.pdf (265532 bytes) - Response to Amicus Curiae Brief of Non-Title Respondents, Vinod K. Sharma and County of Santa Clara, Filed on October 7, 2011
34-s194861-resp-acb-matosantos-chiang-100711.pdf (190529 bytes) - Response to Amicus Curiae Brief of Respondents, Ana Matosantos and John Chiang, Filed October 7, 2011
35-s194861-resp-acb-pet-100711.pdf (660047 bytes) - Response to Amicus Curiae Brief of Petitioners Filed on October 7, 2011

If you'd like to submit a brief document to be included for this opinion, please submit an e-mail to the SCOCAL website

May 22, 2012 Annotated by Albert Ho

FACTS In the wake of a declared state fiscal emergency, the California State legislature enacted two measures meant to stabilize school funding by shifting funding originally allocated to the state’s community redevelopment agencies. The measures included Assembly Bills 1X 26 and 1X 27, which sought to accomplish this goal through the following functions: (i) “freezing” existing community redevelopment agencies by restricting their ability to take on new debt (Assembly Bill 1X 26, Part 1.8), (ii) providing for the winding up and eventual dissolution of all redevelopment agencies and transference of their respective responsibilities unto successor agencies (Assembly Bill 1X 26, Part 1.85), and (iii) exempting from dissolution cities and counties that agreed to make specified payments to both the county ERAF and a new county special district augmentation fund on behalf of their redevelopment agencies (Assembly Bill 1X 27, Part 1.9). The California Redevelopment Association, along with other affected parties, challenged the measures on grounds that they violated, inter alia, Proposition 22, which amended the State Constitution to limit the state’s ability to require payments from redevelopment agencies for its benefit. PROCEDURAL HISTORY Petitioners filed for writ of mandate with the Supreme Court of California and asked it to invoke its original jurisdiction of the issues. The Court, in invoking its jurisdiction, agreed that the circumstances at issue (the threat of imminent dissolution of nearly 400 redevelopment agencies and question of proper allocation of billions of dollars in property tax revenue) rose to a sufficient level of importance and demanded immediate resolution. ISSUE 1. Under the State Constitution, do redevelopment agencies, once created and engaged in redevelopment plans, have a protected right that immunize them to statutory dissolution by the California Legislature? 2. Under the State Constitution, do redevelopment agencies have a protected right to continued operation without conditioning their existence on payment to various funds benefiting schools and special districts? HOLDING 1. No. 2. Yes. ANALYSIS Majority Opinion (Werdegar, J., Kennard, J., Baxter, J., Chin, J., Corrigan, J., Liu, J.) Guiding Principles The Court proceeded by discussing the legal principles that would inform its analysis of the constitutionality of Assembly Bills 1X 26 and 27, including the following: (1) Doubts as to the Legislature’s power to act should be resolved in favor of the Legislature’s action (2) Restrictions imposed by the State Constitution should be strictly construed and not extended to include matters not covered by the language used. The Constitutionality of Assembly Bill 1X 26 Statutory Dissolution under Part 1.85 The Court recognized the Legislature’s power in making laws as plenary. A corollary to the legislative power to make laws is the power to abrogate them, which thus includes the power to create and dissolve political entities. Redevelopment agencies are political subdivisions of the state and creatures of the Legislature’s exercise of its statutory power under the Community Redevelopment Law, and therefore exist at the Legislature’s pleasure. The Court rejected Petitioners’ contentions for why the dissolution provisions of Assembly Bill 1X 26 are invalid: (1) Petitioners claimed that Assembly Bill 1X 26 was inconsistent with article XVI, Section 16 of the state Constitution, governing tax increment revenue. The Court held that nothing in the text of this section created an absolute right to the allocation of tax increment revenue or that redevelopment agencies must exist in perpetuity. Instead, the text stated that the legislature “may provide that any redevelopment plan may contain a provision” diverting tax increment to redevelopment agencies. The legislative history also supported this position. The Court also held that the last sentence of article XVI, Section 16, stating that the “Legislature shall enact those laws as may be necessary to enforce the provisions of this section,” was still permissive in nature since it directed passage only of those laws “as may be necessary.” The Court rejected Petitioners’ claim that the Bill was invalid for the failure to continue allocating tax increment for existing indebtedness as broadly as in the past under Marek v. Napa Community Redvelopment Agency, 26 Cal.3d 1070. The Petitioners’ reading was flawed because article XVI, Section 16 did not grant a constitutional right to redevelopment agencies to receive continued tax increment, but granted the Legislature authorization to statutorily grant such a right. Pursuant to the law making corollary, the Legislature could repeal such a right. (2) Petitioners claimed that Proposition 22 amended the State Constitution to effectively withdraw the power to dissolve community redevelopment agencies for the financial benefit of the state. The Court found nothing in the text and ballot arguments in support of and against Proposition 22 that would limit the Legislature’s plenary authority over the existence of redevelopment agencies. Proposition 22 amended the State Constitution to in effect, prohibit the Legislature from requiring a redevelopment agency to pay