New State Budget Proposal Calls for Elimination of Redevelopment

Gov. Jerry Brown told reporters Monday that he'd reached a deal with Democratic lawmakers and would surge ahead with his new proposed budget plan, with or without Republican support, according to the Los Angeles Times and other media sources.

The move comes just weeks after the governor vetoed a Democratic budget — the first budget veto in California history, the Times notes.

Lawmakers could vote on the new budget as soon as today. If they do, redevelopment — which is responsible for a number of local projects — will be dead. 

Unlike previous iterations, the new budget does not depend on an extension of existing taxes set to expire July 1. As a result, the state tax rate will drop 1 percent, bringing Union City’s tax rate down to 9.25 percent. Instead of tax extensions, the proposed budget assumes an additional $4 billion in revenue, according to the Sacramento Bee.

Should additional revenue fail to materialize, the plan would slash $2.6 billion (roughly equivalent to the entire ) mid-year, with deep cuts to schools and public safety. Austerity measures in that scenario include a shorter school year. 

Like its earlier versions, this budget proposal would eliminate redevelopment agencies across the state, making the agencies null as of July 1, redirecting their revenue to local government and selling off unconstructed land holdings. The move is expected to divert $1.7 billion to schools and local governments, schools and counties, according to a report by the Legislative Analyst's Office.

The Union City Community Redevelopment Agency has already to the City of Union City as a precautionary measure. In March, the city also authorized the agency to issue up to a $40 million bond to ensure that current redevelopment projects, including the , are completed.

The second phase of the BART station renovation is currently underway. Tonight, the agency will award contracts to construct a pedestrian promenade and a plaza near the station, according to Redevelopment Manager Mark Evanoff.

“As long as the resources of the redevelopment agencies are not confiscated, the city can go forward as planned," Evanoff said.

Last week, Union City Mayor Mark Green issued who support the dismantling of redevelopment agencies.

“I am extremely disappointed in the state lawmakers,” Green wrote last Wednesday. “This elimination and hostage-taking of local redevelopment funds puts our city and the entire State of California on the wrong track.”

Green estimates that some 10,200 new jobs could be created through redevelopment projects. The work in the Station District would also generate up to $68 million in state and local revenues, according to Green.

Union City also has a significant amount of blight, which cannot be cleaned up without the redevelopment agency, Green said.

City Council is scheduled to approve tonight.

However, the plan — which calls for restoration of a number of services slashed in recent years, including the addition of a police officer and several city positions — relies on redevelopment remaining intact.

According to City Manager Larry Cheeves, if redevelopment is eliminated, the amount of money the city will lose is comparable to the amount of money it plans to reinstate in the two-year budget. Some of the proposed restorations may be delayed, Cheeves said.