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    In Depth

    Showdown Nov. 16 Vote Set On Whether Councilmembers, Or Current Non-Elected Body, Will Govern LB Redevelopment;

    Councilman Lerch Modifies & Adds To His Proposed Limits, Seeks Mgr. Report On Add'l Time & Costs


    (November 11, 2004, updated Nov. 12) -- A November 16 showdown City Council hearing has been scheduled at which Councilmembers could direct the City Attorney to prepare an ordinance that would declare Councilmembers to be LB's governing Redevelopment Agency Board.

    If approved by a Council majority, this would (when the ordinance becomes effective effective shortly after Jan. 1, 2005) effectively replace LB's current non-elected (Mayor-appointed, Council-approved) Redevelopment Agency board with members of the City Council.

    Councilmembers will basically be deciding whether to give themselves direct control over millions of dollars that are supposed to be used to combat blight in nearly half of LB previously declared within Redevelopment project areas (as well as the power to place additional areas under Redevelopment subject to a statutory definition of "blight" and other legal requirements).

    While not explicitly listed on the agenda, the hearing materials include two memoranda by 9th district Councilman Val Lerch...which differ in some respects from the limits on Council/RDA action he sought on November 9. (The Council voted 6-3 to defer action on Councilman Lerch's items until after the Council votes on the main Redevelopment issue on November 16.)

    Councilman Lerch's two proposals now are:

  • A full and complete report from the City Manager on...[r]esponsibilities and total time involvement of the current RDA members; equate that time involvement to dollar cost; The estimated extra time expenditure/involvement for Council Members/RDA Members (over and above time involvement for Council duties); What will be the extra cost to City Council budgets for additional staff required to handle the RDA work? What are any other possible costs that might be implemented?

  • [I]n the event that the City Council votes to establish itself as the RDA Board, that the following be included in the establishing Ordinance: Require that property tax increment must be spent within the Redevelopment Project Area in which it was generated, except for low and moderate housing set-aside funds; Require that the merger of any of the Redevelopment Areas require a two-thirds vote of the members of the Redevelopment Agency Board; Require that any increase in the stipend received by the RDA Board shall not become effective until after the incumbent member is no longer in office.
  • If approved by a Council majority, the City Council would become the Redevelopment Agency governing board on January 6, 2005 and could hold its first meeting at its January 11, 2005 regular meeting date.

    City staff proposes to include the Mayor as Chair of the Redevelopment Agency and a non-voting member of the Board, with the Vice Mayor as Vice Chair. (In most communities where the City Council is the redevelopment agency, the Mayor serves as the chair of the Redevelopment Agency.)

    The proposed Council actions are described in detail in a staff memo and "Report Substantiating and Explaining the Determination that the City Council Shall Declare Itself the Redevelopment Agency" spelling out the reasons for the action and including proposed findings for Council action.

    LBReport.com posts these materials below.

    City staff report re hearing declaring City Council to be LB's Redevelopment Agency

    November 16,2004

    HONORABLE MAYOR AND CITY COUNCIL
    City of Long Beach, California

    SUBJECT: Public Hearing Declaring the City Council to be the Redevelopment Agency - Citywide

    DISCUSSION

    On August 25, 2004, the City Manager sent a memorandum to the Mayor and City Council that discussed their role in the redevelopment process. It described his concerns regarding the lack of progress in redevelopment project areas, the disconnect between City Council interest and the direction of the Agency Board and the fact that the City Council is held responsible for redevelopment policy but has little authority over it (Exhibit A) [(Previous LBReport coverage, click here.] The memorandum suggested that the City Council consider becoming the Agency Board.

    On October 19, 2004, the City Council decided to hold a public hearing on November 9 or after to discuss the advantages and disadvantages of the City Council declaring itself to be the Redevelopment Agency. The hearing was scheduled for November 16, 2004 at which time, after listening to public testimony and discussing the matter, the City Council may request the City Attorney to prepare an ordinance declaring the City Council to be the Redevelopment Agency.

