RDA shutdown crunches Menlo Park budget | January 25, 2012 | Almanac | Almanac Online |



News - January 25, 2012

RDA shutdown crunches Menlo Park budget

by Sandy Brundage

A clearer picture is emerging of how the redevelopment agency (RDA) shutdown will impact Menlo Park's budget.

After the California Supreme Court ruled on Dec. 29 that the governor did have the power to shut down the nearly 400 RDAs in the state and also nixed a plan that would have let cities pay to keep the agencies open, Menlo Park staff started analyzing what that decision meant for the city.

The agency's non-housing assets will be turned over to a successor agency and fund controlled by San Mateo County; housing assets will be reassigned to a successor housing agency run by the city. Some aspects of the impact have already been discussed — the city's code enforcement, narcotics enforcement, graffiti abatement, and housing programs relied heavily on RDA funding.

Now it looks like the effect of losing almost $3.1 million in agency money will ripple through other programs as well, including the city's midday shuttle bus line, which received $70,000 in RDA money annually, according to the staff report.

The agency also partially funded 37 staff positions. Capital improvement projects on the chopping block include Belle Haven pool upgrades ($128,269); Kelly Park improvements ($1.3 million); and other items for a total of $7.4 million in now unfunded projects.

The San Francisquito Creek Joint Powers Authority will also need $100,000 from the city's general fund — the main source for making up the budget gaps created by the loss of RDA money — to continue its flood control measures.

The debate over what to do with the RDA's housing assets has taken shape since the announcement of the court's decision. Former councilwoman Lee Duboc sent out an email asking the council to prevent the general fund from covering any housing costs, saying in part that the department was unproductive and that no one wants below-market-rate (BMR) housing in Menlo Park, leaving the department sitting on funds the county could put to better use.

However, architect Sam Sinott disagreed. In an email to the council on Jan. 21, he wrote, "There are immediate opportunities for BMR housing in Menlo Park. Doug Frederick, Menlo Park's housing manager, and I have been exploring the possibility of a 100% BMR housing project at 1258 El Camino Real, next to Jason's Cafe. Because this narrow, difficult site is not well suited for must uses, it works for Below Market Rate housing."

Menlo Park has come under fire during the past two years for accepting in-lieu fees instead of BMR units from developers of new housing projects. The city's current stock of 57 affordable housing units isn't sufficient to meet demand, according to the Housing Commission.

The City Council will examine the impacts during its meeting on Tuesday, Jan. 24, and try to decide which programs can be funded from other sources, and which need to be cut. The meeting starts at 7 p.m. in council chambers at the Civic Center at 701 Laurel Street.

Go to tinyurl.com/6p5owdb to read the staff report.


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