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Well folks, it looks like one thing’s a lock for the November ballot: A request from the City Council to increase the property transfer tax – paid by buyers and sellers when a home or other piece of property changes hands – from $4.50 (ed. note: It's $5.40 - thanks Lena T) per $1,000 of a property’s purchase price to $12. The increase could raise about $5 million a year for the city.
As we explained the other day, the council passed a budget a few weeks ago, but they’re looking for additional revenue solutions to deal with what they anticipate will be ongoing budget shortfalls. They hired a polling firm to ask voters about whether they’d approve a parcel tax, maintenance assessment or increase in the transfer tax, and the latter solution was apparently the only one of the three that could pass.
Here’s the gist of the council’s conversation: It’s the apocalypse, people. The city has cut $9 million total from its budget for this past year and the one coming up, and they’re expecting more financially choppy times ahead. If they don’t get more cash in hand, they will need to cut services like police and fire. They could close all the libraries, and that wouldn’t even be enough to fix the problem. They could consider raising the sales tax, but let’s face it, there aren’t enough stores on the Island for people to shop at to make that work because everyone has a fit when someone tries to put one here (including the council, which is apparently considering a ban on big box stores, according to the Journal). If we’re not careful, we could turn into broke-a** Vallejo. And do you have any idea how difficult it is to concentrate on this stuff when there are so many videos of totally hot Doctor Who star David Tennant on YouTube? (Okay, I added that last part.)
Rob Platt of the Alameda Association of Realtors said his members are against the tax increase because it’s an excessive burden on people buying and selling homes, and he said his group plans to vigorously oppose it. That didn’t sit well with folks on the council, who wanted to know where the hell Platt was when they were making this year’s round of painful budget cuts and whether he had any other ideas to help balance future budgets. Another member of the realtor’s group pointed out that with the originally proposed increase to $14.50, the tax would add a total of around $13,000 to the cost of a $900,000 home in his East End neighborhood.
The council also okayed a list of charter amendments for the November ballot, which is here, and bid a sad adieu to the city’s chief financial officer, Juelle-Ann Boyer, who is retiring on August 1. You can read all about her accomplishments here.
The Alameda Unified School District’s finance chief laid out the impacts of Gov. Arnold Schwarzenegger’s budget proposal for next year, and they are grim. Under the proposal, the district could lose more than $4 million in state funding for the current year and 2009-2010. And that’s not counting the $650,000 it will lose when the new Nea Community Learning Center charter school opens next year, taking an anticipated 250 students off the district’s rolls.
If the governor’s plan were to be enacted, the district could face layoffs and even the loss of five days of the school year, district chief financial officer Tim Rahill said, though it could allow the district to take money out of “categorical” programs – money that is designated for specific programs that can’t be used for any other purpose.
Declining enrollment and increasing costs – Rahill said worker’s compensation costs, for example, will probably rise – will also impact the district’s budget.
“Alameda is facing a state budget crisis. We are facing the opening of a charter school. Also, we’re experiencing declining enrollment,” Rahill said.
He said parcel tax dollars generated by the passage of Measure H could also be used to help cover the cuts, if the board wishes to use those. This year, the district is slated to get $4 million in Measure H tax funds, and it has only budgeted $1.2 million of that.
Schwarzenegger has proposed a number of additional taxes to bridge $31.3 billion in budget shortfalls between the 2007-08 and 2009-10 fiscal years.
The district wants your input on its budget situation. They’ve scheduled budget workshops for February 11 and April 2. We’ll update you when times and locations are available.
If the governor’s plan were to be enacted, the district could face layoffs and even the loss of five days of the school year, district chief financial officer Tim Rahill said, though it could allow the district to take money out of “categorical” programs – money that is designated for specific programs that can’t be used for any other purpose.
Declining enrollment and increasing costs – Rahill said worker’s compensation costs, for example, will probably rise – will also impact the district’s budget.
“Alameda is facing a state budget crisis. We are facing the opening of a charter school. Also, we’re experiencing declining enrollment,” Rahill said.
He said parcel tax dollars generated by the passage of Measure H could also be used to help cover the cuts, if the board wishes to use those. This year, the district is slated to get $4 million in Measure H tax funds, and it has only budgeted $1.2 million of that.
