California cities like San Diego are getting creative in their search for revenue sources to replace funding lost with the elimination of redevelopment programs.
However, Murtaza H. Baxamusa, an affordable housing developer and planning professor at the University of Southern California, argues that the public should be leery of funding efforts that attempt to mimic redevelopment.
"I am supportive of finding new ways to fund redevelopment that are proper and legal. However, absent clear community benefits standards, I am not sure if the public interest will be served by a property acquisition-income fund. There are several reasons to be wary of funding schemes guised as redevelopment."
Civic San Diego, a nonprofit consulting firm that works with the city of San Diego, recently adopted a funding acquisition program that involves leveraging a New Market Tax Credit (NMTC) to purchase properties and become landlords.
Baxamusa sees this push as a major concern because while redevelopment agencies were funded with public tax increment money, governed by elected officials, and regulated by state law, these new programs give private individuals a big role in decision making.
He goes on to highlight several questions posed by "pseudo redevelopment schemes."
"Our low-income urban neighborhoods are thirsting for investment, and they deserve better than a Wall Street scheme with little accountability."