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HomeMy WebLinkAboutRES NO 89-99RESOLUTION NO. 8 '9 "g 9 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAKERSFIELD, MAKING WRITTEN FINDINGS IN RESPONSE TO EACH WRITTEN COMMENT OR OBJECTION OF AN AFFECTED PROPERTY OWNER OR TAXING AGENCY AND RULING ON WRITTEN AND ORAL OBJECTIONS TO THE REDEVELOPMENT PLAN FOR THE SOUTHEAST BAKERSFIELD REDEVELOPMENT PROJECT WHEREAS, on May 26, 1999, the City Council of the City of Bakersfield ("City") and the Central District Development Agency ("Agency") held a duly noticed Joint Public Hearing on the proposed Redevelopment Plan for the Southeast Bakersfield Redevelopment Project (the "Project") in accordance with the California Community Redevelopment Law (Health & Safety Code Sections 33000, et seq.); and WHEREAS, any and all persons having any objections to the proposed Project or who deny the existence of blight in the Project Area, or the regularity of the prior proceedings, were given an opportunity to submit written comments prior to the commencement of the joint public hearing, or to give oral testimony at the joint public hearing, and show cause why the proposed Redevelopment Plan should not be adopted; and WHEREAS, prior to and/or at the time of the May 26, 1999 Joint Public Hearing, written objections to the Southeast Bakersfield Redevelopment Project were received; and WHEREAS, Sections 33363 and 33364 of the Health & Safety Code requires that the City make written findings in response to each written objection of an affected property owner or taxing entity; and WHEREAS, the City has carefully considered all objections raised to the proposed Project, including all written objections, and has heard and considered all evidence, both written and oral, presented in support of and in opposition to the adoption of the Southeast Bakersfield Redevelopment Plan. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAKERSFIELD AS FOLLOWS: Page 1 of 3 SECTION I The City Council hereby finds and determines that the recitals contained hereinabove are true and correct. SECTION 2 The City Council finds, on the basis of the substantial evidence contained within the Report to City Council submitted by the Central District Development Agency and other substantial evidence in the record, that conditions of blight exist within the Redevelopment Project Area, and that written and oral evidence in opposition received at the joint public hearing is not persuasive to the contrary. SECTION 3 The City Council and the Central District Development Agency have duly complied with all the provisions, requirements, and procedures of the California Community Redevelopment Law relating to the preparation and adoption of the Redevelopment Plan for the Southeast Bakersfield Redevelopment Project. SECTION 4 The City Council finds that all persons have had the opportunity to be heard or to file written objections to the proposed Redevelopment Plan for the Southeast Bakersfield Redevelopment Project and to the regularity of the proceedings with respect thereto, and having heard and reviewed such oral and written objections, the City Council hereby makes findings in response to each written objection as set forth in Attachment "A" and incorporated herein by this reference, and determines that there are compelling reasons to justify the adoption of the Southeast Bakersfield Redevelopment Plan as proposed, notwithstanding written and oral objections. SECTION 5 The City Council, accordingly, overrules any and all objections to the adoption of the Redevelopment Plan for the Southeast Bakersfield Redevelopment Project. SECTION 6 The City Clerk is hereby authorized and directed to transmit certified copies of this Resolution, including Attachment "A," to the persons submitting written objections, by first class mail, postage pre-paid. Page 2 of 3 I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a meeting thereof held on ,lUll 16 ~ , by the following vote: AYES: NOES: ABSTAIN: ABSENT: COUNCILMEMBER CARSON, DEMOND, MACCARD, COUCH, ROWLES, SULLIVAN, SALVAGGIO COUNCILMEMBER COUNCILMEMBER COUNCILMEMBER CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED: JUN ~- 6 ~ MAYOR ;~t/h'e City of Bakersfield APPROVED AS TO FORM: BART J. THILTGEN CITY ATTORNEY By: .,, JANICE'SCANLAN Deputy City Attorney js:S:\REDVAREA\se council ob.I reso Page 3 of 3 ATTACHMENT "A" THE CITY COUNCIL OF THE CITY OF BAKERSFIELD PROPOSED REDEVELOPMENT PLAN FOR THE SOUTHEAST BAKERSFIELD REDEVELOPMENT PROJECT RESPONSES TO COMMENTS AND OBJECTIONS OF PROPERTY OWNERS AND AFFECTED TAXING ENTITIES JUNE 16, 1999 PREAMBLE On May 26, 1999, the City Council of the City of Bakersfield and the Central District Development Agency held a Joint Public Hearing on the proposed Southeast Bakersfield Redevelopment Plan and Project. At that public hearing, some nineteen persons or organizations voiced their comments on the proposed plan. Every person who spoke supported the proposed project. Prior to the Joint Public Hearing, the CDDA received written comments on the proposed plan and