CRA’s Financial Condition After Recession

The Times does itself and its readers a disservice by failing to tell the whole story of the Los Angeles Community Redevelopment Agency’s history and failures in “Lagging Property Tax Values Put CRA in Financial Pinch” (May 21). You could have included an analysis of the CRA’s greed and avaricious appetite for power at taxpayers’ expense. That is what dug the financial grave the agency is now wallowing in. In Los Angeles only one small project, Ann Street, has closed down since the city’s CRA was created in 1948. And that was in 1962. All the other projects continue to siphon taxes from the general fund to the CRA, taking money that would otherwise be available to pay for the police, fire, library, parks and public health services that desperately need funding.

According to the city’s chief legislative analyst, over 80% of tax increment revenues through 2000 are committed to payment of the CRA’s debt service. That figure was calculated in 1995. With the decreases in assessed valuation, the percentage of taxpayers’ money used to pay debt is most assuredly higher now. The CRA’s answer, instead of returning money to the general fund, is to continue to siphon it off, by creating more projects and increasing the “caps.” L.A.’s Bunker Hill project, adopted in 1959, is a prime example.

In 1977 the CRA Board of Directors made headlines when it announced “End of Bunker Hill Work Seen by ’86 . . .; $43 Million Tax Return to County Units Proposed.” Instead, in 1986, the mayor, City Council and CRA did not terminate the Bunker Hill project. They extended it for 20 more years and raised the spending cap from zero to $2.5 billion. That’s the amount of property taxes the CRA will divert from the city, county and school board, further aggravating their ability to provide basic services to their constituents without a tax increase.

It’s these kinds of arrogant power moves that have led to the introduction of bills in the state Legislature such as the one recently put forth by state Assemblyman Thomas McClintock (R-Northridge) to dissolve CRAs completely (AB 923). According to a 1993 projec- tion, if the CRAs’ way of doing business isn’t stopped, the tax increment claimed by CRAs throughout the state will climb to $5.2 trillion by fiscal year 2010-11. This is debt that the voters were never asked to approve and are not even aware of.

ERNANI BERNARDI

Van Nuys