Legislature Passes Bill that Would Return $15 Million in Redevelopment Funding to WeHo

The California Legislature last night passed a bill that will allow the City of West Hollywood to use $15 million in redevelopment agency money that the state had demanded be relinquished to help solve California’s debt problems.

The bill, which is expected to be signed by Gov. Jerry Brown, was brought forward by state Assemblymember Richard Bloom, who represents the 50th District, which includes West Hollywood.

The $15 million that West Hollywood would receive includes $5.65 million for affordable housing and $9.25 million for improvements to Plummer Park. The state also has agreed to relinquish to the city a parking lot on Santa Monica Boulevard and Spaulding valued at $2.5 million that had been owned by the redevelopment agency.

The legislature’s passage of the bill comes after extensive negotiation with Gov. Brown’s office, which gives its supporters confidence that Brown will sign it. Last year Brown vetoed a bill proposed by Bloom that would have returned redevelopment agency money to local cities and asked the state Department of Finance and his staff to work with the legislature to resolve problems he saw with it.

City Manager Paul Arevalo praised Bloom for his efforts over the past few years to resolve the issue. “Without his energy and focus on it, it never would have happened,” Arevalo said.

Redevelopment agencies were established to help local governments secure funding for projects. By declaring an area suitable for redevelopment, the share of property tax revenue that went to schools and other local agencies in the area was frozen and increases in that revenue were diverted to the local redevelopment agency. West Hollywood had hoped to use $14 million in redevelopment agency funds to finance major renovations to Plummer Park along with $27 million the agency netted in issuing bonds in March 2011. The state’s decision in 2011 to freeze the redevelopment agencies also resulted in a ban on West Hollywood’s use of those bond revenues.

Arevalo said the compromise that likely will result in Brown’s signing the law passed yesterday isn’t perfect. But, he said, “we are capturing close to 50 percent of the bonds. We are securing the parking lot on Santa Monica Boulevard. It’s a fair deal.” He also noted that interest on the bonds issued in March 2011 is being paid by the county and that the bonds will be repaid in 2021.

Renewed access to the revenue intended for Plummer Park and building housing for low- and moderate-income people is lightly to rekindle the debate over plans for Plummer Park. One of the most controversial element of a previous plan was the demolition of Great Hall/Long Hall, the conjoined buildings in the center of the park built during the Great Depression by the Works Progress Administration.

Mayor Lindsey Horvath said she intends to make sure the community is engaged in any discussions about the park’s future. “What I’ve heard from the community is that people want to be engaged in the conversation about what’s happening there. I haven’t heard that people don’t want anything to occur at Plummer Park,” she said. “My intention and I believe the city’s intention is to make sure we have engagement.”

Arevalo said use of the money set aside for housing will be determined by the projects presented to or developed by the city. The city has a partnership with the West Hollywood Community Housing Corp., which has been in a tight financial situation, and has moved money from its general fund to help the WHCHC. Arevalo said some of the redevelopment agency housing money can be used to repay the general fund for those allocations.

West Hollywood is one of about 50 cities that will benefit from Bloom’s bill if the governor signs it. The city has been engaged in a long process of contesting the application to West Hollywood projects of the state’s decision to dissolve the redevelopment agencies and has been lobbying the legislature to support the current legislation.

Arevalo called out John Leonard of the city’s Department of Finance and Technology Services for playing “the critical role in drafting the language and working with Assemblymember Bloom and the Governor’s office to craft a compromise.” He also noted the assistance of Hernan Molina, a senior management analyst and Helyne Meshar, the city’s Sacramento lobbyist.

“Mayor Horvath has been all over the political discussion and helped get the votes at the 11th hour,” he said. Indeed, Horvath told WEHOville that she was contacting legislators she knew last night to secure their support for Bloom’s bill.

“I am so proud of our team. Let’s hope the Governor signs the bill so we can advance our efforts here in West Hollywood!” Arevalo said in a message to City Council members.