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Barry Cottle, of C&C, WBBB, LLC, indicated that their project has qualified <br />residents ready to move into apartments; request City protect funds; willing to <br />assist City in response to State's demand. <br />Christian Abasto of The Public Law Center, organization has assisted low income <br />residents in the past; urged City Council not to comply with demand; legal review <br />needed; City has strong case to protect funds; willing to join lawsuit and assist <br />City in protecting best interest for the community. <br />BUSINESS CALENDAR ITEM <br />65A CALIFORNIA DEPARTMENT OF FINANCE'S DEMAND FOR PAYMENT OF LOW <br />AND MODERATE INCOME HOUSING FUND <br />Interim Executive Director of Community Development, Nancy Edwards and Legal <br />Counsel Tom Clark provided history of AB26X, Oversight Board approvals, <br />previous approval of obligations by Department of Finance (August 31, 2012), and <br />City's submittal of Due Diligence Report. <br />Mayor Pulido, City to dispute demand by State; City impacted disproportionally; <br />much at state; consider Ad Hoc Committee to work with the County and advocate <br />in Sacramento; recounted that Proposition 1A protected redevelopment funds, but <br />State simply abolished and now City's left to tackle budget without redevelopment <br />funds. <br />Councilmember Sarmiento, concerned with amount demanded by State; City has <br />compelling case - address blight and low income housing; state imposes other <br />obligations with no funding such as RHNA; projects underway worthy of <br />completing, funds encumbered and appropriated for; City and Successor Agency <br />thoroughly reviewed projects; City has tangible projects underway; City to send no <br />funds; urged developers to partner with City and take stronger position together. <br />State has been inconsistent with responses to City. <br />Councilmember Benavides, City to take strong position against States demand; <br />residents need dignified housing; State strong arm City's to meet their budget <br />challenges; over 200 affordable units under construction; City to oppose State's <br />Department of Finance's demand. Thanked developers for willingness to help <br />advocate City's position. <br />Councilmember Reyna, support City's position to oppose demand. <br />City Attorney noted for the record that letter received from State on December 15, <br />2012; City to respond with 5 working days. Also, letter of demand indicates that if <br />City does not pay full amount, future property and sales taxes may be withheld and <br />a 10% penalty imposed, State may also go after developers that have received <br />funds, risks are draconian, but legal ramification is option. <br />MINUTES SPECIAL MEETING 2 DECEMBER 21, 2012 <br />1 0A-2