Ron Kaye: Glendale seeks straight story

Twenty months after Gov. Jerry Brown and the state Legislature abolished community redevelopment agencies statewide, local officials have gone through all the stages of grief — from horror to anger to confusion.

Now they have reached the point where all they can see is darkness at the end of the tunnel of their experience, uncertainty over whether the revised redevelopment law and its interpretation by state Finance Department officials will be the same in six months or six months after that as it appears to be today.

For all the successes that cities like Glendale and Burbank claim in terms of using the property tax dollars they kept under redevelopment to create projects like the Americana at Brand with new jobs and long-term revenue streams, regenerated neighborhoods, upgraded infrastructure and affordable housing, there were endless examples of abuses.

Take Los Angeles, where the CRA was little more than a slush fund providing welfare to the rich and to giant corporations — not as the law was intended, to remove blight and support a healthy economic future for the community.

“When you look at the communities that abused the program, yes it's cleaner, but a lot of cities used redevelopment appropriately and did some good work, as we did in Glendale,” said Phil Lanzafame, chief assistant director of community development.

“I'm not asking for the redevelopment law back; I'm not asking for a new tool. I'm just asking for some surety going forward so that we don't get into the same bind again where for 60 years everybody recognized what was lawful and then in one year cities were told, ‘OK, you're on your own. It's over.'

“We fought it. We challenged it. The court didn't agree. We lost. So now we've bit the bullet. But going forward, we don't know if we can rely on the law they've given us. How we can plan anything when we don't know what the rules will be in six months or the six months after that.”

The heart of the financial problem for Glendale is that in order to expedite projects, the city lent its redevelopment agency $78 million and was being paid back $6 million to $7 million a year with interest from the increased tax revenue that otherwise would have gone to the state.

At first, state officials said tough luck to Glendale and other cities — loans from a city to its redevelopment agency would not be recognized as legitimate. Then the rules were changed, and it was agreed the loans would be repaid but not with the accrued interest if a long list of vague and cumbersome procedures were met.

For Glendale, that meant if its Recognized Obligation Payment Schedules are accepted in April, the city will start getting its money back in dribs and drabs over the next dozen years or so, starting with more than $2 million next fiscal year and going up year after year.

“When we were told the cooperative agreements [the city loans for redevelopment] were not enforceable, we wrote it off the books, took all $78 million off our balance sheets. That's why the rating agencies teed off on us and made the cost of our borrowing more expensive,” said City Manager Scott Ochoa.

“Now, it looks like we'll be getting a lot of it back,” Ochoa said. “It's like found money now that can go into capital outlay, into restoring services that have been cut, into shoring up the technology infrastructure that had been cut.”

Not so fast. There's a big but — the inevitable but — about getting the money.

To get their money, cities have to submit the ROPS report every six months to the Department of Finance, and there's no guarantee the rules or the interpretation of the rules will be the same each time or that the redevelopment law with its vagaries and inconsistencies will not be changed yet again.

“History has shown us [that] these folks are drowning in Sacramento, and they won't think twice about purloining those resources that were earmarked for local government and decide maybe we'll just keep that money to pay our bills,” Ochoa said.

That certainly has been the case numerous times over the last 25 years, as the Legislature has found ways of taking money that was supposed to go to local governments, even when voters approved constitutional protections intended to stop the raids.

Earlier this month, Ochoa criticized the city's out-of-town legislators — Sen. Carol Liu, who lives in La Canada Flintridge, and Assemblyman Mike Gatto, who lives in Silver Lake — of only showing up “to hand out certificates and the cut the ribbon” for groundbreakings.

That's exactly what happened last week when Gatto sent a representative with a proclamation to make a cameo appearance at a Downtown Glendale Business Assn. ribbon-cutting for a new project that its members paid for themselves through a tax assessment they approved.

This week, Ochoa plans to write Liu and Gatto and ask for more substantive support.

“What we want from them is legislation or a legislative finding that the law as it is applied today will be the law for the foreseeable future,” he said. “We have been good little puppies and played by their rules, but we can't write a budget or plan for the years ahead without knowing what the rules are and where our money is coming from.”

Good government, careful planning, consistency, stability — those are concepts that have been foreign to Sacramento for a long time. Maybe you all should join Ochoa's letter-writing campaign to Liu and Gatto and remind them Glendale is that city on the map between their residences.


RON KAYE can be reached at Share your thoughts and stories with him.

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