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~ Educational Forum ~
Community Redevelopment Agency (CRA)
Northeast Valley Redvelopment Project
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Community Redevelopment Agency (CRA)
Northeast Valley Redvelopment Project
What is the "CRA"? Los Angeles' CRA is a bureaucratic agency that has been in existence for over 50 years, yet most of us know very little about what it does.
Every year the CRA siphons away millions of dollars from L.A. City's General Fund that should have been used for basic services throughout the entire City of Los Angeles! Even more alarming, every year the percentage of our taxes that the CRA consumes is rising much too quickly!
Based upon the State Controller's projections, CRAs now consume approximately 10% of all property tax revenues collected in California, and these projections predict this level will reach 32% by 2025 (it doubles every fifteen years)(see TABLE #1.) By 2040 (the expected completion date of the project) CRAs will consume 64% of all California property taxes! Obviously, CRAs just aren't economically viable and the system will surely fail under its own weight before we even reach 2030! L.A. City bankrupt? A definite possibility!
Have you ever wondered why there no longer is enough tax money to pay for adequate L.A. City services? EVEN IF YOU RESIDE OUTSIDE OF ONE OF THE 31 EXISTING L.A. CRA-PROJECT AREAS, YOUR TAX MONEY IS STILL BEING "DIVERTED" TO L.A.'s CRA. Because of the unsound financial structure of CRAs, this is a very important matter for all Californians to acquaint themselves with as this problem will surely get worse unless enough of us rise to the challenge in time to stop it!
So then, what does the CRA do with our diverted taxes? The CRA won't repave your street, build or repair sidewalks, trim trees, clean streets or provide street lights or sanitation. The CRA also will not build or repair schools or help pay for police and fire protection. 40% to 60% of our diverted tax money typically goes for CRA overhead (i.e., to pay bureaucrats instead of policeman, fireman, teachers!) The bulk of the rest of your tax money goes to finance wealthy developers' construction projects.
Welcome to this website. We are SFV area residents who are trying to understand the full impact of the CRA's proposed takeover of the Northeast San Fernando Valley.
The only redevelopment winners are the project's outside developers, their attorneys, their so-called contract "specialists" and their lobbyists. A powerful Sacramento lobby group, NAHRO, is financed by those special interest groups now feeding at the CRA's trough!
Who would create such an unruly and slothful beast? CRAs are created by stealth - there are no real public debates or fair elections held in order to even form one; instead, CRA strategy is to sneak into power with the assistance of obliging elected officials, who are often duped into believing the CRA's empty promises.
One politician who understands CRA methods well is Fullerton City Councilman Chris Norby, who wrote in 1998:
"Redevelopment [CRA] thrives on public ignorance. Both lay people and elected officials are often intimidated by the complexity of redevelopment law, its specialized jargon and mind-numbing financial figures. Redevelopment is, however, easy to understand, if presented in an organized way and using plain English. From understanding comes power the power to change." [Click here for his entire statement]
We Hope this forum will help unmask the mysterious CRA; perhaps then together we can drive away the money-hungry CRA-monster now lurking in or midst. Since CRAs have been in existence for 50 years, perhaps the best way to judge any CRA's future performance is by looking at its sordid past.
Ordinarily, CRA projects last many decades. CRAs have a mandated 40 year "sunset" clause requirement, but this is easily circumvented! Of the 359 that have been created in California, only 4 have ever been disbanded.
The CRA claims to be in the business of revitalizing "BLIGHTED" areas, yet, they have been dismal failures at ever achieving any of their goals. The L.A. Times recently reported that, after spending 117 million dollars (with no apparent end in sight) the North Hollywood CRA project, failed to complete any of its projects as originally promised. After wasting all of this money, L.A.'s CRA even failed to raise that area's standard of living when compared to equivalent areas, which was its original stated goal when they had declared the North Hollywood area "blighted" in 1979.
How TAX INCREMENT DIVERSION" works is that all property taxes within a CRA's targeted redevelopment zone are locked in at the creation of the project. Thereafter, any tax increases (caused by inflation and/or change of ownership, etc.) that would normally fund schools, police, street repair, etc., are instead "DIVERTED" for use by the CRA. Thus, the taxes which are needed for our basic City-services are instead used, for example, to clear the land and to entice large developers into the project-area with CRA promises of further property tax breaks (for them) and cheap (or, even free) land.
