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Council Commits Alameda Taxpayers to over $820 million Debt Burden

When Alameda City Council approved agreements totaling $326 million in future redevelopment projects earlier this week, they effectively committed current and future Alameda taxpayers to a future debt burden of over $820 million.

Trying to circumvent a plan by Democratic California Governor Jerry Brown to eliminate some 400+ redevelopment agencies across the state of California to free up money for schools, four out of five Councilmembers – all Democrats – Councilmember Beverly Johnson was absent – voted to commit some $326 million of future property taxes from Alameda Point and other parts of Alameda to future redevelopment projects for affordable housing, flood protection, storm drains, parks and other infrastructure improvements. Redevelopment projects are funded through ‘tax increment financing,’ a mechanism that requires bonds to be issued up front, and paid back over decades from future property taxes.

The $326 million commitment comes on top of the existing $223 million in outstanding debt owed by Alameda redevelopment agency, the Community Improvement Commission of the City of Alameda, according to the most recent California State Controller’s report on California redevelopment agencies.

Alameda Redevelopment Debt, State Controller's Report

At the same meeting, City of Alameda staff presented the City of Alameda Comprehensive Annual Financial Report for the fiscal year ended June 30, 2010. Buried on page 218 of the 232 page of the document is the City of Alameda ‘computation of direct and overlapping debt.’ The report totes up the value of various debt instruments that are paid back in part or in whole by residents of the City of Alameda, such as obligations of the Bay Area Rapid Transit District, the Peralta Community College District and the East Bay Regional Park District. According to the report, some $271,198,920 of debt attributable to various agencies is applicable to the City of Alameda.

All tolled, the debt applicable to Alameda taxpayers adds up to over $820 million.

City of Alameda Computation of Overlapping Debt

8 comments to Council Commits Alameda Taxpayers to over $820 million Debt Burden

  • Barb

    Does this include the proposed new AUSD parcel tax (for my 2 bedroom home- $791) or the Alameda Hospital earthquake retrofitting unfunded costs? And are we going to be asked to pay the new Alameda County Schools parcel tax of about $180 per parcel?

    Was anything done to stem public employee unfunded pensions or are they in addition to the above?

    Looks like if one doesn’t work for the City or School District, one will never get to stop working to pay off these bills.

  • Sharpie

    At some point, even if politically incorrect, you have to say enough;
    what we have is not working, I have no more to give, and we need to find new solutions. Not more money.

  • Q. Does this include the proposed new AUSD parcel tax (for my 2 bedroom home- $791)

    A. No.

    Q. or the Alameda Hospital earthquake retrofitting unfunded costs?

    A. No.

    Q. And are we going to be asked to pay the new Alameda County Schools parcel tax of about $180 per parcel?

    A. Not sure.

    Q. Was anything done to stem public employee unfunded pensions or are they in addition to the above?

    A. No.

  • Barb

    I omitted thw new Alameda County parcel tax for schools of $180 that we vote on in April 2011. I am not sure we have to pay this, but if so, it be in addition to the $791 for AUSD.

  • It appears that during the Great Recession, everyone is cutting back except government. And I don’t see any headlines or reporting documenting all these increases in taxes in the Journal or the Sun. Seems Action Alameda is the only one paying attention.

    Some of the biggest offenders are the school teachers, who would rather take days off from the classroom, (“furloughs”), than real cuts in pay.

  • Vania

    I don’t mean to be a kill-joy, but I wonder how these commitments of funds square with Article XXXIV (34) of the California Constitution?

    One blogger described the commitments of funds the City of Alameda made as: “Tuesday night that will allow them to use future property tax revenues to fund affordable housing and roads, storm drains, parks and other infrastructure improvements at Alameda Point and other redevelopment areas on the Island…The agreements commit $235 million for infrastructure and affordable housing at Alameda Point and $91 million for those items in other areas of town.”

    Article XXXIV of the California Constitution has been in existence since 1950. In 1990, it was deemed constitutional in a California Supreme Court case called Davis v. City of Berkeley, 51 Cal. 3d 227; 794 P.2d 897; 272 Cal. Rptr. 139; 1990 Cal. LEXIS 3506 (1990).

    Article XXXIV, Section 4 provides: “The provisions of this Article shall supersede all provisions of this Constitution and laws enacted thereunder in conflict therewith.”

