News

In an effort to provide legal guidance to the broad range of interests impacted by tomorrow’s dissolution of redevelopment agencies in California, Alvarez-Glasman & Colvin (AGC) is proud to announce the formation of its newest practice group: the AGC Redevelopment Transition Practice Group.

Formation of the Redevelopment Transition Practice Group comes in response to the enactment of Assembly Bill 1X26 – recently upheld by the California Supreme Court in its ruling, California Redevelopment Association v. Matosantos – which provides for the dissolution of all redevelopment agencies in California by Wednesday, February 1, 2012. The consequences of Matosantos decision, coupled with the recent failure of other lawsuits challenging AB1X26, promise to drastically reshape urban development in California and will transform the way local governments will operate for decades to come.

Comprised of attorneys with extensive experience in representing redevelopment agencies, municipalities, and private sector parties engaged in redevelopment transactions, the Redevelopment Transition Practice Group is intended to serve as a comprehensive legal resource to address the complex and diverse challenges created by the dissolution of redevelopment agencies throughout the State. Among the legal issues which the Redevelopment Transition Practice Group is presently addressing are:

• What legal duties must city and redevelopment agency staff perform under AB1X26?
• What are the responsibilities of cities and other successor agencies under AB1X26?
• Are mayors and city council members held to a different fiduciary standard when acting on behalf of a successor agency rather than a city?
• Should successor agencies establish new by-laws, policies of procedures, and other guiding documents for the conduct of regular business?
• What conflicts of interest should mayors and city council members, city officials, and redevelopment agency staff consider when taking action under AB1X26?
• How are oversight committees to be formed, and what guiding procedures and documents should be employed in their conduct of business?
• What powers should an oversight committee exercise, and what fiduciary and other legal standards should be employed in exercising those powers?
• When should a city or successor agency consider litigation to challenge the decisions of their oversight board, and vice-versa?
• How must private sector assets be addressed by redevelopment agencies and their successors, and which assets are put at risk by the loss of redevelopment?
• What types of agency bonds, security financing and contracts will be honored by AB1X26?
• What actions must cities and other successor agencies take to safeguard redevelopment assets and obligations?
• How will long-term financial agreements, many of which were entered into by redevelopment agencies years ago, be affected by AB1X26?
• What fiduciary obligations do cities and successor agencies have to investors, developers, property owners, and the State when liquidating the assets of redevelopment agencies?
• Will the liquidation of agency real property assets adversely affect the real estate market or provide opportunities for investment and development?

The vast majority of attention on redevelopment dissolution has thus far come from the public sector – cities, counties, and agencies themselves grappling with the meaning and consequences of losing redevelopment agencies. However, the loss of redevelopment will likewise have extensive impacts in the private sector, as a very uncertain future is emerging for lenders, developers, financial institutions, bond holders, public housing advocates, and others involved in redevelopment transactions. AGC’s Redevelopment Transition Practice Group is able to address the interests of these sectors – both public and private – who are each impacted by the loss of redevelopment in unique ways.

With more than fifty years of combined experience in the areas of redevelopment and municipal law, AGC’s attorneys are practicing on the cutting edge of events in the changing field of California redevelopment law. If your city, agency, organization or business is responding to AB1X26 or has otherwise engaged in transactions with redevelopment agencies, we urge you to explore the impacts, and exposure, and opportunities posed by this precedent-setting legislation.

For more information on AGC’s Redevelopment Transition Practice Group, please contact AGC at (562) 699-5500, or e-mail any of the Practice Group directors: Andrew Jared at ajared@agclawfirm.com; Scott Nichols at snichols@agclawfirm.com; and Matthew Gorman at mgorman@agclawfirm.com.