One month before California Gov. Jerry Brown signed a law abolishing the state's nearly 400 redevelopment agencies to use their public money for cash-strapped schools, social services and other obligations, the Santa Monica City Council went on a $147 million spending spree.
By the time the May 24, 2011, council meeting was gaveled to a close, the city, dubbed "Beverly Hills by the Sea" by some, had locked in nearly $100 million for new capital projects — a Palisades Garden Walk park, a library on Pico Boulevard, a downtown fire station, an "esplanade" at the proposed Expo Light Rail station downtown, new affordable housing and improvements for the Santa Monica Pier.
Still there was $46.8 million left before the state grabbed the cash. The Santa Monica City Council spent that money two days later, with what Councilman Bobby Shriver would call "intensity' and "fear" — to renovate the Santa Monica Civic Auditorium.
Shriver described the bill as "fantastic," "spectacular" and "dynastic" and criticized the money spent on the auditorium as "extravagant." "This isn't exactly what redevelopment was intended for," he said.
Councilman Bob Holbrook said, "It's an enormous amount of money. We could build a public building or a museum or something when you start talking about $48 million."
The big spending era ended on Dec. 29. That day, the California Supreme Court upheld Brown's move to dissolve redevelopment agencies (RDAs) and use their billions of dollars in tax money to help bridge California's $9.2 billion deficit in 2012-2013.
By Feb. 1, RDAs statewide had been dissolved and replaced with successor agencies that will determine which redevelopment projects could legally be completed — in essence, how much tax money each city could keep from the governor. This sent cities scrambling to explain their great needs to the Brown administration.
But perhaps no city has more explaining to do than Santa Monica.
Santa Monica set up a redevelopment agency weeks after the 1994 Northridge earthquake rocked the beachside city and left more than 500 buildings with mild to severe damage. Within two years, the vast majority of vacant buildings had been repaired or replaced with private, federal, state and local funds. Yet Santa Monica continued to divert to its RDA tens of millions of dollars a year in property taxes that normally would have flowed to the state general fund for schools, colleges and social services. The City Council has used the money almost entirely to bankroll projects having nothing to do the earthquake.
Last year's take alone was $74 million. These property taxes flow from an "earthquake zone" encompassing most of the city, from Pico Boulevard to Montana Avenue and from the ocean to 26th Street.
In 1995, the legislature realized that Santa Monica's generous definition of earthquake redevelopment could be copied by other cities. So lawmakers restricted such funds solely to "acquiring, demolishing, removing, relocating, repairing, restoring, rehabilitating or replacing" damaged structures.
Meanwhile, the Santa Monica City Council and Mayor Richard Bloom have all but ignored two potential time bombs — pre-1970s multistory concrete buildings with insufficient rebar, known to engineers as "non–ductile concrete" structures; and buildings constructed between 1964 and 1994 with "welded-steel moment-frames," which were believed to be sturdy until the '94 Northridge and '95 Kobe, Japan, quakes.
As L.A. Weekly reported in November ("The First 15 Minutes After the Big One: Who Dies in Los Angeles, and Why?"), engineers generally don't know which buildings are "WSMF," or welded-steel moment-frame construction. A fairly limited survey, funded by the state, found 1,317 such buildings within the city of L.A. alone.
Property values have skyrocketed inside Santa Monica's huge "earthquake zone," with the extra taxes generated now far exceeding property taxes rolling in from homes, businesses, apartments and commercial developments outside Santa Monica's "earthquake zone."
That extra revenue — all property taxes generated above the pre-RDA 1994 levels — kept flowing to the city's earthquake redevelopment agency.
Until Jerry Brown came along, Santa Monica officials were projecting that as much as $5.2 billion would flow into their Earthquake Recovery Redevelopment Agency by 2043.
Bloom and other Santa Monica officials argue that the economic stimulus and jobs spurred by redevelopment projects will help Brown more than pumping those property tax dollars into state coffers.
Bloom notes the city recently provided $56 million for athletic facilities at Santa Monica High School. "The state is not in the position to do that," boasts Bloom, who is running for state Assembly. Per capita, he says, "Santa Monica is giving more to the local schools than Sacramento ever will."
That Santa Monica's spending had nothing to do with earthquakes became clear in 2000 with the City Council's first big-ticket expenditure — its $53 million purchase of 13 acres of prime real estate on Ocean Boulevard from RAND Corporation. Last month, city officials and megadeveloper Related California broke ground on a $350 million, 3.7-acre complex of luxury condos and affordable rentals.
Santa Monica played a cat-and-mouse game with Sacramento, which began eyeing the city's unusually rich earthquake-redevelopment windfall. In 2003, Santa Monica leaders sold six downtown public parking structures and shifted several other big projects to the earthquake redevelopment agency. It was an aggressive maneuver in response to a plan by Gov. Gray Davis to stop redevelopment agencies from incurring further debt.
That's ok you'll have the next quake soon enough and then it will all repeat, this time complete with federal bailout. Your money will be worthless but as long as you take the national id and go to the work camp and thumbscan for food, you'll get enough to pay your government-subsidized landlord.
And as ALWAYS the Tax Payers witness their Corrupt Career Inept Politicians doing the two things they do best, Flushing Tax Dollars Down the Drain to Improve things for the Haves. And Second they Remove all doubt about where their loyalty lies. The List of Self Serving Corrupt A Holes in California Politics is ENDLESS.
Santa Monica went from being a laid back beach community with a stable middle and lower income population that was culturally diverse --- to an exclusive enclave for the wannabe rich and famous ---- that is probably even more socio-economically homogenous than Beverly Hills.
I lived in Santa Monica for over twenty years. First as a renter in one of the most architectually well designed apartments imaginable. Those were what I remember as the good old days prior to the 1994 earthquake. The earthquake levelled much of the city, especially the apartment buildings, which had not been properly maintained due to greedy landlords, many of whom were real estate speculators. Termites (the insect kind) which had also done there work on the wood and stucco buildings turned out to be the developers best friends when the buildings collapsed due to underlying structural damage.
Then as an owner in a TORCA conversion project gone badly wrong. I moved in a year or two before the 1994 earthquake and actually found myself underwater on the mortgage for a while. In the meantime while I was waiting for the market to turn around, I watched the City of Santa Monica become totally corrupt. The rich quickly took over City Hall and gobbled up the shrinking middle class with things like (flat parcel taxes to subsidize the schools) so if your annual property taxes were $2 million per year on your beachfront estate or $1,200 in your torca conversion in the barrio you paid the same amount. Fortunately I sold at the top of the market (or bubble) and was one of the few to make a decent profit. I moved to West LA and these same corrupt corporate and real estate interests want to run an illegal light rail system in front of my house. No shame what ever is right.
Santa Monica is still Raymond Chandler's Bay City. The city is just as corrupt as it was when the Rex was anchored offshore.
Money diverted into the redevelopment agencies would have otherwise gone to the county and to local school districts. Los Angeles County could have fixed problems at Martin Luther King Hospital, expanded gang prevention programs, and improved services to battered women with this money.
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