placed them in the record at the Joint Public Hearing. Only two people, Mr. Leonard Hall and Mr. Robert W. Murray, submitted any objection to the proposed Southeast Bakersfield plan. Mr. Hall owns property within the Southeast Bakersfield Redevelopment Project Area. Although Mr. Murray is not a property owner within the Southeast Bakersfield Redevelopment Project Area, and thus not "an affected property owner," the City Council also wishes to respond in writing to his objections. In responding to these objections, the City Council will paraphrase the objections and immediately respond. The responses are provided in a different font in order to make clear the objections and responses thereto. The precise objections raised by Mr. Hall and Mr. Murray are included in the record of the Joint Public Hearing and are available for review. RESPONSES TO COMMENTS AND OBJECTIONS OF LEONARD HALL (Submitted May 5, 1999) 1. Although he lives in Hanford, Mr. Hall is a property owner in the Southeast Bakersfield Redevelopment Project Area. His only objection to the proposed redevelopment plan appears to be that he claims to be paying too much in taxes now and is trying to sell his property. He states: "1 own property as 3423 Lotus Lane and I am trying to sell the place. I am paying to [sic] much in taxes now. $417. 60." Mr. Hall's objection does not: dispute the existence of blight in the Project Area or the need for redevelopmerit. His concern that redevelopmerit will hamper his ability to sell his property and/er raise his taxes are misplaced. By adopting a program of redevelopmerit to revitalize the Southeast Bakersfield az~ea, new and greater interest should be generated for the area, including interest in acquiring properties for proper development. Depending upon the particular circumstances of Hr. Hall' s p~operty, it should be easier for him to find a buyer. Redevelopmerit agencies do not have the power to tax. Any increases in tax revenues come from the uniform application of Proposition 13 to the sale} or improvement of property. Horeover, if Hr. Hall can find his buyer, he will_ no longer be responsible for the payment of taxes within the Project Area. 2 which RESPONSES TO COMMENTS AND OBJECTIONS OF ROBERT E. MURRAY (Submitted April 12, May 3 and May 6, 1999) Letter dated April 12, 1999: 1. Mr. Murray "formally objects" to both plans and identifies the documents upon he apparently bases his objections as: "a. Draft Development Plan and its accompanying EIR for the 'Southeast Bakersfield Redevelopment Project' comprising 7+ square m~es of this city. b. Preliminary Report and its EIR for the 'Old Town Kern - Pioneer Redevelopment Project', an area of about 3 square miles." The documents referenced by HN_. Murray do not constitute the complete record of documentation concerning the proposed redevelopmerit projects. The primary documents upon which the Agency and the City Council w:kk~ base their considerations and conclusions are found ir'~ the Reports to City Council for each redevelopmerit project, wl~ich were not referenced by Hr. Hurray. The Report to City Ccuncil for each proposed project area contains information documenting in detail the existing physical and economic conditions of the project area, an assessment o~!' the economic feasibility of the proposed project, a complete Environmental impact Report, an Implementation Plan for the first few years of the project, the Preliminary Plan for the project and. an analysis thereof, information from the County Fiscal Officer and an anallzsis thereof, an analysis of how 'the proposed program of redevelopmerit contemplated for the project area will eliminate or alleviate the blighted conditions, a Neighborhood Impact: Report on the anticipated .~mpacts of %he project, and a summary of the Agency's consultations with the Project Area Committee for the affected community. 2. Mr. Murray identifies items numbered 3 through 7 in his letter as the reasoning for his objections. The City's responses to these items will be tracked accordingly. 3 3. The proposed Southeast Bakersfield Redevelopment Plan is "rejected summarily" because it is allegedly based only on those documents identified in Paragraph l a of Mr. Murray's letter. It is asserted that "by contrast, the [Old Town Kern - Pioneer] project plan referred to in [Paragraph] l b is comprehensive and detailed, with facts and figures to back it up." Both proposed redevelopment projects are based upon similar documentary "back up." Although the precise conditions are different for each project area, both proposed projects are supported by detailed Reports to City Council and other documentation. Apparently ME. Murray did not review either the Preliminary Report. or the subsequent Report to City Council when conside:ring the Southeast Bakersfield Redevelopmerit Project. FIr. Hurray concedes, however, that even the preliminary informal:ion provided for the Old Town Kern - Pioneer Project Area is "comprehensive and detailed." 