Long Beach City Council Accepts Control of $180 Million in Redevelopment Property

The Long Beach City Council voted Tuesday night to transfer $180 million in property from the Redevelopment Agency to city control in case the state this week passes a budget that would dissolve such agencies and direct those multi-millions to public schools.

At a special meeting March 8, the City Council voted unanimously to receive 222 parcels of land from Long Beach's Community Redevelopment Agency, which had voted on the transfer the day before. The Tuesday night vote was held an hour into the regular Council meeting and drew few speakers considering the scale of the assets and widespread complaint about lacking oversight statewide.

Long Beach was not among 18 redevelopment agencies in California that Controller John Chiang found had cost taxpayers $40 million to replace funds that the redevelopment agencies failed to give to schools.

Long Beach Unified School District, California's third largest with 86,000 students, last week mailed nearly 1,200 layoff notices to mostly teachers--up to 25% of them--but also to nurses, librarians and an already depleted mental health team. Superintendent Christopher Steinhauser has said a minimum of more than $50 million will need to be cut regardless of the state budget vote. But if the extended taxes do not pass, he and the district staff grimly told the public that the worst case scenario involves an almost surreal $150 million total in cuts out of a $700 million annual budget. 

With 8,000 employees, the district is Long Beach's largest employer. LBUSD spokesman Chris Eftychiou said Tuesday that the district was unaware of any outstanding redevelopment money owed it. And it has declined to weigh in on redevelopment as a funding source potential.

At Tuesday's special Council meeting, the members also accepted control of a number of agency-funded projects, including the construction of Fire Station Number 12 in North Long Beach and a new park at Oregon and Del Amo Avenues.

“What we’re doing is making sure these projects will be concluded the way they were intended,” said Ninth District Councilmember Steven Neal.

The 222 land parcels include community gardens, parking lots, and motels. The city also received control of the agency’s video surveillance systems and parking pay equipment.

In transferring the property to the city, Long Beach becomes liable for accidents on the property, according to Heather Mahood, chief assistant city attorney.

Officials, who expect the state legislature to vote on Gov. Brown’s proposed budget sometime this week--and as early as today--said that they oppose Brown’s plan to salvage education funding at the price of redevelopment.

“Long Beach continues to urge the governor and the Legislature to preserve this incredibly effective tool to create jobs, improve public safety and public infrastructure, and improve our most challenged and depressed neighborhoods,” City Manager Pat West said in a press statement he released Monday.

Yet if the state legislature does not approve the budget plan and the end of redevelopment agencies, Long Beach would return the land to the agency, according to Third District Council Member Gary DeLong. He added after the vote, "Those are assets that should be protected.”

There will be no “co-mingling” or mixing of funds, according to City Director of Development Services Amy Bodek.  Funds for redevelopment projects will not be part of the city’s general fund. 

Laurie Angel, a business manager at Cal State Long Beach, spoke during public comments and urged the creation of independent auditing group that would make sure the money is spent correctly. There has been some question about Mayor Bob Foster's salary being paid with redevelopment funds, which by law are designed for blight removal and economic revival. Critics of redevelopment argue that the money often has little oversight. Foster was not present for comment and was in San Francisco to be in a panel discussion on pension reform.)

Council member Neal asked residents to contact their state representatives and speak out against the possibility of the redevelopment agency's demise.

“Let them know the impact this could have on your community,” Neal said.

The property officially changes hands March 9.

On March 7, the Redevelopment Agency voted to allow the transfer of 99 percent of their property to city control, according to Bodek.

The only two parcels of land that remain under the auspices of the agency are the downtown courthouse, which is owned by the state and cannot be transferred without consent of the state, and Wrigley’s Marketplace, which is under a longterm lease agreement with a developer, Bodek said. Editor's note: a few details such as the consent needed by the state wered just added this afternoon.

Tuesday night's vote comes on the heels of a report from the office of State Controller John Chiang that said, of 18 sampled redevelopment agencies, five hadn’t deposited their money that would have funded schools, totaling $33.6 million.

To read Chiang’s report click here.

 “I think the redevelopment agencies that aren’t investing the money appropriately should be pursued,” DeLong said. “Fortunately in Long Beach we invest the assets appropriately. We follow the rules.”

Mayor Bob Foster did not attend the meeting; his office announced that he was in San Francisco for a Wednesday panel discussion on pension reform.

To read the text of the special meeting agenda click here.