What the story doesn't reveal is that the debt will be paid back over many years with tax increments from the redeveloped properties but a drop in assessed valuation means the General Fund may have to be tapped, further exacerbating the defunding of services for residents that's been going on. Emeryville's assessed valuation plunged so severely last year that the bonding capacity to build the Center of Community Life has been more than cut in half.
The city is hoping to squeeze some extra Redevelopment Agency projects not yet started (like the $10 million Arts Center) in under the wire and increase this debt by fiat from the to-be-announced oversight committee for the redevelopment wind down.
Re-printed from the Contra Costa Times:
Death of redevelopment draws closer |
By Lisa Vorderbrueggen Contra Costa Times |
Posted:01/28/2012 07:38:10 PM PST |
As California cities shut down their redevelopment agencies after losing a war for survival with the state, the battlefield assessment has begun. The casualties are extensive. Layoff notices have gone out in advance of a Feb. 1 court-imposed dissolution deadline. Projects big and small are in limbo or dead. National investment rating agencies Moody's and Fitch downgraded California bonds secured with redevelopment money, citing uncertainty about repayment. Hundreds of redevelopment properties bought with taxpayer dollars could go on the market at a loss. And a Bay Area News Group review of 29 redevelopment agencies in Alameda and Contra Costa counties reveals that the effect goes deeper still. For years, the redevelopment financing mechanism -- originally created to cure urban blight -- has permeated city and county operations. The money built libraries, senior and community centers, roads, transit villages, shopping centers, office buildings, plazas, fountains, landscaping, walkways, houses, apartments for the poor, parking garages and movie theaters. It paid people who stripped graffiti off the walls in Oakland and deputies who patrolled North Richmond. It helped residents buy their first homes, prosecuted slum landlords and underwrote the farmers market and summer concerts in Concord. But in the process, East Bay agencies accumulated combined debts of $12.2 billion, according to the most recent figures available. That adds up to $4,740 for every man, woman and child in the East Bay. Put another way: If every dollar the agencies received was applied to the debt -- at an annual rate based on the past fiscal year's revenues allocated to redevelopment -- repayment would take 30 years. Among other findings: Amid all this angst and regret, redevelopment officials say the rules for dismantling set out in the new law are muddier than the Delta after a storm. "The lawmakers who wrote the dissolution law were unburdened with knowledge of how redevelopment actually works," Brent Hawkins, a Sacramento attorney who represents redevelopment agencies, wryly observed. "It's a mess." The dissolution law orders audits of the 425 agencies by the respective county's auditor-controller, the appointment of 425 separate oversight boards charged with ensuring that agencies wind down expeditiously, and assigns the state Department of Finance to make the final decisions. However, taxpayer money invested in half-finished infrastructure may go to waste if agencies cannot complete projects, said Jim Kennedy, California Redevelopment Association's interim executive director, who is also a retired Contra Costa redevelopment director. In Rodeo, for example, a sewer pipe upgrade is only partially completed; without redevelopment money, the county may not be able to finish it. Kennedy and redevelopment proponents are fiercely lobbying for a stay of execution. A bill to postpone the dissolution deadline to April 15 is pending in the Assembly, although Senate President Pro Tem Darrell Steinberg, D-Sacramento, said last week that its passage is unlikely. Another measure would allow local governments to keep the affordable housing money. Assemblywoman Susan Bonilla, D-Concord, whose hometown is using redevelopment money for planning at the former Concord Naval Weapons Station, is writing a bill that would restore some redevelopment benefits to communities with former military bases. Any bill needs Gov. Jerry Brown's signature, and he has signaled his disinterest. He was the chief driving force behind the dissolution, saying redevelopment diverted too many dollars from schools and other public services. Redevelopment critics agree with Brown, although not for the same reasons. Local governments have racked up massive debts