On February 28, 2008 I attended a meeting of the Citizens Alliance. At this meeting held at Barton Hospital more good questions were asked by those present about the proposed new community improvement financing tool known as Redevelopment Project Area # 2. While responding to those present, I also wanted to share the information with you and your reading public. I truly appreciated the invitation to attend the Citizens Alliance Meeting and look forward to attending more meetings.
Eminent Domain – The RDA plan now being written by staff for presentation to the City Council later this year will not propose the power of eminent domain for the new Project Area. The question was asked if a future City Council decided it wants to amend the plan to include the power of eminent domain, will the Agency have to again justify that blight exists?
Answer – Yes, in order to amend a redevelopment plan to include the power of eminent domain, a future City Council will have to find that significant blight remains in the Project Area and that blight cannot be eliminated without the use of eminent domain. In addition, the redevelopment plan would have to be amended which is a long and expensive public process.
“No Eminent Domain” Affirmation – A suggestion was made that if the City Council is truly opposed to including eminent domain in a new redevelopment project area then it should clearly state its intentions now.
Answer – A resolution expressing the City Council’s intention to eliminate the RDA’s power of eminent domain in a new project area will be voted on at the City Council’s next meeting on March 18, 2008.
Project Area Committee (PAC) – A question was raised whether a Project Area Committee (PAC) is needed for the
proposed redevelopment project area.
Answer – A PAC is not needed for the new redevelopment project area plan because the Agency will not have the power of eminent domain to acquire residential properties. The RDA Agency would arguably need to form a PAC in connection with amending the plan in order to authorize eminent domain authority if a substantial number of low or moderate income persons resided in the project area and the amendment would grant eminent domain authority with respect to property on which any persons reside. The proposed plan could include a requirement to form a PAC in connection with any amendment to grant the Agency eminent domain authority.
Tax Increment Calculation – Does the calculation used by the City for the growth of tax increment over time count the 2%
Proposition 13 Allowable Annual maximum?
Answer - The tax increment for the Project Area will include the 2 percent inflation adjustment, plus value changes from ownership changes and new development. Prior to 1994 when AB 1290 was passed, taxing entities could elect to get tax increment from the 2 percent growth. This occurs in the existing Project Area. That was replaced by the statutory pass through payments that this Project Area, if approved, will need to pay.
Estimate of New Revenue to the RDA - How much new revenue is estimated to come to the City RDA if a new redevelopment project area is formed?
Answer - The RDA’s financial advisors are working on tax increment and other financial projections for the Preliminary Report. They are examining the estimated cost of public improvements and the amount of tax increment revenue to be received.
Plan Adoption – Under State law may the City Council place an ordinance adopting a redevelopment plan on the ballot to be confirmed by the voters?
Answer – State law establishes a statutory scheme for approving redevelopment plans. Legal counsel has confirmed that the Law does not appear to authorize the City Council to place an ordinance adopting a redevelopment plan on the ballot to be confirmed by the voters. However, any such ordinance adopted by the City Council is subject to referendum.
David M. Jinkens
South Tahoe Redevelopment Agency