Schwarzenegger has proposed a number of additional taxes to bridge $31.3 billion in budget shortfalls between the 2007-08 and 2009-10 fiscal years.
The district wants your input on its budget situation. They’ve scheduled budget workshops for February 11 and April 2. We’ll update you when times and locations are available.
posted by Michele Ellson at 9:00 AM on Jan 28, 2009
18 Comments:
I take issue with the suggestion that there aren't enough stores on the island and we need more to generate sales tax.
Studies done for Alameda Landing estimated that taxable sales leakage from Alameda is around $41 million annually. Alameda's share of sales tax is 1% - 1% on $41 million is $410,000 per year. Even if we could capture all that taxable sales leakage, it only adds up to about $400 to $500K per year - far short of the multi-million dollar shortfall.
On the other hand, the Community Improvement Commission - Alameda's redevelopment agency - realized revenues of over $15 million last year, most of it coming from property taxes. Council needs to look at rolling back or diminishing redevelopment going forward, to stop the agency from taking so much in property taxes away from the general fund.
See the figures in the state controller's report - look for City of Alameda http://www.sco.ca.gov/ard/local/locrep/redevelop/reports/0607redevelop.pdf
The amount of money collected by the City of Alameda from the Tax Increment (the aforementioned $15 million) that would be returned if the redevelopment area was dissolved would be ~$340,000. Less than the $410K dismissed above.
Good job in capturing the highlights of last night's Council discussion. Just a minor clarification, the current real estate property transfer tax is $5.40 per $1,000 of valuation not $4.50. The Council voted to place a ballot measure to increase it to $12. For a median-priced Alameda home at $600,000, this translates to 1.2% of the sales price. In essence, this is a "sales tax" when a property changes hands. This measure will help the City generate potentially $5 M and minimize the need to cut funding for essential city services.
Mr. Howard is correct in describing the limited ability of the City to generate sufficient revenues from sales tax to offset the projected budget deficit. Alameda County's sales tax is the highest in the state because of the County's 1/2 cent healthcare tax. This has the effect of 'capping' the ability of each city in Alameda County to raise the sales tax, currently at 8.75%.
With respect to the access to redevelopment funds, Mr. Knox-White is correct in that over 97% of the redevelopment revenues recorded in the State Controller's report must be used to repay debt.
Here's a brief primer of my understanding of redevelopment funding. State law allows Alameda's CiC to pledge tax increment so that they can repay bonds and other types of debt incurred to initiate projects in the designated redevelopment areas throughout the City, but the funds are very restricted. In essence, redevelopment agencies have no ability to generate taxes, but must fund projects through the improvements in the communities. They stimulate increases in property values that otherwise would not have occurred. Redevelopment agencies
keep a greater portion of these increases in order to pay back the debt that was incurred to jump-start revitalization of an area. Once the debt is paid off and the redevelopment area dissolved all taxing jurisdictions receive their proportional shares of the full amount of property tax from the increased property values. In our case, it's the $340,000 cited by Mr. Knox-White.
Lena Tam, Vice-Mayor
Vice-Mayor Tam touches on the most important question about redevelopment - a.k.a. Tax Increment Financing. She writes that redevelopment projects "stimulate increases in property values that otherwise would not have occurred" - this is not necessarily a foregone conclusion, and should not be accepted as such. There is an argument that worthy projects would happen anyway, with or without redevelopment subsidies, and only money-losing, unworthy projects need redevelopment subsidies.
So, if, for example, the cineplex and parking garage were, for example, a viable and worthy project, they might have happened anyway, without issuing redevelopment bonds, and would have increased property values and the property tax thrown off to the general fund. (Note that movie theatre tickets are not taxable - so there's no sales tax from ticket sales. And I've done the math on sales tax needed from meals stimulate by the theatre - those numbers are un-viable as well.) If the cineplex and parking garage wouldn't have happened without redevelopment subsidies, perhaps they are not worthy - meaning, financially viable - projects?
