Ever since the demise of redevelopment agencies in 2012, there have been a variety of legislative efforts to revive, incrementally or in whole, some form of redevelopment in California. We have seen enhanced infrastructure financing districts, community revitalization and investment authorities, and more traditional affordable housing authorities and joint powers authorities. But we have yet to truly see a funding source that would revive the use of redevelopment tools. The political climate is much different now than in was in 2012: California has a surplus budget, there is an affordable housing crisis, and thousands of homes have been lost over the last several years due to wildfires and other natural disasters. Piggy-backing on overwhelming support of an affordable housing measure in 2018, Senators Beall and McGuire are now proposing SB 5, the "Local-State Sustainable Investment Incentive Program."
An article by Tom Gogola in the Pacific Sun has deemed the bill "Redevelopment 2.0," and according to the article, Beall's office believes the bill aligns with Governor-elect Gavin Newsom's campaign priorities given that he signaled support for re-upping RDAs in his campaign. The bill would provide funding of up to $2 billion over the next ten years. So what makes this different from traditional redevelopment in California? Gogola reports:
Redevelopment 2.0 emphasizes the affordable-housing component over economic development, which lawmakers say will be a hedge against the sorts of corruptions of the RDA model that led to big-box build-outs under the old redevelopment regime. And the bill includes a threshold requirement that at least 50 percent of funds sent to localities are used for the development of affordable housing.
In addition to the shift away from economic development, the bill also supports transit-oriented development and builds resilience from sea-level rise, along with providing rigorous state oversight and, according to the release, taxpayer protections to ensure that affordable housing construction occurs quickly and local governments are accountable for the expenditure of funds.
The bill seems to be hitting on the hot-button topics (affordable housing, transit-oriented development, and sea-level rise), while hedging against some of the issues that doomed redevelopment in the past (dodging financing for big-box stores and stronger oversight to prevent running up debt and handing out massive subsidies). We'll continue to track the bill into the new year.
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