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Gov. Jerry Brown signs laws to ax redevelopment agencies, collect taxes from online retailers

June 29, 2011 |  3:09 pm

Gov. Jerry Brown signed into law Wednesday proposals to abolish California’s existing redevelopment program and to try to force online retailers, such as Amazon.com, to collect sales taxes.

The  new laws are pieces of the Democratic budget package that lawmakers finalized late Tuesday night. Brown announced signing eight separate pieces of that package Wednesday, though not the main spending plan itself.

The online sales tax law, AB 28 1x, would seek to force online retailers who have no physical presence in California, such as Amazon.com, to collect the same levies as bricks-and-mortar stores. Lawmakers calculated it would net the state $200 million.

Retailers from Wal-Mart to mom-and-pop bookstores had pressed for the tax law rewrite.

But online retailers have already begun mobilizing to neutralize the statute. Amazon.com, for example, sent letters Wednesday severing its ties with marketing affiliates in California, one of several ways the state is trying to force big Internet retailers to cough up sales taxes.

Opponents of the new redevelopment law were plotting ways to scuttle that legislation, as well.

Under AB 26 1x and AB 27 1x, California will force its existing network of more than 400 redevelopment agencies, which spend property tax dollars to fix up blighted areas, to dissolve and join a new redevelopment program. The agencies would have to hand over $1.7 billion to the state for the privilege in the coming fiscal year, as well as $400 million each year thereafter. 

Supporters of redevelopment agencies have likened the plan to extortion and have promised to sue.

-- Shane Goldmacher in Sacramento

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