What’s In Your Wallet?How Redevelopment Agencies Divert Millions From Public Safety

Fire Chief Steve Foster, Cosumnes FDBusiness Officer John Ebner, Cosumnes FD

Presentation Abstract The Cosumnes Fire Experience

Impact of RDA law on public safety

(Unintended) consequences of RDA law

Amending or changing RDA law

What’s In Your Wallet?

Cosumnes CSD Fire Experience Reorganization into the Cosumnes Community

Services District (November of 2006)

Cosumnes CSD inherits the Galt Redevelopment Agency

Original RDA enacted in 1983, was set to expire in 2011

RDA amended in 2007 with and extension and expansion

What’s In Your Wallet?

Cosumnes CSD Fire Experience Unintended consequences of Galt RDA

Diverting approximately $550K per year (and rising) from the Cosumnes CSD Fire Department

Total amount diverted by the Galt RDA could be as much as $38 million over the next 30 years

What’s In Your Wallet?

Cosumnes CSD Fire Experience What could you do with $38 million?

Galt RDA developed agricultural land into homes and an industrial park for which the Fire Department has received no property taxes for the services we provide

Is this an abusive use of RDA law?

What’s In Your Wallet?

Cosumnes CSD Fire Experience Where does abuse occur in RDA law?

Agricultural land Blight Notification and cooperation with other taxing

entities Limited challenge opportunities Bonding General Plan nexus

What’s In Your Wallet?

What is Redevelopment? California Community Redevelopment Law

(CRL) California Health and Safety Code beginning

with 33000 et. seq. California Community Redevelopment Act

(Enacted 1945; revised 1993)

Over 400 California cities and counties have adopted local redevelopment plans

What’s In Your Wallet?

The Goals of Redevelopment Attract new jobs and business Create affordable housing Stimulate private investment Reduce crime Build or improve infrastructure Preserve open space Transform hazardous waste sites

(Brownfields) Initiate and fund planning efforts

What’s In Your Wallet?

What is a Redevelopment Agency (RDA)?

Separate public body reporting to a local governing agency

Any county or city can establish an RDA

Local governing body usually serves as the RDA board

What’s In Your Wallet?

What are an RDA’s powers? Adopt a budget Buy and sell property Make certain types of loans or grants Construct improvements Rehabilitate, modernize, consolidate, or

remove structures Assist in developing or rehabilitating low-

income or moderate income housing

What’s In Your Wallet?

What are an RDA’s unique powers? The ability to purchase private property for

resale to another private person or organization

The ability to use the power of eminent domain

The power to collect property tax “increment”

What’s In Your Wallet?

How does a typical RDA accomplish its goals?

Assembles land for development

Utilizes tax increment and issue bonds

Invests in infrastructure to entice private enterprise

Creates affordable housing opportunities

What’s In Your Wallet?

How does a typical RDA work? Alters the distribution of property tax

revenue

Only applies to property within the redevelopment project area

Adheres to the adopted or amended Redevelopment Plan

What’s In Your Wallet?

How does a typical RDA work?

Existing taxing agencies (such as Fire Districts) continue to receive property tax allocations consistent with those up to the plan/amendment adoption date

Property tax increases are then frozen and incremental increases, with the exception of pass-through payments, are taken by the RDA

What’s In Your Wallet?

How does a typical RDA work?

In theory, a successful redevelopment project increases the value of property within, as well as around, the redevelopment project area; generating even more value and an increase in the resultant property taxes

What’s In Your Wallet?

How an RDA affects Fire Services

City Fire Departments

Fire Districts

What’s In Your Wallet?

Fiscal Impacts to Fire Districts Annual loss of property tax increments for

the life of the Redevelopment Agency

What’s In Your Wallet?

What can a Fire District do? Get involved!

Attend all RDA planning meetings (do not miss a meeting)

Get an attorney

What’s In Your Wallet?

RDA Process

Initial Ordinance Joint Public Hearings Planning Meetings Environmental Impact Report

What’s In Your Wallet?

Things You Can’t Control Special Consideration for Individual Taxing

Agencies The RDA can’t make an exception to its rules for

a Fire Department unless all taxing agencies are given the same exception

The Redevelopment Agency

What’s In Your Wallet?

Things You Can Control Attend all RDA planning meetings (do not

miss a meeting)

Keeping the community informed

What’s In Your Wallet?

Further Reading California Redevelopment Association

Website http://www.calredevelop.org

California Department of Housing and Development Website http://www.hcd.ca.gov/rda/

Local, Regional, and State RDA websites

What’s In Your Wallet?

What’s In Your Wallet?