Last month the redevelopment argument convulsed again when the California Supreme Court accepted California Redevelopment Assn. v. Matosantos, a petition challenging the legality of AB 1 x 26 and AB 1 x 27, two budget provisions that require California’s 400 redevelopment agencies to make ransom payments to fund budget obligations, or be shut down entirely.
The lawsuit has prevented the laws from going into effect until the court can determine if they violate Prop. 22, an amendment approved by voters last November that prevents the state from seizing money from local governments, including the tax increments generated for redevelopment agencies.
While we wait for lawyers to make their arguments in court and our honorable judges to issue a decision early next year, controversy over redevelopment agencies continues to breed uncertainty and interrupt much needed business and job development.
Dispute over California’s redevelopment agencies has boiled for too long and the probability that these legal proceedings will be drawn out over years is too high. For everyone involved, the best plan of action is to pull the current legislation and negotiate a deal that both sides can live with.
By compromising, we will save time and taxpayer money, and help sustain some redevelopment efforts that are vital to creating jobs, improving the economy, rejuvenating blighted communities and funding public improvement projects.
For more than nine months, redevelopment efforts across the state have deteriorated and most agencies have not been able to conduct any business.
Doubt over the survival of the redevelopment program is obstructing existing projects and business investment from moving forward. Not only have redevelopment agencies postponed improvement projects that make business development possible in order to gather funds for their ransom payments, but businesses, developers and investment groups have pulled back on all projects in redevelopment areas because of financial uncertainty. Many of these projects will not pencil out if redevelopment agencies have to close their doors or lack the proper funds to facilitate them. As a result these projects, which would generate the economic activity and jobs California desperately needs, are in limbo and may never recover.
Business investment in redevelopment areas will soon be a fraction of what it is today if this continues. Businesses are simply not willing to clean up brown fields, make large infrastructure improvements, or deal with the social ills of blighted areas alone, especially when they can simply go elsewhere – most likely to another state. Cities across California need redevelopment agencies to influence businesses to take chances.
It seems that our state legislators would rather push anti-business policies and regulations that would keep our economy stagnant, blight in our communities prevalent and our residents jobless.
Legislators pledge that redevelopment funds would be redirected to schools and special districts, but they will simply go into the general fund and support our Legislature’s need to spend, instead of being used to stimulate economic activity.
California residents want their property taxes to be used to better their surrounding communities. In San Bernardino we have successfully used redevelopment resources to bring about new construction, business and job attraction, crime reduction, private investment and improvement of roads, utilities and public facilities. Our achievements are proof that redevelopment agencies are the best vehicle to deliver the projects taxpayers want and need.
Instead of dragging these issues out in court, legislators and redevelopment advocates should compromise to find a resolution that will help the state address its budget issues, and keep redevelopment agencies working in our communities. While we work against each other, taxpayers are losing out. By working together we can produce better outcome.