    Article XXXIV, Section 1 provides:

    “Section 1. No low rent housing project shall hereafter be developed, constructed, or acquired in any manner by any state public body until, a majority of the qualified electors of the city, town or county, as the case may be, in which it is proposed to develop, construct, or acquire the same, voting upon such issue, approve such project by voting in favor thereof at an election to be held for that purpose, or at any general or special election.

    For the purposes of this Article the term “low rent housing
    project” shall mean any development composed of urban or rural
    dwellings, apartments or other living accommodations for persons of
    low income, financed in whole or in part by the Federal Government or a state public body or to which the Federal Government or a state
    public body extends assistance by supplying all or part of the labor, by guaranteeing the payment of liens, or otherwise. For the
    purposes of this Article only there shall be excluded from the term
    “low rent housing project” any such project where there shall be in
    existence on the effective date hereof, a contract for financial
    assistance between any state public body and the Federal Government
    in respect to such project.

    For the purposes of this Article only “persons of low income”
    shall mean persons or families who lack the amount of income which is necessary (as determined by the state public body developing,
    constructing, or acquiring the housing project) to enable them,
    without financial assistance, to live in decent, safe and sanitary
    dwellings, without overcrowding.

    For the purposes of this Article the term “state public body”
    shall mean this State, or any city, city and county, county,
    district, authority, agency, or any other subdivision or public body
    of this State.

    For the purposes of this Article the term “Federal Government”
    shall mean the United States of America, or any agency or
    instrumentality, corporate or otherwise, of the United States of
    America.”

    SO MIGHT WE ASK JUST WHEN DID ALAMEDA’S VOTERS APPROVE THE AFFORDABLE HOUSING PROJECTS TO WHICH ALAMEDA’S LAWYER-HEAVY CITY COUNCIL/REDEVELOPMENT AGENCY HAVE CONTRACTED THESE TAX DOLLARS IN SUBSIDY THEREOF?

    I SUSPECT THAT THE STATE, OR SOME WELL INTENTIONED LOCAL GROUP WHO DO NOT WANT TO SEE ALAMEDANS’ REAL ESTATE TAX DOLLARS WASTED ON “AFFORDABLE HOUSING” MAY WANT TO CHALLENGE THE CITY/REDEVELOPMENT AGENCY’S EFFORT TO PUT THESE FUTURE TAX REVENUES OUT OF THE REACH OF GOVERNOR BROWN’S BUDGE PLANS.

    THE LAWYER-HEAVY CITY COUNCIL/REDEVELOPMENT AGENCY HAS TRULY PUT THE CART BEFORE THE HORSE, IN THAT ARTICLE XXXIV SPECIFICALLY SAYS IN SHORT:

    “No…project shall hereafter be DEVELOPED, constructed, or acquired in any manner…UNTIL a majority of the qualified electors of the city…approve such project by voting”

    ISN’T THE CONTRACTING FOR THE USE OF THE TAX INCREMENT A FIRST STEP IN “DEVELOPING” SUCH A PROJECT?

    It should be noted that in Santa Rosa, there is a small group of retired lawyers who have been successful in asserting that their city building utility infrastructure, waiving city fees, giving away city land, or selling city land at discounted prices for such a project IS the development of such a project by a city, without approval by its voters.

  • Barb

    Great work as usual Vania. Unfortunately our lawyers are busy paying TAM’s lawyers, defending our fired CM and CA in SUNCAL lawsuits, hiring new lawyers for them, defending us from the actions of the 3 SUNCAL stooges, hiring Meyers Nave et al. and their great (not)advice, ad inifinitum. And they have to start by teaching our Yale and Boalt law grad Council/Mayor that we don’t have a strong Mayor form of government. And can you believe the comment that Gilmore just called the staff employee up to tell her she was fired by the Imitation City Manager, and Gilmore just wanted to be the first to convey the good news?

    If the new ICM didn’t acceed to cover Gilmore’s rear end, then you know we would be down to our 4th level of management in the CM’s office. Of course having the City run by a Secretary or Administrative Assistant in the CM’s office might not be so bad compared to what we have now.

    I think we are all hoping that the Gov nixes this kind of underhanded posturing. The cows are already out of the barn. All we are left with is manure.

  • Even if these maneuvers were legal, they are completely contrary to Governor Brown’s effort to balance the state budget, and to give the voters as much say as possible about tax extensions to avoid more deficits. And more say about reckless spending. Redevelopment has to stop! Some of that money will go to the schools, which is a better source than more, new parcel taxes!

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