Cra group 1 powerpoint 1
- 1. CITY OF LA: POST REDEVELOPMENT USC SOL PRICE SCHOOL OF PUBLIC POLICY PPD 619: SMART GROWTH & URBAN SPRAWL GROUP 1 JOY-ALONICA BAUTISTA JEFF KHAU MARISOL MACIEL THOMAS WONG
- 2. RESEARCH OUTLINE Background Context Meeting w/ City of LA’s Planning Department Case Study of California Cities City of Alhambra Best Practices of Economic Development Chicago, Ilinois Phoenix, Arizona New York, New York
- 3. BACKGROUND CONTEXT California Redevelopment Agencies died on February 1, 2012. Land-use conflicts and much more… Successor agencies What is LA doing to spur economic development?
- 4. RECOMMDENDATION #1 CITY OF ALHAMBRA
- 5. Potential Tools for Financing Economic Development long-term loans secured by some form of collateral and revenues generated from a project or paid Section 108 loans from a portion of the city’s annual CDBG allocation ideal for infill development projects and tenant improvements under the category of job creation or Annual CDBG allocation elimination of blight CDBG Program Income net proceeds from any project made possible through the use of CDBG funds New project-generated sales new net sales taxes from a development that can be rebated to offset project costs tax rebates New project-generated new net property taxes from a development that can be rebated to offset project costs property tax rebates Short term lines of credit secured and repaid by new net project generated property or sales taxes Federal/State Grants or increases access to capital for small businesses–a key component of job creation, and helps provide Economic Development additional security for a Section 108 loan Initiatives
- 6. ADDITIONAL FINANCING TOOLS Loans from General Fund or may require a loan agreement as well as an interest component to do some types of projects Enterprise Reserve Funds Sale of city assets set aside funds from sale of city assets City fees that are discounted, negotiated incentives to make it easier to attract new businesses and investments waived or deferred assistance to assess and remediate abandoned or underused industrial and commercial property Brownfields assistance (possible funding available via the EPA or Federal/State agencies) bonds through IFDs can be used to help pay for infrastructure-type projects by diverting property tax Infrastructure Financing revenues to pay debt service from other local governments, except schools (requires two-thirds Districts (IFDs) voter approval) bonds backed by revenue generated from a project funded with bond proceeds and repaid by Revenue bonds earnings from the operations of a revenue producing enterprise tax-exempt bonds issued by chartered cities for economic development or multi-family housing. The Conduit revenue bonds bond is payable from loan payments received from the non-governmental developer on the condition of a public benefit, and presents no liability for the governmental entity bonds used mainly to finance public works improvements and services or to pay for specific, limited Community Facilities Districts improvements related to privately-owned or real property (requires two-thirds voter approval to establish the parcel tax, i.e., Mello-Roos) a charge assessed against real property whereby there is a benefit from a particular public works or Assessment Districts public services project or activity undertaken by the city. The special weighted voter-approved assessment becomes a part of the funding mechanism to defray the cost of the project
- 7. RECOMMENDATION #2 NYCEDC Commercial Tax Incentives Empower Zone Benefits Commercial Revitalization Program Source: http://www.nycedc.com
- 8. RECOMMENDATION #2 New York State EDC Example of IDA Benefits Project "X" builds 50,000 sq. ft. building for $5,000,000, and has Brownfield Cleanup $4,000,000 mortgage. Program (BCP) Tax Mortgage recording tax savings (1% Credits of mortgage) = $40,000 Real Property Tax abatement = $275,000 over 10 years Industrial Development Sales tax savings on construction materials and non-manufacturing Agency Program equipment = $120,000 + $54,000 = Abatement of sales tax $174,000 Total savings over 10 years = $489,000 Source: http://www.nysedc.org/
- 9. RECOMMENDATION #3 Restructuring: Chicago’s Model Department of Housing and Economic Development Comprised of Commissioner’s Office and three bureaus Bureau of Housing Bureau of Economic Development Bureau of Planning and Zoning Bureaus do the bulk of the work in regards to execution of projects. Commissioner’s Office assists in the decision-making process Composed of private individuals who attend meetings once a month Community Development Commission (CDC) Chicago Skyline Oversight body created to review Source: http://www.prlog.org/11842434-chicago-it-doesnt-get-any-better-than- this.html expenses; unpaid positions
- 10. Chicago Model HED Structure Source: http://www.cityofchicago.org/content/city/en/depts/dcd/auto_generated/dcd_our_structure.html
- 11. RECOMMENDATION #4 Streamlined process Simplified way to get involved with development Department that knows about the start-up process Desire to have a relationship with business owners
- 12. CONCLUSION Pass Limited Transition Ordinance Institute economic development plan using alternative financing tools Capitalize on incentives and provide a customer advocacy program Streamline planning & development processes