Redevelopment: The Next Chapter

On June 30, 2011, Governor Brown signed SB 87, the main budget bill containing the FY 2011-12 State Budget.  Additionally, he signed a number of budget trailer bills, including ABX1 26, the redevelopment elimination bill, and ABX1 27, the bill that allows redevelopment agencies to “opt in” to a new system but force them to make $1.7 billion in payments next year to stay alive.

ABX1 26 and ABX1 27 become effective immediately upon being signed by the Governor. RDAs can not enter into any new agreements until they have enacted an ordinance committing to make the payments as required by ABX1 27.

Two other key items are still to be determined.  On the legal front, it is a virtual certainty that the CRA/League of Cities will file litigation to invalidate these two pieces of legislation.  On the legislative front, legislative leaders, Senator Steinberg included, have promised to do a “clean-up” bill that will fix the problems included in the recently passed legislation.  Those promises include:

1. Legislation that deals with proportionate funding.  This will ensure that schools, special districts and RDAs don’t get all the money.
2. Legislation that could extend the life of RDAs who meet certain public policy goals such as SB 375 or job creation goals
3. Legislation that protects affordable housing and ensures that housing money that has been taken is paid back by 2016.
4. Legislation that deals with ensuring no new barriers to infill building have been created.

For more in-depth information on the situation click here for a Goldfarb & Lipman analysis and here for a CRA document on Frequently Asked Questions.

California Housing Consortium Inducts Five Affordable Housing Advocates into California Housing Hall of Fame

The California Housing Consortium (CHC) honored the best in affordable housing at its annual California Housing Hall of Fame Awards luncheon in Santa Monica Thursday.

The awards, presented at the Hotel Casa del Mar, honor those who have made a profound impact in the affordable housing field. 

"At a time when state funding for affordable housing is being threatened, it's important for us to recognize the heroes among us who provide high quality affordable housing for low income Californians," said Ray Pearl, executive director of CHC, a statewide "big tent" housing advocacy organization.

To be inducted into the Housing Hall of Fame, an individual or organization must demonstrate a seminal or substantial contribution toward advancing the cause of affordable housing in California. The CHC Board of Directors selects award recipients by gauging leadership characteristics such as innovation, effectiveness, inclusiveness, impact, tenure, collaborative spirit, and inspirational records of service.

This year, three awards were presented for nonprofit, public and private sectors and two awards were presented for lifetime achievement.  The 2011 honorees include:  Jim Silverwood, Affirmed Housing Group – Private Sector; Ken Sauder, Wakeland Housing – Nonprofit Sector; State Sen. Mark DeSaulnier – Public Sector; Maureen Higgins – Lifetime Achievement; and Christine Minnehan – Lifetime Achievement.

Prior to the awards, CHC hosted a policy forum with former Assembly Speaker Bob Hertzberg, who now co-chairs the nonprofit organization California Forward, delivering the keynote address.

David Smith with Recap Advisors then moderated a lively policy debate over whether the affordable housing responsibilities now assigned to various state and local agencies should be consolidated into a Comprehensive Housing Funder (CHF). Cynthia Parker, CEO of BRIDGE Housing, and Lynn Jacobs, former director of the California Department of Housing and Community Development, spoke in support.  Jim Silverwood, president and CEO of Affirmed Housing Group, and Doug Shoemaker, director of the Mayor’s Office for Housing in San Francisco, spoke in opposition.

Budget Revise Eliminates Redevelopment

Governor Jerry Brown issued his May revise this week, keeping his original plan to eliminate redevelopment agencies.

Page 12 of the budget deals specifically with RDAs:

"Because redevelopment of specific areas is a local economic responsibility, rather than the state’s, the May Revision maintains the Governor’s Budget proposal to eliminate redevelopment agencies. Redevelopment costs the state more than $2 billion annually in lost school property taxes, and its effectiveness on a statewide basis is questionable. By eliminating the agencies, more funds can be returned to cities, counties, special districts, and schools to invest in core services such as hiring police officers, firefighters, and teachers."

Read the full budget

Read the Sacramento Bee article

Human element lost in budget-cutting

The Orange County Register published a wonderful letter to the editor recently from Jamboree Housing President Laura Archuleta, who pointed out that the human element is getting lost in the scuffle of the debate over eliminating redevelopment agencies.

"Affordable housing is a lot more than number of jobs and dollars generated, or lost. It can be the lifeline for seniors on fixed incomes or a new life for families who earn minimum wages or are down on their luck due to such calamities as unemployment, illness, and divorce."

Read the full editorial

Keep Up the Legislative Calls & Emails!

Silence isn't always golden. Sometimes it can lull you into a false sense of security. 

Last month the Assembly last month narrowly defeated legislation to end California's 425 redevelopment agencies. While redevelopment agencies survived to see another day,  their future is no more certain today than it was a month or two ago.

California remains in a state of budget gridlock. While billions of dollars of spending cuts have already been approved by the legislature and signed by the governor, a $15 billion deficit remains.

A number of different scenarios could play out as the legislative process continues to grind forward on other fronts, particularly with RDA reform legislation. As long as RDAs remain in the mix, CHC will continue to focus its efforts on much-needed reform.

Just yesterday, the Sacramento Bee published a "Mend or End" RDA debate between Ben Boychuk, a fellow of the Claremont Institute, and Pia Lopez, a Sacramento Bee editorial writer. It's no surprise who CHC agrees with.

Clearly, this is not the time to sit idle. Affordable housing providers need to share success stories of redevelopment and affordable housing far and wide. Affordable housing's future remains uncertain, and legislators need a constant reminder of the benefits affordable housing provides and how much there is to lose in this debate! Please contact your legislators again and remind them just what is at stake!

(To get your assembly member or senator's phone number, check out Legislative Contacts under Resources in the right column!)