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Report Says LA Shouldn't Finish Redevelopment Agency Work

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The fallout from last month's state supreme court decision effectively eliminating local redevelopment agencies--which use property tax money to partner with private developers on projects in blighted areas--continues to rain down ahead of the February 1 deadline for shutdown. RDAs must find successor agencies to take them over and shut them down; according to the LA Times, "Those agencies must sell off assets but can complete economic development projects that are under way." But LA is a special position, because it (along with only three other cities) is independent from its redevelopment agency, the Community Redevelopment Agency of LA. Existing ties have made it somewhat easier for many cities to become successors, as "the majority" already have, according to the LA Daily News. The city is set to decide on Friday whether it'll take on the responsibility and hire the CRA/LA employees to finish their work, but the city administrative officer and the chief legislative analyst released a report yesterday saying that the city can't handle it. CRA/LA employees make much more than the average city employee, probably because the agency has a more narrow and specialized range of jobs than the entire city government. Here's a breakdown of their findings and some of the other facts at play in the decision:

-- It would cost the city $109 million to absorb the CRA/LA
-- The 192 CRA/LA employees make an average of $109,524 per year
-- City employees make an average of $72,000 per year
-- Mayor Antonio Villaraigosa has already written a letter to the City Council telling them not to take on the CRA/LA
-- "A committee of the mayor and four council members instructed [the city administrative officer] to begin the process of laying off 192 redevelopment employees," according to the LA Times
-- The CRA/LA had a budget this year of about $670 million
-- The report also "warned of untold financial liability from lawsuits by developers whose projects are killed during what Santana called a 'liquidation' process," according to Patch
-- Projects on DeathWatch include the cleantech campus in the Arts District and the Grand Avenue project's affordable housing component
-- On the plus side, getting rid of the CRA/LA "will yield an immediate $57.4 million infusion to the city's general fund and a payment of $19 million each additional year" for the city.
-- If LA passes on the CRA/LA, LA County could take on the agency
-- If no one wants it, a state-appointed oversight panel will take over

Meanwhile, up in Sacramento, Senate President Pro Tem Darrell Steinberg has proposed legislation that would keep $2 billion in redevelopment agency money to be used on affordable housing. As of now, redevelopment agencies are "the single largest source of funds for affordable housing in the state."
· L.A. assesses costs of shuttering redevelopment agency [LAT]
· Report urges city to relinquish CRA/LA role [LADN]
· City Warned Not to Become CRA/LA's Successor Agency [Patch]