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Redevelopment agency change vexes Council

City leaders take on reluctant task of dismantling redevelopment program.

January 11, 2012|By Brittany Levine, brittany.levine@latimes.com
  • An artistic rendering of the design plans for the Museum of Neon Art, slated to move into renovated city-owned space across from the Americana at Brand. A paseo between the museum and the Glendale Library was supposed to be funded by the redevelopment agency. (Courtesy of City of Glendale)
An artistic rendering of the design plans for the Museum…

As Glendale shuts down its redevelopment agency in the coming months, City Council members will have a new hat to wear — one they don’t particularly like.

Once directors of the redevelopment agency, council members are set to take the helm of a new successor agency in charge of winding down the program after the action was relucantly approved on Tuesday.

“I just think it’s a sad situation,” said Councilman Ara Najarian.

Glendale’s redevelopment agency is one of about 400 throughout the state that got the ax after the state Supreme Court upheld a law eliminating the agencies as part of Gov. Jerry Brown’s plan to fill a multibillion dollar budget shortfall. Property tax dollars that once went to help build the Americana at Brand and affordable housing units will instead go to schools and other public services.

“The stakes are incredibly high for Glendale, both in terms of financial resources and the land that exists as assets,” said City Manager Scott Ochoa.

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The elimination law allows a successor agency to pay redevelopment debts and enforceable obligations first, while the rest of redevelopment money gets directed back to schools and other services.

City officials across the state have decried the dissolution as hamstringing their future ability to generate the kind of investment and economic stimulus seen in recent decades in previously blighted areas.

“I think it’s really going to be a game changer for the city in a bad way,” said Mayor Laura Friedman.

A payment schedule for the city’s $21 million in obligations is set to come before the council, acting in its dual role as the successor agency, by Feb. 1, according to a city report. The agency can begin paying the debts by May 1, the report stated.

By July 1, the county auditor-controller is required to review the agency’s assets and required payments.

Some redevelopment money, at most $1 million in Glendale’s case, can be used to cover administrative costs to dissolve the agency during the first year.

All payments must be approved by an oversight committee comprised of seven representatives selected by the mayor and school and county officials. But the state Department of Finance can overturn any action.

Despite the defined hierarchy, the waters remain murky.

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