The Morning Report
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In my last post, I mentioned that a reader had asked about the money the Redevelopment Agency owes to the city.
Here’s what I’ve been able to dig up so far: According to this chart attached to the Redevelopment Agency’s 2007 budget, its total debt to the city was $50.6 million as of June 30, 2005. However, that figure seems to exclude the debt owed by the Centre City Development Corp. and Southeastern Economic Development Corp., the two public corporations that implement the city’s redevelopment projects in certain areas.
The other document I found was put out by the city’s auditors in 2002, and it put the total owed at $230.6 million, covering all of the redevelopment project areas. Since the post-2002 audits haven’t come out yet, that’s looks like the most up-to-date official figure.
To see how things have changed between 2002 and 2005, I tried putting the data from both tables into a single spreadsheet and compare the project areas covered in both. For this smaller universe of projects, the amount owed to the city has fallen from $64.6 million in 2002 to $49.3 million in 2005. However, as you’ll read below, that doesn’t necessarily mean that some of the money has been repaid; it could simply mean that it was transferred to other project areas not covered by the 2005 document.
I’m expecting a call back from Frank Alessi, CCDC’s chief financial officer, in about an hour to discuss how much the corporation has borrowed.
I also asked City Councilwoman Donna Frye – she argued during her mayoral campaign that the Redevelopment Agency should repay the money – about the numbers. Frye said she had the city’s accountants prepare a report on the loans in June 2003, which put the total debt at $221 million.
And Frye has not abandoned her calls that at least some of the money be repaid. Although each loan has it’s own repayment schedule, Frye believes that the Redevelopment Agency can afford to pay them back sooner.
In her “inauguration speech” yesterday, Frye said the redevelopment agency had approximately $20 million the city had loaned from its general fund and bed tax revenue – money that the city could use for anything it wants, once it’s paid back. Frye argues that the agency should hand over that money.
Some of the rest of the loans, Frye said, came from restricted grants, which means that the city will only be able to spend the money on specific projects once it’s repaid.
So, why hasn’t the money been paid back? Frye’s take:
That’s a good question. I’ve been trying to do this for years. …Unfortunately, I don’t have the support for it. I had gotten close in the past, but those people are no longer on the (City) Council.
Paying back the loans means using less of the Redevelopment Agency’s operating revenue on new redevelopment projects – including projects in the councilmembers’ districts. That may be one reason why the City Council does not want to go along, or so Frye thinks.
On a related note, when the City Council (acting as the Redevelopment Agency) considered the agency’s budget in late May, one of the issues on the agenda was whether to repay the city a $400,000 loan from the Southcrest Redevelopment Project Area, and then to loan it back to the Redevelopment Agency for the Central Imperial Redevelopment Project. According to the minutes, all of the council members voted in favor, including Frye.
Please keep your questions coming. Just click on my name.