The consistent message to the council from those in attendance was that – while redevelopment hasn't come close to meeting its hoped-for outcomes over the last 20 years – they wanted to continue moving forward and taking advantage of millions of dollars that city staff estimated would be generated for the city if the plan is extended for another 10 years.
City staff explained that the council must wait until June 24 for the final votes on the plan, but if it isn't extended the redevelopment agency shuts down on July 9, and no new redevelopment dollars will come in.
At one point, when community member Dave Hughes asked the council to request a show of hands for those in favor, Mayor Judy Thein did just that. Of the roughly 80 people in the room, most raised their hands in favor of the plan amendment. Only three raised their hands to signify they were against it.
“I absolutely know this town needs redevelopment and those funds are essential to our survival,” said businesswoman Jeri Spittler, who led an effort last weekend to spruce up the building at the city-owned Austin Resort property.
She said she and other city residents were ready to roll up their sleeves and spend their own money to get the city going on the right track.
“We can't live in our mistakes,” she said.
But those against the plan, such as Alice Reece, didn't like the city's redevelopment direction, particularly giving nearly $7 million in redevelopment funds to an out-of-area developer for the proposed Lowe's-anchored shopping center on the former airport property on Highway 53.
Reece faulted the city for failing to create a “sense of belonging” in Clearlake. While the county has done a good job on the Northshore with its redevelopment project, Clearlake hasn't. “Do not continue this,” she said.
Only three council members – Thein, Chuck Leonard and Roy Simons – were present on the dais during the entirety of the meeting.
Following a brief discussion about amending the city's housing element – which the council voted unanimously to do – Vice Mayor Joyce Overton and Councilman Curt Giambruno read statements noting their potential conflicts of interest due to owning homes in the redevelopment area, which covers 80-percent of the city.
In January, the council had to deal with those potential conflicts of interest. At that time, Thein also had declared a conflict because of her home's location. However, Thein was “rehabilitated” under the legally required participation exception, which allows for a conflict of interest exception to political reform act rules. The exception was needed to bring the council to a quorum, as Lake County News has reported.
An explanation of redevelopment's key precepts
Tom Hart, deputy director of the California Redevelopment Association, gave what he called a “redevelopment 101” presentation to explain the basic concepts of redevelopment, which he summed up as a way for cities and counties to get rid of urban decay and blight in designated areas.
Hart said California Redevelopment Law began in 1945, right after World War II, and the law became codified in the California Health and Safety Code in 1951. Major changes in redevelopment law occurred in 1993.
In California there are 395 active redevelopment agencies and 759 project areas, Hart said. Eighty-one percent of California's cities and 55 percent of counties have a redevelopment area.
Redevelopment is a “problem solver,” which Hart said uses the “but for” premise to define projects areas. But for redevelopment, Hart said, the private and public sectors couldn't eliminate blight in those specific areas communities identify.
Redevelopment can eliminate blight by creating partnerships, bringing investment into a community, creating value and a sense of place, all of which can build a local tax base, Hart said.
“It's a community's economic stimulus plan,” but it's also more than that, he explained.
Tax increment revenue is redevelopment's primary funding source, Hart said. It's generated from the increased property tax values in an area that result from removal of blight and improvement of infrastructure.
Simons said that after pass-through payments to other agencies, there isn't much money left. He said the information he has gotten from the California Redevelopment Association leds him to believe that the city needs a project area committee, which the council decided against forming earlier this year.
Hart said redevelopment agencies retain about 60 cents on the dollar after pass-through. As for project area committees, he said of all the redevelopment agencies and project areas, all but about 50 of them have the committees, which are required if there is an affordable housing component to a redevelopment plan.
Neiman explained that tax increment pass-through payments are made to agencies – such as school and fire districts – that are hurt by the loss of funds to a redevelopment agency.
As for the project area committee, they're required if a redevelopment plan that's being adopted or extended can condemn residential properties, Neiman said. The city formerly had such a committee, but it was dissolved.
Neiman gave a presentation of his own, noting the city's financial difficulties and the plan amendment's projected benefits.
He showed a document three and a half inches thick, prepared by city staff in house because they couldn't afford a consultant. That has saved the city money on the amendment; Neiman said the estimated cost for a plan amendment ranges between $250,000 to $400,000.
He said all they were doing to the plan was changing its time limits, financial caps and revenue limits.
In addition to extending the plan for another 10 years, Neiman said the city also is seeking to extend for 10 years the period in which it can collect revenues to pay off debts for bonds.
The maximum revenues for the new plan would be $425 million over 60 years, with a maximum of $65 million for outstanding debt at any one time.
