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City wary of future payments

Ryan Carter

Several city- redevelopment projects progressed this year, but city

officials have concerns over continued large payments of property-tax

revenues to the state that could jeopardize future redevelopment



Questions linger over whether the Redevelopment Agency -- which

collects revenue from portions of the increase in tax-increment value

from a redeveloped property -- will have to make another large


payment to the state next year. Those payments were required by

former Gov. Gray Davis the past two years to help fill a state

education fund.

For the 2003-04 fiscal year, the agency will give $1.3 million to

the state’s Education Revenue Augmentation Fund. The fiscal year

before last, about $800,000 went to the fund, officials said. Local

officials are concerned about the possibility that Gov. Arnold

Schwarzenegger’s administration will continue the required payments


in his proposed 2004-05 budget, due out in January.

“The concern is that [the payments] will continue, and that would

be damaging to the Redevelopment Agency,” said Derek Hanway, the

city’s financial services director. “Property-tax revenues are at

stake, and the question is whether you keep it local.”

Redevelopment officials are bracing themselves.

“Is it possible we will have to make a payment? Yes,” said Ruth

Davidson- Guerra, assistant community development director for


Housing and Redevelopment.

“If it is at the same level as this year ($1.3 million), will it

put us in jeopardy? No. Will it impact our projects? Sure. What would

be at stake is our ability to embark on new projects.”

Officials presented an update on the progress of the city’s

redevelopment projects and the amount of tax revenue they generated

for the city in the 2002-03 fiscal year at Tuesday’s City Council


The agency collected $13,600,821 in tax revenue from the Golden

State Project Area, which includes the Empire Avenue corridor in the

area of the city bordering the Burbank- Glendale-Pasadena Airport,

which was scheduled to be renamed Bob Hope Airport today. The agency

collected $1,118,472 from the South San Fernando Project Area. The

West Olive Redevelopment Project Area brought in $2,741,464 in tax

revenue and the City Centre project, which includes the revamped

Burbank Entertainment Village and areas within the civic center,

generated $5,887,074.

The agency takes 20% off the top of its tax revenues to put back

into its community housing programs, and it still must cover

recurring debts from projects, Davidson- Guerra said.