Transcript California Redevelopment Law

California Redevelopment Law
E159U:
Local Economic Development
California Community
Redevelopment Act of 1945
Allows local governments
(cities & counties) to create
a redevelopment agency
What is Redevelopment?
“Redevelopment means the planning,
development, replanning, redesign,
clearance, reconstruction, or rehabilitation,
or any combination of these, of all or part
of a survey area, and the provision of
those residential, commercial, industrial,
public, or other structures or spaces as
may be appropriate or necessary in the
interest of the general welfare…”
What is Blight?
An area that is predominantly
urbanized…and…it constitutes a
serious physical and economic burden
on the community which cannot
reasonably be expected to be reversed
or alleviated by private enterprise or
governmental action, or both, without
redevelopment (from CDL §33030).
Blight: Physical Conditions
Unsafe or unhealthy building
conditions
 Inadequate building or lot design
 Incompatible adjacent uses
 Irregular lots (size and/or shape)

Blight: Economic Conditions
Stagnant or depreciated property values
 High business vacancies, high turnover
rates, abandoned buildings
 Lack of typical neighborhood businesses
 High number of “adult” businesses
 Residential overcrowding
 High crime rate

Examples of Blight
Examples of Blight
Examples of Blight
Redevelopment Agencies
Local legislative body must adopt an
ordinance declaring the need for a RDA
 Usually, the local legislative body also
sits as the redevelopment
board/decisionmaking body
 Usually, the RDA has a staff which will
vary on size of the agency

Redevelopment Project
Areas
A plan is required for every
redevelopment project area
 Must be consistent with the
locality’s general plan
 Time limit for establishing
indebtedness cannot exceed 20
years

Power of Redevelopment
Eminent Domain
 Tax Increment Financing

Eminent Domain
Government’s right to seize
private property for a public use
including the health and safety of
community -- the government
must pay “fair market value” for
any property acquired with this
power.
Tax Increment Financing
Financing based on tax revenue
increases from some base period
through life of project
Tax Increment
Value
Value over time
Value in BY + Inflation
Value in Base Year
Time
Tax Increment Financing
Tax increment funds can be spent
directly on projects
 Tax allocation bonds can be issued to
be paid off from future tax increment
revenues

Affordable Housing
Set-Aside
Redevelopment Law requires
every agency to set-aside 20% of
its redevelopment funds for lowand moderate-income housing.
Criticisms of Redevelopment
in California
Areas
designated as redevelopment
projects were not “blighted”
RDAs contributed to competition
among jurisdictions
RDAs took “unearned” property tax
RDAs are not using their set-aside
funds to create affordable housing