10:00 PM PST on Tuesday, January 18, 2011
By DUANE W. GANG
Riverside County joined a growing list of agencies Tuesday that are scrambling to counteract Gov. Jerry Brown’s proposal to eliminate redevelopment in California.
During a special meeting, the Board of Supervisors unanimously authorized up to $155 million in bonds to fund a host of projects throughout the county’s unincorporated areas. Redevelopment was the meeting’s sole topic.
“We’re taking this action in order to protect our position and continue to enhance the communities in which we work,” county redevelopment director Rob Field told supervisors.
The governor last week unveiled a 2011-2012 budget proposal that would phase out city and county redevelopment agencies, which use property tax revenue to fund libraries, community centers, sidewalks, roads and, in some cases, aid private development.
Riverside County’s recent projects include the $14 million Rubidoux Library and the $26 million Northwest Riverside County Animal Shelter.
Redevelopment agencies receive funding from what is known as tax-increment revenue. The money comes from property tax increases that result from improvements and new development within a redevelopment zone. Most of the revenue pays off bonds issued to raise money for projects within the zone.
Statewide, 12 cents of every property tax dollar goes toward redevelopment. In the Inland region, the rate is the highest in California: 31 percent in San Bernardino County, 75 percent in the city of Fontana and 26 percent in Riverside County.
The governor’s proposal would not affect redevelopment funding already tied to projects or being used to pay off existing bonds.
Riverside County originally planned to seek approval for the bonds in March but took action Tuesday after the governor announced his budget proposal, Field said.
“Is this a run on the bank? The answer is yes. Is this grabbing the golden egg from redevelopment? The answer is yes,” Supervisor Jeff Stone said in response to a question from a resident at Tuesday’s meeting.
“I am sick and tired of the counties and cities being the punching bag of the state,” Stone said.
Other agencies across California and the Inland area have or are considering similar moves to accelerate redevelopment projects. They include Palm Springs, Los Angeles, Long Beach, Santa Monica, West Hollywood, Citrus Heights and Napa.
John Shirey, executive director of the California Redevelopment Association, said Tuesday the group has advised agencies to take action. He wasn’t surprised that Riverside County already had done so.
“When the state threatens local government with drastic action, no one should be surprised that local officials are going to do whatever they can to protect local funds and local programs,” he said.
In Riverside, City Manager Brad Hudson said late last week that the city has the capacity to issue more than $75 million in additional redevelopment debt. He said the city would consider that option if it looks as if the Legislature will approve the governor’s proposal.
Temecula Councilman Mike Naggar, the city’s redevelopment agency chairman, said Tuesday officials are evaluating whether to issue new bonds in response to the governor’s plan.
“Certainly, it has caused us to accelerate what we have been working on,” he said.
Brown’s office had a subdued response to the redevelopment borrowing.
“We hope that the redevelopment agencies rushing through billions in taxpayer dollars are going to use these funds to create jobs now,” governor’s spokeswoman Elizabeth Ashford said. “These scarce dollars, which could be used to protect police, firefighters and teachers, should not be banked away for special projects.”
Lawmakers representing Riverside County did not offer a hearty endorsement of the supervisors’ vote Tuesday.
Assemblyman Kevin Jeffries said he understands why the county and other agencies have rushed redevelopment borrowing.
But Jeffries, R-Lake Elsinore, said he worries that some agencies, in their haste to commit money, will end up making errors.
Riverside County supervisors touted the success of redevelopment Tuesday and challenged the governor to view completed projects. They stressed that redevelopment does not increase property taxes for residents.
With about $100 million in annual revenue, Riverside County’s redevelopment agency is the state’s seventh largest by revenue.
After allocating funding to other agencies, such as schools and special districts, the agency has about $77 million to fund various public improvements. Currently, about $58 million a year is repaying existing bonds.
Not including the $155 million supervisors authorized Tuesday, the county has issued about $766 million in bonds to fund improvements.
“These are not pork-type of projects,” Stone said. “These are projects our communities need that otherwise would not be funded.”
He the cited the planned $4 million Quail Community Center in his district that could be paid for with the new round of bond funding.
Supervisor John Benoit said he was glad to see the governor taking some bold steps in his budget proposal.
To read entire story, click here.