These "diverted" taxes may not seem like much money in the project's beginning, but 10, 20 or even 30 years down the road City-wide services will increasingly begin to suffer since the City will still have to maintain its service obligations to all parts of the city, even as the redevelopment areas increasingly contribute less and less of their fair share to the tax base as time goes on.
The official information linked to this page clearly shows that the CRA will not bring outside money into the CRA's targeted area as its proponents claim; instead, due to these very obscure redevelopment laws, what actually happens is that all of our futures are sacrificed in an elaborate scheme dependent upon borrowed money and waste, thereby committing all City residents to enormous interest payments far into the future.
The CRA's enormous drain on the general fund could perhaps be justified if it actually benefited the property owners within the CRA's autocratic jurisdiction; however, to date not one CRA project has ever produced any tangible benefits to these areas' residents, who are often left feeling victimized.
A large portion of our diverted tax money goes to feed CRA employees' enormous salaries (some over $100,000); mind you, these over-fed "employees" have never produced any tangible results with our money, thus, at least 40% of this "diverted" tax money seems wasted on their salaries. The bulk of the rest of the money will be further wasted on what should be private construction projects that will mostly benefit outside developers, who most likely live in Beverly Hills, and other such areas outside of the redevelopment zone! That's where the REAL money goes!
The information on these pages detailing the CRA's many abuses came from such reputable sources as the 1993-94 Los Angeles County Grand Jury Report. Also, from the State Controller Office's annually published reports
The Municipal Officials for Redevelopment Reform (M.O.R.R.), also has published "Redevelopment: The Unknown Government" which is extensively linked to on this page. For the entire MORR document [CLICK HERE.] Please keep in mind these points:
1. After decades of trying at enormous cost, no CRA project has ever met its promised expectations; indeed, these projects admittedly make things much worse before their promised pay-off (which never seems to come!)
2. Even if miraculously there were an improvement after 30 years to 40 years of disruption and lost money (which is the CRA's approximate completion date) the vast majority of us currently living in or near the targeted area will have probably already moved on after selling at drastically reduced market rates - who would possibly pay the fair market-value for your property during the 40+ year course of this project - NO ONE! WHO WOULD WANT TO BUY INTO THIS BOONDOGGLE? Look at N. Hollywood, 21 years into that project and the area still hasn't returned to normal!
3. Even if you live outside of a CRA area your taxes will also be "diverted" to make up the difference in the CRA-project area's lost tax base. Your schools will suffer, your City services will suffer, and the funding for fire and police protection will suffer!
4. Ask yourself these questions:
Since the CRA would like to mortgage our lives on a project that will cost millions of dollars with little certainty of success (as their past history proves), how old will you be in 40 years? How old will your children be in 40 years? Will this 40 year project, which will only enrich the developers at the expense of our schools and other City services, be worth this heavy sacrifice?
Keep in mind, that due to TAX INCREMENT DIVERSION", this project's financial burden will automatically increase each year. Perhaps these costs seem relatively low in the beginning; however, even the 31 existing CRAs will continue to eat up a larger portion of our taxes each year (According to the State Controller, from 8% of all Calif. taxes in 1995 to a projected 16% in 2010, then to 32% in 2025.) Can we stop this upward spiral? Maybe we can!
The CRA claims that they use only "free money" from the tooth fairy - this is a lie! (Public Policy Institute). Remember, the real tax burden of all CRA projects will be on the shoulders of your children and grandchildren, 20, 30 and even 40 years down the road! Is this the inheritance that you want to leave to your children?
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Please contact your L.A. City Council-person as soon as possible, before it is too late! Your City Council is the last hope to stop this wasteful project.
Contact Your City Council-person (click here) |
2000, POOPT News Services
~ American Homeowners Resource Center (AHRC) ~
AHRC ~ WebTv
This site has important information for
homeowners living under oppressive CC&Rs
(& non-Java browsers)
Legalized Theft: Eminent Domain And Redevelopment
Why are you losing your rights?
Eminent Domain & Redevelopment
Rebuilding American Cities;
But, at What Cost?
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