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City Council Approves Demolition of 2413 Buena Vista Avenue

Robb Ratto of the Park Street Business Association stood before City Council last night in support of the demolition of the Queen Anne Cottage at 2413 Buena Vista Avenue in the name of retail sales tax revenue. The problem is, the last big retail sales tax revenue scheme for Park Street and vociferously supported by Mr. Ratto – the Alameda Theatre and Parking Garage – haven’t provided the promised sales tax revenue.

We’ve written about this already, but let’s put it in the context of the North of Lincoln plan, and the demolition of 2413 Buena Vista Avenue. The local redevelopment agency, the Community Improvement Commission of the City of Alameda, took over $14 million in property taxes last year away from the state, the county, our schools and the Alameda General Fund. According to City Treasurer Kevin Kennedy, 27% of property tax revenues in Alameda go to the general fund, so that’s a loss of $3.79 million which has not been made up with retail sales tax revenue attributable to the Parking Garage and Alameda Theater. We suspect, as Anne-Marie Gallant hinted at last night, that the mix of sales tax revenue is changing – more from restaurants around the Theater and less from merchandise, but overal sales tax in the Theater district was down in the third quarter of last year 1.7% from the previous year, and the theater districts share of overall sales tax revenue in the City is flat, not increasing.

The Parking Garage and Alameda Theater project prove that redevelopment projects all too often simply don’t work. The $3.79 million that the general fund lost last year – and it will be a higher figure next year – is not compensated with new sales tax revenue. The City of Alameda realizes about $5 million each year in sales tax revenue, representing about $500 million in spending in the city. All these redevelopment projects do is shuffle that spending around the city, and shuffle the mix of spending, without actually increasing the overall spending in the city, and at the same time, they take money away from the general fund, necessitating parcel taxes on property owners.

The use of redevelopment tax-increment financing for the Park Street North of Lincoln project – wait for it, we’re sure City staff will dream up a scheme – is going to further aggravate the problem. It will simply re-distribute retail sales tax spending and take money from the general fund to subsidize the redevelopment.

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