A Tidbit from the Controller’s Redevelopment Agency Audit

FINDING 4 — Most Redevelopment Agencies Charged Expenditures That Were Questionable can be found on Page 9 of State Controller John Chiang’s audit, released March 7, of 18 large and small redevelopment agencies around the state.

As an example of such expenditures, the audit cites the City of San Jose which charged 25 percent of the salary and fringe benefits of the mayor, the 12 members of the city council and 40 city council staff members to the redevelopment agency.

One-fourth of the mayor’s $127,000 salary is $31,750. One-fourth of a city council member’s $90,000 salary is $22,500. Multiplied by 12 council members that’s $270,000.

In response to the audit, the redevelopment agency said the 25 percent was “based on the level of services provided (by the mayor and city council) in their capacity as the agency’s board and that the allocation of costs is based on several factors,”  the controller’s report quotes them as saying on Page 31.

“Agency representatives provided a detailed explanation of the project areas as well as core services provided by the (redevelopment agency) but failed to address the basis of how the 25 percent allocation was derived.

“Without a measurable basis to allocate costs, the 25 percent remains arbitrary,” the controller concludes.

Of the state’s 450 redevelopment agencies, the boards of 376 of them are coty councils, according to Chiang’s Community Redevelopment Agencies Annual Report, issued December 31, 2010.

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