Give credit to Assembly member David Alvarez for his doggedness, albeit in service to a really bad idea. Last year, the Chula Vista Democrat introduced legislation that would have brought back California’s redevelopment agencies similar to how they existed before Gov. Jerry Brown mercifully dismantled them in 2012. The legislation died after the powerful California Teachers’ Association opposed it.
Alvarez is back this year with Assembly Bill 2945. It’s redevelopment redux with a smarmy new name. The 2023 bill was called the Community Redevelopment Law. The 2024 legislation is called the Reconnecting Communities Redevelopment Act. Whatever one calls it, it’s one of the worst bills to pop up this session. Alvarez ought to be embarrassed.
The entire redevelopment scam is fading from memory, but it was a locally controlled scam that floated debt without voter approval and gave cities the power and incentive to exert eminent domain on behalf of developers. It drove up debt to fund crony capitalist projects favored by city planners and, as a result, created pressure for endless tax increases.
California formed redevelopment agencies in the 1940s to combat urban blight, but cities learned they could deem almost anything – entire neighborhoods, shopping centers, vacant land – “blighted.” Instead of uplifting slums, cities used their land-acquisition and borrowing powers to subsidize big-box stores, auto malls and movie theaters. It became a way to grab sales taxes. It distorted housing markets by incentivizing commercial developments at the expense of housing.
During a budget crisis a dozen years ago, lawmakers shuttered the agencies because they diverted sent a large share of property taxes to redevelopment projects rather than traditional public services. We don’t often agree with CTA, but it opposed redevelopment agencies’ ability to snatch money earmarked for schools. The state backfilled the lost dollars, but it still jeopardized K-12 funding.
Critics of last year’s legislation sought to have anti-eminent-domain protections inserted into the language, but that never materialized. This year’s bill specifically allows agencies to “acquire real property by eminent domain to be used in a redevelopment project.”
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The U.S. Constitution allows agencies to acquire land via eminent domain for public uses (freeways, courthouses), but redevelopment agencies used it to benefit private developers. The evils of that process became clear in the U.S. Supreme Court’s Kelo decision, which allowed a Connecticut city to bulldoze a neighborhood to make way for a corporate headquarters (that never materialized). After that decision, many states – but not California – tightened up takings laws.
Eminent-domain abuses fall disproportionately on residents lacking political power, as happened in the case of Bruce’s Beach. In the 1920s, Manhattan Beach used eminent domain to take a beachside resort mainly to clear the area of Black beachgoers. Los Angeles County ultimately returned the land to the descendants of the family in 2022. Recognizing its abuses, lawmakers increasingly have included more limitations on eminent domain in some housing-related bills, but Alvarez hasn’t gotten the message.
The bill’s supporters might look at the size of the state budget deficit, which is more than double the size of the deficit that drove Brown to dissolve the agencies. Even if one likes the idea of redevelopment, it’s simply not affordable. Alvarez can call the new legislation anything that he chooses, but we’d call it the Disconnected from Reality Act.
