Redevelopment times two appears to be returning to California, less than a year after the program was dissolved by the Legislature at the direction of Governor Brown. After redevelopment agencies (RDAs) were disbanded, members of both parties, the education establishment, and property rights advocates applauded the action. But less than a year later, there are actually two bills that use government structures, debt and eminent domain to tempt local government to invest dollars they don't have for projects that people don't want.

Monday, AB 2144, authored by Assembly Speaker John Perez, passed 53-27 off the floor. The bill makes it easier for local governments to create Infrastructure Finance Districts (IFD), essentially redevelopment agencies by a different name.  Tuesday, SB 1156 actually reconstituted RDAs for certain central planning uses without the benefit of retaining the property tax increment at the local level. Both bills allow locals to tax and indebt themselves easier.

"In 2011 under the guise of cutting spending to balance the budget, Governor Jerry Brown and state Democrats pulled the plug on California's 425 redevelopment agencies.  The law was upheld by the State Supreme Court, and the Governor and other elected officials took a victory lap. In January 2011 I warned that in reality, the Governor's redevelopment proposal might simply take $1.7 billion in local RDA funds claiming to backfill education, while merely robbing local governments that had planned ahead and had reserves," Harkey said.

Specifically the two bills:

·  Create the potential for the seizure of private property through eminent domain. 

·  Allow for local taxation, with AB 2144 allowing for the creation of debt with a 55% voter threshold, as opposed to 2/3.

·  Expands debt limitation from 30 years to 40 years.

·  Significantly expand the use for which public funds may be spent, including "Sustainable Communities" strategies, high speed rail accomodations, open space, environmental mitigation, and the purchase of land and property for development purposes.

·  Require prevailing wages and labor compliance programs, including any infrastructure investments supporting retail or transit project areas.

·  Contain no regulatory reforms with regard to CEQA compliance, business permitting costs, tax reform, the payment of costly prevailing wages, or construction litigation.

Harkey continued, "These bills do not represent a market solution to the problems with former RDAs or the dissaray associated with the hasty dissolution.  I could not support a wholesale shut down of RDAs in 2011 because the legislation was disingenuous at best.  As presented, the plan in 2011 consisted of the state once again grabbing local dollars to backfill obligations it could not meet. The legislation also put municipalities in a tough spot in which they could continue to operate as de facto RDAs if they paid a ransom note to the state of California. As a result of the hastily crafted legislation, cities with RDA debt have seen their bonds rated as junk.  It would appear that after today, RDAs suffered a short death and are now being resurrected to try to correct some of the problems with the knee jerk dissolution, but may force municipalities into further quandaries with labor, property rights, debt and environmental litigation."

The full text of AB 2144 and SB 1156 is available here and here.

The Assembly floor votes may be viewed here and here.