0

Swalwell bill aims to help cities that lost RDAs

California cities that saw economic development projects sidelined or shelved when the state dissolved their redevelopment authorities would compete more easily for federal grants to fund those projects, under a new bill from Rep. Eric Swalwell.

Swalwell news conference 11-26-2013 (photo by Josh Richman)Swalwell, D-Pleasanton, held a news conference Tuesday morning at a huge empty lot along Post Street in Fremont’s Centerville area. A sprawling mixed-use “Artist Walk” development had been planned for the site, but tanked after state lawmakers and the governor did away with local redevelopment authorities in 2011 and seized their assets to help balance the state’s budget.

“There’s a reason we only see buildings in artists’ renderings and not in reality,” Swalwell said. “Localities can no longer raise adequate funds for redevelopment…. And it is my hope today that the federal government can fix it.”

Swalwell’s H.R. 3518, the “Restarting Local Economies Act of 2013,” doesn’t allocate any new federal funding. Rather, it changes rules for the Economic Development Administration’s Economic Adjustment Assistance program, which provides competitive grants for local redevelopment projects if they meet specific criteria related to challenges to their economy.

Swalwell’s bill would include the closure of a government entity – such as a redevelopment agency – as a specific example of an economic challenge to a region, letting California localities more easily compete for these grants.

“I hope we can do our part to make things a little bit easier,” he said, noting projects like the Artist Walk development would create jobs not only in construction but also in the businesses that could locate there.

But for now, it’s “welcome to Centerville, welcome to an empty lot,” quipped Fremont Mayor Bill Harrison. “We need to get people to work, we need affordable housing.”

Harrison said Fremont in the past used redevelopment authority funding to do grade improvement projects that cleared the way for BART’s extension into Santa Clara County, and to improve the Niles Town Plaza around that district’s historic train station.

Union City Mayor Carol Dutra-Vernaci said an easier path to federal grants could help her city complete its intermodal station district project in the area around its BART station.

Because this bill would have special meaning for California, it’s unclear how it’ll play with the rest of the Republican-controlled House. Swalwell said he hasn’t yet begun lining up co-sponsors even amid California’s delegation.

“I’ve got my work cut out for me,” he said. “But whether you’re a Republican or a Democrat in California, you represent cities that suffered with the loss of their redevelopment authorities. This is going to be my year-end push, to reach out to colleagues on this issue.”

4

CA redevelopment agencies take plea to governor

The California Redevelopment Association and League of California Cities have sent Gov. Jerry Brown an eight-page letter outlining all the ways the pending Wednesday dissolution of redevelopment agencies is a bad idea.

Read the full letter here.

Among the critical issues they spell out:

  • Possible bond defaults
  • Loss of taxpayer funds
  • Possible violations of federal law
  • Stranded public infrastructure projects
  • Loss of critical staff to implement the law

“Both organizations want to collaborate with the governor and Legislature in order to prevent harm to the public interest and to keep California on track in its economic recovery,” the league wrote on  CA Cities Advocate.

They had hoped to win passage of  a pending bill (SB 659 Padilla) that would postpone the deadline to April 15, but Brown has been quoting saying he saw no reason to “delay the funeral.” The California Supreme Court struck down in December legislation that would have allowed redevelopment agencies to stay in business in exchange for cash payments toward the state deficit.

0

Redevelopment, redistricting on TWINC tonight

Watch KQED “This Week in Northern California”  tonight when I and my colleague Josh Richman and KCBS reporter Barbara Taylor talk about redevelopment, redistricting and the woes of SF Sheriff Ross Mirkarimi.

The show airs live at 7:30 p.m. on Channel 9 in most of Contra Costa County.

News Panel: The latest on the Citizens Redistricting Commission, Oakland layoffs, and Ross Mirkarimi

The California Supreme Court considers which Senate maps to use in the fight over the new lines drawn by the Citizens Redistricting Commission. The City of Oakland will send layoff notices to hundreds of city workers to make up for the loss of redevelopment funds. There are calls for the resignation of newly-sworn in San Francisco Sheriff Ross Mirkarimi, who may face domestic violence charges.

UPDATE @ 11:10 A.M. SATURDAY: And here we are…

0

Redevelopment advocates fight back

Organizations that represent California’s cities and redevelopment agencies have filed a lawsuit challenging recently passed legislation that all but eliminates  redevelopment as a separate entity.

The League of California Cities, California Redevelopment Association and the cities of San Jose and Union City filed will challenge in the bill as unconstitutional in the state Supreme Court, citing voter-approved Proposition 22 which barred state raids on local funds.

Read on for their joint release sent out a few minutes ago.

SAN FRANCISCO — Today, the League of California Cities (League), the California Redevelopment Association (CRA) and the cities of San Jose and Union City filed a petition with the California Supreme Court, challenging the constitutionality of AB 1X 26 and AB 1X 27, the two redevelopment bills passed as part of the state budget in June. AB 1X 26 eliminates redevelopment agencies. AB 1X 27 allows agencies to continue to exist (albeit on life-support) if they agree to pay their share of $1.7 billion this year and $400 million annually in perpetuity.

The lawsuit also requested the California Supreme Court to issue a stay to prevent the legislation from going into effect until the Court can rule on the merits of these claims.