The statement about 97% of redevelopment money being required to pay back debt is specious - by law, redevelopment projects cannot attach to the tax increment UNLESS and UNTIL they issue debt. The redevelopment project HAS to issue debt to get its hands on the property tax money - which includes any property tax increment that would have occurred without the redevelopment project.
The problem with redevelopment is that the redevelopment agency - in Alameda's case, city council - can issue debt without voter approval to subsidize development projects that may or not be worthy, and may or may not have come to pass without the redevelopment subsidy.
Now look at Alameda Point - a massive redevelopment district and a valuable piece of land. Are redevelopment subsidies required to stimulate development on the last piece of bayfront land in the Bay area? Or is the land so valuable and the potential for profit so great that it might be developed without redevelopment subsidies?
For more, read "Tax Increment Financing and Economic Development, Uses, Structures and Impact", Craig L. Johnson and Joyce Y. Man, State University of New York Press.
Also note that retail is not the only way to bring sales tax revenue to the city - certain business-to-business transactions generate sales tax as well, and it's independent of how much residents spend in Alameda. But city staff and the current council seem fixated on using retail to generate sales tax, and aren't focused on the potential light industrial re-use of Alameda Point buildings to generate B2B sales tax.
I'm findings the numbers here a wee bit confusing. But before I begin, let me make one thing clear: I am for redevelopment. No "ifs", "ands", or "buts."
According to the State Controller redevelopment reports for FY 01-02 through 06-07, Alameda's RDA annually generated the following amounts of tax increment (see Table 4):
Table 1: Annual Tax Increment to Alameda RDA
01-02 $7,115,468 tiny.cc/PM9NO
02-03 $7,739,233 tiny.cc/9beAH
03-04 $7,993,280 tiny.cc/AUbv1
04-05 $8,956,572 tiny.cc/XKfUn
05-06 $11,178,320 tiny.cc/Zxwtd
06-07 $12,266,563 tiny.cc/mKd32
Strictly for the sake of analysis, let's assume there was no redevelopment agency in Alameda. And, for argument's sake, let's assume that the tax increment above was still generated, except that instead of being categorized as "tax increment", the dollars above are property taxes that go to City Hall, not the RDA.
For every one dollar in property tax, the City of Alameda (i.e. City Hall) tends to get roughly 25 percent, with the remainder shared between various taxing entities. So, if there was no redevelopment agency, then following amounts would have gone annually to City Hall.
Table 2. Estimated Annual Amount of Tax Increment That Would Go to City Hall if No RDA
01-02 $1,778,867
02-03 $1,934,808
03-04 $1,998,320
04-05 $2,239,143
05-06 $2,794,580
06-07 $3,066,640
Given the numbers above, I guess I'm scratching my head as to where the $340,000 figure comes from.
Now, let me go back to my initial statement as to why I am for redevelopment, without going into too much detail.
Tax increment collected by Alameda's RDA (Table 1 above) result from public investments (i.e. RDA issuing bonds that are paid back by tax increment revenues) made by City Council\RDA to improve areas that were (and continue to be) obviously blighted, and that developers would avoid but for redevelopment subsidies.
Without redevelopment (for those of you who remember), the Marina Village area would still be the hunk of junk it was back in the 70s and early 80s, instead of the nice well-manicured mixed use site it is today. Have we forgotten what was on the site that now is occupied by Independence Plaza and the accompanying park?
The key is to strike deals that entices developers to transform blighted areas that, at the time, are fair to residents and our on-going fiscal concerns.
Tony - you're making the same false assumption that none of these projects would have happened without redevelopment subsidies. Some would, some would not. That is the unproveable fault of redevelopment - would ALL of the projects happen ONLY with redevelopment subsidies? And if they would happen only with subsidies, do they make sense? Some do, some don't. Redevelopment lets taxing authorities issue public debt without voter approval for projects that may or may not make sense. And it thereby opens up the public coffers for abuse.
The book I referenced speaks to the issue in depth. The problem is that the starting point for all of these projects is that they must happen within the redevelopment framework. Where are the studies, and what work did City Hall do, to recruit a developer to the Alameda Theatre to develop a project without redevelopment studies? I'm willing to read them.
