California Redevelopment Law

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California Redevelopment Law

• E159U
• Local Economic Development

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California Community Redevelopment Act of 1945

• Allows local governments
• (cities counties) to create
• a redevelopment agency

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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

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What is Blight?

• An area that is predominantly urbanizedandit
  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).

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Blight Physical Conditions

• Unsafe or unhealthy building conditions
• Inadequate building or lot design
• Incompatible adjacent uses
• Irregular lots (size and/or shape)

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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

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Examples of Blight
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Examples of Blight
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Examples of Blight
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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

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Redevelopment Project Areas

• A plan is required for every redevelopment
  project area
• Must be consistent with the localitys general
  plan
• Time limit for establishing indebtedness cannot
  exceed 20 years

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Power of Redevelopment

• Eminent Domain
• Tax Increment Financing

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Eminent Domain

• Governments 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.

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Tax Increment Financing

• Financing based on tax revenue increases from
  some base period through life of project

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Tax Increment
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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

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Affordable HousingSet-Aside

• Redevelopment Law requires every agency to
  set-aside 20 of its redevelopment funds for low-
  and moderate-income housing.

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Criticisms of Redevelopmentin 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