What’s In Your Wallet? How Redevelopment Agencies Divert Millions From Public Safety Fire Chief Steve Foster, Cosumnes FD Business 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 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  California Department of Housing and Development Website  Local, Regional, and State RDA websites What’s In Your Wallet?