As for the $340,000, I have no idea where the figure comes from, and, as typical of redevelopment sympathizers, it is provided un-substantiated and without reference. But assuming it's correct, here's another way to look at it.
$340,000 in property tax revenue re-directed from the general fund to the redevelopment agency translates to $8.5 million (assuming only 25% of the property taxes go to the general fund) of additional taxable sales needed to make up contributions to the general fund. So, redevelopment has aggravated the taxable sales problem to the tune of $8.5 million. Instead of needing to capture the $41 million of taxable sales leakage per the Alameda Landing study, we now need to capture $49.5 million. How many wal-marts are you willing to bring into Alameda to do that?
Tony,
The City of Alameda's share of the Tax Increment is about 2.27%, with is where the $340,000 comes from.
David, you wrote: "you're making the same false assumption that none of these projects would have happened without redevelopment subsidies. Some would, some would not. That is the unproveable fault of redevelopment - would ALL of the projects happen ONLY with redevelopment subsidies?"
Yeah, yeah, yeah: I read Michael Dardia's PPIC report, in which he argues that redevelopment in a number of cases provides subsidies to projects that probably would have occurred even without redevelopment.
But here's where I'm coming from: I'm looking at Alameda, not some theoretical question about whether redevelopment generally over-subsidizes the private sector.
In the 1970s and 80s, there was clearly a need for redevelopment, TIF bonds, and developers etc to revitalize the area where Marina Village exists now. I was a young kid then and redevelopment was the furthest thing from my mind. But looking back from the vantage point of now, I doubt any developer would have been willing to do what Don Parker eventually did for this area without access to the redevelopment kitty. That's what redevelopment is about -- providing financial leverage to get the private sector involved in areas they would not otherwise go to. Good redevelopment occurs when the partnership attends to the fiscal and other needs of each other in a fair and upfront manner.
Likewise for Alameda Point. The place is a mess underneath the ground. Redevelopment (and all the tools that implies) is needed to get Alameda Point going. Bayport proved this: what started out as I think a $10 million demolition and backbone infrastructure improvement project turned into a $19 million project because of the stuff underneath the ground. By stuff, I'm not referring to contaminants but to years and years of the Navy putting in pipes and other infrastructure in a hodge podge manner. So, out at AP, developers basically have to do two things -- take stuff out and then put stuff back in. Right there, costs are doubled right off the bat. Most developers wouldn't touch AP without redevelopment and all the tools that implies, or some other tools such as Mellos Roos.
So, I'm not going to knock Michael Dardia. Obviously he knows his stuff. And PPIC is a very good outfit that, btw, had as its first director my professor and advisor at Cal's City Planning, Michael Teitz. But the issue is Alameda. The problems we are dealing with are not theoretical; they are real.
But, here's the deal: this discussion I'm hearing or reading about now about redevelopment at Alameda Point is, well, old. I brought this up waaaaay back in 1995 when Council (before I was even on Council) was dealing with this issue. In particular, I brought up a very unique particularity about Alameda Point's redevelopment. And, guess what? When I finally got on Council, I fixed it, in part, by championing and shepherding the municipal service district. The MSD is not the total solution, to be sure, for reasons I'm not going into.
But the idea that this issue was not vetted in the public, by several Councils, is furthest from what happened.
Is redevelopment mis-used in California? Yeah, there's no doubt it is. But just because some city in California is mis-using redevelopment, should we, in Alameda, throw out this baby with the bath water, so to speak? I don't think so.
Does redevelopment come with fiscal trade-offs, in terms of diverting property taxes from the General Fund or other taxing entities to the RDA, such that money that would otherwise pay for services is now locked in (for the most part) for infrastructure purposes? Sure, that happens... But the way to get around that is being creative about policies such as MSD or what land use choices you decide to pursue.
Going forward, it's not complicated: use the redevelopment tools that you have at your disposal but just make sure to cross your "t's" and dot your "i's" when doing so.
There's no doubt what Dardia has to say is very interesting when it comes to redevelopment generally in California. But when it comes to the particular needs of Alameda, Dardia's issues, in some respects, were vetted and dealt with. Alameda needs to move forward.
Hi John,
Thanks for the info above: I'm guessing what you did was multiply 2.27 percent against $15,000,000, which yields $340,500.
