Morgan Hill – The Redevelopment Agency supports $1.3 million in city staff jobs but is quickly running out of money, putting some positions at risk, officials say.
Only a vote by the Morgan Hill City Council can save the multi-million dollar agency, and with a vote pending next month, the agency is pouring its own funds into promotional materials such as an eight-page glossy mailer sent to every house in the city.
The mailer touts the accomplishments of the 25-year-old agency in providing infrastructure, housing, community facilities, economic revitalization and historic preservation.
City officials who act as the agency’s staff on Monday did not provide a figure on how much the mailers cost. City Manager Ed Tewes, who servers as the the redevelopment agency’s executive officer, said the brochures were needed to “educate” the public.
If the agency’s money runs out, positions could be lost in various municipal departments that administer the agency’s projects.
Director of Business Assistance and Housing Services Garret Toy said “massive restructuring” would be required in 2008 if that’s the case.
“The agency pays for a portion of city salaries as (those jobs) relate to the agency,” Toy said.
Those departments include the city manager’s office, the city clerk’s office, the city attorney’s office, the human resources department and the finance department. Both the city manager and the city attorney receive half their salary from redevelopment agency funds. Business Assistance and Housing Services gets all of its funding from the agency. Under state law, 20 percent of redevelopment agency funds must be spent on affordable housing.
Much of the lost money for salaries would be replaced with funds from the city’s general budget, which would see a net gain of $1.3 million if the agency’s spending cap is not extended next month by the city council. But Tewes said the loss of future redevelopment projects would make it hard to justify keeping staff levels as they are.
“If there was less government activity, there would have to be changes,” Tewes said.
The city’s redevelopment agency was created in 1980 to provide a way to redevelop blighted areas. A map of those areas was created, and tax revenue that normally goes to the county is redirected toward the agency. The agency’s bylaws allow for the construction of projects such as the Morgan Hill Community and Cultural Center, but do not allow for money to be spent on maintenance. It has spent more than $250 million on those and other projects. The city council acts as agency directors.
Because the spending cap is about to be reached in January 2008, the agency has put forth a proposal for a $333 million extenuation. The money might extend the agency’s life by some 15 years, the time it would take to collect the funds. The city council is slated to vote on the extension on Nov. 8, following a public hearing in council chambers.
The city council has not yet pegged new projects for redevelopment funds.
A common discussion point regarding the extension of the agency is eminent domain. The agency is recommending limited use of eminent domain in the name of economic revitalization. Several people in the community have raised questions as to how and when this tool would be used. The has indicated it would be used sparingly, and only as a last resort to spur revitalization if property owners refuse to cooperate with neighbors’ efforts to rejuvenate areas.
City Attorney Janet Kern said the tool could come in handy in assembling larger parcels to accommodate bigger buildings.
“What sometimes happens is you get one or two holdouts. That’s when the redevelopment agency gets over the last hurdle” with eminent domain, Kern said.
Currently the agency does not have eminent domain powers. The city, on the other hand, can use eminent domain for projects that serve the public.
The agency’s use of eminent domain could be greatly limited or eliminated if California’s Proposition 90 passes on Nov. 7. The measure would limit government authority to use eminent domain except for facilities that will be owned and occupied by a government agency.
While the city has not taken a position on the legislation, the California Redevelopment Association has opposed Proposition 90.
The redevelopment agency is holding a town hall meeting tonight, 6:30-8:30pm, at the Morgan Hill Playhouse, 17090 Monterey Road, to provide citizens a summary of the agency and the proposed funding plan. City officials will answer questions after the presentation.
Another meeting is being planned for Oct. 30 to further address the issue of eminent domain. Letters of invitation are being sent to residents living within the eminent domain inclusion area, roughly bordered by Del Monte Street, Main Avenue, Dunne Avenue and Butterfield Boulevard. The meeting will be open to all members of the public.
Tony Burchyns covers Morgan Hill for The Times. Reach him at (408) 779-4106 ext. 201 or tb*******@mo*************.com.
