Lucia Mar Unified School Dist. v. Cohen CA2/6

Filed 6/14/16 Lucia Mar Unified School Dist. v. Cohen CA2/6 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SIX

LUCIA MAR UNIFIED SCHOOL 2d Civil No. B260624 DISTRICT, (Super. Ct. No. CV 130573) (San Luis Obispo County) Plaintiff and Appellant,

v.

MICHAEL COHEN, as Director, etc.,

Defendant and Respondent.

This is an action to enforce a pass-through agreement with the Redevelopment Agency of the City of Pismo Beach (RDA). Lucia Mar Unified School District (Lucia Mar) appeals an order (1) transferring venue to the Superior Court of Sacramento County and (2) vacating a default judgment against the RDA’s successor agency, Designated Local Authority (DLA). (Health & Saf. Code, §§ 34177, subd. (m), 34168, 34189.1-34189.3.)1 We affirm. BACKGROUND The RDA was formed to improve streets and access to Highway 101, among other things. The RDA was authorized to borrow money, acquire land, and improve infrastructure under the Community Redevelopment Law. (§ 33000 et seq.) Once the redevelopment plan was adopted, all increases in property tax revenue in the

1 All statutory references are to the Health and Safety Code unless otherwise stated.

area were allocated to the RDA to repay its indebtedness, the "tax increment revenues." (Cal. Const., art. XVI, § 16; § 33670, subds. (a) & (b).) The share for local taxing entities such as Lucia Mar was frozen. (Ibid.) To alleviate the resulting financial burden on Lucia Mar, the RDA agreed to pass through the tax increment revenues to Lucia Mar as follows: from 1988 to 2008, the RDA would receive all tax increment revenues; but from 2008 to 2033, Lucia Mar would receive all tax increment revenues (the Agreement). The RDA began making pass- through payments to Lucia Mar in 2008 as agreed. In 2011, the Legislature dissolved RDAs. (§ 34170 et seq., “the dissolution law.”) The Governor is charged with creating a DLA when a city such as Pismo elects not to act as successor to a redevelopment agency it created. (§ 34173, subd. (d)(3).) Under the dissolution law, the former RDA's tax increment allocations are deposited into a trust fund while the DLA, as successor, "winds down" RDA affairs. (§§ 34172, subd. (d), 34182, subd. (c)(1), 34177.) The DLA disposes of assets and pays “enforceable obligations,” as directed by an oversight board subject to review and approval by the State Director of the Department of Finance (the Director). (§§ 34171, subd. (d)(1), 34177, subds. (a), (e) & (m).) Meanwhile, the county auditor-controller distributes the trust funds according to a statutory priority: first, to make pass-through payments; second, to the DLA to pay enforceable obligations; third, for administrative costs; and, finally, to local taxing entities according to their ordinary property tax shares. (§§ 34183, subd. (a), 34188.) Pass-though payments stop when all the RDA’s enforceable obligations are paid or retired. (§ 34187, subd. (h).) After that, property tax revenue is distributed to local taxing entities according to their ordinary shares, essentially as it was before redevelopment. (Ibid.) The auditor-controller for the County of San Luis Obispo took over Lucia Mar’s pass-through payments in 2011. These payments were to continue until the RDA's enforceable obligations are paid.