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March 3, 2010 > Thirteenth Amendment adds 600 acres to Milpitas redevelopment

Thirteenth Amendment adds 600 acres to Milpitas redevelopment

By Steve Wyant

Images courtesy of City of Milpitas

The Milpitas Redevelopment Agency (RDA) is poised to extend its footprint, and longevity, as outlined at the latest Joint Development Agency and City Council Meeting on February 16. Noteworthy are plans to add 600 acres of new territory, extend the time limits by ten years, increase the tax increment and bond indebtedness limits and reinstate eminent domain for non-residential uses.

The RDA's proposals are the "Thirteenth Amendment for Project Area No. 1 Redevelopment Plan" and the "Sixth Amendment for the Great Mall Redevelopment Plan." According to Milpitas Economic Development Director Diana Barnhart, both the Environmental Compliance Report and the Report to the City Council require over 1,000 pages to ensure the proposed amendments satisfy the legal requirements.

Since 1976, Milpitas has identified nearly 3,000 acres of commercial and industrial areas within the city that have needed revitalization. Due to blight and inadequate infrastructure, private investment to redevelop these areas has been traditionally risky without special incentives. California Redevelopment Law allows municipalities to address this issue with the establishment of redevelopment agencies. Funding for RDAs comes from a portion of the property tax revenue generated when property values increase as a result of new development, known as the tax increment.

Over the years the city has steadily added to the original 1976 area (577 acres). Amendment Area No. 1 in 1979 (483 acres), Amendment Area No. 2 in 1982 (479 acres), Great Mall Project Area in 1993 (150 acres), Midtown Area in 2003 (691 acres) and, finally, the Proposed 13th Amendment Area in 2010 (600 acres). If this latest amendment is approved, the combined redevelopment areas will form one large contiguous perimeter, minus a few areas of original residential development.

The proposal to add 600 new acres, extending the time and dollar limits, and reinstating eminent domain are now culminating in efforts to reach out to owners and residents. Approximately 10,000 letters will be mailed to all property owners, residences, and businesses within all current and proposed redevelopment areas in the city 30 days prior to a public hearing on April 6. Also included in the letters will be notification of a community information meeting on March 25 at Milpitas Library. Public Notices in newspapers and postings throughout the redevelopment areas will also be done five weeks prior to the hearing.

It is anticipated that one of the public's most critical concerns will about eminent domain.

"We're very careful to talk about eminent domain as non-residential. The RDA could not use eminent domain in most of these areas to acquire residential property," stated Barnhart.

To spur redevelopment in the areas, the city has identified numerous projects that are designed enhance the basic infrastructure. Typically, the results of redevelopment are seen through the buildings, parks and landscaping, such as the new City Hall and Library. However, much of the impact the city can have is through developing what is not readily visible. Underground infrastructure, much of it responsible for managing water in one form or another (primarily flood control), is where the city can be most effective. Other areas include street lighting, transportation development, streetscape improvements, and underground utilities. That allows the developers to save and focus their investments more effectively.

"That's the type of thing that gets very costly for developers. That's one of the real assets that redevelopment can lend" said Barnhart.

While most of the Thirteenth Amendment Added Area is commercial or industrial, there are two residential sections - the Adams area and the Selwyn/Shirley area. The City Council Report cites numerous issues of crime, overcrowding, physical blight and code violations. According to Barnhart there are continuing code and livability issues there.

Since those two areas are residential, they won't be subject to eminent domain, but voluntary relocation may be a solution. The report states that "any voluntary displacement which occurs as a result of Agency redevelopment activities will be mitigated by providing relocation assistance including financial payments, advisory assistance and replacement housing plan provisions of State law relating to Agency assisted developments." Residents in those areas may regard it as a definite opportunity.

"Those areas are probably the saddest areas in Milpitas in terms of what people are living in," concluded Barnhart.

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