Few More Votes Needed to Kill RDA's Drain on Funds

The Calm Before the Storm Summary:Despite daily rumors to the contrary, neither chamber took up the issue of redevelopment last week. Both the Senate and Assembly held brief floor sessions Friday morning without voting on either SB 77 or AB 101, the bills eliminating redevelopment....View the full post by clicking this link:http://www.californiaeminentdomainreport.com/2011/03/articles/redevelopment-1/the-calm-before-the-storm/ Redevelopment Folly 10:00 PM PDT on Wednesday, April 6, 2011 The Press-Enterprise The latest proposal to stave off the end of redevelopment in California offers taxpayers only minor changes in return for ridiculous concessions. Legislators should flatly reject a plan that retains redevelopment's flaws while ignoring the central public policy issues at stake. Gov. Jerry Brown proposes to end redevelopment in California, as part of a plan to close a $26.6 billion budget shortfall through next fiscal year. The California Redevelopment Association and the League of California Cities are now floating a "compromise" plan that would provide the state some additional funds, but would let redevelopment continue. Redevelopment allows local governments to keep a larger share of property taxes that would otherwise go to schools, counties and other public agencies. The money is supposed to help improve run-down areas, but local governments have often spent the money in ways that that have little to do with any urban renewal. Redevelopment now consumes more than $5.5 billion a year in property taxes, at a time when state and local governments struggle to fund basic public services. Under the latest scheme, redevelopment agencies would provide "voluntary" contributions to help pay for public education, in return for allowing redevelopment projects to extend their lifespan by as much as 12 years. And the proposal includes a series of still hazy reforms, though not a crucial one recommended by the state's legislative analyst: state oversight to ensure that local redevelopment plans are legitimate. But numbers alone show the state would be foolish to accept this dubious bargain. The state has to give education about $2 billion annually to replenish tax money lost to redevelopment, thanks to Prop. 98's school funding guarantee. The redevelopment association's proposal would provide the state with as much as $2.7 billion over 10 years to help offset that cost, assuming those voluntary contributions actually materialized. But that amount is far less than the state will spend during that time to cover the redevelopment diversion. And nothing would prevent redevelopment agencies from creating new projects in the meanwhile, thus grabbing an even larger share of property tax money from schools. The contributions, however, would buy agencies a way around redevelopment reforms. The Legislature in 1993 set time limits of 45 to 50 years for how long redevelopment projects could continue, with extensions only possible if agencies could meet certain conditions, such as demonstrating that blight still existed. The redevelopment association plan would give agencies up to 12 years of additional life with no requirement to show any need for those extra years. The redevelopment agencies' proposal leaves intact a process that is easily abused, has little accountability and diverts badly needed tax money away from necessary public services. Even a fiscally challenged Legislature should be able to spot that deal's huge downside. Dan Walters: Redevelopment officials are offering pig in a poke By Dan Walters http://us.mc331.mail.yahoo.com/mc/compose?to=dwalters@sacbee.com The Sacramento Bee Published: Monday, Apr. 4, 2011 - 12:00 am Page 3A When Gov. Jerry Brown proposed to abolish more than 400 local redevelopment agencies and redirect billions of dollars in property taxes, the state's redevelopment industry shifted into political overdrive. Redevelopment officials claimed that abolition would devastate efforts to improve local economies and cost hundreds of thousands of jobs. However, independent analysts agree that redevelopment, while lucrative to subsidy-seeking developers, provides no substantial improvement to the state's overall economy. The agencies skim more than $5 billion a year off the top of the property tax pot each year, and the state must make up about $2 billion of that hefty diversion in extra payments to schools. Brown is saying, in effect, that the state can't afford to subsidize local development schemes and wants the money back. His proposal is a major issue in the budget stalemate and fell barely short of passing the Assembly. That has redevelopment officials worried, and they've conjured up an alternative – allowing redevelopment agencies to voluntarily shift some funds into schools in return for being allowed to extend redevelopment projects that are expiring. John Shirey, who runs the California Redevelopment Association and is the field general of the war against Brown's plan, calls it "a reasonable compromise for all involved" that would give the state about $2.7 billion in budget relief over the next decade. The CRA plan would provide only a small fraction of the money that Brown envisions, but the real clinker is giving redevelopment projects an automatic extension, a variation of a scheme that some redevelopment groups have floated for several years. The key word is "blight." Cleaning up urban blight was the rationale for the state's authorizing redevelopment agencies six decades ago. But over the years, redevelopment agencies adopted very creative definitions of "blight" to justify subsidies to private developers of hotels, auto malls, big box stores and other commercial ventures. One city, for instance, declared land blighted because it was "subject to periodic flooding," thereby justifying its redevelopment. The land in question was a marshy reach of San Francisco Bay that was home to birds and other wildlife. The use of redevelopment became so far-fetched that the Legislature tightened up state law, eventually decreeing that for projects to be extended, local authorities had to prove the continued existence of real blight, not the imaginary kind. That requirement put many projects in peril, and redevelopment officials have been desperately seeking ways to change or repeal it. Now they hope to make a silk purse from a sow's ear by offering, in effect, a bribe to the state to allow extension of marginal projects. It is, however, merely a pig in a poke. Read more: http://www.sacbee.com/2011/04/04/3525460/dan-walters-redevelopment-officials.html#ixzz1ImplzQae