4. Mr. Murray agree[s] that the physical and economic conditions described in the Preliminary Report and EIR for the Old Town Kem- Pioneer Redevelopment Project "could, technically, be used to defend the application of the CRL in that area." Nevertheless, Mr. Murray objects to the use of the Community Redevelopment Law "as a matter of principle." Although this comment does not directly address the proposed Southeast Bakersfield Redevelopmerit Project, it is assumed for purlposes of this response that Hr. Hurray's objection to redevelopmerit "as a matter of principle" extends to this Project Area as well. This comment does not dispute the existence of blight in the Southeast Bakersfield Redevelopmerit Project Area, but "objects" to redevelopmerit as "a matter of principle." The use of redevelopmerit tools in an area which meets the qualifications set forth in the Community Redevelopmerit Law is a matter of principle and policy vested in the sound discretion of lhe City Council of the City of Bakersfield. As discussed in later responses, there are many sound policy reasons to provide special assistance to the Southeast Bakersfield Redevelopmerit Project Area. 5. Mr. Murray asserts that redevelopment has "virtually unlimited powers" and "divert[s] · .. tax monies" amounting to a "virtual dictatorship over these parts of Bakersfield." He argues that "in our free-market competition-based system, private capital will still be 4 invested where the action is - unless, of course, the taxpayers/owners give them their properties and underwrite their risks." This comment demonstrates an incorrect and distorted view of redevelopment. Redevelopment, agencies do not have "virtually unlimited powers" but are answerable and accountable to elected officials as well as the community at large. Rather than "diverting" tax do] lars, redevelopment enables communities to retain a ]portion of their own tax money in order to address crucial issues within that community. As demonstrated by the Report to City Council, the Agency' s work with the Project Area Comlit%ee, and the Joint Public Hearing itself, the formulation and adoption of a redevelopmerit project is a very open 24nd public process. Furthermore, successful implementation of redevelopmerit is dependent upon the participaE. ion of the cormnunity, and is subject to various levels of public review and audit. The whole point of a redevelopmerit project is to revitalize an area that was once alive and active - to make this area once again "where the action is." There are various means and strategies for :inducing new irzvestment and re-investment into existing urban areas, all dependent upon the particular circumstances of the cormTnanity at a particular time. Some strategies can include the public body addressing neglected infrastructure, such as repairing streets and sewers; other strategies can include the creation of rehabilitation loan programs which provide existing owners with the ability to repair and expand their own properties. Such actions help lower "risk" to any (and all) business in the projec. t area - risk that its success or failure will be decided by factors such as crime c,r a "bad neighborhood" rather than the skill and quality of its service or product. Mr. Hurray notes that the relocation of Highway 99 westward has reduced the economic at. tractiveness of the Old Town Kern - Pioneer and Southeast Bakersfield project areas. This statement only acknowledges some of the blighting conditions that affect these aEeas snd highlights the need for redevelopmerit. Redevelopmerit has indeed produced "economic miracles," but.. only after long, hard, work, often extending over years and even decades. As demonstrated by the City's existing Downtown Redevelopmeant Project Area, it sometimes takes many years of intense effort and investment to begin to see an economi. c resurgence, bn:t it can. and does occur. 5 6. Mr. Murray objects to the "composition, independence, authority and powers of a redevelopment agency." He asserts that a redevelopment agency is a "shadow government" "unaccountable to the public." This comment does non zepresent a challenge to the documentation of blight or the need for redevelopmerit in the Southeast Bakersfield Redevelopmerit Project Area. Instead, it presents another erroneous and distorted view of redevelopmerit as a concept. In the City of Bakersfield, in accordance with the duly adopted California Community Redevelopmerit Law, the members of the Central District Development Agency (CDDA) are appointed by the Hayor, an elected official. Their appointments are ratified by the members of the City Council, who are also elected officials. The City Council generally oversees CDDA actions and mnst also independently approve certain actions of the CDDA, as required by State law. The powers of the CDDA are specified in the Community Redevelopmerit Law, as well as each redevelopmerit plan adopted by the City of Bakersfield. Just like the City Counci:L, meetings of the CDDA are open to the public. Furthermore, tt~e Community Redevelopmerit Law requires that public hearings be held before certain actions, such as the sale of property, may be approved. The financial activities of the CDDA, like all redevelopmerit agencies, are also subject to regular al~dit. In addition, certain activities, especially those relating to the provision of affordable hoLiSing, are subject to State, as well as local, scrutiny. Fif~ally, the CDIIA ~s required to adopt, with public review and comment, 5-yeaz implementation plans which demonstrate how the Agency is planning to carry out i_ts work, and to review with the pub].ic its progress on those plans every two to three years. This is hardly "shadow government" and presents ample opport:unity for public review and accountability. 