Governor Brown is lining up votes to get his budget proposal finalized before next Thursday’s deadline. Now he has the backing of Democrats in the legislature, including Assembly leader John Perez. Redevelopment proponents are starting to admit that their only tactic going forward may be litigation, as an attempt to broker a deal by borrowing has gone nowhere in the Capitol. The last step is to get a few Republican votes, and that’s more a matter of compromise than a lengthy debate. Perez:
That would clear one of the most contentious hurdles confronting Democrats. “My preference is to not eliminate them, but the realities of the day indicates there’s not yet a viable alternative to elimination,” Perez said. “It’s a likelihood that we’ll see action to eliminate redevelopment agencies.” Mayors from California’s largest cities had proposed a borrowing scheme to keep the current redevelopment agency system intact, but Perez said Brown’s approach of replacing it with more localized efforts to focus on blight and affordable housing is a better way to go.
Seeing the writing on the wall, Oakland moved to secure some funds slated for redevelopment projects. Mayor Jean Quan took a wait-and-see approach going into this week, and now that the barbarians are at redev’s gates, it might be a good time to take what you can. Unfortunately, this puts the Victory Court plan in a fiscal limbo. No one knows how much the final cost will be, and VC would have to get in line behind other projects for a very limited pool of funds.
Should the League of Cities or its individual members decide to sue, chances are that it wouldn’t be 400 lawsuits against the state. However many there are, the courts would probably combine them into one and then rule on the issue. That issue may have to be decided sometime before the start of the fiscal year so that a state budget could be finalized. The Governor’s office is extremely confident in its stance and the cities are by-in-large showing desperation, so it’s easy to guess which party feels like it’s on more solid footing. No wonder San Jose is getting ready to create a new joint powers authority to handle the ballpark deal – a drastic step born of not being willing to take chances when so much is at stake.
The other side of the legal scale is the Governor’s office looking to stop the individual RDA’s from tying up funds or keeping assets. That part isn’t so clear as various cities are going to different lengths. The court(s) would have to set a standard by which the RDAs are/were overstepping their authority, and it’s hard to know what that standard would be. San Jose, which is somewhat unique in its landbanking strategy, may have a different standard applied as it relates to seizing or liquidating property.
Looks like we’re in for a bumpy ride, folks.
newballpark.org 
I just listened to Ray Ratto on Athletics After Dark. He really has no idea what he is talking about.
RM,
Isn’t SJRDA owned property city owned property? I could see the state stopping immediately any new bonding and ceasing TIF/redirecting tax money. But I don’t see them seizing city owned land; just my opinion.
Ratto has been consistent since 05 on his thoughts re: T-Rights and has always put the onus on SJ/Wolff to make this happen. I’ve seen him give commentary on the MLB Network, so he is a respected columnist.
He was just giving his opinion on SJ being “almost dead,” and for the reasons given I don’t agree with him.
Loss of redevelopment might be the biggest loss of the economic downturn. At this point, I think it’s safe to safe the sponsors of prop 22 overplayed their hand.
…safe to say…
Ray Ratto doesn’t know what he’s talking about while everything Mark Purdy says is gospel. Got it!
Rob,
I actually agreed with 90% of what Ratto said. The 10% I disagreed with was the “I think SJ is almost dead” stuff (key words being “I think”, meaning an opinion). And the reasons given were 1) that he believes Wolff really doesn’t have the financing /revenue for Cisco Field without (as RM alluded to) providing any proof and 2) somehow believes the RDA stuff will affect the San Jose project, when in fact no RDA bonds will be used/needed for the Cisco Field project. So I’ll say BOTH Purdy and his “good friend” Ratto preach MLB gospel but will throw in opinion (at times) which some here will disagree with.
@Tony D
Ratto didn’t have a lot of specifics to offer about the A’s. He just spouted off stuff he probably got from Urban and from reading the Chron. That’s not what I expect from someone who comes on an A’s podcast.
Proud to say I didn’t vote for Moonbeam.
I’m proud of things that no one else cares about too, Dan– exclamation marky mark.
Ratto, when he explained the purpose of the EIR, gave himself away as far A’s I am concerned. The EIR is not something Oakland wants to do to understand the impact on the Bay, as he explained. We all know it is something Oakland HAS to do for any development of this magnitude and it will study way more than how it impacts the Bay. He was talking out of his ass.
Dam autocorrect. A’s means as
So correct me if I’m wrong but here’s the situation IF this lame brained budget gets passed next week:
Oakland’s stadium plan as it stands today is dead. There will be no redevelopment funds to fund land purchases at Victory Court
San Jose’s plan MAY be in jeopardy but that will now hinge on whether or not the state tries to steal the land back from the city (and will invariably end up in litigation of some kind if that happens).
