Local Liberty

They Take a Village:
Redevelopment in “Blighted” Claremont
By C. Robert Ferguson

Claremont is one of the most affluent cities in Southern California. It is the home of the prestigious Claremont Colleges. Property values are rising rapidly. The heart and civic center of the city is the Claremont “Village,” which includes City Hall, the county library, and numerous trendy shops and restaurants within approximately 14 blocks of tree-lined streets. In 1973, the Village and the area to the west were declared a physical, social, and economic liability. Deemed “blighted,” they became a redevelopment project. With the power of redevelopment, the City, its Redevelopment Agency, and two private developers redesigned and are redeveloping the area west of the Village at the cost of five existing businesses, a storage facility, and $2.25 million.

Redevelopment in California began in 1952 after the adoption of a new state constitutional amendment, Article XVI, Section 16, which permitted the creation of redevelopment agencies and their financing through tax increment. Tax increment provides a never ending source of revenue.

After a redevelopment project is adopted, taxes on real property in the project area are divided between the original taxing agencies and the redevelopment agency (typically the city council under a different legal label).The taxing agencies (for Claremont, 16 entities including the County, school, flood control, and water districts, fire department, etc.) and the redevelopment agency/city council receive the amounts they would have received before the adoption of the plan, plus additional, small, statutory amounts. The remainder of the tax increment—i.e., the additional property tax—is the revenue from the additional values assessed after the adoption of the redevelopment plan goes to the redevelopment agency/city council.

In addition to financing through tax increment, redevelopment agencies also have the power to take property by eminent domain and to issue bonds without the two thirds voter approval that is otherwise required in California. The agencies are responsible for new streets, sidewalks, curbs, gutters, landscaping signage, signals, public parking, trunk lines for sewers, storm drains, and communication and electricity.

Redevelopment agencies are also responsible for demolition and grading. Cities, through their redevelopment agencies, have these extraordinary powers for a reason, however questionable. Redevelopment was intended to revitalize blighted communities by reversing the decline of urban slum neighborhoods which have been rendered economically useless and a liability to the community. Also, there must be “true blight” as exemplified by the kind of inner-city slum conditions described in the Bunker Hill case.

There, it was found that unacceptable living conditions were 82 percent, unacceptable building conditions were 76 percent, the crime rate was double the city's average, the arrest rate was 8 times the city's average, the fire rate was 9 times the city's average, and the cost of city services was more than 7 times the cost of tax revenues.

Unfortunately, rather than curing blight, redevelopment today is primarily used to recycle real property by using eminent domain to acquire parcels and sell them at a discount to a developer. Instead of private capital paying for the construction of streets, curbs, and sidewalks, redevelopment agencies often pay for them. The benefit to the city is increased sales tax and more upscale residences and commercial businesses.

To cure this misuse of redevelopment for private commercial benefit, the California Legislature enacted a statute that requires that 20 percent of the redevelopment tax increment be used for low- and moderate-income housing. As a general rule, however, this mandate is honored more in its breach.

The City of Claremont adopted a redevelopment plan which included the Village by passing City Ordinance 73-8. By doing so, the Claremont City Council declared that “blight” existed in the Village. Yet in its description of the Village’s physical, social and economic conditions, the Claremont Redevelopment Agency described it as follows:

The existing structures “were fairly well maintained”; residents were described as “predominantly white, of moderate income, and either elderly or young families with children”; economic conditions were “characterized [sic] by relatively static retail sales and a lack of dynamic growth in the commercial facilities.”

In 2000 the Agency and City Council again reviewed the question of blight in the Village. The Claremont City Council found that the Village was indeed blighted. This “finding” was made despite the fact that the Village remains a vibrant, active area where rents are so high that several local businesses went out of business. According to the Redevelopment Agency’s staff, “The Claremont Village is one of the most successful small downtown areas in Southern California. Parking spaces are nearly full most hours of the day, even into the evening, and there are virtually no commercial and retail vacancies in the Village.”

Home prices around the Village are no longer affordable for most of the elderly or young families with children. Because the findings of blight were not challenged within 60 days after their adoption, they cannot be challenged.

The idea of expanding the Village across Indian Hill Boulevard, the main north-south street in Claremont, began in the early 1990s. The City decided to take what it termed a “proactive approach” to the expansion. Initially, the approach was directed to potential development, which evolved into the actual development of shops, a theater, a hotel, cafes, and offices. The development was initially called “Village West.” But because this label struck fear into the hearts of the existing merchants, the Agency changed the name to “Village Expansion.”

The City and the Redevelopment Agency wanted to ensure that the Village grew in an orderly, thoughtful manner that reflected the community's standards, “not just the whims of private developers” (Village Expansion section of Council Briefing Paper, 2002). But the Redevelopment Agency had already hired two consultants: One was a private residential developer; the other a private commercial developer.

The governmental “process” for developing the Village west of Indian Hill Boulevard began in 1998. That year, the Claremont Planning Commission began preparing a Specific Plan for redeveloping the area west of the Village into a mixed-use residential and commercial area. In January of 2001, the Village Expansion Specific Plan was adopted by the Claremont City Council. City officials