More than $4 billion in property taxes would help pay for redevelopment projects and related expenses over the next four decades under a plan approved by the City Council last week.
The plan came in response to Gov. Jerry Brown’s proposal to eliminate redevelopment agencies and his pledge to honor their existing obligations. Before the state has a chance to approve Brown’s proposal, San Diego set out to create new, long-term obligations.
In a matter of days, the plan to protect redevelopment swelled from spending a few hundred million dollars to nearly $4 billion. Then the estimated cost grew to $4.1 billion and then finally to $4.4 billion.
While previous expansions accounted for a growing list of projects, a final $300 million boost accounted for a spending “cushion” over the plan’s lifetime. Unlike the other $4.1 billion, which is specifically tied to projects and purposes like affordable housing, the final $300 million was added to supplement planned projects or other expenses if their costs increase.
The cushion could pay for increasing construction costs or add to the $60 million chunk already set aside for administration at Centre City Development Corp., the downtown redevelopment agency. The money could be spent on any project or expense approved by the City Council last week and it’s divided among the city’s redevelopment areas. The city needed it to plan for the unexpected, said Janice Weinrick, a top city redevelopment official.
“I think it will be safe to say costs will increase,” she said. “The further out you go, the costs are harder to prepare for.”
While the City Council fast-tracked its approval of the plan, the $300 million cushion was not part of the public discussion. It wasn’t included in the 72-page list of projects and related expenses provided to the City Council before it voted last Monday
In other documents provided to the City Council and at the meeting, city officials never explained what accounted for a $300 million difference between the $4.1 billion project list and the plan’s total estimated cost, $4.4 billion. Both figures existed in documents and a presentation by Chief Operating Officer Jay Goldstone, but the distinction between them was unclear.
When we asked the Mayor’s Office to explain the $300 million difference on the day of the City Council meeting, it didn’t know the answer. It responded the two days later, after the vote.
That the purpose of $300 million was not publicly reconciled spoke to the speed of the proposal’s movement, the lack of questioning and the scope of its long-term reach. The city has approved projects so far into the future that it doesn’t know exactly how much they will cost and preemptively assigned them a reserve fund to draw from.
The graphic below illustrates the four-decade-long timeframe over which the money would be collected.
Please contact Keegan Kyle directly at keegan.kyle@voiceofsandiego.org or 619.550.5668 and follow him on Twitter: twitter.com/keegankyle.