If this is the case, then several points. Actually, the $15 million figure is property taxes, but, in the context of redevelopment, this $15 million is also "property tax increment," or what people refer to in the short hand as simply "tax increment."
Presumably, this $15 million in property tax increment comes from the assessed valuation for a number of properties in the redevelopment area. IOW, the product of the 1% property tax rate and assessed valuation results in $15 million.
Indeed, when you look at the Controller data, Alameda RDA assessed valuation for purposes of redevelopment is $1.1 billion. Multiply 1% against $1.1 billion, you get $11.1 million. Now, do you want to guess how much property tax increment Alameda's RDA gets? $12.3 million. (The difference between $11.1 million and $12.3 million is attributable largely, I think, to the unique peculiarity of Alameda Point's redevelopment).
So, since the $15 million in tax increment referenced above (ps: it's really $12.3 million -- see State Controller's Redevelopment Report, Table 4 of FY 06-07, line "tax increment") is also property taxes resulting from the 1% rate multplied against assessed valuation, Alameda (i.e. City Hall) share is approximately 25%. IOW, we get 25% of 1% of assessed valuation. So, if redevelopment didnt exist but there was still $15 million in property taxes, you multiply $15 million by 25%, which yields $3.7 million. (But you really should multiply 25% against $12.3 million, which is the true amount of t.i. that Alameda's RDA gets, resulting in $3.1 million).
Now, I knoow someone is going to say, see, that $3.1 million that should be going to the General Fund but, instead, is captured by the RDA. The counter to that is that that $3.1 million could only happen because of redevelopment; without it, there might not have been the scale of improvement to the assessed valuation base, from which property taxes (including t.i.) are gather via the 1% rate.
And, like I said above, you can still make the GF whole by creative\prudent policy decisions a la the MSD and land use choices.
Wow, that was an amazing historical perspective on Redevelopment in Alameda. Thanks Tony!
And speaking as a homeowner who pays that MSD tax ($1000+/per year on top of my property taxes), I'm quite sure that even though some of my property tax goes into the redevelopment coffers, I'm probably paying a significant amount because of the MSD into the general fund as folks not in a redevelopment zone.
Tony - just to be clear, I quoted the $15 million as -revenues- to the RDA, not prop. taxes. I'm well aware that the $15 million in revenue is comprised of roughly $12 million in property taxes, and interest and income indicated as "other income" on the controller's report.
And while I have read the PPIC report on redevelopment, I was referring to the book on Tax Increment Financing - both texts speak to the question of whether or not given projects would happen whether or not redevelopment is in place and whether redevelopment subsidizes projects that are financially questionable.
And again, the argument that "it could only happen with redevelopment" is circular - once the redevelopment district is drawn, by default, all projects are viewed through the redevelopment lens and no other options are examined. Then, at the end, redevelopment proponents claim that it "could only happen with redevelopment." Well, when that's the only option you study, what other conclusion would you come to?
The Cineplex and Parking Garage are local examples of how redevelopment was arguably mis-used and abused in Alameda. There was significant opposition to the addition of the cineplex to the theater, and to the size of the parking garage. Many people who were ambivalent about the project going in are disappointed now to see it complete. But the opposition was dismissed as a "vocal minority" and the project jammed through and CIC issued the bonds arbitrarily, as no voter approval was required.
How do you defend the ability of the CIC/redevelopment to arbitrarly issue debt in the citizens' names?
Hello David, you wrote, "And again, the argument that 'it could only happen with redevelopment' is circular."
From a conceptual and general observation about redevelopment, yes, your point has some validity.
But from the point of view of Alameda, and its particular needs regarding Marina Village area circa early 1980s and Alameda Point today, I don't think anyone can credibly argue that redevelopment was\is not needed because things will take care of themselves. Frankly, the argument applies to the movie theater, as well; I dont think anyone can credibly argue that reviving the historic theater would have happened by itself -- that some developer would come into town and then take on that task knowing full well that there'd be a maze of unknwons hidden beneath various walls of the old theater.
