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State Budget To Impact Outlying Areas' Bottom Lines

POSTED: 8:44 pm PDT August 4, 2009
UPDATED: 10:14 am PDT August 5, 2009

California's borrowing of up to $2 billion from local governments across the state will have a significant impact on Kern County cities, several city leaders said Tuesday.

Overall, more than $39 million will be borrowed from Kern County governments and redevelopment agencies, according to date from the California Redevelopment Association.

While the majority of that will come from county governance and the city of Bakersfield, every city will feel the burden.

Impacts on Taft

In Taft, about $255,000 total will be taken from the city government and redevelopment agency, City Manager Bob Gorson said.

"It's money that could pay for a police officer, it could pay for two correctional officers, economic development staffers, you name it," he said.

The take is around $28 a resident in Taft. It's money the city believes should be used to benefit Taft residents, while helping redevelopment.

"One of the worst things the state can do is rob from redevelopment," Gorson said. For every dollar of redevelopment funds that's used on a project, you get about a 14-to-one return."

Consequences on Arvin

In Arvin, the impact will especially be felt on the city's redevelopment agency, which stands to lose more than $300,000.

It's going to be felt in a city that has made significant strides to improve business facades on Bear Mountain Boulevard, according to city redevelopment director Mike Kunz.

The state will also borrow around $130,000 from Arvin's city government, but city leaders believe the sales tax increase approved by voters last year will help soften the blow.

A stimulus grant recently given to Arvin's police department will also help the city make it through the tough time, according to Chief Tommy Tunson.

Arvin, along with Bakersfield and Delano, were the three Kern County cities who won a competitive grant to fund pay for new police officers.

"An extra officer will allow us to put another officer in investigations, so we'll have an investigator full-time," he said.

The process to hire that new officer will begin shortly. For more information, you can call (661) 854-5583.

Impacts Even Felt In Maricopa

Maricopa may be Kern County's smallest incorporated city, but even they will feel the impact of state borrowing.

It may not seem like much, just a shade over $14,000, but that's the same as roughly 30 percent of the city's public works budget.

"It'll hurt us here," said Bob Milburn, Maricopa's city manager. "We don't anticipate any furloughs or anything like that, but we'll just continue to watch every dollar and try to get by."

Historically, Maricopa has not had much in fiscal reserves, so they have been frugal with city money before and are continuing to do so, he added.

A Done Deal?

Redevelopment officials in Bakersfield, who will suffer a $2.9 million hit, say the taking of local redevelopment funds could be overturned.

The California Redevelopment Association won a lawsuit earlier this year in which a Sacramento County court judge ruled borrowing from redevelopment funds was unconstitutional.

The new attempt to borrow redevelopment monies could spur a new lawsuit as soon as next spring, according to Rhonda Barnhard, the assistant economic development director with the city of Bakersfield.

The state is mandated to repay the general fund loans from local entities within three years, but there is no stipulation that redevelopment money has to be repaid.

But local leaders we spoke with were not upbeat that even general fund repayment would happen, especially considering state budget projections for the next few years.

While they say they don't like it, it's something over which they have little control, and are resigned to dealing with it.

"It prevents us from growing," Gorson sighed. "It prevents us from doing the kind of things that we know we could do if we could just keep the state from stealing from us."

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