Redevelopment projects escape ax, for now

The planned Museum of Neon Art and parking for a proposed Laemmle Theater remain alive after surviving a round of cuts aimed at redevelopment projects this week.

Also safe, at least for now, are millions of dollars in capital improvements to the Alex Theatre, which has been in a state of limbo as officials work to dissolve Glendale’s redevelopment agency.

In February, a state mandate killed redevelopment agencies statewide, redirecting the property tax revenues Glendale and other cities received from such projects to Sacramento to help close a multi-billion dollar budget gap.

As part of the dissolution, city, county and education officials who make up an Oversight Board must decide if there are any local redevelopment projects that can be eliminated or altered to increase tax revenues flowing to the other agencies, such as the Glendale Unified School District.

On Wednesday, the board approved keeping the city’s contracts for a handful of high-priority projects. But they still face several hurdles.

The California Department of Finance must approve decisions by the Oversight Board, which still could reverse course on the Museum of Neon Art.

It’s all part of a complex, and according to some board members, confusing process in which local officials must weigh their state obligations against existing development agreements that, if broken, could leave Glendale exposed legally and financially.

For example, if the Oversight Board decides to void a $5.2-million deal between the now-defunct Redevelopment Agency and MONA to open across the street from the Americana at Brand, the city could be sued for breach of contract.

Although the liability would be on the city’s shoulders, a loss could affect county and education agencies too because a costly lawsuit could eat up leftover redevelopment money that would otherwise be distributed to those agencies.

“The money is still at stake,” said Charles Green, the Oversight Board’s attorney. “Do you get sued? No. Is there a cost to you? Absolutely.”

The board did approve the Laemmle Lofts project, which includes a theater, retail space and 42 apartments near the Alex Theatre, as well as $1.1 million more to build underground parking for the project, which had relied on a public parking garage.

But that was on the condition that a city plan to redistribute property taxes from the project is approved by the county, city, Glendale Community College and Glendale Unified. If it’s not, the parking garage agreement gets pulled.

It’s a complex maze of decisions with multiple consequences that, in turn, bring up a whole new set of choices — a process that kept the four attorneys present the recent meeting fielding a constant barrage of questions.

“Maybe we need to have ‘Redevelopment Dissolution for Dummies,’” said Oversight Board member Albert Abkarian.

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