Back in 2011, Governor Jerry Brown abolished redevelopment agencies in California successfully gaining $1.5 billion of the redevelopment funding to close California’s budget gap. Recently, three bills have reached the Governor’s office in an attempt to revive redevelopment in California. Gov. Brown has signed two of those bills, Senate Bill 628 and Assembly Bill 229, into law while vetoing Assembly Bill 2280.
SB 628 will create what redevelopment revivalists call Enhanced Infrastructure Financing Districts, which essentially is redevelopment on a bigger scale, without protections. Old redevelopment law required a city to deem a certain area as blighted, meaning inhabiting the area would be dangerous and against public safety. The new law under SB 628 does not require a finding of blight. Opponents to the bill argue that the new law will make eminent domain abuse much easier to get away with. EIFD also will change the threshold for voter approval from two-thirds to only 55%, a lowered threshold from standard infrastructure finance districts. Furthermore, opponents fear that the new law will give city officials the right to take private property from downtown areas which will decrease or eliminate low-income housing. The new law, unlike the standard IFD, does not require cities to set aside funding for low-income housing.
AB 229 is another form of redevelopment law that targets the revitalization of old military bases. Known as the Infrastructure and Revitalization Financing District (IRFD), this bill can issue 30 years of debt with a 2/3 voter approval in the district. Opponents argue that the IRFD is granting city officials great power over private property, unrestricted power of eminent domain and the ability to fund private party projects with state tax money.
The only bill vetoed by Brown was AB 2280. This bill, known as Community Revitalization and Investment Authority (CRIA), would allow local governments to create CRIA in areas of the city facing disadvantages for funding community specified activities. It would also have revived tax-increment financing which sets aside 25% for affordable, low-income housing. Brown’s veto message stated that, if approved, the bill would “unnecessarily vest this new program in redevelopment law.” However, he did also mention his desire to work with the bill writers to come to a possible consensus on tax-increment financing for disadvantage areas.
Regardless of opposition, redevelopment appears to be back with little or no restrictions on the power to take private property by city and state officials. When the passed bills were showcased, their focus was funding for upgrading roads, sewer pipes, and levees. But it will be interesting to see how far the new law will stretch the definition of “infrastructure.”
By: A.J. Hazarabedian
To learn more about A.J. Hazarabedian, the managing partner at California Eminent Domain Law Group, visit http://www.eminentdomainlaw.net/aboutAJH.php