6.a. As an asserted example of a redevelopment agency's "unlimited powers," Mr. Murray claims that the electorate of the proposed Project Areas will be "disenfranchised" in that "except for the right of referendum, the legislative acts of officially declaring the existence of blight within the meaning of the CRL, and the approval of the plans, projects, and time and dollar limits are not subject to a vote." He also claims that actions taken after the approval of a redevelopment project are not subject to referendum, or even subject to judicial review. 6 By the time the proposed Southeast Bakersfield Redevelopment Plan was presented for review and approval by the Bakersfield City Council, the CDDA had worked for months with the affected community through a duly elected and representative Project Area Committee. It had prepared and circulated for public review and comment a complete Environmental Impact Report on the anticipated impacts of redevelopment. llt had also prepared significant documentation and analysis of the physical and economic conditions of the Project Area, as well as the potential fiscal impact of the project. The proposed Redevelopment Plan itself sets forth time and dollar limits, as well as identifies potential public improvement contemplated by the Plan. At the Joint Public Hearing on the proposed Southeast Bakersfield Redevelopmerit Project, there was not one oral objection to the plan. No affected taxing entity, such as the County of Kern, submitted any objection whatsoever. To the contrary, representatives of Bakersfield schools submitted oral and written support tot the project. If the proposed Redeve]Lopment Project is adopted, the City will be making necessary findings of blight, and approving the limits and proposed public improvement projects described in the Redevelopmerit Plan. In approving the Redevelopment Project, this legislative action by the elected Bakersfield City Council will be subject to referendum, just like any other legislative action. llt will also be subject to legal review, as will. be subsequent actions taken by the CDDA to implement the plan approved by the elected City Council. It is simply untrue to say that there is no judicial Keview of redevelopmerit activitie. s; the fact that the vast majority of court cases uphold such activities merely means that redevelopment agencies comply with the law. 6.b. As another example of claimed "unlimited powers," Mr. Murray cites the authority to acquire private property and claims that redevelopment is "governmental incursion into private enterprise by engaging in speculative investments." One of the most important aspects of redevelopment is to prevent or les. sen speculation in real property. Speculation in property has often been found to be a cause of blight because owners are unwilling to make necessary investments to maintain or improve their property. On the other hand, property that is developed with concern and a real plan for use tends to maintain and increase its value, demonstrating a substantive investment and no!: speculation. 7 The authority to acquire property is not unique to redevelopmerit agencies; virtually every public body has the ability to acquire property for its public use. It is not the goal of redevelopmerit to acquire real property; it is the goal of redevelopmerit to encourage real property owners to invest in and take care of their properties. It is also more economical for redevelopmerit agencies if existing property owners participate in the redevelopment of their own propert/.es. To the exlent that some owners refuse to undertake needed repairs to make the properties safe or habitable, or to otherwise care for their properties, however, the Agency needs to have the authority to acquire such properties at fair market value in order to eliminate blighting influences. Horeover, the CDDA' s authority to acquire private property is constrained by restrictions found in the Community Redevelopment Law, as well[ as the limitations found in the Eminent DomaLn ]Law. The CDDA and the City are both very cognizant of the seriousness associated with the possible use of eminent domain and have used this power infrequently and only as a last resort when al_l other means hi~ve failed. 