Neiman showed pictures of blighted buildings and gave rundowns of the quality of residential and commercial stock in the city. City staff has estimated it would cost $245 million for repairs to raise all residential dwellings to a sound condition. A survey of commercial buildings on Lakeshore Drive found most in need of repair.
The consulting firm Keyser Marston found that the current retail space inventory doesn't serve the population base, said Neiman, who also touched on crime rates and retail sales in gauging the community's health.
If the plan is amended, Neiman said it will generate a total of $42.2 million in affordable housing and public infrastructure funds for the community. Those are funds that can help improve housing stocks, make loans to businesses, and improve streets, sidewalks and drainage.
“I'll be the first to tell you, things could have been done better in the past,” Neiman said of the city's redevelopment track record.
He said he didn't think past councils had been aware of what was going on. “But, you know, that's history,” he said, explaining that without the plan the city won't have the money for important projects.
Simons argued with Neiman over the city's ability to use redevelopment funds for cleaning up blighted properties as part of code enforcement operations. Neiman replied that the agency has been budgeting about $100,000 annually for cleaning up buildings, which he said is an acceptable use.
Leonard said that in those cases liens are placed on properties and have to be repaid.
Community members urge council to move forward with plan
Richard Birk, president of Habitat for Humanity, said the city shouldn't throw away the opportunity for the millions of dollars that redevelopment is estimated to generate.
Albert Bernal, a city resident and planning commissioner, said he was confident the council and the agency could use the money wisely and make redevelopment work better moving forward.
Samir Tuma, who purchased the former Lake Escape Resort and reopened it as Clearlake Cottages and Marina, told the council that redevelopment takes a lot of different forms. His business, it was noted during the meeting, was given a loan from redevelopment which helped prepare it for opening.
Pointing to the Austin Resort painting and facelift project last weekend, Tuma said, “This community cares.”
He said during the Memorial Day weekend his business was packed with out-of-town visitors, who brought in money that he can then use to hire local people.
Tuma implored the council to extend the plan in order to be in a position to take advantage of the statewide and worldwide economic recovery.
Dave Hughes told the council that the city has nothing to lose and everything to gain by extending the plan another 10 years.
“Move forward,” he said. “Move forward positively.”
Officer Ryan Peterson read a message to the council on behalf of the Clearlake Police Officers Association – several of whose members were in attendance – urging them to extend the plan.
Joey Luiz, another Clearlake resident, noted that he works in the county's Northshore redevelopment project area. There, redevelopment has been so successful that his employer, Shannon Ridge Vineyards and Winery, expanded its investment, bringing in more jobs and economic opportunities.
Luiz, who noted he grew up poor in the city, said he had to watch many of his peers leave to find work. He said it's the council's responsibility to make sure that changes, and that the city improves.
“We can bring this community out of poverty,” he said.
Carl Webb, another planning commissioner and 41-year city resident, told the council, “Some of the greatest people in the world live right here in Clearlake,” adding that they deserve a city as great as they are.
“And there's no way they can do it without redevelopment funds,” said Webb, acknowledging that the city needs to learn from past mistakes. There are no other funding sources large enough to help the city, he added.
Karen Karnatz had family in the area, and she and her husband first moved to Lakeport, but they've more recently moved to the city. “This community is so special,” said Karnatz, explaining that she plans on raising a family in the area.
“Give us the money to have Clearlake be the special place that it can be,” she said. “It can happen, we just need a little bit of help.”
Jim Scholz said he believed the community wanted to pull together, and said it was the most community involvement he's seen, with people talking about the issues.
“I'm encouraged,” he said. “Let's move forward.”
During the council's discussion, Leonard said he felt the city has “a long ways to go,” but that they can handle redevelopment going forward. “We need to do it for the future.”
Thein said the city was like a child to her. “For me, this is easy. I believe in the future of Clearlake. I love this city.”
Neiman said he and attorney Melanie Donnelly, from the firm of Best, Best & Krieger – which has provided the city's attorneys – had discussed the vote requirements. If the city received written comments on the plan, they needed to wait at least seven days.
The ordinance extending the plan and a public hearing on the adoption of the agency's five-year implementation plan need to be voted on during the council's June 24 meeting, he said.
However, the council could move forward with certifying the draft mitigated negative declaration on the plan and finding that the agency had complied with community redevelopment law. The council voted 3-0 on both items.
Because he and City Clerk Melissa Swanson were busy preparing for the special meeting, Neiman said they weren't able to finish the agenda for Thursday's regular meeting, which he suggested they cancel. The council agreed to do so, with the next council meeting set for June 24.
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