HONORABLE MAYOR, CITY COUNCIL, REDEVELOPMENT AGENCY	RICHARD DOYLE CITY ATTORNEY/GENERAL COUNSEL
SEE BELOW	November 4, 2003

SUBJECT:

ADOPTION OF AN ORDINANCE BY THE CITY COUNCIL aMENDING CERTAIN TIME LIMITATIONS WITH RESPECT TO THE REDEVELOPMENT PLANS FOR THE Alameda, Almaden Gateway, Alum Rock Avenue, Century Center, CIVIC PLAZA, East Santa Clara Street, Edenvale, Guadalupe-Auzerais, Japantown, Julian-Stockton, Market Gateway, MONTEREY CORRIDOR, NEIGHBORHOOD BUSINESS CLUSTERS, Olinder, Park Center, Pueblo Uno, Rincon de los Esteros, San Antonio Plaza, Story Road, STRONG NEIGHBORHOODS INITIATIVE, and West San Carlos STREET PROJECT AREAS

RECOMMENDATION

It is recommended that the City Council adopt an Ordinance amending certain time limitations with respect to the Redevelopment Plans for The Alameda, Almaden Gateway, Alum Rock Avenue, Century Center, Civic Plaza, East Santa Clara Street, Edenvale, Guadalupe-Auzerais, Japantown, Julian-Stockton, Market Gateway, Monterey Corridor, Neighborhood Business Clusters, Olinder, Park Center, Pueblo Uno, Rincon de los Esteros, San Antonio Plaza, Story Road, Strong Neighborhoods Initiative, and West San Carlos Street Redevelopment Project Areas.

BACKGROUND

In August 2003, the legislature passed SB 1045, which became effective September 1, 2003. SB 1045 allows Redevelopment agencies to amend plans to extend by one year the time limit of the effectiveness of the plan and the time limit to repay indebtedness or receive property taxes by adoption of an ordinance of the legislative body rather than the statutory plan amendment process.

ANALYSIS

SB 1045 requires that Redevelopment agencies pay a total of $135 million to the Educational Revenue Augmentation Fund (ERAF). For Fiscal Year 2003-2004, the San Jose Redevelopment Agency’s payment to the ERAF will be approximately $10 million. To assist agencies with covering that unexpected financial burden, the legislature authorized agencies to extend by one year the last date to undertake redevelopment activity within a project area and the time limit to repay indebtedness or collect tax increment. The California Community Redevelopment Law, as amended by SB 1045, allows the City Council to make these amendments by ordinance rather than by the standard plan amendment process.

The effect of extending these time limits will benefit the Agency by providing one additional year of tax increment receipts within the Merged Redevelopment Project Area. These time limit extensions will also allow for an additional year for conducting redevelopment activity.

FISCAL IMPACT

There is no direct cost to the Agency from the amending of Redevelopment Plans to extend the time limit for the effectiveness of the plan and the time limit to repay indebtedness or receive property taxes.

RICHARD DOYLE

City Attorney/General Counsel