I don't think even you would say, "Well, let's not create a redevelopment area for Alameda Point and use whatever tools that implies to get the base going." As it is, I think most eveyone agrees that, out at Alameda Point, beneath the ground, there's a lot of problems that would make many developers balk at coming here but for redevelopment dollars. And even if they did come here and said they'd do it without redevelopment dollars, knowing the amount of risk involved, they'd demand a high rate of return of their investment that might make some local officials balk.
So, knowing the amount of risk involved for either the public or private sectors with respect to AP, what do we do? Sit around and do nothing? Come on . . . that's not credible.
I'm darn sure that Councilmembers in the early 1980s thought through the same issues when it came to redeveloping what became Marina Village. Should they sit around and do nothing and let the place be a dump?
Because that's what it comes down to: Councilmembers, in conjunction with the Alameda residents, need to address real life redevelopment particulars and make that decision -- sit on our hands and do nothing and let a place remain in the blighted condition that it is and thus bring everyone around down? Or, use redevelopment powers to issue bonds to pay for demolition (if necessary), removal of yucky stuff such as old infrastructure, grading the land and making it ready for development, lay down new infrastructure, putting in new roads, sidewalks, and public amenities -- and those bonds are then paid back by property taxes in the form of t.i.?
You ask the question, "How do you defend the ability of the CIC/redevelopment to arbitrarly issue debt in the citizens' names," as if I'm supposed to be surprised or intimidated by this question.
As Councilmember, you are elected to make decisions with respect to exercising INCREDIBLE powers, among them the use of redevelopment. I would hope Councilmemebrs do not flinch from exercising those powers entrusted to them by the people of Alameda and, in so doing, I would hope they use judgement, exercise discretion where mecessary, and, at all times, listen to a wide possible number of people as possible.
Now, let's go back to your question: "How do you defend the ability of the CIC/redevelopment to arbitrarly issue debt in the citizens' names?" Come on David, you're employing an obvious rhetorical gimmick here by inserting the word "arbitrarily": after all, who wants to support anything that's "arbitrary"? But I think readers here should ponder this word, "arbitrary", and ask, "Arbitrary to whom?" After all, like the outcome or not, the redevelopment process with respect to the theater\multiplex was quite lengthy, a drawn out process in which information was shared above board, people were involved, our community divided, and Council ultimately voted. That's arbitrary? Come on . . . . and this is coming from a person (me) who voted against the multiplex after listening to all sides, reading the materials, and weighing the issues based on my professional judgement (given the obvious pent up local demand for movies, I didn't see why we had to settle so low when it came to the elase arrangement) and community ideals. It was a tough decision . . . but I know that for any of us on Council, it was not arbitrary.
OK: forget about the movie theater, maybe AP redevelopment or redeveloping what ultimately became Marina Village is\was, in the minds of some, "arbitrary." Again . . that's just not credible in the face of overwhelming facts in support of redevelopment. In addition, we went through a process to establish AP redevelopment area, and matters pertaining to fiscal consequences were vetted and, by me, ulitmately partly dealt with via the MSD. Arbitrary? No.
I think what Alameda or any city needs is a watchdog when it comes to redevelopment, someone who makes sure redevelopment deals address all issues, and involve and are fair to immediate and long-term needs of residents, so that redevelopment is not done in a vaccum, but that issues of cost control, project priorities and scoping, fiscal consequences, jobs, quality of development, etc., etc are examined in concert. But, to say Alameda (or Alameda Point) doesn't need redevelopment, frankly, is just not credible.
Tony, thanks for explaining where I went wrong.
Thanks again Tony, I think you touched upon an important point that our sitting CIC is comprised of our elected City Council members. When they act as the CIC, they are still answerable to the citizens of Alameda, basically it is part of their job description and folks should understand that when they cast a vote to place someone in the chair.
I also like your idea of a citizen-led "watchdog" group and would feel comfortable with a group that was comprised of folks who ended up on the fiscal sustainability committee, but possibly slightly more expanded to include stakeholders from the areas designated as redevelopment areas.
