Redevelopment: To Be or Not To Be

By: T. Keith Gurnee

Barack Obama’s compromise with Republicans not to raise taxes last December may have saved not only his presidency but our national economy as well. Most economists have credited this move as giving us our best chance to get our economy back on track. But not so with Jerry Brown and California. With his budget that would raise taxes, dump State programs onto the backs of local government, and eliminate redevelopment, Brown seems determined to plunge California into the dark ages.

As a San Luis Obispo City Councilman in the 1970s, I met Brown when he first became Governor in 1974. I was impressed back then with his wit and candor, but not so much by his arrogance. While Brown reincarnated has lost none of that, he has inherited the mess created by his predecessors and a dysfunctional State Legislature. Now he — and we — are reaping the whirlwind. Facing an unprecedented $26.6 billion deficit, we expected Brown to deliver a draconian budget and he did not disappoint. But of the many facets of his budget that deserve vigorous scrutiny, his proposed elimination of redevelopment may be the most troubling.

After extensively using redevelopment, while Mayor of Oakland, to rejuvenate its Fox Theatre, its downtown, and its waterfront, Brown wants to preclude all local governments from ever using that tool again. With 40% of the members of the State Legislature coming from local government, redevelopment should have some strong defenders in Sacramento. Unfortunately, not so. It is amazing how quickly so many of our State legislators forget where they came from when they get to Sacramento. But we can’t let them forget how important redevelopment is to our local and State economy and to improving the livability of our communities. Consider the impacts that eliminating redevelopment will have on our communities:

  1. It’s a job killer. At a time when California’s unemployment rate exceeds 12%, we desperately need more jobs. The last thing we need is to get rid of the jobs we have. The California Redevelopment Association reveals that over 304,000 jobs provided by the redevelopment industry on annual basis would be lost if Jerry Brown gets his way.
  2. It will jeopardize affordable housing. Redevelopment funding is the second-largest producer of affordable housing in California next to the federal government. Leaders of such local affordable housing nonprofits as People’s Self-Help Housing and Habitat for Humanity say that the loss of redevelopment will halt a significant number of pending affordable housing projects in the San Luis Obispo/Santa Barbara county region.[a1]
  3. It’s unconstitutional. The 425 redevelopment agencies that currently exist in California are protected under our state constitution. Why the State would consider going against its constitution to eliminate an activity that produces $40 billion annually for just a one time savings of $1.7 billion is beyond comprehension.
  4. It repudiates the voters’ will. Proposition 22, which was placed on the ballot to protect redevelopment funding, was passed overwhelmingly by 61% to 39% just three months ago. With Jerry Brown trying to place his tax increase on the June 2011 ballot, he is ignoring what the voters just said in November 2010.
  5. It will stifle investment in our local communities. When Brown ran for Governor, he pledged to “move government down to the local level where it is closest to the people.” Little did local governments know that he really meant to take away the single most powerful economic development tool available to local government. As a result, our infrastructure, our downtowns, and the livability of our communities will suffer.
  6. 6.       It will stymie the implementation of SB 375. After passing this landmark legislation to deal with global warming and providing no local funding to implement it, the State Legislature should be doing everything to save redevelopment as the strongest local government tool to foster city-centered growth and mixed-use urban infill development.
  7. 7.       It won’t solve the budget problem. For the Governor and his partisans, to eliminate a program that annually generates billions of dollars of economic activity for a one time savings of at most $1.7 billion is just doesn’t make sense.

As a 70 person design firm that specializes in revitalizing California’s communities, about 30% of our projects have involved some form of redevelopment funding. Whether it is a streetscape in downtown Hermosa Beach, a Town Square in the Niles District of Fremont, a fire station in Farmersville, a restored creek in downtown Santa Rosa, or affordable housing in Oceanside, we have had a front row seat to witness how redevelopment has helped shape the communities we have served.

Yet, saving redevelopment has a steep hill to climb. The state’s public employee unions, the most powerful force in Sacramento, are bringing all of their resources to bear on the people they helped elect — most notably Governor Jerry Brown and the Democratic majority in the State Legislature. As of this writing, the Legislature is poised to vote on a budget that may eliminate redevelopment. With his self imposed 60-day timeframe already behind us, Brown needs only a couple of Republican votes to join the Democrats in passing that budget and placing his tax extensions on the ballot as early as this June.

In conclusion, losing redevelopment would have a devastating effect on the economies and livability of our communities. In the face of this State created crises, local governments — at least the smart ones — have rightly moved to protect and obligate their redevelopment funding. In reaction, the State is trying to enact retroactive legislation to undo what the cities have done since Brown came into office. But armed with the recent passage of Proposition 22, the League of California Cities and the California Redevelopment Association are preparing to litigate the issue based on its unconstitutionality. Stay tuned…


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