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June 25, 2008 > Redevelopment - boom or bust?

Redevelopment - boom or bust?

This is the eleventh chapter reprinted with permission from Redevelopment: The Unknown Government, A Report to the People of California published by Municipal Officials for Redevelopment Reform (MORR). Ninth Edition, September 2007.

Part XI: The Redevelopment Establishment

Redevelopment is an entrenched special interest. It thrives on contributions from its beneficiaries and from lack of awareness of the general public. Its advocate is the California Redevelopment Association, a Sacramento-based lobby that seeks to protect and expand redevelopment power.

The CRA's $2.9 million annual budget is paid for from hefty annual dues by both agency-members and the private firms that profit from redevelopment. Despite the public tax dollars contributed to the CRA, the public has no say in CRA operations. The CRA is governed by an 18-member board. All are redevelopment agency administrators. None are elected officials. The CRA is operated by and for redevelopment insiders. Good public policy is the last of its concerns.

The CRA is highly sensitive to the growing public and legislative reaction to redevelopment abuse. Its monthly newsletter, Redevelopment Journal, brims with advice to redevelopment staff on finessing inquiries from the press and grand juries. It has repeatedly criticized Redevelopment: The Unknown Government, and personally attacked its authors but has refuted none of the factual information provided here. Mostly it provides photos of new malls and shopping centers, accompanied by fluff pieces from redevelopment directors.

The CRA has two core constituencies: agency staff members whose salaries derive from redevelopment and private businesses that profit from redevelopment.

Redevelopment staff control agency agendas and recommend actions. Agency members - usually elected city council members - tend to rely more on staff than on their own judgment. Though simple in principle, redevelopment is presented as too complex for ordinary elected officials and citizens to understand.

The special interests profiting from redevelopment are easy to find. The 2003 CRA Directory includes 53 commercial developers, 37 bond brokers, 50 law firms and 131 separate consulting firms.

The CRA Annual Conference in Monterey, held March 8-10, 2006, boasted over 100 corporate sponsors and exhibitors. The main purpose of such conferences is to increase business for the firms that prey off redevelopment budgets.

Among these are California's biggest developers, priciest law firms and Wall Street's most powerful brokerage houses. The "expertise" they provide for public officials is always geared toward high debt and expanding redevelopment power.

For all its guile, however, the CRA is puny compared to the California Teachers Association (CTA) and other interest groups that could mobilize to reclaim the money diverted by redevelopment. Admitted one CRA executive, "The largest group we have to fear is the CTA, because they are becoming aware that the money the state backfills to schools is additional money the schools might have, if they had not lost the money to tax increment in the first place."

In the end, the CRA's real power lies in widespread ignorance of what redevelopment is and how it operates. By law, redevelopment agencies are an arm of state government, yet there is little state oversight. This isolation has spawned abuses that would not be tolerated in any other government agency.

This series will continue in following weeks with interviews and comments from local redevelopment officials.

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