Redevelopment income slips below expenses
Expenditures will outpace income for Yorba Linda’s city-run Redevelopment Agency this fiscal year, thanks to the state’s $2.05 billion takeaway from property tax revenue generated by California’s 417 redevelopment agencies.
This city’s share of the 2009-10 tax shift is about $5.7 million, due May 10 for placement in the state’s Supplemental Educational Revenue Augmentation Fund. Some $1.2 million more is owed for 2010-11.
This year’s payment puts the city’s Redevelopment Agency income more than $2.7 million behind expenditures, an “unusual” situation, said city Finance Director David Christian. Next year’s smaller shift shouldn’t result in red ink for the 27-year-old agency.
In rounded figures, the city’s total redevelopment income for 2009-10 is expected to be $20.8 million, expenditures $17.8 million and state takeaway $5.7 million. Next year’s estimates: $21 million income, $18 million expenditures and $1.2 million takeaway.
At a Feb. 16 meeting, the City Council voted 5-0 to use about $4.1 million of the agency’s housing set-aside funds to make the state payment, with $1.6 million paid from the agency’s property tax revenue. The housing money must be repaid within five years.
Redevelopment agencies are funded by “tax increment” income from project areas. Tax increment is the increase in property taxes over the assessed amount at the time a project area is created from development intended to eliminate physical and/or economic blight.
Yorba Linda’s first project area was adopted in 1983 and includes 2,640 acres in the Savi Ranch region extending to the eastern city boundary. The area also includes a land swath to the northern border that contains some Hidden Hills homes, a section vacant in 1983.
A second project area was adopted in 1990 with 328 acres that includes Town Center in a corridor running from just west of Avocado Avenue along Yorba Linda Boulevard to just west of Valley View Avenue and west of Prospect Avenue north of Bastanchury Road.
Most of the approximate $20 million in increased property taxes collected each year from these two areas is “passed through” to 17 taxing agencies that would normally collect any additional assessments if the Redevelopment Agency didn’t exist.
The largest chunks of pass-through cash go to the Placentia-Yorba Linda school district (more than $4 million) and the Fire Authority (more than $1.5 million). Among others: a cemetery district, two water districts, three more school districts and county tax agencies.
An RDA’s annual tax increment income can’t exceed debt, which for Yorba Linda includes $60 million in bonds, a $6 million city loan and $15 million due PYLUSD.
Twenty percent of agency income must be set aside for affordable housing programs. The 2009-10 allotment will pay part of the state takeaway, with a remaining balance projected to grow to $33 million by 2014.
This city’s share of the 2009-10 tax shift is about $5.7 million, due May 10 for placement in the state’s Supplemental Educational Revenue Augmentation Fund. Some $1.2 million more is owed for 2010-11.
This year’s payment puts the city’s Redevelopment Agency income more than $2.7 million behind expenditures, an “unusual” situation, said city Finance Director David Christian. Next year’s smaller shift shouldn’t result in red ink for the 27-year-old agency.
In rounded figures, the city’s total redevelopment income for 2009-10 is expected to be $20.8 million, expenditures $17.8 million and state takeaway $5.7 million. Next year’s estimates: $21 million income, $18 million expenditures and $1.2 million takeaway.
At a Feb. 16 meeting, the City Council voted 5-0 to use about $4.1 million of the agency’s housing set-aside funds to make the state payment, with $1.6 million paid from the agency’s property tax revenue. The housing money must be repaid within five years.
Redevelopment agencies are funded by “tax increment” income from project areas. Tax increment is the increase in property taxes over the assessed amount at the time a project area is created from development intended to eliminate physical and/or economic blight.
Yorba Linda’s first project area was adopted in 1983 and includes 2,640 acres in the Savi Ranch region extending to the eastern city boundary. The area also includes a land swath to the northern border that contains some Hidden Hills homes, a section vacant in 1983.
A second project area was adopted in 1990 with 328 acres that includes Town Center in a corridor running from just west of Avocado Avenue along Yorba Linda Boulevard to just west of Valley View Avenue and west of Prospect Avenue north of Bastanchury Road.
Most of the approximate $20 million in increased property taxes collected each year from these two areas is “passed through” to 17 taxing agencies that would normally collect any additional assessments if the Redevelopment Agency didn’t exist.
The largest chunks of pass-through cash go to the Placentia-Yorba Linda school district (more than $4 million) and the Fire Authority (more than $1.5 million). Among others: a cemetery district, two water districts, three more school districts and county tax agencies.
An RDA’s annual tax increment income can’t exceed debt, which for Yorba Linda includes $60 million in bonds, a $6 million city loan and $15 million due PYLUSD.
Twenty percent of agency income must be set aside for affordable housing programs. The 2009-10 allotment will pay part of the state takeaway, with a remaining balance projected to grow to $33 million by 2014.
posted by Jim Drummond at 12:00 PM
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