LAO Releases Report on Unwinding Redevelopment

The complicated process of unwinding redevelopment is covered in a new report released by the Legislative Analyst’s Office. Due to scope of redevelopment agencies’ funds, assets, and financial obligations, the LAO concludes that dissolution will “take time” and that the Legislature should “amend the redevelopment dissolution legislation to address timing issues, clarify the treatment of pass–through payments, and address key concerns of redevelopment bond investors.” Here are the report’s major findings, none of which are all that supportive of the work and economic benefits that redevelopment has created across the state:

• “Although ending redevelopment was not the Legislature's goal, the state had few practical alternatives.
• Ending redevelopment changes the distribution of property tax revenues, not the amount collected.
• Design of replacement program merits careful consideration.
• The redevelopment agency unwinding process could yield important civic benefits.
• Hold hearings to promote local review over use of the property tax.
• Provide funding to train K–14 oversight board members.
• Alternative use of redevelopment assets raises difficult policy and fiscal issues.
• Key state and local choices will drive state fiscal effect.
• Clarifying amendments would help implementation of ABX1 26 (Blumenfield).
• Clarify treatment of pass–through payments.
• Address timing issues.
• Clarify authority to take actions to ensure that funds are available to pay bonded indebtedness.

You can read the full report here. View a video about the report’s conclusions here: