Supporters of California’s redevelopment agencies have suffered another setback in their seemingly endless attempt to revive these locally controlled planning bureaus. The Assembly Appropriations Committee recently scuttled Assembly Bill 2945 during its suspense-file hearing. That was the only reasonable course given the bill’s massive costs in the face of a $45-billion budget deficit. The state doesn’t have money for good ideas, let along bad ones.
Forgive us for again dancing on redevelopment’s grave, but this latest rebuke is cause for celebration. Actually, cheering redevelopment’s defeat has become our annual ritual given that local-government lobbies never get the hint. Gov. Jerry Brown and the Legislature shuttered the agencies in 2011 to help fill a budget hole amid a then-smaller deficit, but there were plenty of other solid reasons for ending this abusive and wasteful process.
California created redevelopment agencies in the 1940s to fund urban-renewal projects that combat inner-city blight. Local governments gained the power to float debt to fund related infrastructure projects and then captured the resulting “tax increment” — the increase in property taxes that flowed to the newly revived project areas.
The result was a mess. Cities used their redevelopment powers to divert property tax proceeds from traditional public services toward their projects — and the state ending up backfilling diverted public-school revenue. Over the years, cities focused on subsidizing auto malls and big-box stores that brought in sales taxes. They often abused their eminent-domain powers by clearing away homes and businesses and giving them to private developers.
The two latest bills were authored by Assembly member David Alvarez, D-Chula Vista. Sadly, a number of Democratic and Republican lawmakers backed the bill before the committee killed it. AB 2945 was basically the same as the 2023 bill, except with a nice-sounding new name: the Reconnecting Communities Redevelopment Act.
The state doesn’t need to reconnect with a system that promotes crony capitalism and routinely abuses property rights. We can only hope that after this year’s defeat, Alvarez and redevelopment’s other revanchist supporters give it up already and look for productive, market-based ways to encourage urban revitalization.