for questionable anti-blight projects using liberal redevelopment rules that require no voter approval and provide little transparency, Contra Costa Costa Taxpayers Association Executive Director Kris Hunt said. "People are talking about the end of redevelopment like it's a bad thing," she said. "This should have happened long ago." In smaller redevelopment agencies or those nearing expiration, such as Lafayette or Walnut Creek, dissolution is an inconvenient speed bump. For many communities, however, it will be messy and complicated. Union City's agency, for example, spent $50 million in redevelopment money buying land and building streets as part of a $120 million transit village near its BART station. "The lots are ready, but the market has been slow in this economy," City Manager Mark Evanoff said. "If we have to sell the lots now, it will be a fire sale." Numerous Bay Area News Group reporters contributed to this report. Contact Lisa Vorderbrueggen at 925-945-4773 or IBAbuzz.com/politics. Follow her at Twitter.com/lvorderbrueggen. REDEVELOPMENT BY THE NUMBERS City/County Jobs funded Properties Total debts* in part or transferred entirely with to city RDA money or county Alameda County 6 10 $96.3 million Alameda 3 0 $302.3 million Albany 0.3 0 $3.9 million Berkeley 1.58 0 $8 million Emeryville NA 44 $255.1 millionFremont NA NA $237.4 million Hayward 8 0 $129.3 million Livermore 1.25 29 $112.3 million Newark NA 0 $227,270 Oakland 159 NA $4.3 billion San Leandro 9.1 23 $103.6 million Union City 16.12 9 $886.5 million Contra Costa County 9 2 $723.2 million Antioch 7 25 $140 million Brentwood 2 9 $310.2 million Clayton 0 0 $26.9 million Concord 11 37 $267.1 million Danville 0 0 $40.7 million El Cerrito 3 1 $174.5 million Hercules NA 4 $314.6 million Lafayette 0 1 $94.7 million Oakley NA Numerous $508.9 million Pinole 5 25 $84.9 million Pittsburg 5 149 $890.1 million Pleasant Hill 11 5 $658.2 million Richmond 17 30 $574.4 million San Pablo 0 NA $244.9 million San Ramon 6 0 $683.2 million Walnut Creek 2 2 $15.5 million TOTALS 282.35 405 $12.2 billion NA -- Not available, unprovided or undetermined by agency * Per statements of indebtedness each agency filed with the county or state for the most recent year available. The final debt numbers may differ after dissolution oversight boards determine which loans and other financial obligations will be paid. |
Redevelopment was robbing the schools for years while making city halls across the state look "flash." Jerry Brown did the right thing despite the very powerful lobbying power of the league of California cities.
ReplyDeleteThe most wasteful part of redevelopment was the bidding wars that went on to steal developers away from neighboring cities.
I still think that much of the early redevelopment was good for Emeryville due to its pollution and industrial roots. And despite our love hate relationship with Bay Street, I love it more than hate it. But the Triangle sure got shortchanged!
Michael Webber,
DeleteHow can you say the Triangle got shortchanged?! I live there and I'm loving the improvements that redevelopment brought us. We have newly paved streets, new LED street lights and beautiful new traffic calming and landscaping that the neighborhood clamored for. Adeline Street now looks beautiful--better than it ever has. That's a lot of public infrastructure paid for with redevelopment money. I'm sure glad the traffic calming project squeaked through. We won't be seeing any major infrastructure projects for a while unless they're absolutely necessary.
The cost of those improvements you have mentioned are staggering. The Triangle got nothing for the money spent. I would guess the above poster lives on 47th Street,(or recently sold their condo and gave up their political position), who lived on the only street that got blocked off for the so called traffic calming. Good for them, they got what was needed for their street but on the backs of their neighbors, 45th and 43rd streets whose traffic has actually doubled after traffic calming measures were put in place. For the planters, how tacky, and cheap, no irragation, how lovely it will look in a few years all dried up like tumbleweeds. Newly paved roads? no way that is only a slurry coat which is called maintenance, but the tax payers will be paying top dollar for such improvements, of course. Not to mention the two or three times they re-stripped the road because of poor planning. On a side note, how about San Pablo Ave? We now have our very own Cash for Gold store that just opened. Thank goodness for our Redevelopment scammers.
ReplyDelete