City Takes Steps Toward Redeveloping Second Area : Government: A program similar to the one that revitalized downtown is expected to be approved for 750 acres along San Fernando Road.

After 11 months of study and dozens of community meetings and public hearings, the Glendale City Council on Tuesday adopted a series of resolutions and introduced an ordinance to form a second redevelopment zone in the city.

The new zone comprises 750 acres of largely industrial property along San Fernando Road, parallel with the Golden State Freeway from the southern tip of Glendale north to Burbank.

The zone will allow the city’s Redevelopment Agency to collect an estimated $712 million in increased property taxes over the 35-year life of the project. The revenues could be used to upgrade and expand businesses and create jobs.

The city also could spend about $115 million of the new revenues on improvements to streets, sidewalks, storm drains and utilities and to help develop a light-rail system and train stations along the Southern Pacific railway tracks.

State redevelopment law allows cities to collect a portion of property taxes generated from new development to help pay for additional private and public improvements. Cities also are given the power of eminent domain to assemble small lots into large parcels that otherwise could not be acquired by private developers. Cities often pay a portion of development costs because they can recover expenses from new property taxes.

City officials said they do not expect redevelopment to begin immediately. Although some cities issue bonds to fund projects in anticipation of future revenues, Glendale traditionally has waited to spend funds until they are earned.

Redevelopment Director Jeanne Armstrong said it will take at least four or five years for the city to accumulate enough money to begin investing in the zone. “In that period of time we will be developing proposals,” she said.

Glendale’s 263-acre downtown redevelopment zone, the city’s first project, was formed in 1972 and facilitated development of the Galleria shopping mall and most of the high-rise office buildings and improved shopping areas that flank North Brand Boulevard. That project, which also includes restoration of the historic Alex Theatre and other proposed improvements, is expected to take 20 more years to complete, officials said.

An ordinance forming the San Fernando Road zone is scheduled to be adopted Tuesday by the City Council, which also serves as the five-member Redevelopment Agency. The ordinance will go into effect in 30 days.

Opponents have until Feb. 15 to file legal action to halt formation of the zone, Armstrong said. Glendale school district officials have threatened to sue for a greater share of property tax revenues from the new zone than the state-recommended 2%.

Residential development within the zone is expected to be minimal--with only 37 new residential units projected--because of zoning laws. However, to meet the requirements of state law, 20% of funds generated by the project would be used to build low- and moderate-income housing in other areas of the city. That is why the school district is seeking a greater share of funds--as much as 10%--to build facilities for increased enrollment. Armstrong said negotiations with district officials are continuing.

An environmental impact report adopted last month determined that the number of businesses within the zone could double if the project is fully developed. About 5.8 million square feet of new and expanded commercial and industrial development could be built.

During a series of public hearings, dozens of property and business owners said they fear their land will be taken from them through the city’s power of eminent domain. However, officials on Tuesday repeated past assurances that the city does not intend to start acquiring land in the near future.

“We want to encourage businesses to stay and to expand,” Armstrong told about 50 people gathered at the final public hearing. She said the city will use some of the tax increment funds to provide low- or no-interest loans for private improvements to run-down property.

If the city decides to acquire property, it is required by state law to pay full market value for the property and to pay relocation costs to tenants and businesses.

Mayor Carl Raggio said the zone will allow the city to obtain property tax revenues that otherwise would go to other governmental agencies and to use the money for local improvements. “I view this as being a positive thing for the city of Glendale,” he said. “It is the epitome of local control.”

Resolutions to establish the zone were approved 4 to 0 by the joint council and agency. Councilman Larry Zarian was legally required to abstain from voting because he owns property close to the zone.