Santa Clara County and the San Jose Redevelopment Agency reached an agreement on the RDA’s $63 million debt on Wednesday, ending a feud that has been simmering for the past 18 months.
The agreement has the RDA handing over the Old City Hall building at 801 N. First St. to the county in lieu of $10 million, the Mercury News reports. The transfer is to be completed by June 30. The RDA will also pay the county $21.5 million by the end of this month with an additional $5 million to be paid by May 15. The balance of the debt, amounting to $23.78 million will be paid off with interest in five annual installments, beginning in 2014.
The need to reach an agreement gained urgency when Gov. Jerry Brown announced his intention to seize redevelopment funds to cover the State’s budget deficit. San Jose never denied that it owed the county the money, but the agreement stalled over how it would be paid, given the recession and 10 consecutive years in which the city ran a deficit.
The County has yet to decide what it plans to do with the old City Hall building, which has been vacant since 2005. One option is to turn it into county offices, though this would require considerable renovation, given the amount of asbestos in the building. Another option is to convert it into a residential property.