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Thursday, Mar 28, 2024

Redevelopment Supporters Begin Initiative

As cities like Glendale make moves to navigate economic development without the help of redevelopment funds, an initiative out of Orange County is working to bring the tool back. The Jobs and Education Development Initiative was filed with the California Attorney General late last year and is currently working toward gaining the about 505,000 signatures it would need to qualify for the November ballot. And since it’s an initiative, as opposed to a bill, Gov. Jerry Brown, who orchestrated the end of redevelopment in 2011, couldn’t strike it down with a veto. Under the initiative, a powerful tool of redevelopment would be reinstituted: tax increment financing, which allowed cities to sell bonds paid back by capturing the higher property tax revenues created through new projects. “The guiding principle behind the initiative is to bring back redevelopment, yes, but also to modify the law to focus more on areas that needed economic development due to higher unemployment rates,” said William H. Ihrke, partner in the government and regulatory law practice at Rutan & Tucker LLP, the Costa Mesa law firm retained to draft the act. “Absence law, economic development corporations won’t have the ability to use tax increments like redevelopment agencies used to, and that’s what was most effective.” The group behind the initiative is a collection of labor organizations, cities and individual citizens concerned with how hard the dissolution of redevelopment hit the state. The group’s spokesman, Stu Mollrich, partner at Newport Beach consultancy Forde and Mollrich, did not respond to calls or emails seeking comment. The initiative would not only help to move forward with projects stalled or lost with the dissolution of redevelopment, but it would widen the definition of a blighted neighborhood to include areas with an unemployment rate higher than the state or national average. The initiative argues that “high unemployment is the new blight, which quickly becomes the old blight – poverty, neighborhood deterioration and crime.” What’s more, the initiative would grant the new agencies a 40-year extension on the execution of approved redevelopment plans, in addition to establishing new redevelopment project areas. Larry Kosmont, chief executive of Los Angeles consultancy Kosmont Cos., said legislation is inevitable in the post redevelopment era, as cities can’t really make do without it. “We just don’t have a good solution right now, so it has to happen,” he said. “There will be an ongoing focus with some sort of financing tactic in legislation, perhaps like the (act).” – Elliot Golan

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