Real Estate & Property Law

Ilya Somin Gets It Right: Abolish California Redevelopment Agencies

By Alan Ackerman

Ilya Somin's article accurately reflects what is happening in California. Governor Brown's proposal to eliminate hundreds of local 'redevelopment agencies,' which have abused condemnation power for years, is likely to protect property owners. While the proposal is premised on cutting California's gargantuan budget deficit, ridding the state of these agencies would also end a sad history of infringement on property rights in favor of private business interests.

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As part of his plan to address California's fiscal crisis, liberal Democratic Governor Jerry Brown has proposed abolishing California's 400 local 'redevelopment agencies,' which would save the state some $1.7 billion per year, an important step towards closing the state's $25 billion annual deficit. Unfortunately, his plan has so far been stymied by opposition from California Republicans, all but one of whom voted against it in the California Assembly. Under the California state constitution, passage of the bill requires a two thirds majority in the state Assembly, and Brown fell one vote short.The GOP's stance on this issue is extremely unfortunate, and at odds with the Party's supposed devotion to free markets and property rights. As Steven Greenhut, an expert on California property rights issues points out in a recent Wall Street Journal op ed, the redevelopment agencies are notorious for their abuses of the power of eminent domain for the benefit of powerful private interest groups:

[I]n the last 60-some years, redevelopment agencies have become fiefdoms that run up enormous debt and abuse eminent domain by transferring private property to large developers promising to build tax-generating bonanzas. Today, there are 749 such projects. In the late 1950s, there were only nine. According to the state controller, redevelopment agencies consume about 12% of all state-wide property taxes—money that would otherwise go to critical public services.

 

Full post as published by National Eminent Domain Blog on April 01, 2011 (boomark / email).