Gov. Jerry Brown to possibly eliminate redevelopment agencies

Shock waves are rippling through cities and counties across California on word that Governor Jerry Brown might eliminate redevelopment agencies.

KUSI's Steve Bosh has been following this story and explains why Jerry Brown may make that decision.

Wiping out these agencies could seriously damage or kill major projects in San Diego, including a Chargers stadium, expansion of the convention center, and 2-billion dollars of additional projects in the downtown area.

The importance of redevelopment to cities and counties cannot be overstated.

In San Diego, Horton Plaza, the Gaslamp Quarter, and Petco Park were build on tax increment dollars generated by redevelopment.

Every single tax increment dollar invested by the public has returned 8-and-a-half dollars in private investment.

Over CCDC's 35-year life span the numbers tell the story. 1.54-billion dollars invested by the public, 12.8-billion invested by the private sector. Redevelopment by its very definition creates jobs, stimulates the economy, builds affordable housing.

Wiping out these agencies would free up about 6-billion dollars toward the state deficit but it would add to the deficits of cities and counties.

The repercussions of this are staggering for local government.

The state has raided redevelopment dollars 8-times in the last 20-years, including a raid 2-years ago. In downtown San Diego over the last 2-year period its about 48-million dollars taken out, those are dollars that stay in our city, are reinvested in projects, put people to work, create affordable housing, and if those are gone back to the state our city could face more financial difficulties.

Redevelopment is more than putting up buildings, and generating jobs. The Mayor's office will likely join the effort to fight this, if it happens, saying, quote:
redevelopment not only removes blight but it also generates significant new sales and hotel tax revenue that is used in all our neighborhoods to pay for police and fire protection, street maintenance, parks and libraries.”

Another problem is the debt already created from projects already underway, and those ready to go forward. San Diego has about half a billion dollars in bonds outstanding in the market, we've got projects started or in the entitlement stages of getting started, so the question than becomes when you've got bonds that are over a 30-year repayment schedule who then is responsible for repaying those?

As for the stadium, Chargers point man Mark Fabiani says without the possibility of redevelopment dollars the prospect of a stadium downtown pretty much disappears.

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