The city agency that Alhambra used to attract national chains such as Toys R Us, Kohl's, and Albertsons; to create and maintain a “restaurant row,” and to install the movie theaters and clubs on Main Street, could soon be dissolved. Among the cuts proposed in Gov. Jerry Brown’s new budget were $1.7 billion from statewide redevelopment agencies, which reinvest a portion of property taxes into economic development projects and affordable housing in blighted areas.
“The agency is the economic driving force behind everything that we do,” City Manager Julio Fuentes said. “It could have a chilling effect on job creation. Minimal investment versus the large-scale investment that is going on now. ”
California redevelopment laws were created to help blighted areas, and Old Town Pasadena is often cited as an example of a classic success story of transformation. But critics say that the development comes at too high a price to the state since property tax revenues are diverted that could be used for other local services, that it is a potential conflict of interest having government playing a leading role in negotiating development, and that agencies are not only used to develop areas that are actually in need.
“What we’re doing here is spending money at the local level that the state doesn’t have,” Brown said in his January 3 address. “So we want to take that money and leave it at the local level for the purposes that it was historically intended. That’s police or fire or local activities…counties, or schools.”
But Alhambra local officials believe that it will backfire, eliminating a tool that has greatly improved quality of life in the city. Fuentes said that when he arrived in the city in the early 1990s the area around Main Street was indisputably blighted. “I’d look across the street at the abandoned hardware store,” he said. “Then across the street was an abandoned bank building — deteriorating and ratty. It was horrible.”
When Sears closed down in the early 1990s, he said, attracting new developers proved a challenge because, like many urban areas, much of the city is already built out. “We didn’t panic but the city started to think outside of the box,” he said. The city, he said, "became a developer.” The federal Housing and Urban Development agency, which provided a grant to the redevelopment agency, cites it as a case study for successful development. The former Sears site on Fremont is now home to to develop the Fremont Plaza site now home to national chain stores such as Toys R Us and PetSmart. "Fremont Plaza represents a new and aggressive strategy in economic development for the City of Alhambra,” according to the agency’s website.
Since then Fuentes said that the redevelopment agency has helped or built hundreds of buildings, which in turn have generated jobs, investment, housing and other improvements. But despite the progress, Fuentes, who as city manager along with other city officials, receives part of his salary through the agency, maintains that “there is still blight” and the need remains for the agency in Alhambra. “Is it still as bad as it was in the early 90s? No,” he said. “Because we’ve done our job. Can we continue to do more? Yes.” In Fuentes’ opinion, the redevelopment agency also changes the dynamic in government from simply providing services and draining funds, to generating them itself. “The agency creates funding,” he said. “It works with the private sector to create economic wealth that will be redistributed back to the community.”
Others in local government share this view. When a representative of Alhambra’s newly elected State Senator Kevin De Leon recently visited the Alhambra City Council, members had just one request:
“We really need his help saving our redevelopment agencies,” Councilwoman Barbara Messina said.
Alhambra’s Assembly representative in Sacramento, Mike Eng, has been hearing a lot of criticism of Brown’s budget proposal from local government officials. He said that he is in the process of trying to understand the issues of his constituents and the nuances of the budget. The intention, he said, behind doing away with redevelopment agencies include to “get the state out of the budget business where decisions are made in Sacramento and they’re not taking into account Alhambra and local cities. I think we have to understand that this is an attempt to do that.” But, he said, while the governor “is to be applauded for trying to have a longer view of the budget rather than let’s just fix it for this year,” that “the No. 1 issue is redevelopment and whether that budget cut makes any sense at all to raise revenues.”