City of San Diego to Take Over Redevelopment

The City Council on Tuesday named the city of San Diego to be the successor agency to wind down its redevelopment activities.

The 7-0 vote, with Councilwoman Marti Emerald absent, was a formality, seeing as how the alternative would have meant giving away decision-making control of the city's redevelopment projects and portfolio of affordable housing.

The Legislature passed a pair of bills last year, one that abolished redevelopment agencies and another that let them remain if local governments made certain payments to the state. The state Supreme Court recently upheld the first measure but declared the second unconstitutional, a decision that killed off the agencies entirely.

The City Council's vote came amid uncertainty over how the city should proceed, and what role it should play, now that redevelopment agencies are supposed to be abolished.

"There are more questions than answers," Councilman Todd Gloria said.

While the city's Redevelopment Agency is due to perish Feb. 1, one of the unknowns is the fate of the quasi-independent organizations it oversees, the Centre City Development Corp. and the Southeastern Economic Development Corp.

According to Deputy City Attorney Kevin Reisch, the state legislation that killed redevelopment agencies does not address the fate of corporations like the CCDC or SEDC.

However, since their funding comes from the increase in tax revenues generated by their projects, the two organizations may continue to exist but not have any funding, Reisch said. It still needs to be determined if the CCDC and SEDC can continue to exist under alternate funding methods.

Officials with the mayor's office said they are seeking clarification from the state on a myriad of issues.

"This is kind of like building a rocket after we've launched," Councilman Carl DeMaio said.

Under the motion passed Tuesday, city officials will be able to decide how to dissolve the Redevelopment Agency's assets. The tax revenue generated by their projects will be transferred to fund schools, prisons and other state obligations.

Projects currently under contract, like the transformation of the downtown waterfront on which ground was broken last week, will continue until completed. City officials will have to find another way to pay for other projects that didn't get that far in the planning process.

On Wednesday, the City Council's Land Use and Housing Committee will hear a CCDC report on the impact all these changes will have on affordable housing, for which redevelopment agencies had been required to set aside 20 percent of their income.

-City News Service