    Legal Requirements

    Community Redevelopment Law (CRL) Section 33200 (b) describes the process that is required for a city council to declare itself the redevelopment agency if an appointed agency board has been in existence for more than three years. The following steps are required:

    • Publish the public hearing notice during the 10 days prior to the public hearing.

    • Post the public hearing notice throughout the redevelopment project areas at least 10 days before the public hearing.

    • Mail the public hearing notice to persons who have expressed interest in receiving information on redevelopment activities.

    • Prepare a report explaining the determination that the City Council will declare itself the Redevelopment Agency.

    • Hold a public hearing.

    • Approve an ordinance declaring the City Council to be the Redevelopment Agency.

    As part of the City Council's Ordinance, it must make findings that: (1) the action will serve the public interest and promote the public safety and welfare in a more effective manner than the current appointed Redevelopment Agency Board; and (2) there has been a full public disclosure of all reports and proposals relating to the City Council's intent to declare itself the Redevelopment Agency.

    The noticing requirements for the public hearing have been met (Exhibit B) [not included below] and the report explaining the determination has been prepared and is attached as Exhibit C [included below]. All of the legal prerequisites for the public hearing have been met.

    After the public hearing, the City Council could request the City Attorney to prepare an Ordinance declaring the City Council to be the Redevelopment Agency.

    Effective Date

    Ordinances usually take effect 30 days after the second reading. If the City Council requests the preparation of the Ordinance on November 16, 2004, it could approve the Ordinance on November 23, 2004, and have the second reading on December 7, 2004. The Ordinance would take effect, and the City Council would be the Redevelopment Agency, on January 6, 2005. The City Council could hold its first meeting as the Redevelopment Agency at its January 11, 2005, regular meeting date.

    Role of the Mayor

    In most communities where the city council is the redevelopment agency, the Mayor serves as the chair of the redevelopment agency. The proposed Ordinance would include the Mayor as Chair of the Redevelopment Agency and a nonvoting member of the Board. It is also suggested that the Vice Mayor serve as the Vice Chair.

    This letter was reviewed by Assistant City Attorney Heather Mahood on November 3, 2004, and Budget Management Officer David Wodynski on November 4,2004.

    TIMING CONSIDERATIONS

    City Council action on this matter is not time critical.

    FISCAL IMPACT

    The assumption of redevelopment authority by the City Council will have no fiscal impact assuming Agency operations remain the same. Additional fiscal impacts will be evaluated at a later time.

    IT IS RECOMMENDED THAT THE CITY COUNCIL:

    1. Receive supporting documentation into the public record, conclude the public hearing and request the City Attorney to prepare an Ordinance declaring the City Council to be the Redevelopment Agency; or

    2. Receive and file this report; or

    3. Request the Redevelopment Agency to study the advantages and disadvantages of appointed redevelopment agency boards and city councils serving as redevelopment agency boards as part of the Independent Study of Redevelopment.

    Respectfully submitted,

    s/ GERALD R. MILLER
    CITY MANAGER


    Report Substantiating and Explaining the Determination that the City Council Shall Declare Itself the Redevelopment Agency

    November 16.2004

    Redevelopment Agency Governance in California

    There are 475 cities in California. The City of Long Beach is the fifth largest city in the state with a population of 473,000. Only Los Angeles, San Francisco, San Jose and San Diego are larger with populations of 800,000 to 3 million. Slightly smaller cities include the cities of Sacramento, Oakland and Fresno, which have populations ranging from 400,000 to 450,000. Smaller yet are Santa Ana and Anaheim, both of which have populations of about 350,000. Other cities in California have populations under 300,000. To recap, the ten largest cities are as follows:

    CityPopulation
    1. Los Angeles3,807,400
    2. San Diego1,244,700
    3. San Jose918,000
    4. San Francisco793,600
    5. Long Beach473,100
    6. Fresno441,900
    7. Sacramento426,000
    8. Oakland408,800
    9. Santa Ana343,700
    10. Anaheim334,700

    Most of Californiaís 475 cities have activated their redevelopment powers. Community Redevelopment Law empowers the City Council to utilize redevelopment powers by adopting an ordinance declaring the need for an agency and establishing a redevelopment agency board. In most cities, the city council also serves as the board of the redevelopment agency. Only in the largest cities are separately appointed boards that handle redevelopment matters more typical. In three large cities, these boards operate as fully functioning redevelopment agencies. It is just as common, however, for the appointed boards to have less than a full range of powers even in large cities. Many of the boards serve in an advisory capacity or handle smaller matters. For instance, in San Diego, several non-profit groups (CCDC and SEDC) perform many of the functions of a redevelopment agency, but their vote is advisory in nature and most redevelopment agenda items must still be taken to the City Council for approval. Agency boards are appointed bodies, typically appointed by the mayor or city council.

