BILL ANALYSIS
SENATE LOCAL GOVERNMENT COMMITTEE
Senator Dave Cox, Chair
BILL NO: AB 1641 HEARING: 6/30/10
AUTHOR: Hall FISCAL: No
VERSION: 6/24/10 CONSULTANT: Detwiler
REDEVELOPMENT AND BLIGHT
Background and Existing Law
The Community Redevelopment Law allows local officials to
set-up redevelopment agencies, prepare and adopt
redevelopment plans, and finance redevelopment activities.
Before redevelopment officials can wield their
extraordinary powers of property tax increment funding and
property management (including eminent domain), they must
determine if an area is blighted. The definition of
blight, and how redevelopment officials apply it in
specific local settings, is the pivot around which
redevelopment powers turn.
Until 1994, state law did not explicitly define blight.
Instead, the statute described the characteristics of
blight. This lack of statutory precision allowed local
officials to adapt a statewide law to fit local
circumstances. It also permitted some local officials to
find blight where critics and the courts did not. In 1993,
the Legislature passed the most important redevelopment
reform bill in a decade. AB 1290 (Isenberg, 1993) enacted
the first statutory definition of blight. Partially in
reaction to the protests following the U. S. Supreme
Court's Kelo decision the Legislature tightened the blight
definition (SB 1206, Kehoe, 2006).
A blighted area must be predominantly urbanized with a
combination of conditions that are so prevalent and
substantial that they can cause a serious physical and
economic burden which can't be helped without
redevelopment. In addition, a blighted area must have at
least one of four conditions of physical blight and at
least one of seven conditions of economic blight.
Predominantly urbanized means that at least 80% of the land
in the project area:
Has been or is developed for urban uses (consistent
with zoning), or
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Is an integral part of an urban area, surrounded by
developed parcels.
The four conditions of physical blight are:
Unsafe or unhealthy buildings.
Conditions that prevent or hinder the viable use of
buildings or lots.
Incompatible land uses that prevent development of
parcels.
Irregular and inadequately sized lots in multiple
ownerships.
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The seven conditions of economic blight are:
Depreciated or stagnant property values.
Impaired property values because of hazardous
wastes.
Abnormally high business vacancies, low lease
rates, or a high number of abandoned buildings.
Serious lack of necessary neighborhood commercial
facilities.
Serious residential overcrowding.
An excess of adult-oriented businesses that result
in problems.
A high crime rate that is a serious threat to
public safety and welfare.
A blighted area that meets these physical and economic
conditions may also be characterized by inadequate public
improvements or inadequate water or sewer utilities.
Some of the 11 public housing projects owned by the Housing
Authority of the City of Los Angeles are outside the Los
Angeles Community Redevelopment Agency's 23 redevelopment
project areas. City officials want to coordinate their
housing and redevelopment efforts. They are considering
creating new redevelopment project areas to take in public
housing projects, including the Jordan Downs and Nickerson
Gardens housing projects built before 1960. City officials
want to replace the existing housing with mixed-use
development. Because public housing projects get federal
subsidies, the Housing Authority must keep the units
decent, sanitary, and safe. Los Angeles officials worry
that they might jeopardize the federal subsidies if they
declare the housing projects as "blighted" under state
redevelopment law.
Proposed Law
Assembly Bill 1641 declares that a blighted area that
contains characteristics of physical and economic blight
may also include housing constructed as a government-owned
housing project, constructed before January 1, 1960.
If a redevelopment agency uses this explanation of blight,
AB 1641 requires the agency to follow redevelopment law and
follow additional requirements for replacement housing and
limit the displacement of households.
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Comments
1. A defining moment . Blight is the gateway to
redevelopment. Unless they can document blight,
redevelopment officials can't get access to the state
subsidies that support property tax increment financing and
they can't use their extraordinary eminent domain
authority. The 1993 reforms and the 2006 revisions
demonstrate the Legislature's insistence that redevelopment
officials respect the statutory "blight" definition.
Without expanding that definition, AB 1641 demonstrates
that older, government-built public housing can be part of
a blighted area. This nuanced approach should avoid
jeopardizing federal housing subsidies while still allowing
Los Angeles officials to use redevelopment's extraordinary
powers.
2. Housing requirements . For over 30 years, state law has
required redevelopment officials to spend money on
affordable housing, replace housing destroyed by
redevelopment projects, and relocate displaced tenants. As
Los Angeles officials approach the redevelopment of public
housing projects, AB 1641 ensures that they will go beyond
the requirements of existing law to protect low-income
tenants.
3. Double-referred . The Senate Local Government Committee
shares policy jurisdiction over redevelopment activities
with the Senate Transportation Committee. Because AB 1641
affects redevelopment agencies' obligations to provide
replacement housing and tenant relocation benefits as well
as the statutory "blight" definition, the Senate Rules
Committee ordered the bill's double-referral. The Senate
Transportation and Housing Committee passed AB 1641 on June
22. The Senate Local Government Committee will hear the
bill on June 30.
Assembly Actions
Assembly Housing & Community Development Committee: 6-3
Assembly Floor: 46-26
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Support and Opposition (6/24/10)
Support : City of Los Angeles.
Opposition : Unknown.