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SB 286 (Wright) - Redevelopment

Strong Reform Package Will Increase Accountability and Effectiveness of Redevelopment in California

Senator Rod Wright (D-Inglewood) is authoring Senate Bill 286, a bill that would impose tough new reforms to increase accountability and limit the size and scope of redevelopment in California. SB 286 would ensure redevelopment is being used responsibly to maximize job-creation, revitalize rundown communities, clean up contaminated properties, finance infrastructure improvements, and build affordable housing.  It would also institute tough new reporting and accountability standards.

Below is an outline of SB 286 reforms:

Tighten Definition of Blight to Stop Inappropriate Uses of Redevelopment and Ensure It Focuses on Areas Most in Need

• SB 286 amends the Health & Safety Code to require redevelopment agencies to document specific, fact-based, and quantifiable evidence of blight findings, based on evidentiary standards specified by the courts.
• Evidence must be based on empirical and quantifiable evidence demonstrating the prevalence of specific conditions of blight that are so substantial they prevent the proper utilization of the entire project area.
• Redevelopment will be prohibited on vacant (never developed) tracts of land of 20 acres or more, with an exception for military base conversions. This would reduce redevelopment’s size and focus redevelopment on existing developed areas.

Limit Redevelopment Size

• Cities in which 25% or more of the land area is in redevelopment project areas and counties in which 10% or more of unincorporated land is in project areas, cannot add any additional land area to redevelopment.

School Districts Retain all Property Taxes and Tax Increment in New Redevelopment Project Areas, Increasing School Funding and/or Providing State General Fund Relief

• Beginning January 2012, any new redevelopment plan or project area would be prohibited from collecting the school share of local property tax or tax increment. Schools would retain their share of existing property taxes and any tax increment, thereby increasing local school funding and providing State General Fund relief as the State will no longer need to provide a backfill to school districts in new redevelopment project areas.

Implement Strict, Performance-Based Standards Focused on State Priorities and Increase Oversight by Local Citizens Committees

• Redevelopment agencies would be required to adopt specific, performance-based goals to ensure at least 50% of their non-housing set-aside expenditures address the following State priorities:
  • job creation
  • transit-oriented development
  • remediating contaminated property
  • military base conversion
  • basic infrastructure needs, or
  • affordable housing

• SB 286 would require agencies to establish a local Project Area Committee (PAC) or equivalent community advisory board comprised of local property owners, businesses, renters, home owners and community groups.

• The local PAC or equivalent community advisory board shall review the agency’s 5-year implementation plan and make a recommendation to the agency.  Every 10 years, the implementation plan must receive the approval of the PAC or equivalent community advisory board or it has to be approved by a 2/3 vote of the agency board.

Increase Accountability with Stringent Reporting and Performance Standards

• SB 286 would appoint one State agency to develop a set of consistent performance standards that all agencies will use beginning in FY 2013, including:
  • A uniform method of calculating and reporting job creation and retention.
  • Standards for measuring and reducing poverty levels in project areas.
  • Standards for measuring and reducing crime in project areas.
  • Methods for measuring reductions in vehicle miles traveled through such projects as infill development and transient-oriented development.
  • Standards for reporting on brownfield clean-up and hazardous waste mitigation.
  • Standards for measuring the efficiency and effectiveness of expenditures for affordable housing.

• Beginning in 2013, each agency’s annual report must describe the agency’s performance against the above metrics.
• The development of one standardized report will lead to consistent reporting and more effective oversight of redevelopment agency activities.

Prohibit the Use of Funds for Non-Redevelopment Expenses

• Tax increment revenues cannot be used for non-redevelopment operating expenses and non-redevelopment related costs, such as staff or elected official salaries (overhead) costs not directly attributed to redevelopment.

Reduce Redevelopment Footprint in California

• By limiting the percent of a city/county land area that can be placed in redevelopment project areas, focusing redevelopment on already-developed areas, tightening the findings of blight, limiting the permitted uses of redevelopment, and significantly reducing the amount of tax increment in new project areas, SB 286 would ultimately reduce the size of redevelopment project areas and tax increment going to redevelopment in California, and free up more money for schools and other local entities.