Where’s the Blight?

map1At its May 5 meeting, The Fullerton City Council will consider expanding the city’s redevelopment area by 1,165 acres. This would place nearly 25 % of the entire city under the redevelopment agency, with its expanded powers to use eminent domain, divert property taxes and subsidize development.

State law allows the creation or expansion of redevelopment areas for only one reason—blight.

Blight is a legal requirement. Without it, a redevelopment area can be thrown out by the courts, as has been done with the cities of Mammoth Lakes, Temecula, Glendora and Diamond Bar. Judges are loathe to allow more revenue diversion unless the law is respected. The proposed expansion would place much of Southeast and Southwest Fullerton’s commercial areas under redevelopment. Are they blighted?

picture1The allegedly blighted area abuts my College Park neighborhood, along Raymond Ave. It includes a new Walgreen’s, the original Polly’s Pies and the Albertson’s where I shop. South of the tracks lies the newly-built Valencia Industrial Park, leased to near capacity, and the bustling Home Depot. It includes multinational distribution centers such as Yokohama Tire, UPS, Alcoa Aluminum and the Kimberly-Clark plant.

The council is being asked to declare as blighted all 167 small businesses along West Commonwealth, stretching from Euclid to Dale. All of these business owners must realize that a blight designation automatically makes them subject to possible future eminent domain.

atnip1Also blighted would be the new Fresh’n’Easy shopping center at Euclid & Orangethorpe. The proposed blight includes the Fullerton Municipal Airport and adjacent aviation businesses. It includes unique regional specialty retailers on Orangethorpe like Bob Marriott’s Fly Fishing Store and the Harley Davidson Center, both the largest of their kind on the West Coast.

Urban Futures Inc. conducted the city’s blight report, which studied conditions in the proposed expansion areas. It found that out of 629 buildings, only 5% were deteriorating. Less than 2% of the all parcels are described as incompatible. In the proposed project area, sales tax revenues grew 50% faster than in the rest of the city. There is no blight to legally justify the expansion.

fishing-storeExpansion means the agency will divert even more property tax funds from local government. Statewide, 10% of all property tax revenues are diverted by redevelopment agencies—that’s $5 billion annually. Most of this is at the expense of public schools, which then must be backfilled from the state general fund. But the state is now broke, and the backfills can’t be maintained without the massive new tax hikes proposed for the May 19 ballot. Redevelopment also diverts funds from the city’s general fund with an estimated $100 million loss to the municipal budget over 45 years.

Here in OC, RDAs now consume 15% more property taxes than all of county government. The County of Orange has lost $190 million to redevelopment agencies since 1990. This translates into real cuts in public services. We must defend our public revenue stream against future diversions.

With these funds, RDAs typically assemble land (under threat of eminent domain) and subsidize new retail development. Costco alone has received $30 million in public money just in OC, while Walmart has gotten over a $1 billion nationally in tax subsidies. The promised revenues rarely materialize as sales taxes are simply shifted from one area to another. Subsidized corporate big boxes soak up the sales that used to go to small businesses.

In 1998, the respected Public Policy Institute of California conducted a comprehensive study of redevelopment areas throughout the state. This groundbreaking report “Subsidizing Redevelopment in California” found no net economic benefits that justified the huge public expenditures.

fake-2nd-floor3392135869_b2ae8a32751Compare the three shopping centers at Harbor and Orangethorpe: Metro Center and Fullerton Town Center received massive public subsidies, while Orangefair was built and recently improved with purely private money. Compare the Knowlwood complex at Harbor and Commonwealth (with its fake second story), built with $510,000 in RDA subsidies, next to privately built Stubrik’s and Slidebar.

RDA funds can be used for purely public projects. While a member of the Fullerton City Council, I did vote for redevelopment funding for infrastructure, parks, libraries and the Maple School rehab. maple-school3392113811_21cf1eec3eBut the temptation to get involved in purely private commercial ventures makes city government a major developer and landowner.

Because of site-based sales tax allotment, cities typically use redevelopment to subsidize new retail centers. Auto malls, shopping centers and multiplexes have all been built with public funds. With retail centers now overbuilt and languishing, where is the market for all these new taxable sales? With property values plummeting, when will any additional property tax increment materialize?

Fullerton’s current RDA areas were created when blight standards were vague and unenforced. Subsequent laws require blight to be definitively proven. Judges have little tolerance for city governments simply seeking to expand power and revenue at others’ expense.