6.c. Mr. Murray asserts that redevelopment agencies "divert property tax money from the agencies and purposes for which those taxes were originally levied" leading to increased taxes and reduced services. He also claims that redevelopment agencies receive funds they have not "earned" and that such monies as the CDDA will receive for the proposed project is not enough to pay for needed infrastructure. Redevelopment agencies are constitutionally and statutorily authorized to help finance their activities by sharing in the increase in tax revenues which result from increases in assessed valuations occurring after the redevelopmerit plan is adopted. This form of tax sharing is commonly referred to as "tax increment ." Under this ]process, taxing entities, such as schools and county governments, continue to receive the same amount of tax revenue as they each received prior to the redevelopment plan. Redevelopment agencies receive a portion of additional revenues resulting from increases in valuation in order to repay debt already incurred to foster reinvestment in the community. The taxing entities also receive a share of this increased revenue, as specified by the Community Redevelopment Law. Rather than "divert" tax revenues, redevelopmerit enables communities suffering from parlicular problems to retain their own taxes, in order to fix these serious problems. Because of the existence of these problems, or blight, tax revenues are reduced for all taxing entizies. When the redevelopment project is completed, and blight eliminated, the increased revenues flow to all the taxing entities; the agency will receive nothing. The process of redevelopment is psychological as well as physical. When others see that a Project Area, through redevelopment, is taking bet:er care of itself, property values rise. The redevelopment agency may only improve a street with better sidewalks, lights or landscaping, yet the value of homes and businesses along that street often improve without the need for the agency to pay for repainting or repairing the structure itself. The return of confidence in a Project Area can prompt a business to expand or entice a new business to enter the Area. Redevelopmerit clearly "earns" the increases in assessed value tinat it encourages. In response tothe claim of the insufficiency of tax increment for public i. nfrastructure, it should be understood that redevelopmerit is not intended to take ove~ other governmental functions, merely to assist in bringing about improved conditions in particular areas. It is not the purpose of redevelopmerit to "pay for ew}rything." Many of the public improvements identified in the Southeast Bakersfield Redevelopment Plan include providing for or repairing infrastructure that would normally be part of a joint undertaking by many governmental agencies, including the City of Bakersfield, the County of Kern and even the State of California. Redevelopment was not designed to relieve these entities of their existing and concurrent obligations, but rather as a tool to facilitate the accomplishment of these goals. Redevelopment i_s a foum of partnering, not only with the private sector but with other public entities. ]instead, it is anticipated that all_ public and private participants will play their respective and appropriate roles in helping' to construct needed improvements. 7. Mr. Murray also questions the inclusion of parcels he deems "not blighted," based upon speculative and unsubstantiated guesswork. He states: "lf l were to pick $50k [sic] out of my hat as the average assessed valuation for those 2409 parcels, that would account for $120, 450, O0 of the total of the assessed value of $530,295,827 shown in [Old Town Kern - Pioneer] for all 3~ 86 parcels. Subtracting 12,450,000 from that number would represent my WAG [sic] of the assessed valuation of the 777 questionable parcels, or an 9 average of $527,472. 11 for each of those parcels." Mr. Hurray' s guesses as to average parcel valuation represent only his own selection of value and are not based upon any apparent documentary evidence. Again, Hr. Hurray's statement does not dj_rectly address the Southeast Bakersfield Redevelopmerit Project. Nevertheless, the Report to ~2ity Council for the Southeast Bakersfield Project Area contains property valuation data, both in terms of assessed valuations and actual market values of the properti. es. As reported in Section 6.5 of the Report to Council for the Southeast Bakersfield Project Area, the average per acre assessed value is only 27% of City-wide values, and per acre market values are only 37% of City-wide values. The average per parcel assessed valuation in Southeast Bakersfield is $49,726, while the City-wide average per parcel assessed valuation is S129,782. These documented values show a clear discrepancy between values in the Project Area and values in the City as a whole. The Report to Council indicates that not every parcel in the Southeast Bakersfield Project Area demonstrates obvious signs of physical blight. But the law does not require such a showing. The Report to Council also demonstrates that some of the parcels contained in the Project Area are included for effective redevelopmerit of the area as a