    In Long Beach, the City Council established an appointed board to oversee day-to-day redevelopment matters. That board, which is empowered with the full range of redevelopment powers available under the law, is appointed by the Mayor and confirmed by the City Council. Beginning in 1999, two of the members were appointed by the Mayor from nominees submitted by the Agencyís existing Project Area Committees (PACs). The number of PAC-nominated Agency Board members increased from two to three in June of 2003. Long Beach appears to be the only city in California where the Project Area Committee submits nominees for the Agency Board.

    To recap, in all but the largest cities, the city council acts as the agency board. In the ten largest cities in California, three have separate agency boards with full powers, three have advisory boards or boards with limited powers and in four the city council is the redevelopment agency board. The type of agency boards in the ten largest cities is as follows:

    CityAgencyBoard
    1. Los AngelesSeparate Board with Full Powers.
    2. San DiegoSeparate Boards with Advisory Powers/CCDC and SEDC. City Council is the Agency Board and the Mayor is the Chair and votes.
    San JoseCity Council serves as Board. Mayor is the Agency Chair and votes.
    4. San FranciscoSeparate Board with Full Powers/Redevelopment Commission.
    5. Long BeachSeparate Board with Full Powers.
    6. FresnoCity Council serves as Board. Mayor does not vote on Agency matters. City Council elects one if its own as Agency Chair.
    7. SacramentoSeparate Board with Limited Powers/Housing and Redevelopment Commission. City Council is the Redevelopment Agency Board; the Mayor is the Chair and votes.
    8. OaklandCity Council serves as Board. The Mayor is the CEO and does not vote. The City Council President is the Agency Chair.
    9. Santa AnaCity Council serves as Board. The Mayor is the Chair and votes.
    10. AnaheimSeparate Board with Advisory Powers/Housing and Redevelopment Commission. The City Council is the Redevelopment Agency Board. The Mayor is the Chair and votes.

    In communities where the city council serves as the redevelopment agency, the mayor generally is the chair of the agency and votes on issues before the board. All city council members are generally voting members of the redevelopment agency board. However, there are exceptions to this rule. Staff surveyed the seven largest cities where the city council has retained redevelopment agency powers. Five of the seven used the model described above with the mayor as a voting chair and all city council members as voting members of the agency board. The two exceptions were the cities of Fresno and Oakland. In Fresno, the Mayor does not vote on redevelopment matters and the City Council elects one of its own as the Agency Chair. The City of Oakland has a strong mayor form of government and the Mayor serves as the CEO of the Agency working closely with the City Manager to set policy and direct redevelopment staff.

    Process Required for the City Council to Become the Redevelopment Agency Board

    Community Redevelopment Law clearly describes the process required for the City Council to declare itself the Redevelopment Agency. The City Council may, by adoption of an ordinance, declare itself to be the Agency; in this case, all the rights, powers, duties, privileges and immunities vested by Community Redevelopment Law in an agency will be vested in the City Council. If a member of the City Council does not wish to serve on the Redevelopment Agency Board, the member may so notify the City Council and the City Council would appoint a replacement that is an elector of the city to serve out the term of the replaced member.

    As part of the City Councilís ordinance declaring itself to be the Redevelopment Agency, the City Council must make findings that the action shall serve the public interest and promote public safety and welfare in an effective manner. The City Council may not adopt an ordinance declaring itself to be the Redevelopment Agency without first conducting a public hearing on the proposed ordinance.

