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Redding Mayor Missy McArthur joined a group of some 100 city leaders and industry lobbyists who traveled to Sacramento on Thursday to oppose California Gov. Jerry Brown’s proposal to discontinue redevelopment agencies statewide.
McArthur attended a hearing of the state Senate Budget and Fiscal Review Subcommittee, which is currently evaluating the proposed elimination of redevelopment agencies (RDAs).
“With Shasta County’s unemployment rate for December at 16 percent, the abolishment of redevelopment and the unique tools it provides would be disastrous,” McArthur said in an e-mail to A News Café.com. “In addition, Redding’s ability to continue providing much-needed affordable housing would be significantly crippled. Now is not the time to worsen an already dire economic situation.”
The governor, who unveiled his plan in early January, wants to take $1.7 billion from redevelopment funds to help tighten the state’s $25 billion budget deficit, as well as channel more money back to local city and county general funds to provide for basic services such as schools and police.
Proponents of Brown’s plan believe that redevelopment agencies (RDAs) are expendable and that the property tax revenue they currently generate would be better off funneled into the general funds of cities. They criticize RDAs as being corporate welfare providers that wreak havoc on property rights in California.
“Redevelopment allows agencies to declare virtually anything blighted, thus giving them the power to assemble lots and hand them over to developers, who promise cities a tax windfall,” wrote Steven Greenhut, editor of www.calwatchdog.com, in an op-ed piece in the San Francisco Examiner. “Just because certain nice areas received redevelopment money doesn’t mean that redevelopment agencies saved those neighborhoods.”
In building his case, Gov. Brown, pointed to a study by the Legislative Analyst’s Office, which said no concrete evidence exists to prove that redevelopment is indispensable to fixing up rundown cities and communities. The study also said that there’s little evidence that redevelopment projects actually attract business to the state.
In Redding, redevelopment funds helped build the mall in downtown Redding in the early 1970s. Recently, $3.5 million in redevelopment funds were used to demolish that very same mall (now the Market Street Promenade). Critics have also vocalized their concerns over $10 million worth of redevelopment funds spent on the Stillwater Business Park, which recently landed an agreement with its first tenant, but currently remains an empty expanse of land.
Local redevelopment supporters, however, point to a number of successful projects they believe have improved the city and stimulated the economy. Redevelopment funds have been used for the Parkview neighborhood revitalization ($4.6 million), Churn Creek Road realignment ($7 million), Big League Dreams sports park ($2 million), the new Redding Library and a host of affordable housing and street/landscape projects that total well into the millions. Some $640,000 in redevelopment funds were used in the restoration of the Cascade Theatre.
Gov. Brown is also proposing the end of Enterprise Zones, which provide tax incentives to stimulate employment in depressed areas.
“There are few tools that city governments possess to spur economic development,” said Greg Clark, Assistant to City Manager Kurt Starman. “If you take those tools away, in long term, you could be really hurting yourself. Certainly in Redding, (redevelopment has) been a very valuable tool.”
In Redding, the redevelopment agency annually collects about $18 million in property tax revenue, which is spent on property acquisition, construction subsidies, affordable housing projects, debt payments and some funding for schools and special districts.
Clark mentioned the recent passage of Proposition 22, which was designed to prevent the state from raiding local tax revenue sources. The measure passed 61 percent to 38 percent.
“We’ve already asked voters if local funds should be immune from the state and it passed overwhelmingly,” Clark said. “The voters have said these are local funding sources that should remain in the hands of local governments.”
McArthur said Brown’s plan attempts to “run around” Prop 22.
“I would urge your readers to write letters to Governor Brown, Senator LaMalfa and Assemblyman Nielsen asking them to avoid this attempt to cure the state’s structural budget problems on the backs of cities such as ours,” McArthur said. “We need the redevelopment funds to help employ people and foster economic recovery.”
State Senator Doug LaMalfa, who represents the north state, is one of the three members on the Senate Budget and Fiscal Review subcommittee. He also sits on the Committee of Governance & Finance and the Joint Legislative Audit Committee, both of which are expected to play key roles in the ongoing state budget negotiations.
McArthur planned to meet with LaMalfa on Thursday to express the city’s concerns about the proposed end of redevelopment.
Redevelopment funds are in play with a pair of current Redding projects — Redding Kia’s plan to build a new Subaru dealership on Cypress Avenue, and Pine Street Lofts, a three-story mixed-use building that would provide subsidized rents for the lower-income tenants.
According to a city press release, the Redding Redevelopment Agency has been responsible for construction of more than 700 multi-family and 34 single-family units in the past 10 years, with 82 more in negotiation or under contract. Another 362 units were touched through the agency’s first-time homebuyers’ loans, rehabilitation assistance and other programs.
Many redevelopment agencies are making immediate moves to spend money just to keep it out of state hands, reports California syndicated political writer Tom Elias.
In Long Beach, City Council members voted to commit $1.2 billion in current and future RDA funds to local projects, some of which have not even been specified. The Los Angeles Community RDA has similar plans to invest $930 million for use over the next five years, Elias reports. RDAs from across the state are making similar moves.
While acknowledging that there have likely been abuses in the redevelopment system across the state, it’s also not a system that operates in secret, Clark said.
“Whether it’s being abused or not, it’s not done in secret,” he said. “There are strong opinions on all sides. Redevelopment has been around for quite some time (since the 1950s). It’s been a cure for blighted areas and a jumpstart for new development.
“Right now I think everyone is cautiously looking at (Brown’s plan),” Clark said. “Even school districts that might stand to gain are taking a wait-and-see approach.”
Jim Dyar is a news, arts and entertainment journalist for A News Cafe and the former arts and entertainment editor for the Record Searchlight’s D.A.T.E. section. Jim is also a songwriter and leader of the Jim Dyar Band. He lives in Redding. E-mail him at firstname.lastname@example.org.
A News Cafe, founded in Shasta County by Redding, CA journalist Doni Greenberg, is the place for people craving local Northern California news, commentary, food, arts and entertainment. Views and opinions expressed here are not necessarily those of anewscafe.com.