Critics Decry Merger of Redevelopments

The City Council was taken by surprise this week when strong public opposition developed to a proposal to merge two redevelopment projects so that one can pay the other’s debt.

The council is considering the use of tax revenues from the successful Central Commercial Redevelopment Project to clear up the lingering debt of the Freeway Redevelopment Project, which has produced little development.

During a public hearing Monday, 10 property owners denounced the proposal as a prelude to the seizure of land under eminent domain, drawing cheers from about 100 people in the audience.

“I have been under this cloud for 10 years,” said Judy Shieh, who owns property in the Central Project area along Garvey Avenue, Atlantic Boulevard and Garfield Avenue in the northern part of the city. “My tenants are worried and I am worried because we are under the eminent domain death threat.”

Bank of America, which has branches at 969 S. Atlantic Blvd. and 110 W. Garvey Ave., and Alhambra-based All-American Land Corp., which owns property in Monterey Park on east Garvey Avenue, gave the city written notification of their opposition to the merger.

The concern over eminent domain was apparently aroused by the mailing of registered letters to property owners informing them of the public hearing on the merger proposal.

But council members said they have no intention of condemning anyone’s property.

The only reason to combine the two projects would be to repay the city the $517,000 it loaned the Community Redevelopment Agency in the mid 1980s to service the debt of the Freeway Development Project and to continue paying $170,000 annually until the project’s 25-year bonds are paid off, said City Manager Chris Jeffers.

The project, at the intersection of the Long Beach (710) and San Bernardino (10) freeways, issued bonds in 1977, before the passage of Proposition 13. Because the area was never developed to the extent planned, causing property taxes to remain stagnant, the Freeway Project has had to borrow from the city to make its bond payments, Jeffers said.

By law, the redevelopment agency cannot take tax revenues generated by one project to pay off a debt incurred by another. By merging the two projects under the Central project’s name, the redevelopment agency could pay off the Freeway Project’s 14-year-old debt.

“Nobody is taking your property,” Councilwoman Marie T. Purvis told nervous property owners on Monday, expressing disbelief over the vehemence of their testimony. “There is no condemnation here. There are not even any projects here. No one is changing your zoning. You have always been in a redevelopment area.”’

Only Mayor Samuel K. Kiang opposed the merger, saying it would be more financially responsible to sell one parcel of the unprofitable Freeway Project land back to Los Angeles Corporate Center Venture, from which it was originally purchased in 1990, and use the $4 million it would bring to pay off the debt to the city.

“I believe that each project should stand on its own financial strength,” Kiang said. “I hope that we will be more careful with our investments in the future.”

But Purvis said: “Corporate Center doesn’t want to buy it. They sure wouldn’t give $4 million for it. That idea isn’t going to work.”

The council voted to respond to the written objections of Bank of America and All-American Land Corp. and to take up the merger issue again at its July 27 meeting.