Thanks, John and Lauren, for your comments and insights. Just for the record: I hadn't given the notion of a "watchdog" any great (or serious) thought. I don't think there's anything "broken" per se with the way redevelopment in Alameda is pursued. I think the Mayor and Councilmembers, staff, and our residents ask plenty of good\tough questions when it comes to redevelopment and many other matters. But I suppose it doesn't hurt to have one more set of eyes and ears bird-dogging this or that. So, it's in that vein that I mentioned "watchdog". Whew . . . that's enough for me for now . . . back to my cave to hibernate.
Tony - you're reading more into my comments than I intended. In your post you attached a lot of baggage to my use of the word "arbitrary" - did I inadvertently strike a harsh chord within you?
My only intent in the use of the word "arbitrary" was to contrast it with putting the debt issue to a vote. I have mis-givings about redevelopment because it allows elected officials to issue debt without putting it to a vote. Combine that with the potential for mis-use/abuse and I have serious mis-givings. Then cap it off with the Theatre project and the Mayor dismissing legitimate opposition and then I have objections.
El Cerritto somehow renovated their historic art deco theatre without adding a 7 story parking garage or a cineplex. How could they do it when Alameda could not? Granted, I don't think Alameda residents banded together to raise restoration funds as in El Cerritto. But once the redevelopment district was drawn, there was no examination of any other path.
As for Alameda Point, I can see an argument for subsidies of some kind for the developer, but I have trouble with redevelopment being used as the mechanism, for the reasons I explained above.
But let me ask you - how has Harsch Realty been able to upgrade Alameda Town Center without redevelopment money?
Story on redevelopment in San Francisco http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2008/07/21/BA6511Q4G0.DTL
Hello I was the person who spoke at the council meeting on how much the increase in transfer tax would cost a homeowner purchasing or selling a 900k house in Alameda. What the Mayor and Marie Gilmore did not bring up when discussing this tax increase is that they are asking a very small number of people to bridge the budget gap the city is facing. For example there was approximately 550 real estate transactions last year, assuming one party for each side of a real estate transaction 1100 people would be shouldering the burden for closing the budget gap.
At the city council meeting the Mayor, Marie Gilmore and the rest of the council stated that they looked at many other alternatives and none of them would raise enough money to cover the gap. When Rob Platt spoke and brought up that this huge tax increase was unfair the Mayor and Marie Gilmore chastised him and asked him to solve the deficit in the City of Alameda never mind it is their job not his to solve this problem. The Mayor and the rest of the city council does not want to do the heavy lifting or take the political heat that it would take to ask the citizens of this city to pay for this problem. As for other possible revenue sources the city could ask that the utility tax be increased, the sales tax be increased, fees for park use, the golf course etc. all could and should be increased. While none of these increases would solve the problem combined they could help a lot and make such a huge increase in the transfer tax un-necessary. You can see this meeting at this link http://alameda.granicus.com/MediaPlayer.php?view_id=2&clip_id=349&publish_id=&event_id= I suggest you fast forward to about 1 hour and 57 minutes to see the Mayor and Marie Gilmore discuss this with Rob Platt.
At this meeting I very briefly brought up one of the ways to increase city revenue with out raising taxes, condominium conversion. This is where you take an existing building say a 10 unit Doctors office on Central near Alameda High. And Convert (not tear down) the property from a single Parcel to one building with 10 separate addresses or parcels. This would give you a number of benefits. Currently these buildings sell very infrequently therefore the assessed value for tax purposes is very low and the city collects very little money from transfer taxes. A building that has not been sold in the last 30 years often has an assessed value of less than 150 thousand dollars this results in a property tax of less than 2000 dollars a year and one parcel tax for the schools and one parcel tax for the hospital. If this same building was a 10 unit commercial condo with multiple owners its current accessed value would be conservatively valued at 1.5 million dollars and the property taxes would be about 18,000 dollars a year and instead of just one parcel tax for the schools and hospital there would be 10 parcel taxes. Another benefit this would have would be that the units would sell more often and the city would collect additional transfer taxes. I have seen very conservative analysis that making condo conversions easy to do in the city it could raise and additional 250 thousand dollars a year in tax revenue.
When people have tried to do this the city has made it virtually impossible to do. The Mayor, the city council and the planning department have turned a def ear to this way to increase revenue without raising density or increasing taxes.
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