Redevelopment looks likely to remain alive in San Diego.

Mayor Jerry Sanders said at a news conference Monday outside the Mercado del Barrio redevelopment project in Barrio Logan that he will recommend the city buy back into the new redevelopment system offered by the state

The decision, he said, will cost the city’s 17 redevelopment areas $70 million this year and $16 million annually thereafter. But paying the fee is better than the alternative: death.

“While there’s no good alternative, I believe continuing redevelopment in some fashion is better than pulling the plug on it all together,” Sanders said.

Last month as part of the budget package, legislators and Gov. Jerry Brown gutted the state’s redevelopment system. They passed two laws, one that eliminated redevelopment and one that allowed cities to buy back into redevelopment provided that they pay schools and other local governments a portion of their revenues.

Redevelopment siphons property taxes away from other local governments to improve rundown neighborhoods. Brown has argued that the state can no longer afford to make up for schools’ lost tax revenue and should sacrifice the program. Sanders and other San Diego leaders have been some of the most aggressive in the state in fighting back against redevelopment’s elimination. They say the program is needed to create jobs, affordable housing and pay for projects the city otherwise would be unable to afford.

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Redevelopment dollars have been targeted to help pay for two downtown megaprojects: an expanded Convention Center and a new Chargers stadium.

The decision to buy back into the system will hamper, but not bankrupt city redevelopment. The city expects to collect $172 million in redevelopment property taxes this year. The payment will be about 40 percent of those funds this year and about 9 percent in future years. Sanders said the payments will delay projects across the city that would have gone forward more quickly.

Sanders added the city would support, but not join, a lawsuit expected to be filed by the League of California Cities and California Redevelopment Association advocacy groups against the new redevelopment laws. Among other arguments, the groups maintain that a ballot measure passed last November prohibits the taking of redevelopment funds. Sanders said the city would seek repayment of its redevelopment funds if the lawsuit is successful. That will take time, though.

“A resolution of this suit may take months or even years,” the mayor said.

The City Council will consider the redevelopment buy back at a meeting next week. The city’s downtown redevelopment agency, the Centre City Development Corp., will be discussing it on Wednesday.

For those especially interested in the topic, Oakland-based law firm Goldfarb & Lipman has put together a helpful guide to understand the state redevelopment legislation.

Please contact Liam Dillon directly at or 619.550.5663 and follow him on Twitter:

Liam Dillon was formerly a senior reporter and assistant editor for Voice of San Diego. He led VOSD’s investigations and wrote about how regular people...

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