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Cuts in Downey's Redevelopment Urged

May 14, 1987|RICHARD HOLGUIN | Times Staff Writer

DOWNEY — Los Angeles County has suggested that the city reduce the size of its proposed redevelopment areas, contending that private development is occurring in those zones--reducing the need for government intervention--and that in any case they are not as blighted as the city says.

In addition, the county would lose about $126 million in tax revenues during the 30 years the redevelopment areas would be in effect, if they are approved as large as the city wants them, a redevelopment fiscal review committee has reported.

"It does not seem appropriate for the (Redevelopment) Agency to intrude in the process before the private sector has been given the opportunity to accomplish development on its own," the committee said.

The committee was composed of representatives of the county, the county Flood Control District, the Downey Unified School District and the city. The city favored the project, and the school district did not submit information for the report.

'Financial Tug of War'

Jim Cutts, Downey director of community development, said the county is only trying to save tax dollars it would lose if the redevelopment areas were approved.

"It's a financial tug of war, that's what it is," Cutts said. "They're posturing to get more tax increment (money) from the (Downey) Community Development Commission."

County representatives on the review committee said the city should reduce the planned redevelopment areas by at least one-third and share tax revenue from those areas once they are formed.

The Community Development Commission is seeking to expand by 305 acres the city's 125-acre redevelopment district along Firestone Boulevard--the fourth amendment to the city's current redevelopment project. The city also wants to create a separate redevelopment district, the Woodruff Industrial Project, in 118 acres along Woodruff Avenue south of Firestone Boulevard.

The city contends that these areas are blighted, with dilapidated buildings and land uses contrary to zoning, and that the economic benefits of redevelopment zones are needed to spur growth.

When a redevelopment district is created, property taxes used to support traditional government services--county flood control, for example--are frozen. Additional tax revenue from the higher value of redeveloped properties is then diverted to the redevelopment agency. The agency uses that money to promote development.

But before the City Council can approve a redevelopment project, affected taxing agencies have the opportunity to participate in a committee to assess the financial impact of such a district and advise the council.

In the committee report, the county and the Flood Control District argue that development is occurring in both the Amendment 4 and the Woodruff areas.

The report said property values in the Amendment 4 area have increased an average of 11.5% annually for the past five years, while the rates for the entire city and Los Angeles County were 8.1% and 9.2% respectively.

Property values in the Woodruff area increased an average of 9.6% during the past five years, the report said.

"We have reason to believe . . . that the assessed values in the project area will continue to grow at this historical rate," the committee said. "This indicates that there is positive activity in the area without redevelopment activity."

As examples of ongoing development, the county pointed to the Downey Galleria--an old bowling alley being remodeled for retail shops--in the Amendment 4 area and a planned industrial park on a 14-acre site in the Woodruff area.

But Cutts insisted that few projects have been undertaken and that the redevelopment zones are needed.

The county said its own survey indicated that many buildings in the proposed project area need little or no repair.

But Cutts said some of the blight is not readily apparent.

"They're trying to limit blight to just structural," Cutts said. "Blight comes in many forms, not just what you see. The blight may be in the form of insufficient fire flow (water available for fighting fires) or the sewers may be at capacity. We have all those problems."

The Downey City Council, which approves or alters redevelopment plans, will consider the reports during public hearings May 26 on the Woodruff Project and June 9 on Amendment 4.

"We're hoping they're going to offer a resolution (of the differences) before the hearing," county spokesman Delta Uyenoyama said.

If the City Council were to ignore the county's advice, the county's only recourse would be to file a lawsuit.

City officials have said the new redevelopment boundaries could be in place by mid-July.

The committee report was lauded by a spokesman for Downey CARES, a group of property owners in the Firestone area who oppose the redevelopment plans and the power of condemnation they would give the city.

'Not a Burden'

"The county has done some homework and reached some of the same conclusions that Downey CARES has reached," said Michael E. Sullivan, president of the organization. "Downey's development on its own is a prime example of free enterprise at work. Firestone and Woodruff are not a burden on the community."

Downey CARES also fought the city's efforts to expand the redevelopment district in 1984. The City Council added 380 acres to the district, but a Superior Court judge invalidated the action after finding that Mayor James S. Santangelo had a conflict of interest when he cast the deciding vote.

The city has appealed the decision and is moving forward with the alternate Amendment 4.

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