    Notice of the public hearing must be published not less than once during the ten calendar days immediately prior to the hearing in a newspaper of general circulation printed and published in the community. The notice of hearing must include a general statement of the procedure and effect of the City Council declaring itself to be the Redevelopment Agency. Copies of the notice must be posted throughout the project areas at least ten calendar days prior to the hearing. The City Council must also mail by first-class mail copies of the notice at least ten calendar days prior to the hearing to all persons who have expressed to the Redevelopment Agency or the City Council an interest in receiving information on redevelopment activities.

    The City Council must cause the preparation of reports or proposals necessary to substantiate and explain the determination that the City Council will declare itself the Redevelopment Agency to be presented at the public hearing.

    As part of the City Councilís ordinance declaring itself to be the Redevelopment Agency, the City Council must make findings that: (1) the action will serve the public interest and promote public safety and welfare in a more effective manner than the current organization and (2) there has been full public disclosure of all reports and proposals relating to the legislative bodyís intent to declare itself the Redevelopment Agency.

    Having declared itself the Redevelopment Agency, the City Council must decide on the structure of its governing board. Most cities have chosen to have all city council members serve on the redevelopment agency board and have the mayor serve as the chair and a voting member of the agency board. In Long Beach, the City Charter specifies that the Mayor does not vote on City Council matters. However, the Charter does not prohibit the Mayor from serving as a voting member of the Redevelopment Agency. The City Council has the authority to select the most commonly used model for a Redevelopment Agency Board or, as in the case of Fresno or Oakland, devise another model.

    Findings

    The City Council makes the following findings:

    1. The City Councilís declaration of itself to be the Redevelopment Agency will serve the public interest and promote public safety and welfare in a more effective manner than the current organization for the following reasons:

    A. The current organization of the Redevelopment Agency has resulted in policy conflicts that would be avoided if the City Council were to declare itself the Redevelopment Agency.

    The City of Long Beachís appointed Redevelopment Agency Board sets redevelopment policy for all of the Cityís seven redevelopment project areas. The Redevelopment Agency is a separate legal entity from the City of Long Beach and the Agency Board has considerable authority to act independently without City Council review. The Redevelopment Agency Board has the authority to approve contracts, purchase goods and services, provide assistance to private developers, provide loans, review the design of development projects and approve design standards without the review or approval of the City Council.

    Community Redevelopment Law provides the City Council oversight in a few critical areas. The approval of the City Council is required for Agency agreements that result in the sale of land purchased with tax increment. The City Council must also approve the Redevelopment Agencyís annual budget and must also approve the adoption and amendment of redevelopment plans. The City Councilís authority over these matters is one of acceptance or rejection. The City Council can reject projects proposed by the Redevelopment Agency, but cannot compel the Redevelopment Agency to approve projects, programs or policies proposed by the City Council. The City Council has in the past made recommendations to the Redevelopment Agency that the Agency has declined to accept.

    The City Council reviews all matters of importance to the City, while the current Redevelopment Agency Board concentrates on matters related to redevelopment. As a result, the Redevelopment Agency may embrace priorities that differ from those of the City Council. When City Council and Redevelopment Agency Board priorities differ, the City Councilís ability to redirect Redevelopment Agency policy is limited.

    If the City Council declared itself the Redevelopment Agency Board, the potential for conflict over redevelopment policy between two public bodies would be removed.

    B. The City Council is more directly accountable to voters than the current, appointed Redevelopment Agency Board.

    The residents of the City of Long Beach have made known their desire to have a voice in setting redevelopment policy and approving projects in the City of Long Beach. The City of Long Beach has formalized the role of the public in the formation of redevelopment policy to a greater degree than any other City in the State of California. There are three Project Area Committees (PACs) that provide advice on redevelopment matters. In most communities, PACs are in existence for three years and then are disbanded. The redevelopment plans for the Central and North Project Areas guarantee the existence of the PACs for the life of the project areas. A legal agreement with the West Long Beach Industrial PAC guarantees their continued existence.

    The voters of Long Beach directly elect members of the City Council. Citizens have the ability to hold members of the City Council accountable through elections and their power to recall members of the Council. Members of the appointed Redevelopment Agency Board are selected by the Mayor and City Council, but are not directly accountable to the general public. If the City Council were the Redevelopment Agency Board, the redevelopment policymakers would be directly accountable to those citizens who are affected by redevelopment projects and programs.

