Redevelopment in California Created after World War II to eliminate blight in the State Constitution amended in 1952 to allow the collection of property tax increment Became especially important to cities after Prop 13 to fund public improvements as well as undertake economic development
Redevelopment in California Now more than 400 agencies in California State began to shift tax increment to schools in the 1990’s through ERAF Eminent domain became controversial after Kelo decision at Supreme Court State took a total of $2.05 billion from Agencies in 2009-10 and 2010-11
Community Redevelopment Agency Palm Springs CRA created in 1973 with CBD Project Area City added nine more new areas between 1983 and 1991 The 10 areas were merged into two areas in 2000: one largely Indian land and one mostly non-Indian land Agencies also must set aside 20% of increment for Low/Mod Housing
Community Facilities Funded withRedevelopment College of the Desert Campus (Land) New Animal Shelter Construction Plaza Theater Frances Stevens Park/Palm Canyon Theatre Renovation Jackie Lee Houston Plaza Part of Convention Center Debt Service Visitor Center Improvements
Hotel and Hospitality Projects Desert Shadows Inn Parcel Acquisition and Street Improvements Casino Disposition & Development Agreement Wyndham Land Assembly/Renaissance Renovation Palm Mountain Resort Mondrian Project Hard Rock Project
Street Projects South Palm Canyon Street Widening Radio Road Street Improvements Uptown Street Lighting Program East Tahquitz Lighting Program KFC Public Improvements Mesquite Avenue Median and Road Improvements
Downtown Infrastructure Indian Canyon Drive Two-Way Traffic Improvements Palm Canyon Drive and Indian Canyon Drive Public Improvements Downtown Trash Enclosure and Alleyway Enhancements Desert Fashion Plaza Street Improvements
Downtown Parking Lots Catholic Church parking lot Blue Coyote Lot Vineyard parking lot Terrace Eateries Lot Las Casuelas Lot Henry Frank Arcade Lot Prairie Schooner Plaza Mercado DDA/Parking Lot
Low/Mod/Other Housing Vista Sunrise Apartments/Riverside County Family Care Center Coyote Run Apartments (I & II) Cottonwood/Chuckwalla Single Family Homes Desert Highland Single Family Homebuyer Assistance and Infill Homes Burnett DDA – K. Hovnanian Four Seasons
Low/Mod Housing Vista Serena/Vista Del Monte Senior Housing Sunrise Village Mobile Home Park El Dorado Mobile Home Park Sahara Mobile Home Park Neighborhood Revitalization Program Tahquitz Court Apartments La Ventana Apartments
Supreme Court Ruling EliminatesRedevelopmentWhat does this mean and what are the next steps? Upheld Assembly Bill 1X 26 (dissolution of redevelopment agencies), but overturned AB 1X 27 which allowed agencies to continue with voluntary payments to the State. All agencies are dissolved as of February 1, 2012. California Redevelopment Association is currently working with state legislators to introduce legislation to fix issues and save redevelopment. We assume worst case.
Successor Agency The city or county that originally created the former redevelopment agency automatically becomes Successor Agency A Successor Agency is: Vested with any remaining authority, rights, powers, duties and obligations formerly vested to the redevelopment agency; and Responsible for winding down the affairs of the former redevelopment agency (in conjunction with the Oversight Board)
What Does Successor Agency Do? Successor Agency power over financial and planning issues in the community, including: Making payments and performing obligations (per enforceable obligations) Taking control of all redevelopment agency assets, properties, contracts, leases, books and records, buildings and equipment Disposing of assets and properties of the former redevelopment agency Transferring housing functions Overseeing development of projects currently underway
What is a Successor HousingAgency? ABx1 26 provides City that originally created the former redevelopment agency may elect to retain affordable housing assets and functions; or The succeeding housing entity must assume all rights, powers, duties and obligations of the former redevelopment agencys affordable housing functions. The succeeding housing entity receives all former redevelopment agency housing assets, which may include the repayment of loans or other obligations (includes loans made for prior SERAF payments), but excluding cash deposits. These funds may be available for new affordable housing projects.
What Next? SB 654. Bill tries to correct a number of issues related to Housing, including allowing Successor Housing Agency to retain the fund balances in the Low-Mod Housing Fund to allow projects to continue. Trying to get it adopted before dissolution date of February 1, 2012.
Governor’s 2012-2013 Budget "In accordance with the Courts order, RDAs will be dissolved on February 1, 2012. Revenues that would have been directed to the RDAs will be distributed to make "pass through" payments to local agencies that they would have received under prior law, and to successor agencies for retirement of the RDAs debts and for limited administrative costs. The remaining revenues will be distributed as property taxes to cities, counties, school and community college districts, and special districts under existing law. The Budget reflects an estimate that approximately $1.05 billion in additional property tax revenue will be received by K-14 schools in 2011-12, which will offset the states Proposition 98 General Fund obligation. Additional property tax revenues are estimated at $340 million for counties, $220 million for cities, and $170 million for special districts. These amounts are expected to grow as property values increase and debts are retired. Additional revenues will also be distributed in the next several years as RDA assets are monetized."