Redevelopment on the Chopping Block?

Dear Friends, I just returned for my first full legislative term here in Sacramento, having gained valuable experience serving for the past 10 months since the special election. One announced reform I can embrace is the new governor’s goal of abolishing redevelopment agencies and restoring their funds to counties and schools. As a longtime critic of these agencies, I’ve been called by numerous media outlets and colleagues on issues related to this little understood level of government.

Redevelopment agencies capture 12% of all property taxes statewide-that’s $6 billion annually diverted from school districts, counties and municipal police and fire protection. The funds are largely spent subsidizing private development projects whose promoters acquire land under threat of eminent domain, while 20% pays for low income housing projects.

The government should not be in the business of subsidizing private developers, nor of building housing projects. That’s the job of the private sector. This money needs to be restored to pay for infrastructure and services. Public money should build classrooms, not Costcos.

The agencies cannot be closed, however, until their nearly $100 billion indebtedness is paid off, but a phase-out over time could start, and long-evaded sunset clauses enforced.

While the legislature requires me to be in Sacramento on a weekly basis through June, I’ll keep regular district office hours every Friday. Visit or call 714-672-4734. I’m there for you.

Steele Speaks the Truth

“If he [Obama] is such a student of history, has he not understood the one thing you don’t do is engage in a land war in Afghanistan? Everyone who has tried over a thousand years has failed and there are reasons for that.” In restating this obvious historical fact, Republican Chairman Michael Steele has roused a chorus of neocon critics calling for his resignation.

Instead, they should heed the words of Douglas MacArthur, who warned another young president—John F. Kennedy—in 1961: “Anyone wanting to commit American ground forces to the mainland of Asia should have his head examined”.

Those who take issue with Steele should state why he—and MacArthur—are wrong. And we Republicans who believe they should be heeded should speak up. I am one of them. There are others who question an open-ended commitment of blood and treasure to prop up Hamid Karzai and his illusory government.

Texas Congressman Ron Paul has issued a statement in support of our embattled party chief. Conservative commentators like George Will, Joe Scarborough, Pat Buchanan and the late Bob Novak long expressed similar concerns about open-ended nation-building experiments.

Afghanistan has never been a nation in the conventional sense. It has had neither effective central government nor the civil and cultural institutions that can support one. It is unfair and unrealistic to expect our military to create such a nation. There are an estimated 100 Al-Qaeda operatives in Afghanistan. There are better, more focused ways to suppress them without fighting a conventional ground war.

It is Obama who decided to send an additional 30,000 ground troops. Why should Republicans blindly support this vague and open-ended commitment? Would Reagan have done so? He wisely decided against a similar quagmire in Lebanon, which is far smaller than Afghanistan. Bush Sr. was equally prudent in his use of ground forces only for clear and achievable objectives.

I visited Afghanistan once in 1973, a relatively placid year. Still, there was little civil authority outside a few major cities. I traveled on the one national highway by daylight. Governing is conducted by a medieval mix of clan loyalties with informal village councils tempering endless family and regional feuds. Language differences made communication difficult and male civilians are heavily and openly armed. Loyalty is to family and clan, not to a nation. Afghanistan has never had a top-down government and has fiercely resisted all attempts to impose one.

Steele many not survive as GOP Chair. But our party leaders need a better answer to Obama’s confused Afghanistan policy. Republicans should be skeptical of massive costly federal undertakings such as foreign nation-building. Our troops, our budget and our national security deserve another approach.

Chris Norby: Why I Support Bill Hunt for Sheriff

Four short years ago – 2006 – Bill Hunt challenged Sheriff Mike Carona’s re-election. Carona was well funded and had the backing of the entire OC political establishment – including me. That was my mistake. Our mistake. We already knew there were serious leadership issues in the Sheriff’s Department, serious enough to at least stay neutral. But we didn’t.

Three challengers received 49% of the votes, just a shy of forcing a November run-off. Of those three, Lieutenant Bill Hunt received by far the most votes. Give him credit for standing up and running, for taking an underfunded campaign without endorsements and nearly making it a 2-man run-off in November.

When Carona was forced to resign, I supported another candidate (Santa Ana Police Chief Walters) who had also nearly been elected – in 1998. I give my consideration and respect to those who want a job enough to actually place their name before the voters. Of the three current Sheriff’s candidates, only Hunt has actually received any votes in an election. The three votes our current Sheriff received came from the Supervisors who appointed her. Based on her subsequent performance, it is doubtful those three votes would still be there today.

A sheriff should protect people’s liberties – not restrict them. The current appointed Sheriff has arbitrarily revoked legally issued CCW permits of law-abiding citizens who did nothing to deserve such treatment.

A sheriff must face economic facts and work with the Board of Supervisors to adjust to revenue realities – not play a game of fiscal “chicken” and budget brinksmanship.

A sheriff must instill in staff a respect for elected decision-makers – not use security cameras to spy on them. They should respect citizens’ rights to voice their opinions – not use government-issued blackberries to belittle them in public meetings.

Bill Hunt understands this. He was there for us in 2006. He’s there now, again.

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.