After Doomsday: The Fallout from the End of Redevelopment

Redevelopment's end was not intended to be this messy, given that everyone thought the 400 or so redevelopment agencies in California could limp along under the extortionate system the state legislature set up to keep the agencies in operation after February 1.

But the state Supreme Court unexpectedly chose the nuclear option in late December, and the draconian provisions of the dissolution law - which were mostly there to scare cities into knuckling under - are now being imposed.

The term of art for this process is "unwinding" - as if redevelopment had been a skein of yarn. Instead, it's turning out to be one awful can of worms.

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According to USC's Intersection South L.A. website, "More than 50 housing, public infrastructure, commercial, community service and program development projects in South L.A. will be on the chopping block, unless other funding can be found to move them forward - 34 are in Councilwoman Jan Perry's 9th District. Another 17 are in Bernard Parks' 8th District."

Dissolution also means that affordable housing to replace rental units lost to an expanding USC campus also are unlikely to be built, now that the city of Los Angeles has thrown its redevelopment agency under the bus. ("Unwinding" that particular mess has been handed to a committee handpicked by Governor Brown: lobbyist Tim McOsker, developer Nelson Rising, and consultant Mee Semcken.)

In Santa Rosa, a $28-million elementary school can't open. The city's redevelopment agency was going spend $500,000 to build a safe sidewalk for the mostly low-income children who would have walked or biked to the new school. But the city can't afford to pay for the sidewalk, now that redevelopment funding has gone to backfill the state's deficit. Without a sidewalk, students can't safely get to school and the school can't open.

In Signal Hill - which stands on a former oil field - work to rehabilitate well sites into house lots has stopped. The city also may lose $10 million it loaned its redevelopment agency. In nearby Cerritos, $40 million in city loans, staff salaries, and other costs are at risk. What might happen to a 247-unit senior housing project that would have been financed by the city's redevelopment agency is unclear. In my town, Lakewood, with a tiny redevelopment program, 32 units of affordable and market-rate housing won't be built any time soon.

In Long Beach, a graffiti removal program is one of the programs being "unwound," part of an estimated $6 million in community services paid for by redevelopment revenue. Also ended is the Long Beach agency's funding of public art. And the agency owes the city almost $120 million.

Kendall Taggart at the website California Watch estimates that the end of redevelopment puts at risk more than $4 billion in loans cities and counties made to their redevelopment agencies. Cities fault the hastily written law dissolving redevelopment for lacking a clear mechanism for repaying the billions owed. According to Taggart:

Cities around the state loaned money to their redevelopment agencies as a way to avoid the costs associated with borrowing from private investors. If the loans are voided, cities and counties might have to tap their general funds to make up for the money they expected from loan repayments.

City and county officials sincerely believe that the state can't abrogate existing loan agreements, but the state Supreme Court sidestepped this and many other issues in its December ruling.

That means local taxpayers can be hit twice: Projects and programs funded by redevelopment revenue will stop benefiting their neighborhoods and unpaid loans will have to be made up by higher fees or cuts in city services.

It's all fallout from redevelopment doomsday . . . and more is predicted.

About the Author

D. J. Waldie is the author of "Holy Land: A Suburban Memoir" and "Where We Are Now: Notes from Los Angeles," among other books about the social history of Southern California. He is a contributing editor for the Los Angeles Times ...
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