As a county official, I’m concerned about redevelopment’s impact on public services. As a Fullerton native, I’m concerned about an official declaration that 25% of my hometown is blighted. If redevelopment really has cured blight in our city, why does it continue to grow after 35 years? If there is no blight, why are city officials so eager to flout the law and denigrate Fullerton’s true condition?ns3392235153_c2af9988b52

At our June 17, 2008 meeting, the Orange County Board of Supervisors voted 5-0 to oppose the proposed Fullerton RDA expansion. The opposition was based on the feared loss of County revenues and County Counsel’s opinion that there is no blight to legally justify the expansion.

38 Replies to “Where’s the Blight?”

  1. What happens to property values when large portions of a city are put under redevelopment agencies? I would guess that these properties will become hard to sell once the lawsuits start coming in.

  2. What an impending disaster. Well, why not just declare the whole city a blight and have done with it.

  3. Government is not reason, nor eloquence. It is force. And like fire, it is a dangerous servant and a fearsome master.”
    — George Washington
    Unfortunately, this force was with the fullerton city council when it subsidized the tarantula building at Harbor & Commonwealth. I agree with Norby, the issue isnt curing blight with our tax dollars but satisfying the quirky aesthetics of those with more power than brains.

  4. Travis, you are right. The cloud of living or owning property in a Redevelopment project is a kind of encumbrance on your property. Some people with contacts in City Hall like it because when the Redevelopment Director buys you lunch all you hear is: ca-ching!

    Almost everybody else is more likely to be screwed than to benefit. They can not by law pay you for lost business or good will. For many it’s lights out. And of course Fullerton’s idiot brigade known as the Chamber of Commerce will be promoting this disaster.

    The Dems Keller and Quirk will be for it. Thick-as-a-brick Jones has been beating the drum for this since last summer. Bankhead hasn’t said “no” to Redevelopment in 20 years. That just leaves Nelson to do the right thing. He can’t beat it but he can raise the alarm. Hopefully somebody will sue.

    It’s looking grim.

    1. I like fake second floors, as a matter of fact, I like fake third, and fourth floors too! I really like plastic columns, they are so foolish.

  5. So who is behind this expansion? I see one supporting letter from the Chamber of Commerce. The rest of the comments are complaints and requests from small business owners asking to be exempted from the plan.

  6. This isn’t the right solution and frankly, I don’t see “blight.” Were this a crime ridden area with abandoned buildings subject to drug dealing and crime, it would be one thing. For the most part, what I see are small businesses owned by individuals that are struggling to survive. Surely there are other ways we can help small businesses? Like shopping at them? Perhaps giving them tax breaks as well?

    1. This IS a crime ridden area. My friend in the CHP says those Gilbert apartments are where 95% of his Fullerton, off the highway, chases end up. Are you blind the the graffiti? Have you not seen the meth-heads hanging out from Taco Bell to the Church at Gilbert and Orangethorpe? Look at the Fullerton crime statistics! Help, I live in a third world country – Right here in west Fullerton!

      1. Oh boy, let’s condemn 1,200 acres of Fullerton business’ because there is graffiti on the walls of an apartment complex close to your house. Graffiti Hot line: 714-738-3108.

  7. Concerned, “I see one supporting letter from the Chamber of Commerce.” You just wait and see, pretty soon the Chamber of Horrors will have a hand full of shills writing letters and cheerleading the “team” to victory. And in Fullerton, that’s all it takes to make change.

  8. Yes, let’s focus on the Chamber (of horrors – good one!).

    Anybody who knows about redevelopment knows that it involves government selecting preferred recipients of subsidy. Now since some businesses get help and some don’t, Redevelopment by its very nature is descriminatory. And since the majority of businesses will never receive any benefit Redevelopment is inherently anti-business.

    Let’s see the Chamber talk around that logic. And it doesn’t even address possible eminent domain, etc.

  9. BY the way, the Chamber has been nothing but a gaggle of city hall shills and stooges since the mid-90s when, you guessed it, Dr. HeeHaw was president. No hope for intelligent thought there!

  10. So here’s the deal. What they see might not be pretty, but what I see are working businesses that are making the rent. In this economy, they should kiss the feet of every single business owner still making payroll and quarterly taxes.