whole; again well within the requirements of the Community Redevelopmerit Law. The size and shape of the Southeast Bakersfield Redevelopmerit Project Area was selected after careful consideration and analysis. Only those properties meeting the requirements of the Community Redevelopmerit Law were included in the Project Area. The items that Mr. Murray suggests as "alternatives" to redevelopmerit, such as "p'utting investors in touch with the absentee owners whose properties adjoin each other, and encourage those investor {even the property owners themselves) to buy up and develop those small parcels" are the very type of activities that are contemplated by the Agency' s redevelopment program. I t appears that Mr. Hurray' s objections to redevelopment relate more to the name or concept of "redevelopmen~" than to the conditions of the Project Area or the types of activities %o be undertaken by the proposed redevelopment program. 10 B. Letter Dated May 3, 1999 1. In his letter dated May 3, 1999, Mr. Murray states that in his April 12 letter, he "refused to consider the proposed 'plan' for redevelopment of the proposed 'Southeast Bakersfield Project Area '," and proceeds to make an objection to "that plan. ' Mr. Murray also states that he is not a resident of either proposed Project Areas, but asserts standing to raise his objections "as a property owner/taxpayer within this county." The City Council does not challenge Mr. Murray's standing to state his objections, although it disagrees with them. The City appreciates Mr. Hurray's interest in the proposed projects and participation in the process. 2. Mr. Murray asserts that the proposed Southeast Bakersfield Redevelopment Plan "by itself, does not satisfy the requirements of the CRL. It alone does not provide the basis for an informed, defensible decision by the Council on this drastic legislative action.' He also claims that the proposed Redevelopment Plan "does not give the taxpayers the details required by the CRL." Mr. Murray does not disclose what deficiencies he sees in the proposed redevelopment plan; he does not identify any "requirements of the CRL" that have not been satisfied in the redevelopment plan adoption process. The proposed Southeast Bakersfield Redevelopment Plan takes the form of a charter and grant (and limitation) of authority for the CDDA to undertake a program of redevelopmerit. California courts have recognized that a redevelopment plan does not require the type of detail expected in architectural or engineering plans, but rather contemplates a "comprehensive method or scheme of action." The Southeast Bakersfield Redevelopmerit Plan was reviewed by legal counsel and contains all the provisions required by the Communi. ty Redevelopmerit Law. The proposed adoption of the Southeast Bakers field Redevelopment Project i s not dependent solely upon the Redevelopment Plan, but is also based upon the months of consultation with the community's Project Area Committee, the documentation found in the Report to City Council, and the information pre. sented at the Joint Public Hearing for the proposed project. Together, there is more than sufficient information and detail for both the City Council and taxpayers to make an informed and defensible decision on the need for redevelopment in the Project Area. 11 C. Letter Dated May 6, 1999 1. Mr. Murray makes reference to (1) newspaper reports concerning (a) a proposal before the City relating to the "Grand Canal" proposed development, and (b) a report of Kern County activities with respect to Oxy; (2) the notices of Joint Public Hearings for the proposed Old Town Kern - Pioneer Redevelopment Project and the proposed Southeast Bakersfield Redevelopment Project; and (3) his prior letters of April 12 and May 3. Mr. Netanel has made a proposal for a factory outlet type of development to be constructed near the southern boundary of the City, outside of any Redevelopment Project Area. The specifics of the proposal are undergoing review and will be treated independently from any redevelopment activity. Any newspaper article concerning the County of Kern and any other entity, including the Occidental Petroleum Company, is not relevant or germane to any discussion concerning the existence of blight or the need for redevelopment in the Southeast Bakersfield Redevelopment Project Area. 2. Mr. Murray asserts that both the City and the County of Kern have "discriminated" between competing businesses and "to reward companies for doing that which they... would have otherwise done." While the City cannot speak to the policies and actions of the County of Kern, neither the! Agency nor the City has sought to "discriminate" among businesses or "reward" them for taking actions that they might normally take. To the extent that any form of incentive has been provided for any particular development proposal, the extent and nature of incentive has been carefully considereel and tailored to produce the greatest public benefit at the least public cost. With specific regard to the "Grand Canal" proposal referred to by Mr. Murray, no "incentive" or action has been approved at this time. This comment does not deny the existence of blight or the need for redevelopment in the Southeast Bakersfield Redevelopment Project Area. It does not provide a reason or basis for denying this community an important tool in revitalizing the area. 2. a. Mr. Murray states that the City proposes to "declare 10 square miles of this city as 'blighted' in order to use property taxes to help businesses (old and new) to invest in and 're-vitalize' those areas." 