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City Assumes Del Rio Ownership
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Riverbank has transferred ownership of the Del Rio Theater and its adjacent properties from the Redevelopment Agency to the city.

But the debts involved in the $1.7 million purchase of the Del Rio, its parking lot and adjacent Reed's Garage four years ago with issuance of $15 million in bonds remain the responsibility of the Redevelopment Agency and not the city, according to Director of Economic Development Tim Ogden.

City Council members took the action at their March 14 meeting to protect the properties and their value from the State, which is considering elimination of all redevelopment agencies, having successor agencies quickly sell their properties and transfer the funds to the counties.

"The city is protecting its local assets, enabling potential proceeds to remain in local control and ensuring the best development to occur on a key downtown gateway corner in an effort to continue the downtown revitalization," Ogden said in his memo to the council.

Council members appeared a little doubtful but voted together to transfer the properties by legal action.

"The city must protect this property," said council member Dotty Nygard. "We do not lose anything until we sell it. We could even lease it as an asset."

"We should keep the Del Rio," said Councilmember Jesse James White. "We're $15 million in the hole. We should retain it or sell it. It will cost another $1 million to fix up."

"You were directed to demolish it. I don't think leasing is an option," said Vice Mayor Richard O'Brien to Ogden.

"We should hold onto the property at this time," said Jeanine Tucker in her first meeting as a council member, seated on the dais earlier that evening.

Mayor Virginia Madueno questioned whether there were "any legal pitfalls" and sought assurance the city's general fund could not be held liable for the redevelopment agency's debt or increment tax payments to local agencies such as school and fire.

"We need to keep control of the property. It offers tremendous opportunity. I don't see us selling it," she said.