    Not everything in this world is supposed to look either like Irvine or a made up rendition of “old timey” architecture complete with ugly columns and fake two stories. There’s an inevitable mish mash of styles –ugly, dull or charming, and uses –service, retail, light manufacturing co-existing now.

    Are we going the direction of Brea? Brea who tore down their old downtown in one fell swoop and built Birch Street. The result is rents so high only corporate American would think to pay them. But even corporate America couldn’t survive their excessive expansion of the last decade. The barren storefronts on Brea Bl. are the result. And I can’t say much of the development in Fullerton is any better. Unless you want to shop at a cheap chain store, get your hair done, or get drunk, downtown Fullerton doesn’t have much use.

  11. Kanani, you have hit the nail on the head. Homogeneity is the goal of Redevelopment: a corporate look; a corporate presence. Everything will be nice and plasticized. Brick veneer as far as the eye can see. City bureaucrats thumbing up architectural garbage and thumbing down “incompatability.”

    And thank you for the trenchant observation on the uselessness of downtown Fullerton – which the Redevelopment Agency has converted into an open air food court (+ booze).

    Self-congratualtory types love to crow about “revitalization.” As far as I can tell that meant subsidizing bars and converting a former commercial district into a high density residential one.

    Yet the redevelopment crowd will tell you that “much remains to be done.” After 35 years!

  12. I lived in Pasadena when Colorado Boulevard had loads of pawn shops and drunks passed out on the sidewalk. No kidding. I would literally jump over them from time to time as I found my way over to the now defunct Ernie’s.

    I like Colorado Boulevard. It has a mixture of things DAY OR NIGHT that draw me there. Whether it’s eating at Twin Palms (my favorite), seeing a movie, cruising through Tiffany’s or taking in art at the Norton Simon (break out the violins) –it’s fun and walkable at all hours. The downside of it is with the redevelopment inevitably came the high rents. Some of the small shops are hanging on. I hope they can make it through the economy. But still, it’s better than drunks on the sidewalk and the point is that there is a mix.

    A few years ago, one of the Fullerton grande dames told me that they’d never ever want chain stores on Harbor or around Harbor. She wanted “quaint.” All I wanted was a freakin’ Crate and Barrel like they have on Colorado Bl., a patisserie, a Whole Foods or Trader Joe’s, and a drug store. And she kind of sneered. But I have to wonder if she’s happy now with the booze courts.

    In an ideal world, there’d be a mix of stores and businesses that would make it not necessarily a destination –but a town where we can live, work, and spend our money in for things we need.

    I’m off to Savannah. Now there’s a mix I find exciting. Of course, there are flaws. But there is something both urban and appealing to it all.

  13. Well, the problem is Redevelopment overreach. Everybody wants a Trader Joe’s in Fullerton. In order to get do we have to subsidize them?

    Unfortunately “quaint” as delivered by Redevelopment means brick veneer and fake-old – the sort of stuff that the Fullerton middlebrows adore. That won’t work either.

    It cost Pasadena a lot to get rid of those winos and even their success can be countered by the argument that Colorado is now little more than a tourist attraction with lots of activity but very little authenticity. And high rents that will never permit a shoe repair shop or a hardware store.

    Maybe there’s a happy medium someplace, but I doubt it.

  14. “Are we going the direction of Brea? Brea who tore down their old downtown in one fell swoop and built Birch Street. The result is rents so high only corporate American would think to pay them. But even corporate America couldn’t survive their excessive expansion of the last decade. The barren storefronts on Brea Bl. are the result. And I can’t say much of the development in Fullerton is any better.”

    Kanani, so true are you. I get all warm and fuzzy inside knowing that there are others out there that have come to the same conclusion.

    Please tell us all about life in Savannah 🙂

  15. Art, the last time I went to Santana I got rob by a group of youngsters with a freeking screwdriver, I would have been able to defend myself, but Sandra “I carry a piece so you don’t have to” Hutchens took my pistola away 🙁

  16. Kojac,

    No joke – police in Santa Ana just arrested a guy for stealing a bike while using a hammer as a weapon!

    Time to start issuing permits for carrying tools?

  17. In the crosshairs of big government is no place to be, I lost my job when Redevelopments “Amerage Courte” aka “Vintage Square” was on the radar screen, my boss laid me off because he sold out to Redevelopments “developer”.

    And now… the project has fizzled out, and I’m broke, pray that you’re not me.

