Tax funds pulled in stadium deal

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SANTA CLARA, Calif. -- A California county has surprised both the San Francisco 49ers and city of Santa Clara leaders by pulling $30 million in tax funds from the new 49ers stadium.

Santa Clara County officials told the Mercury News on Saturday that they would rather spend the money on teachers.

The team and the city said voters had specifically earmarked redevelopment money to help build the $1.2 billion stadium and that the county has no right to keep it.

The 49ers and Santa Clara officials will craft an official response this week. Lawsuits are likely, according the newspaper.

The revocation occurred Friday by a new board that oversees property tax from redevelopment zones.

"Let's be real: That stadium is going to get built whether or not you get this $30 million," county tax collector George Putris, the oversight board member who proposed the motion, told a 49ers attorney at the meeting. He said the need was greater at other public agencies, such as school districts. The motion passed 4-3.

The move was so unexpected that Santa Clara leaders claim it was done in violation of public notice laws.

Santa Clara voters approved a 2010 measure that allocated $40 million in redevelopment funds for the stadium, which is set to open in 2014.

The state later did away with redevelopment agencies, and Santa Clara's redevelopment fund had only paid $10 million toward the stadium. So the 49ers loaned Santa Clara leaders the remaining $30 million and started construction, thinking they'd be paid back from future property tax revenues.

A 49ers spokesman declined to comment when asked whether the decision could affect stadium construction, which began in April. Officials have said the team would simply absorb the cost if it loses the funds, which amount to less than three percent of the stadium's total price tag.

Copyright 2012 by The Associated Press

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