Plan for ‘Blighted’ Area Rankles Some

Yorba Linda officials say they’re just trying to beautify a blighted and underused downtown.

Some residents, however, are alarmed by what they consider the City Council’s underhanded attempts to quietly push plans for development many thought had been scrapped -- particularly since it could mean the loss of their businesses and homes.

The Town Center project encompasses the city’s Old Town, north of Yorba Linda Boulevard along Imperial Highway. The city hopes the development will bring in shoppers and liven up a dull area. Details are still vague, but the city’s master plan outlines a mixed-use area of housing and upscale shopping areas, as well as architectural improvements to existing buildings.

Ed Rakochy, a member of the Yorba Linda Historical Society, is among those raising red flags about the project. “Right now you’ve got no reason for people to come downtown,” he acknowledged, “[but] instead of giving money to large-scale housing, restaurants and retail, the project should be smaller-scale, paying more attention to historic resources.”

Weeks after settling a lawsuit involving a special tax district that would fund the downtown upgrade, the council, acting as the city’s redevelopment agency, voted at a meeting last week to begin courting Los Angeles-based developer Creative Housing Associates.

Opponents say they’re not necessarily against the development; they just don’t like the way the city went about approving it. They accuse the council of purposely placing the vote on an agenda after a four-day holiday weekend so few would have time to read up on the issue.

Some were also angered that no public hearing had occurred. The city attorney countered that such a hearing at this point wasn’t a legal requirement.

“This is not a development deal,” Mayor Ken Ryan said at the meeting. “This is, ‘Do we think this is potentially the right partner that we want to get into a pre-marriage deal with?’ ”

City officials insist their actions are aboveboard and say a handful of gadflies are just trying to sideline a long-awaited face-lift for Old Town because they are afraid of change.

“Everything we have done with Town Center has been very public,” said City Manager Terrence Belanger. “Our passion is trying to create a Town Center area that the community can be proud of and that the community is going to want to use and to visit and even want to live [in].”

To that end, Creative Housing Associates was chosen from a field of six candidates -- a sore point with the critics, who say they didn’t even know the city was holding discussions with anyone on the project.

“You have been alarmingly silent,” resident Jeanne Tamulinas admonished the council at the meeting. “I mean, you could hear a feather hit the floor.”

Over the last few months, the council weeded out half the developers and asked the remaining three to submit informal proposals for the downtown area. Creative Housing Associates, which touts itself as a “community builder,” was deemed the best fit for further negotiations.

The company proposed buying about 11 acres from the city to build a 321-unit mix of courtyard- and loft-style homes. A 70,000-square-foot chunk would be set aside for upscale shops anchored by an art-house theater. If the agreement is approved, Creative Housing Associates would be able to buy millions of dollars’ worth of city land and break ground on the project.

The Town Center project came about in the early 1990s, when the council declared the Old Town area “blighted” so it would fall under the umbrella of a tax district set up to fund city improvements.

Once designated, the districts divert increases in property tax revenues from public agencies, such as schools, to pay for improvements to blighted areas. The problem, many agree, is that the law is so vague, almost any area can be considered blighted.

Town Center may be run-down but it’s far from blighted, some residents say.

“Orange County is one of the most affluent communities in the United States,” Rakochy said. “We don’t have blight.”

But, as Rakochy pointed out, “blight is in the eye of the beholder,” and the council began acquiring property it didn’t already own in the project area.

Over the last 10 years, the city has gathered 26 parcels -- about seven acres, Belanger said. Some property owners were forced off their land under the threat of eminent domain, which allows a city to acquire land from an unwilling seller as long as the land is for public use.

Belanger said the city would like to add at least five more acres to what it already owns. It is short of the total acreage Creative Housing Associates hopes to buy.

Property owners fearful of being shoved off their land got a reprieve when redevelopment plans were delayed in 1999 after the Placentia-Yorba Linda Unified School District sued the city redevelopment agency for withholding tax funds that had been promised to schools.

An Orange County Superior Court judge halted the city’s special tax district for the length of the lawsuit, saying the redevelopment agency was not allowed to incur debt on behalf of the project.

The judge sided with the school district in 2002 and ordered the city to pay $240 million in back revenue. The city appealed, and an out-of-court compromise was reached last month when the city agreed to pay $6.6 million to the school district and to split future revenue from the tax district.

Now, residents say, they are back to worrying about losing their businesses and homes.

The council, Tamulinas said, keeps talking about what “we” want. “Is it ‘we’ up here,” she asked before last week’s vote, motioning to the council, “or is it the rest of us?”

Times staff writer Susan Anasagasti contributed to this report.