property taxes “allocated to the agency . . . to or for the benefit of the State” or its agencies and jurisdictions (Article XIII, section 25.5, subdivision (a)(7)(A)). The Court rejected that dissolving redevelopment agencies would entail an impermissible diversion of their tax increments to third parties, in contravention of section 25.5 subdivision (a)(7)(A). To allow such a fundamental change in the structure of state government by implication of voter initiative without express language would be highly implausible, as drafters of legislation do not “hide elephants in mouseholes.” Finally, declining to imply a constitutional guarantee of continued redevelopment agency existence did not render the subdivision a nullity, as it only stripped the Legislature of the narrower power of insisting transfer to third parties of property tax revenue already allocated to redevelopment agencies. Freezing Redevelopment Agency Transactions under Part 1.8 The Court found that the power to suspend the ability of redevelopment agencies to make free use of their funds was incidental to the power to declare their dissolution. Implicit in this power is the practical restriction on requiring instantaneous dissolution (as opposed to winding up and eventual dissolution), which would raise serious impairment of contract questions. As the Legislature acted by statutorily granting redevelopment agencies the right to tax increment funding, the Legislature could determine when that tax increment should no longer be allocated to the redevelopment agencies. Furthermore, redevelopment agencies have a conditional right to allocation of tax increment only to the extent of existing indebtedness, but this does not include the right to incur additional future indebtedness. The Constitutionality of Assembly Bill 1X 27 The Court concluded that the condition existence required by Assembly Bill 1X 27 violated the limitations adopted by Proposition 22. Looking to the legislative history and intent of Proposition 22, the Court found that it was drafted with the specific intent to end ERAF shifts of the sort previously imposed by the Legislature on redevelopment agencies. The text of Proposition 22 also mandated that its provisions be “liberally construed in order to effectuate its purposes.” In light of these findings, the Court found that the conditional payments to continued existence demanded by Assembly Bill 1X 27 were exactly the sort of levy on the receipt of tax increment funds that Proposition 22 was meant to restrict. The Court held that distinctions made on the source of payment and whether the conditional existence imposed by Assembly Bill 1X 27 was voluntary or not were immaterial. The Court also found that dissent’s reading of Assembly Bill 1X 27 would allow every ERAF scheme to remain valid, even after Proposition 22. Severability The Court found that the inclusion of a nonseverability clause in section 5 of individual provisions of Assembly Bill 1X 27 conclusively rendered its remaining provisions unenforceable. In direct contrast, section 4 of Assembly Bill 1X 27 expressed the intent to preserve Assembly Bill 1X 26. Furthermore, the freeze and dissolution provisions of Assembly Bill 1X 26 were functionally severable from the continuation payment program of Assembly Bill 1X 27. Rejecting Petitioners’ claims that the bills came as a package, the Court held that the interstatutory severability clause unequivocally answered the severability question, preserving Assembly Bill 1X 26. Concurring and Dissenting in Part (Cantil-Sakuye, C.J.) Cantil-Sakuye concurred with respect to the majority’s findings on Assembly Bill IX 26, but dissented from the opinion on Assembly Bill 1X 27. The C.J. first identified that Petitioners were facially challenging the constitutionality of Assembly Bill 1X 27, and were thus subject to a higher burden to demonstrate a “present total and fatal conflict” with applicable constitutional prohibitions. Proceeding from a presumption that the bill was constitutionally valid, the C.J. found that petitioners failed to sustain their burden. The C.J. found that Proposition 22 only prevented a redevelopment agency from directly or indirectly reallocating its tax increment funds. In contrast to the majority, the C.J. found no ambiguity demanding that the court look to the intent behind the legislation based on the plain language of Assembly Bill 1X 27. As Assembly Bill 1X 27 provided that the community sponsor may make payment and was agnostic to the source of funds (i.e. did not require the redevelopment agency to use its tax increment), it did not conflict with the state constitution. Given the specificity with which Proposition 22 was drafted, the C.J. found that it was much more reasonable to conclude that Proposition 22 was narrowly intended to protect specific local government revenues, rather than protecting any funds legally available for funding Assembly Bill 1X 27. DISPOSITION Since several critical deadlines contained in Part 1.85 of Assembly Bill 1X 26 had passed and were therefore impossible to satisfy, the Court extended all statutory deadlines arising before May 1, 2012 by four months. In making this reformation, the Court expressly exercised its power of reformation and thought it clear that the Legislature would have preferred Assembly Bill 1X 26 to take effect on a delayed basis than not at all. KEY TERMS Redevelopment agency, legislative power, agency dissolution, conditions to existence, tax increment revenue, ERAF, statutory construction, constitutional construction, Assembly Bill 1X 26, Assembly Bill 1X 27, State Legislature power, power of reformation, statutory severability, state constitution, article XVI, Section 16, Proposition 22, Article XIII, section 25.5, subdivision (a)(7)(A), constitutionality, community sponsor, local governments