    C. By declaring itself the Redevelopment Agency, the City Council would streamline and simplify the process of approving redevelopment agency projects and programs.

    Proposals for new redevelopment projects and programs originate with members of the Redevelopment Agency Board, City Council members, developers, staff, PACs and the public. Before these projects and programs become proposals before either public body, staff spends considerable time attempting to achieve consensus among all of the groups listed above. Often members of the Agency Board and members of the City Council initially have different ideas regarding how a project should be implemented or whether it should be implemented at all. This process of consensus building would be streamlined if only one public body granted redevelopment approvals.

    After a general consensus on a redevelopment project is achieved, many proposals face a dual approval process. Projects must be scheduled for Agency Board review at Redevelopment Agency Board meetings and, if they are approved, then scheduled for approval by the City Council. The assumption of redevelopment authority by the City Council has the potential to streamline this dual approval process for redevelopment projects and programs. The formal approval process would take less time if only one body provided all of the necessary approvals.

    The Redevelopment Agency has the authority to review the design of development projects located in redevelopment project areas. The Planning Commission has the authority to review the design of development projects throughout the City. The Redevelopment Agency and Planning Commission have developed a process to coordinate the reviews by both bodies. If the City Council became the Redevelopment Agency, it is likely that it would delegate its authority over design review to the Planning Commission. The design review process in the City of Long Beach would likely be quicker and less difficult to understand for developers if a single body, the Planning Commission, undertook all reviews.

    2. There has been full public disclosure of all reports and proposals relating to the City Councilís intent to declare itself the Redevelopment Agency.

    A. The City Council will hold a public hearing to discuss its proposal to declare itself the Redevelopment Agency.

    B. The Long Beach Press-Telegram published a notice of the public hearing.

    C. The Notice of Public Hearing was posted in at least one public place in each redevelopment project area.

    D. The Notice of Public Hearing was mailed to all persons that have expressed an interest in receiving information on redevelopment activities and to all Project Area Committee members, neighborhood organizations and everyone that has submitted a current request to receive Redevelopment Agency or Project Area Committee agendas.

    E. The City Council caused staff to prepare this Report, which substantiates and explains its determination that it will declare itself the Redevelopment Agency.


    Memorandum

    Date: November 10,2004
    To: Larry Herrera, City Clerk
    From: Val Lerch, Councilmember, 9th District

    Subject: ITEM FOR INCLUSION IN NOVEMBER 16,2004 RDA HEARING

    I would like to request that included in the agenda item referencing the hearing on the City Council consideration of taking over the RDA a full and complete report from the City Manager on the following:

    Responsibilities and total time involvement of the current RDA members.

    Equate that time involvement to dollar cost.

    The estimated extra time expenditure/involvement for Council Members/RDA Members (over and above time involvement for Council duties.)

    What will be the extra cost to City Council budgets for additional staff required to handle the RDA work?

    What are any other possible costs that might be implemented?

    Thank you.

    Cc: Mayor and City Council
    Robert Shannon, City Attorney
    Gerald Miller, City Manager


    Date: November 10,2004
    To: Larry Herrera, City Clerk
    From: Val Lerch, Councilmember, 9th District

    Subject: ITEM FOR INCLUSION IN NOVEMBER 16,2004 RDA HEARING

    I would like to request that included in the agenda item referencing the hearing on the City Council consideration of taking over the RDA, in the event that the City Council votes to establish itself as the RDA Board, that the following be included in the establishing Ordinance:

    Require that property tax increment must be spent within the Redevelopment Project Area in which it was generated, except for low and moderate housing set-aside funds.

    Require that the merger of any of the Redevelopment Areas require a two-thirds vote of the members of the Redevelopment Agency Board.

    Require that any increase in the stipend received by the RDA Board shall not become effective until after the incumbent member is no longer in office.

    Thank you

    Cc: Mayor and City Council
    Robert Shannon, City Attorney
    Gerald Miller, City Manager


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