By KEVIN McCALLUM
THE PRESS DEMOCRAT
The elimination of California redevelopment agencies will create “carnage” on city projects unless the state gives communities more time to respond and adapt to a recent court ruling, Santa Rosa City Manager Kathy Millison said Friday.
The city stands to lose $12 million in funding for projects ranging from widening roads, reunifying Courthouse Square and building parks. It would also be forced to forgo construction of 285 units of affordable housing, face an annual half-million dollar hit to its general fund and see 12 city jobs put at risk, she said.
“In the short term, it’s a trail of carnage,” Millison said.
Communities across Sonoma County continue to grapple with implications of the state Supreme Court’s rejection of legal challenges to Gov. Jerry Brown’s plan to wrest control of $5 billion in tax revenue from the state’s 399 active redevelopment agencies.
City councils in Santa Rosa, Petaluma, Sonoma, Cotati and Rohnert Park as well as the Sonoma County supervisors next week will hear updates from staff members, many of whom spent much of this week anxiously trying to understand the impacts of the ruling and the meaning of fast-approaching deadlines.
“We’re all scrambling to (find out) what do we do?” said Matt Mullan, city manager of Windsor, which had forecast using $13.9 million in redevelopment money in the next few years.
Sonoma County’s 15 redevelopment areas are expected to generate a total of $50 million in tax revenue this year, money they are supposed to use to fight blight in their communities. All those agencies are set to be dissolved by Feb. 1.
The agencies that formed them have until Jan. 13 to decide whether they want to become the “successor agencies” that will operate under the direction of yet-to-be formed oversight boards.
Petaluma City Manager John Brown plans to tell the City Council Monday that the city has about $14 million that was not nailed down and is now at risk.
“That’s stuff lost as near as I can tell,” Brown said.
Redevelopment funding brings the city about $17 million a year, much of it designated for low-income housing programs, including support for Boys & Girls Clubs, which would take a big hit, Mayor David Glass said.
Unless there are changes, the city has no obvious way to pay for large, local infrastructure projects. “What is before us right now is a game-changer and is totally unacceptable,” Glass said.
Santa Rosa officials plan to update the City Council Tuesday, and will stress the deep financial impact the loss of redevelopment dollars would be for the city. The city’s redevelopment agency receives about $8 million per year in tax revenue from four redevelopment districts in the city.
The $12 million the city had planned to spend would have leveraged another $72 million in private sector investment, Millison said. If those $84 million in investments in the community don’t happen, it could cost the local economy 2,800 jobs, she said.
Sonoma City Manager Linda Kelly said the loss of redevelopment money is on the same scale as the passage of Proposition 13, the landmark 1978 ballot initiative that slashed property tax rates in California.
The elimination of the agencies, however, does not lower taxes. It redistributes the revenue to education and to special districts that have had some of their tax proceeds diverted to redevelopment agencies.
Sonoma City Council will hold a special session Thursday to decide what to do next.
“To transition to a new model after 28 years … is monumental,” Kelly said.
Cities and redevelopment officials are working with state legislators to craft a bill that will preserve some elements of redevelopment, such as its affordable housing component. A Senate measure to protect $2 billion in affordable housing funds heads to committee Tuesday.
You can reach Staff Writer Kevin McCallum at 521-5207 or email@example.com.