Dismantled agencies leave a fog of questions [Corrected]

COSTA MESA — While the long-term effects of a state Supreme Court decision last week to break up California's redevelopment agencies are hazy, what's clear in the short term is that a tangled web of local, county and state agencies will be left picking up the pieces, city officials said.


An earlier version incorrectly said the redevelopment agency oversees the Costa Mesa Village shopping center off Bristol Street. In fact, it's the Costa Mesa Village apartments off Newport Boulevard.

In its effort to reclaim tax revenues to plug a state budget gap, the state Legislature consequently threw into jeopardy planned redevelopment projects statewide and millions of dollars in debt obligations.

Now city officials, like many throughout California, are trying to figure out what the court's decision upholding the legislation means for them. The court's ruling created layers of bureaucracy, with a "successor agency," most likely the city, a county agency and even state officials having a say in where redevelopment agency (RDA) money and assets go.

"It's a significant challenge," city CEO Tom Hatch said at Tuesday night's City Council meeting. "It's going to take some time to understand fully that impact."

Costa Mesa's RDA owes the city about $10 million, which now has to be approved by an outside agency as an "enforceable obligation" that can be repaid. RDAs take property tax revenue from parts of a city that are officially considered blighted and recycle them back into improving that community.

Officials are still unclear about the hierarchy created by the ruling but are working through the court's expansive decision.

In the immediate future, questions about administration need to be answered, said Neighborhood Improvement Manager Muriel Ullman.

For example, Costa Mesa's RDA oversees the Costa Mesa Village apartments at 2450 Newport Blvd. The project was created in 1991 through a partnership with the county using federal and redevelopment funds.

The agency handles the center's inspections, rent and other tenant issues.

"It's unclear at this point to whom those responsibilities would fall," Ullman said

California's RDAs circulate $5 billion in property-tax revenues back into local hands, with about $1 billion of that going toward affordable housing, the Los Angeles Times reported. The court's ruling also creates a $1.7-billion hole in the state's budget, according to the Times.

Costa Mesa is planning to have a meeting updating the council and public on the ruling's effects next week.


Twitter: @JosephSerna

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