WatchSonoma Watch

Windsor to pay $1.1 million in state ‘ransom’ to save redevelopment agency


Windsor is the latest city in Sonoma County to reluctantly decide to pay the state to keep its redevelopment agency alive.

Mayor Steve Allen referred to it as “shakedown money,” and Councilwoman Robin Goble described it as “ransom.” But in the end, the Town Council unanimously agreed Wednesday night to give the state $1.1 million this fiscal year and about $270,000 subsequently for the next 30 years.

As part of the state budget passed in June, the Legislature and Gov. Jerry Brown dissolved redevelopment agencies but also gave them the option to continue — if they agreed to pay specified amounts for distribution to schools and other taxing entities.

A number of cities, including Santa Rosa, Healdsburg and Cloverdale, already have agreed to make payments to keep their redevelopment programs going.

Without doing the same, a number of Windsor projects could be in jeopardy, said Assistant Town Manager Christa Johnson.

They include improvements to Old Redwood Highway associated with the proposed Bell Village project, redevelopment of the old fire station site, improving several sites on Windsor River Road and economic development catalyst projects.

Windsor officials say their redevelopment funds have dipped because the town was forced to pay the state $1. 7 million from its account during the 2009-11 budget cycle. A nine percent decline in assessed property values in the redevelopment area also has caused a drop in tax revenues.

Most of the discussion Wednesday centered on how much of the initial payment to the state should come from money set aside in the redevelopment agency for affordable housing projects. The council agreed that half should come from housing funds.

After paying the state, there will be $1.7 million left for future housing programs and $1.2 million for redevelopment projects.

Council members also questioned how much revenue the agency can count on in the future.

Finance chief Jim McAdler said the agency gets about $3 million annually in property tax revenues, but about $800,000 of that goes to pay off loan obligations, leaving a “significant” net amount.

The payment to the state is not due until January. Cities are hoping that in the meantime the state Supreme Court will find the diversion of funds unconstitutional and they won’t need to pay after all.

Redevelopment agencies were authorized by the state more than 60 years ago as a way to eliminate “blight.” Once a redevelopment agency is established, cities, counties schools and special districts continue to receive property taxes in the redevelopment area, but most of the growth in property taxes goes to the redevelopment agency to finance its programs and construct affordable housing.

Advocates contend they are a needed tool to promote economic development. Critics counter that the agencies have proliferated excessively and divert property tax revenues from core government services and increase state education costs.

Redevelopment agencies have broad powers, including the authority to acquire property through eminent domain and sell, lease, and develop land.

Redevelopment programs have been responsible for remaking the face of downtowns in Sonoma County, including Cloverdale, Healdsburg, and Windsor. In Santa Rosa, redevelopment paved the way for construction of the downtown shopping mall after the 1969 earthquake.

But redevelopment agencies have also been controversial for subsidizing large retail businesses.

7 Responses to “Windsor to pay $1.1 million in state ‘ransom’ to save redevelopment agency”

  1. I hope someone is watching says:

    Lets vote on this! How do they get to sell us down the river without a public vote on something like this. This is a perfect example of the privilaged few making major finanical decesions that our kids will paying for this for years! MAKE IT STOP! Please

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  2. bill says:

    Redevelopment is a racket. That is why our Governor chose to get rid of it. These local yokels who want to keep it around have vested interests.

    Get rid of these yokels and their buddies won’t be able to rob our tax dollars so easily.

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  3. Steve Klausner says:

    Shakedown? Ransom? Kidnapping? Local governments are acting like whores.

    Thumb up 7 Thumb down 1

  4. Fiscal Conservative says:

    The voter needs to understand that the special agenda was more inportant than the basic needs.

    This is a crime against the taxpayer.

    Thumb up 10 Thumb down 0

  5. Jim says:

    It’s interesting to see how all of these city councils and redevelopment agencies frame the argument as being extorted by the state.

    This is not there money.

    The only folks being extorted are the tax payers who ultimately foot the bill and get to watch as more vital services decay.

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  6. Jason Valez says:

    Shakedown? Ransom? Kidnapping? Who do they think they’re fooling? The State decided it no longer wanted to pay for the school’s losses to redevelopment. When redevelopment law enabled cities to make these areas, they never imagined that some cities would designate their whole town blighted in order to siphon enormous amounts of money into their coffers. If cities would have restricted themselves to only redevelop areas that were truly blighted instead of falsifying reports, then the State could have afforded to help them by backfilling for the school’s losses. But they got greedy, declaring every downtown blighted to get that money.

    The cities brought this on themselves by their greed and lust for power (eminent domain). Now, by decreasing their funding it will diminish the amount of damage that they can do to their local businesses that routinely get thrown under the bus when a larger corporation wants to take their land.

    Whenever the government picks winners and losers it destroys the free market. Giving money, land and other perks to favored developers and pushing others out of the way is one of the most despicable practices I’ve ever witnessed in this country. Too bad the State is allowing it to continue. That money should be spent on essential services that benefit everyone instead.

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  7. Redevelop This says:

    Windsor and other local governments should not be in the business of private land grabs and turning it over to developers. But that is what they do and call it “redevelopment.” In this down economy and down property tax economy it doesn’t make sense to build.

    Witness the closed store fronts in Windsor and more stores closing.

    Windsor just gave away $1.1 million in tax dollars and will be giving away $270,000 each year for 30 more years. What a deal! With these liberals in power, what better tools could they use to destroy this country.

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