ENDNOTES vs. New London decision, which affirmed the ability of a city to declare
Stanislaus counties). Our sample included 25 districts, although only
a region “blighted” and exercise eminent domain to displace residents
22 could be used because three districts merged or were dissolved in
in favor of private development, has sparked considerable interest in
the years between 1996 and 2002.
tightening up the conditions under which “blight” can be declared. Certainly a smart districts program should have more rigorous
14
eligibility standards to limit the opportunities for abuse, by either
for economic activity) within each RDA’s boundary at equivalent
local governments or the developers who often exert influence.
points in two economic cycles: 1996-97 and 2002-03. Each year was
8
We recorded the assessed value of all real estate (as a proxy
roughly two years after an economic trough. Statewide, on average, In California, the fraction of revenues that must be “passed
each dollar of assessed property value was the foundation of 42 cents
through” to higher jurisdictions was mandated by AB 1290 of 1993.
per year of economic activity in 2002. (Author ’s calculations based
While the “pass through” computation is complex, the average rate is
on annual reports of the state controller.) Economic growth for the
33% of RDA-generated property tax revenues. See Dardia, Michael,
surrounding area was estimated based on county personal income
Subsidizing Redevelopment in California, January 1998, Public Policy
data from the Department of Finance’s California Statistical Abstract,
Institute of California, for a summary of fiscal issues associated
2005-06. Personal income was used as an economic measure because
with RDAs.
gross state product data is only available at the county level with very
9
long lags. The economic growth in the sample RDAs and surrounding This result is described in Appendix A and discussed below.
10
counties is displayed in the Appendix. .
15
See Dardia, footnoted earlier in this chapter.
urban pied-a-tierre as a second home) and twentysomething slackers
16
“Succeed” is defined as generating enough new revenue
than true job creators.
to parent jurisdictions (a district’s city, county, and the state) to
Kotkin has been outspoken in arguing that many “new
urbanist” environments attract more empty-nest retirees (who buy an
11
compensate for the loss of revenues that are instead retained by the The City of Industry, a “city” that could not exist without
RDAs, at this writing is facing opposition to its attempt to extend the
district.
life of its RDAs in order to offer tax incentives to lure a sports stadium
17
within its boundaries.
Agencies Annual Report, 1996-97.
12
18
Department of Finance, California Statistical Abstract, 2005.
of time necessary for districts’ economic growth to compensate their
19
The tax revenues in question would almost certainly
parent jurisdictions for implicit subsidies.
included property taxes, but could include other taxes generated by
Fiscal impacts are outside the scope of this chapter, beyond
a rough calculation (reported in the Appendix) estimating the length
13
California State Controller, Community Redevelopment
economic activity, such as income or property taxes, if smart districts The random sample attempted to span the range of urban
environments in which SMART districts might be contemplated:
were so designed.
dense city (Los Angeles or San Francisco), inner suburbs (e.g.,
20
Marin, Orange, or San Mateo counties, or north San Diego county),
retained by the smart district—i.e., “subsidized” by its parent
fast-growing edge cities (Placer, Riverside, San Bernadino, and Yolo
jurisdiction—will generally be spent of fixed investment
counties), and fast-growing diminishing agricultural areas (Fresno and
(e.g., infrastructure), which has a long lifespan.
A thirty-year horizon was used because the revenues
87