Santa Clara’s football stadium is dealt a big blow and will now be a hundred million short thus jeopardizing that project since the NFL generally requires some public investment to get the matching funds (and mind that in and of itself may depend on the CBA negotiations as well)
San Diego’s new Chargers stadium dies on the vine not unlike VC due to the lack of redev funds, opening the door for LA to take the Chargers from Sac
Escondido’s AAA ballpark dies on the vine and the AAA Padres remain in Tuscon for the foreseeable future
Did I miss any stadiums in California that would come under the knife because of Moonbeam?
Dan,
Nice post. Again, just my opinion, but I would think RDA/city owned land would be safe, as well as the ability to pay off existing debt on past bonds.
What will die is all existing/proposed TIF districts and the ability to issue new bonds backed by TIF. Am I right here RM?
I’ll give you this: Farmers Field will look awfully tempting to all existing CA NFL teams after RDA is dead.
Well based on what’s been happening with the Chargers the last few months, whomever else from CA goes to Farmers Field, if in fact the Niners or Raiders do so, will be the second tenant. The Chargers will probably sign up to move to LA before the year is out if RDA dies (and takes SD’s last ditch stadium effort with it). It’ll probably happen as fast as Sac losing the Kings seems to have gone.
@Dan – Both of LA’s projects could be in jeopardy too. Industry’s stadium needs RDA funds for hundreds of millions in infrastructure improvements. Downtown LA’s concept uses revenue bonds that are not TIF-based so it may be safe.
@tony d. – You’re half right. TIF districts won’t die immediately, they’ll stay in place until debt service for their respective projects is complete. Then the districts will revert back to the cities and taxes will be collected normally. In the meantime, additional bonding would be severely restricted and subject to new rules.
@ML–I found another one for you (when you find the time to dissect it.. 🙂 ) While driving around a little while ago, I caught Chuck Reed on KGO’s Ronn Owens show 10am hour. I heard just a few minutes of stadium talk. From the podcast, he talks soccer/A’s/49ers from 36:20-38:30. He says were optimistic because Lew’s optimistic and Lew thinks it will work. Ronn thinks the 49er deal in SC will fall apart.
For you San Jose residents, if you can wade through the tons of commercials, there’s a lot of more interesting stuff on the budget, pensions, cops, airport, parking meters.
http://vaca.bayradio.com/kgo_archives/kgo_player.php?day=5&hour=11
The death of the redevelopment funds could mean doom for SJ as well..
While they may be able to put together barley enough funds for the site through land sales (even though the last ones went short) there are still holes to fill.
What happens to the necessary infrastructure improvements? They also need over $80 mil in ADDITIONAL funding to complete things. Is Lew going to pay for that too?
Plus with all the controversy over RDA’s going around, it only gives more fodder to the anti-stadium types come election time.
This thing has a long way to go and the RDA mess is going to make things more cloudy.
@dinosaur jr- an advantage that sj redevelopment has is the land banking strategy- this land that is already owned by the rda/city can be sold to pay for infrastructure upgrades-not suggesting it would be- but it does provide a resource if need be- also not sure where u got your $80M figure from
How is AEG’s stadium in any jeopardy if it doesn’t include TIF funding?
@Dan – The funding mix is not nearly baked yet.
I could see a scenario in which the Raiders and Niners are forced to work together, as a means of pooling resources for one stadium, depending on location. This all depends, of course, on how the politics of stadium proposals shakes out. Then there’s the will-they-or-won’t-they Chargers situation that continues to linger like a bad smell. After the A’s saga, this has to be the most annoying controversy of all the Cali teams.
Too bad about the Kings, though. It goes to show how David Stern is almost the opposite problem of Selig. He (Stern) is much too eager to move franchises around.
All,
FYI,
Autumn Parkway phase 1, from Coleman Av. to Julian .street/HP Pavilion parking, will cost $11 million total (land and construction).
SJ should be just fine after RDA (ballpark speaking that is).
What was the strategy behind SJ’s land banking? Did they purchase the land with the intention of protecting RDA money or is that just a fortuitous side benefit?
Gojohn-rda would lock up land for potential corporate headquarters or housing projects- having the land and than providing development rights to the property has been one of their primary strategies for the past 30 years-none of it occurred with an expectation that rda would go away- always was an excellent strategy on their part- which now should pay dividends with the ballpark project
@GoA’s That’s what I figured. If SJ is putting ballpark land under the control of a JPA, then that land may be sheltered, but the other properties are in jeopardy. From this post in the Tri-City Beat blog:
@go john- admit I am not an expert here but I would expect the JPA to include all parcels owned by the city of SJ– obviously lots of legal wrangling will go on and I can only imagine that cities will continue to get creative here-
Not an expert either, Prop. 22 may protect land already owned by RDA/cities from state seizure. Prop. 22 does not however protect RDA from being abolished outright.