Santa Monica Lookout
|Santa Monica Assembly Member’s Redevelopment Bill Moves Forward||
When one lives in a city as breathtakingly beautiful and unique as Santa Monica, inevitably that city will be shared with visitors.
By Daniel Larios
May 2, 2014 -- A Bill introduced to the California Assembly by Santa Monica Assembly member Richard Bloom that would free up redevelopment funds passed the Assembly Committee on Housing and Community Development on Wednesday.
Assembly Bill (AB) 2493 would allocate approximately $750 million in redevelopment proceeds statewide that were cut by Governor Brown when redevelopment agencies were dissolved in 2011. The money would go to the redevelopment successor agencies to complete redevelopment projects that were in the pipeline.
“When the Legislature and Governor stripped redevelopment agencies away from cities in 2011, we lost a major tool in fighting blight and reinvigorating our local economies,” said Bloom.
“Worst of all, many cities like West Hollywood and Santa Monica were in the middle of major projects when the state withheld their funds. This bill will allow us to get back on track with important economic development projects overwhelmingly supported by these communities.”
The Committee, chaired by Assembly member Ed Chau (D-Monterey Park), passed the bill unanimously on a 7 to 0 vote. The bill will head to the Assembly Committee on Appropriations before being voted on by the Assembly as a whole.
On June 28, 2011, Governor Jerry Brown signed AB 26 and AB 27, the two bills that dissolved the almost 400 redevelopment agencies across the state as a solution to a severe budget shortfall. Approximately $1.7 billion were redirected from various community development and affordable housing projects.
In response, Santa Monica joined the League of California Cities in a lawsuit to overturn the laws. However, the California Supreme Court upheld the Governor’s decision in a December 29, 2011 ruling. The ruling, written by Justice Kathryn Mickle Werdegar, found the Legislature had the power to create redevelopment agencies and the power to end them.
After February 1, 2012, 400 RDAs around the state shut down in compliance with the Court’s decision and transferred their assets to successor agencies. In the case of Santa Monica, the City took over for the dissolved RDA.
“Unfortunately, many local redevelopment agencies had already legally issued bonds for local projects and must now make debt payments even though they cannot reap the economic benefits of the now stalled project,” said Sean MacNeil, Bloom’s Chief of Staff.
“Statewide, approximately $750 million in 2011 redevelopment bond proceeds are sitting idle and cannot be used,” MacNeil said. “If current law prevails, cities will make debt payments for a decade, costing them nearly $1 billion while not completing a single redevelopment project. These non-productive debt payments will further depress local economic activity throughout the state.”
According to SmartCitiesPrevail, a nonprofit that provides research to cities, releasing the funds for the intended projects would generate approximately 19,000 high wage construction and related jobs.
Funding the redevelopment projects would also generate more than $2.8 billion in statewide economic activity and provide $130 million in new state and local tax revenues.
“While improving, our economy is still struggling to get back on its feet,” Bloom said. “This bill offers a common sense solution that will foster job creation, economic development, affordable housing construction, and the completion of needed infrastructure projects.
“The bonds are there waiting. We just need to allow local governments to use them.”
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