RAC told future will be leaner
The Springs Redevelopment Advisory board found out Thursday that life is going to get a little tougher - and tighter - under Gov. Jerry Brown's new budget.
John Haig, the county's redevelopment manager, spelled out what things might look like going forward - but kept cautioning the board that right now he and the people in the county and state redevelopment agencies are trying to make RDA calculations without any concrete numbers.
"This is all based on what we think they're saying," Haig said.
But he told the board that the Highway 12 project should proceed as the county has already sold $15 million in bonds and had a signed contract with the county's Public Works department for the project.
Steve Cox, chair of the Springs RAC, said life will be different for redevelopment in the future.
"The state budget looks like it will be a real blow to redevelopment in the Springs. The Highway 12 improvement project is pretty well protected, but funds available for future projects will be greatly reduced by the state's grab of local tax dollars," Cox said. "At the next RAC meeting, we'll study the effects in more detail and start prioritizing our strategic projects. Lawsuits are being filed against the legislation in the budget that has, in effect, put redevelopment throughout California 'on hold' until September."
The board was told the state budget froze redevelopment agencies as of June 30, and unless a governing body, such as the Board of Supervisors in Sonoma County's case, reinstates the agency by Oct. 1, the agency would be dissolved. But in order to reinstate a redevelopment agency, the governing body would have to pay an "opt-in fee" that would be plus or minus $3 million for Sonoma County.
A couple of months back, the advisory board had requested the county put another $575,000 into the façade improvement program, but Haig told the board that until the Supervisors decide on whether or not to reinstate the agency, no more contracts for façade improvement could be signed.
And even then, the façade improvement program could be something that falls by the wayside because the redevelopment agency is going to need about $3 million for the "opt-in fee."
The $3 million fee is a one-time payment to the state to raise $1.7 billion to balance the state's budget. In future years, it could cost the redevelopment agency anywhere between about $400,000 and $700,000 to continue. And every project that gets started will add an additional fee to the yearly cost.
"As an example," Haig said, "if we've got $9 million in cash and owe $10 million for Highway 12 and another $1 million for façade improvement, we'd have to borrow $2 million and pay the state a fee on top of the interest we'd pay."
Haig put it bluntly to the board, "Do you want to borrow or pay as you go. Any new responsibility would be subject to extra charges."
Board member Dave Whiteley, who had asked about the façade improvement, asked if the proposed wayfaring signage the board has been looking at recently is also on hold, and Haig told him that it too is frozen. The agency is trying to perform due diligence on a future use of the razed Clemente Inn on Highway 12, as well as on the Vailetti property, adjacent to the Sonoma Charter School on Highway 12. Haig said the agency can't even sign an agreement with an appraiser on the Vailetti site.
Whiteley asked if the $3.2 million in affordable housing funds that could be used on the Vailetti property is in jeopardy and Haig said that affordable housing funds are not part of the governor's take back.
Al Lerma, the redevelopment associate, suggested that the yearly contracts the agency has with Becoming Independent for trash pickup on Highway 12, and with the Sheriff's office for graffiti removal, might be better converted to multi-year contracts so that the agency doesn't get charged each year for a contract.