The county and the City of Grand Terrace have reached an agreement that will allow the city to pursue its previous intent of having property once owned by the city’s redevelopment agency near the confluence of De Berry Street and Van Buren Street developed commercially in accordance with its location within the city’s mixed use specific plan area.
In 2011, the state of California closed out all of the municipal and county redevelopment agencies in California, mandating that the property those agencies had acquired be liquidated and that the proceeds from those sales along with any specially held tax money related to those properties be shared with other local tax-receiving entities.
Redevelopment agencies were special adjuncts to local governments which were intended to assist those governments in the elimination of blight and the promotion of economic development.
Those redevelopment agencies were empowered to utilize money passed along to them by the state, provided to them by the city chartering them or money obtained through the issuance of bonds to provide infrastructure or other encouragements to the development of property. The redevelopment agencies would issue bonds, which would be sold to investors. The proceeds from those sales would then be used to construct roads, sewers, storm drains, sidewalks or install utilities that would facilitate development. The provision of this infrastructure and the eventual development of the property would lead to an increase in property value, thus creating a larger property tax revenue stream. That increase in property tax, referred to as tax increment, would be dedicated to debt servicing the bonds, i.e., making annual payment installments on those bonds for the twenty to thirty-five year life of the bonds.
The 2011 legislation did away with redevelopment agencies and mandated the creation of successor agencies to oversee the dissolution of the redevelopment agencies, called for previous obligations with regard to bonding arrangements be met and that any property owned by the redevelopment agencies be sold and the proceeds distributed to the appropriate entities.
Grand Terrace, which vies with the City of Needles for the title of the most sales tax poor of all of the San Bernardino County’s 24 cities, remains committed to seeing a 54.1 acre property converted to commercial operations that will increase the city’s sales tax receipts.
Under the terms of the legislation that dissolved redevelopment agencies statewide, the proceeds of the sale of the Grand Terrace Redevelopment Agency were to be shared with the City of Grand Terrace, the County of San Bernardino; the San Bernardino County Flood Control District; and the San Bernardino County Fire Protection District.
This week, the San Bernardino County Board of Superivisors, which acts as the governing body for
the county, the fire district and the flood control district, signed off on an arrangement that will not require that the City of Grand Terrace hold an immediate fire sale of the property but rather take time to find a buyer willing to develop the land in accordance with the intent the city has long had for the property, specifically transforming it into a substantial commercial sector. Of some consideration is that the property – 54.1 acres – is already “assembled,” that is, available as a whole rather than as one involving multiple owners. The city has zoned the property in accordance with the intention of having it developed commercially with a mix of high density residential uses. Being able to present the property as one package to an entity willing to see it developed represents a crucial step in the development process.
Accordingly, the board of supervisors consented to the creation and implementation of a compensation agreement which will allow the city to seek out a buyer/developer of the property. The compensation agreement calls for the county placing a lien against the property which, upon the sale of the property, will be paid. According to the compensation agreement, proceeds from the sale of the property, described as as 21992 and 21974 De Berry Street and the 21900 Block of Van Buren Street, Assessor Parcel Numbers (APN) 1167-141-08, 1167-151-68, 1157-151-71, 1167-151-74, 1167-161-03, 1167-161-04, 1167-151-22, will be disbursed in portions to the following entities equal to the proportional share of the base property tax due them under the state’s guidelines as indicated: The county general fund will receive 12.72 percent; to the county free library will go 1.23 percent; to San Bernardino County Flood Control District Zone Two will be provided 2.26 percent; to the county’s flood control district administration designations one & two will go 0.16 percent; and to the county’s fire protection district will receive 10.34 percent. The city will receive the rest and have continuing land use authority over the development and disposition of the property.