In February of this year the State legislature at the urging of Governor Brown eliminated Community Redevelopment Agencies (CRA) operated by cities and counties in California.
About 400 agencies were shut down, resulting in thousands of people being unemployed.
Many people have always criticized redevelopment agencies for giving developers money for projects. Some people called it a form of “corporate welfare.” The definition of “blighted areas” was loosely defined and resulted in some poor decisions.
At a meeting last week Rosemead City Manager Jeff Allred gave a description of how the elimination of redevelopment agencies had affected his city. First of all he explained that cities formed redevelopment agencies after World War II. Once an agency was formed and blighted areas defined, the cities would then gain the increment, or increased property taxes for redevelopment projects. The original property tax revenues still went to other agencies, such as school districts and counties. This “pass through” revenue was negotiated with government agencies when the redevelopment area was selected.
The property tax increment that went to the new city redevelopment agency went towards improvements and to finance bonds for projects.
Rosemead is a relatively small city in L.A. County, and also pretty young, since it was incorporated in 1959. They don’t have too many redevelopment projects.
However, the redevelopment funds have come in handy for public improvements.
Allred passed out a sheet with a huge list of public projects that were completed in the city with redevelopment projects.
Can you imagine Rosemead being without Garvey Community Center, the Garvey and Angelus Senior Housing Centers with rent subsidies, landscaped street medians and lots of traffic signals and lighting improvements?
The city also rebuilt Fire Station No. 4 on San Gabriel Blvd. The Rosemead aquatics Center and the Rosemead Park walking trail was constructed with redevelopment funds. The Rosemead high school track was beautifully redone with CRA funds.
The city also used CRA funds to buy the filthy crime-ridden Glendon Hotel and sold it to a private hotel operator for renovation and expansion. Throughout the years, they have also used funds to rehabilitate and improve the housing stock of the community.
It is a similar story in Monterey Park where CRA funds were used over the years to build and new city hall, Langley Senior Center and helped save the historic El Encanto building.
So when the state legislature acted to “clean-up” redevelopment agencies they literally “threw out the baby with the bathwater” or in my translation, they eliminated the good that was achieved by redevelopment agencies, to get rid of the bad part.
Cities and state agencies are still trying to figure out the future of leftovers from the elimination of the redevelopment agencies. There are properties that were owned by the CRAs, bonds, project commitments, contracts and on going expenses. It is a lot more than just eliminating the name from the city telephone books and laying off thousands of people across the state.
You will now be hearing about a new bureaucracy rising out of the ashes. For example there will be “Successor Agencies,” and “Oversight Boards.” Monterey Park will have an Oversight Board made up of some of the larger local agencies. Rosemead, which has had a limited staff and projects, is letting the county handle it.