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WVBR Obtains Reversal With Directions To Return $10.2 Million In Funds To Redwood City For Affordable Housing

On December 29, 2020 WVBR obtained a significant appellate victory for its client the City of Redwood City which will result in $10.2 million being available for low and moderate income housing.  

In 2011, the Legislature dissolved redevelopment agencies across the State. The Dissolution Act required unencumbered funds held by redevelopment agencies to be transferred to the local agency’s general fund, but also required that funds that were subject to enforceable obligations remain with the redevelopment agencies’ successor agencies. At the time, the Redwood City Redevelopment Agency had approximately $10.2 million set aside for low and moderate income housing under the terms of a 1990 contract with the Legal Aid Society of San Mateo County. The Department of Finance deemed those funds unencumbered, and directed that they by redirected. Both the City and the Legal Aid Society brought writs of mandate challenging that decision, but the superior court denied the writs.  Both the City and the Legal Aid Society prevailed.

On December 29, 2020 the Court of Appeal for the Third District reversed.  In a unanimous published decision, the Court remanded the case with directions to grant the writs of mandate in favor of the City and the Legal Aid Society. Agreeing with all of the appellants’ arguments, the Court found that the $10.2 funds are not subject to redistribution, but constitute a housing asset to remain with the City because the 1990 contract with LAS requires that the funds be used to increase, improve, and preserve the supply of low- and moderate-income housing in Redwood City. The appeal was handled and argued on behalf of the City by WVBR partner Michael von Loewenfeldt. A copy of the Court’s opinion can be found here: https://bit.ly/2JyGfQV