Menlo Park scrambles to defend redevelopment assets

Shutting down redevelopment agency would cost city millions

When the governor proposed shutting down redevelopment agencies (RDAs) across California, cities like Menlo Park began taking tactical steps in a war to protect their assets.

"Redevelopment agencies were formed to get rid of blight within a boundary, such as rundown properties, or commercial properties that are underutilized," said City Manager Glen Rojas, who described an RDA as an economic engine for the city.

"We'll lose that opportunity. That money will no longer be available, somewhere in the neighborhood of $17 million."

That money is already earmarked for projects on the city's capital improvement plan, as well as support for community services.

The governor's plan would shift control of housing assets, including below-market-rate units, to the county housing authority. It could also cash out tangible assets such as the six vacant lots and two houses along Hamilton Avenue overseen by the redevelopment agency, according to Dave Johnson, the city's business development manager.

Property tax revenues currently funneled to the redevelopment agency would instead be redistributed by the state -- an aspect of the plan supported by some school districts, since they would receive money directly instead of as a percentage passed through by the RDA.

Mr. Rojas listed as an accomplishment of Menlo Park's redevelopment agency: persuading Pacific BioSciences, now one of the city's top 25 revenue producers, to relocate to the Willows area; the city cleaned up blight and created a better atmosphere, he said.

Other accomplishments: maintaining undeveloped properties within the city, and funding code-enforcement, drug-prevention, and gang-intervention programs run by the police department.

Proposition 22, which passed in November, was meant to protect local funds like those contained within an RDA. But by eliminating redevelopment agencies, Mr. Rojas said, the state leaves nothing to protect.

The state Legislature must approve the proposal by a two-thirds vote for it to become law. And if they do?

"We lose money, we lose land, we lose control," Mr. Rojas said. "I'm not real optimistic, because the state is desperate, and when you're desperate, you do desperate things. If this gets the support of the Legislature, we're up the creek."

Mayor Rich Cline, with the help of staff and other council members, sent a letter to the governor last week. "The proposal to eliminate our RDA wipes out the only tool local governments have to drive economic growth, to build tax revenues, and grow sustainably. Why would we do this?? he wrote.

The City Council will consider what options they have to protect the city's assets at its meeting on Tuesday, Feb. 8.

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