  18. Harpoon, I disagree heartily with you in regards to Pasadena being just a tourist trap. It isn’t. It’s a city with many different areas where much of the architectural integrity stayed intact –and the citizens stay IN town to spend their money or move there because of it. Not only does it have a strong cultural life, it has an appreciation of its own history. City Hall, the Pasadena Library, Arts Center, Gamble House, Cal Tech, Huntington Gardens, Norton Simon, Green Street, Lake, Altadena, FairOaks, South Pasadena and even the stretch of Colorado from East to West is full of a mix of corporate and small businesses which have managed to maintain the aura of Pasadena.

    In comparison, our downtown is the sole remaining remnant of “old.” And most people don’t know who William Perriera was to appreciate what was destroyed with the old Hunt buildings.

  19. Ah, Kanani, nothing like being misquoted to get the ‘ol juices going. What I said was that “Colorado was little more than a tourist attraction.” And so it is – chock full of out of towners, but lots of sales tax revenue.

    Pasadena is a beautiful city, and along with Santa Barbara just about the only really classy places I can think of in SoCal; and, as you say, Colorado is interesting (to me, anyway) when you get east of “Old Town.”

    Speaking of “Old Town” its very existence has proved a boon to the consultants who peddle downtown master plan lies to places like Fullerton; and a bane to towns who fall into the “we can be the next Old Town Pasadena” trap.

  20. You may recall that this item was continued last year until conveniently just after the November council election, then continued again. Council has scheduled a closed door session to review possible litigation related to this proposed expansion.

    You can find the documents related to this proposed redevelopment area expansion at:


  21. Just checked out that website, Matt. The pictures of “blight” are comical – mostly tagging and code enforcement negligence by the city. And lots of pictures of small strip centers and industrial parks – the perfect places for small business to incubate.

    Anybody with half a brain will fight this thing. I guess that leaves out Dick Jones and his cronies at the Chamber (of Horrors).

    1. Yes, the “blight” that is supposed to justify public investment ranges from buildings that are old (gasp!), unattractive, and in a few cases genuinely ramshackle, but mostly they are just nondescript small businesses and modest houses that have been modified (or not) in inauspicious ways. Not always a pretty site, but are these really areas where commerce cannot take place without a designation of redevelopment zone? And do we really expect the city to usher in anything better looking based on the awful redevelopment projects we have seen around town in the last ten years?

      If poorly maintained asphalt and cracked sidewalks are blight, I would love to have them look at my street and tell me why they haven’t fixed it yet.

  22. I have heard that the expansion of the redevelopment zone has been put off for a year or more following the closed door discussions of possible litigation with the County of Orange based on lost tax revenues.

    1. Matt, that loss of county revenue is exactly why all these anti-development posts are up here in the first place. Norby and Bankhead don’t give a care about the future of west Fullerton. They are looking for their piece of the pie.

      1. Diana, the loss of revenue (is because of redevelopment) throughout the State is why California is on the verge of bankruptcy. Our schools, police and fire dept.’s get funds from the state, so in essence, redevelopment is stealing funds from our teachers, schools, police, fire dept’s.

        It sounds like you don’t understand how redevelopment works.

        And FYI: Bankhead’s on your side, Norby’s on the side of fairness for all: city (N.E.W. & S Fullerton), County, State… all people effected.

      2. Diana… while you might get warm and fuzzy over the thought of “redevelopment”, there is more to the issue you should be aware of.

        All tax increments (increase in tax from changes in the land use or improvements commonly used for schools, infrastructure, law enforcement, etc) of properties located in a “redevelopment zone” go to the Redevelopment Agency. They have to use this money for “redevelopment” and things like parks and EXCLUDED. (Believe it or not).

        The County and City do not want their ‘piece of the pie’, they want to be able to pay for increase in impact on government services.

        Imagine, this; if the redevelopment agency converted a parcel (or parcels) from 10 homes built in 1970 to to a large residential development with 200 condos, the redevelopment agency receives all the tax increase. So, instead of that tax increase going to our schools, vector control, fire departments, law enforcement, etc to pay for the new 400-800 residents, it goes to the redevelopment agency who cannot use it for any of those services or even parks nor streets. Does that make sense to you?

  23. These posts are so uneducated and sophomoric it is sickening. Bushala needs to be institutionalized along with his neighbor Shawn Nelson and cracked out friend Chris Norby.

    1. We try our best! And people seem to like it! Our numbers just keep going up. So come back soon #36, and enjoy the show.

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