This week, the Assembly Committee on Housing and Community Development approved AB 2493, a bill by Assemblyman Richard Bloom (D-Santa Monica) that would allow free up approximately $750 million in redevelopment proceeds statewide that have been held hostage by the state since redevelopment agencies were dissolved in 2011.
“When the Legislature and Governor stripped redevelopment agencies away from cities in 2011, we lost a major tool in fighting blight and reinvigorating our local economies,” said Bloom. “Worst of all, many cities like West Hollywood and Santa Monica were in the middle of major projects when the state withheld their funds. This bill will allow us to get back on track with important economic development projects overwhelmingly supported by these communities.”
In 2011, facing a severe budget shortfall, the Governor and Legislature dissolved redevelopment agencies and redirected $1.7 billion away from various community development and affordable housing projects. Unfortunately, many local redevelopment agencies had already legally issued bonds for local projects and must now make debt payments even though they cannot reap the economic benefits of the now stalled project.
Statewide, approximately $750 million in 2011 redevelopment bond proceeds are sitting idle and cannot be used. If current law prevails, cities will make debt payments for a decade, costing them nearly $1 billion while not completing a single redevelopment project. These non-productive debt payments will further depress local economic activity throughout the state.
According to SmartCitiesPrevail, a nonprofit that provides research to cities, releasing the bond proceeds for the intended projects would generate approximately 19,000 high wage construction and related jobs. Funding the redevelopment projects would also create over $2.8 billion in statewide economic activity and provide $130 million in new state and local tax revenues.
“While improving, our economy is still struggling to get back on its feet. This bill offers a common sense solution that will foster job creation, economic development, affordable housing construction, and the completion of needed infrastructure projects. The bonds are there waiting. We just need to allow local governments to use them,” added Bloom.
AB 2493 passed the Assembly Committee on Housing and Community Development on a bipartisan, 7-0 vote. It also passed the Assembly Committee on Local Government on a bipartisan, 8-0 vote last week. The bill will next head to the Assembly Committee on Appropriations.
Richard Bloom chairs the Assembly Budget Subcommittee on Natural Resources and Transportation. He represents California’s 50th Assembly District, which comprises the communities of Agoura Hills, Bel Air, Beverly Hills, Brentwood, Hollywood, Malibu, Pacifica Palisades, Santa Monica, Topanga, West Hollywood, and West Los Angeles.