The central claim in the lawsuit is that AB 1X 26/27 violate Proposition 22, the constitutional amendment passed by 61% of California voters in November 2010, just eight months ago. Proposition 22 was passed by voters to “conclusively and completely prohibit State politicians in Sacramento from seizing, diverting, shifting, borrowing, transferring, suspending, or otherwise taking or interfering with” revenue dedicated to local government. The revenues protected by Proposition 22 specifically include the annual increments of property taxes allocated to California’s 400 redevelopment agencies.

Continue Reading

0

LAO, local officials face off on redevelopment plan

Oakland Mayor Jean Quan, Union City Mayor Mark Green, Livermore Mayor Marshall Kamena, Emeryville Mayor Nora Davis, Concord Vice Mayor Ron Leone and other Bay Area elected officials will gather with business, affordable housing and labor leaders tomorrow in Oakland in opposition to Gov. Jerry Brown’s proposal to eliminate California’s local redevelopment agencies and use their money to help close the state’s gaping budget deficit.

Brown proposes to end the redevelopment agencies, while giving local governments more power to promote economic development themselves by amending the state constitution so that local voters can approve tax increases and general obligation bonds by a 55 percent majority rather than the two-thirds required now.

Those planning tomorrow’s press event insist this is the kind of state raids of local funds that voters oppose, and will bring little benefit to the state while destroying hundreds of thousands of jobs – including an estimated 29,000 in the East Bay – and billions in local economic activity.

But as these local officials – acting as part of a coalition of local governments and business groups – take their complaints to the street, the nonpartisan Legislative Analyst’s Office released a report today saying Brown’s plan is the way to go, shifting responsibility for local economic development to local governments with a level of transparency that’s been lacking with the redevelopment agencies:

Given the significant policy shortcomings of California’s redevelopment program, we agree with the Governor’s proposal to end it and to offer local governments alternative tools to finance economic development. Under this approach, cities and counties would have incentives to consider the full range of costs and benefits of economic development proposals.

In contrast with the administration’s proposal, however, we think revenues freed up from the dissolution of redevelopment should be treated as what they are: property taxes. Doing so avoids further complicating the state’s K–14 financing system or providing disproportionate benefits to K–14 districts in those counties where redevelopment was used extensively. Treating the revenues as property taxes also phases out the state’s ongoing costs for this program and provides an ongoing budget solution for the state.

Ordinarily, we would recommend that the state phase out this program over several years or longer to minimize the disruption an abrupt ending likely would engender. Given the state’s extraordinary fiscal difficulties, however, the Legislature will need to weigh the effect of this disruption in comparison with other major and urgent changes that the state would need to make if this budget solution were not adopted.

8

John Chiang to audit redevelopment agencies

As debate rages over Gov. Jerry Brown’s proposal to raid local redevelopment agencies’ coffers to help close the state budget deficit, state Controller John Chiang today announced his auditors will review 18 redevelopment agencies – including five in the Bay Area – to see how they spend their money.

“The heated debate over whether RDAs are the engines of local economic and job growth or are simply scams providing windfalls to political cronies at the expense of public services has largely been based on anecdotal evidence,” Chiang said in a news release. “As lawmakers deliberate the Governor’s proposal to close RDAs and divert those funds to local schools and public safety agencies, I believe it is important to provide factual, empirical information about how these agencies perform and what they bring to the communities they serve.”

Chiang’s office said the 18 RDAs selected for the reviews – to be done by early March – represent urban, suburban and rural communities, are spread around the state represent a mix of populations. Auditors will review, among other things, how the RDAs define a “blighted” area, whether they are appropriately paying for low- and moderate-income housing as required by law, whether they are accurately “passing through” payments to schools within their community, and how much RDA officials, board members and employees are being paid.

On the audit list are:
Redevelopment Agency of the City of Fremont (Alameda County)
Richmond Redevelopment Agency (Contra Costa County)
Hercules Redevelopment Agency (Contra Costa County)
Redevelopment Agency of the City of Pittsburg (Contra Costa County)
Redevelopment Agency of the City of San Jose (Santa Clara County)
Redevelopment Agency for the County of Riverside
Community Redevelopment Agency of the City of Los Angeles (Los Angeles County)
Redevelopment Agency of the County of Sacramento
Pasadena Community Development Commission (Los Angeles County)
Redevelopment Agency of the City of Fresno (Fresno County)
City of Palm Desert Redevelopment Agency (Riverside County)
Placentia Redevelopment Agency (Orange County)
Parlier Redevelopment Agency (Fresno County)
Anderson Redevelopment Agency (Shasta County)
Community Redevelopment Agency of the City of Citrus Heights (Sacramento County)
Community Redevelopment Agency of the City of Calexico (Imperial County)
Community Development Agency of the City of Coronado (San Diego County)
City of Desert Hot Springs Redevelopment Agency (Riverside County)

UPDATE @ 5 P.M.: As our West County Times’ Tom Lochner reports:

The Hercules, Pittsburg and Richmond redevelopment agencies are among seven in California that, as of December, had not paid their obligations to the Supplemental Educational Revenue Augmentation Fund, part of a statewide $1.7 billion shift of redevelopment agency property taxes to schools in the 2009-10 fiscal year. Hercules owed $4.9 million, Pittsburg owed $17.4 million and Richmond owed $10.1 million. Two of the other seven non-payers — Parlier in Fresno County and Placentia in Orange County — also are among the 18 agencies targeted by the statewide review.

Gee, I wonder if that had anything to do with their selection for the audit?