12 The Agency and City intend to do exactly that:. After demonstrating tlhat the area -ks blighted, it is expected that the City will approve the two proposed redevelopmerit project areas and use property taxes - as well as other sources of funds - to help businesses as well as residents to invest in and revitalize the project areas. 2. b. Mr. Murray claims that the City has "rewarded" Galey and Stier RV "for moving to the more attractive southwest part of town... from their previous... places of businesses in or near those 'blighted' areas." He then asks what incentives could have been provided to them and others for staying and revitalizing these areas. Neither the City nor the CDDA "rewarded" these businesses for relocating to non-blighted areas of the City. These businesses, like others mer~t. ioned in Mr. Murray's May 3 letter, selected their locations based upon independent business judgments. These judgments undoubtedly included the ability to fir!d sufficient land for operations, the price of such land, and the ability to attract customers to their locations. Areas that suffer from blighting conditions, such as the Southeast. Bakersfield Redevelopment Project Area, will not compare favorably to other, non-blighted locations. The fact is, without a program of redevelopment in place, there is very little the City or Agency can do to help retain these types oZ businesses. Rather than serve as examples of reasons to object to redevelopment of the Southeast Bakersfield Redevelopmerit Project Area, the relocation of these businesses show the existence of blight and the need for redevelopmerit there. An adopted redevelopmerit project and program will enable the City and Agency to work to lessen and prevent the relocation of ongoing businesses and to encourage new businesses to enter the Pzzoject Area. These businesses did receive some assistance in the form of Community Development Block Grant loans for which they were eligible. As part of the City' s continuing program to promote job creation, at least 51% of all jobs created {and vacancies filled) by these businesses will go to low- and moderate- income persons. It should be noted that this program does not "entice" businesses to leave their present locations. In the instances cited by Hr. Hurray, to the contrary, the CDBG loan program was used in order to keep these businesses at least within the City of Bakersfield, once they had already decided thai their present locations }~ere no longer suiEable. 13 The Agency intends to use CDBG funds, along with tax increment and other funds, to revitalize the Southeast Bakersfield Redevelopment Project Area so that in the future these types of businesses will not have to leave the Project Area in order to expand or remain viable. 3. Mr. Murray objects to "any proposed plan" which uses "tax incentives" for commercial enterprises. The City understands His. Murray philosophical objections to "tax incentives," but musk also observe that the use of "tax incentives" Ls widespread at all levels of government. Federal tax law provides "incentives" for home ownership in the form of ~r~come tax deductions for home mortgages, for example. The State of California and other levels of government use the tax systen as providing "incentives" for other activities as well., Hr. Hurray does not make clear what he considers "tax incentives" that the Agency could provide. Redevelopmerit does not levy a tax but changes for a certain time period the distribution of the property tax generated under Proposi!ion 13. Using a portion of the taxes generated by an increase in assessed valuation in a Project Area to repay investments already incurred, a redevelopmerit agency may assist a busir~ess or resident with a rehabilitation loan, or may assist in the assembly of property at a fair price, or may assist in the generation of new and additional employment by helping a business to expand. All of these "incentives" are geared towards improving the ihealth, safety and welfare of the community by e. liminating blight. Such "incentives" as may be provided are generally ruinimal in comparison to the amount of additional pr:i_vate capital and employment which come hand in glove with the activity which receives the incentive. These types off redevelopmerit: activities have been used with great success up and down the State of California and have improved the quality of life flor the residents and businesses of these Project: Areas, as well as the communities as a whole. I)Ik:S:x, REDVAREA\se city obj resp attach a 14