As Time Runs out on Redevelopment Agencies, California Senate Preserves Housing Funds
Efforts to save California’s 400 redevelopment agencies from being dissolved on Wednesday failed, but the state Senate passed a measure Tuesday allowing the agencies to spend redevelopment funds earmarked for affordable housing projects.
The measure would allow local governments to spend about $1.4 billion contained in the redevelopment agencies’ low- and moderate-income housing funds. Senate Bill 654 still needs to be approved by the state Assembly and signed by Gov. Jerry Brown (D) before it would be enacted and, even then, it would not go into effect until next January, reported the Sacramento Bee.
Nevertheless, the measure provides limited solace to the local redevelopment authorities striving to redevelop California’s 25 closed installations. Those redevelopment agencies have relied on the monies raised through tax increment financing to carry out the first steps needed to attract private investment — replacing outdated infrastructure, constructing roads, tearing down antiquated military buildings and cleaning up residual contamination.
The death knell for the redevelopment agencies comes as the legislature passed a bill last summer intended to balance the state’s budget by reallocating funds raised via tax increment financing from redevelopment agencies to other public services such as public safety and education. The move was pushed by the governor.
Losing their redevelopment agencies will make it more difficult for BRAC communities to recover from base closure. Now communities must start to unwind their redevelopment agencies and transfer their assets to new successor agencies.