San Leandro Projects Should Survive Adverse Redevelopment Ruling

The California Supreme Court ruled Thursday that the state can take about $1.7 billion from about 400 redevelopment agencies statewide, but some high-profile projects in San Leandro should be unaffected, Mayor Stephen Cassidy said.

This includes the retail and restaurant plaza, according to David Irmer, the developer who is behind that project at the old Albertson's site on East 14th street.

"I have been led to believe by everybody at city management that this will not affect Village Marketplace," Irmer said Thursday. "We have spent a couple of hundred thousand dollars to date and committed ourselves to five leases so we are moving ahead as if everything is okay."

The ruling has big implications.

Winning helps the state balance its budget. Losing deprives cities of a tool that they have used to direct development and upgrade blighted areas.

“I am disappointed by the decision,” said Cassidy, who framed the issue as a choice between whether the city or state should control local property tax dollars.

“Anyone can come up to me on the street and tell me what they think,” Cassidy said. “You can’t do that with (Gov.) Jerry Brown, if he even thinks of San Leandro.”

It is still too early to catalog all of the local effects of the decision. It usually takes a few days to digest such rulings and City Hall is closed this week.

But knowing that the Supreme Court could decide against local redevelopment agencies, Cassidy said the city sought to insulate key projects as best it could.

In the case of Village Marketplace, the city already owns the land and has entered into an exclusive right to negotiate with Irmer’s firm, Innisfree Companies, to acquire and build on the property.

Cassidy said the proposed Shoreline Marina Area Development project does not rely upon redevelopment agency funding. He described it as a public-private partnership between the city, which owns the land, and the developer, Cal-Coast Companies, which would have to come up with the money to build if it gets the necessary permits and approvals.

Cassidy said that as redevelopment agencies go away, cities will have to rely upon such public-private partnerships to affect their fortunes.

He held up the Lit San Leandro initiative as an example.

In that project, San Leandro businessman Patrick Kennedy has leased the right to run a through underground city conduits, giving the city some of the fiber to use as it sees fit.

Not all local government officials sided with the cities.

The Los Angeles Unified School District supported the state case, filing a friend of the court brief before the California Supreme Court, saying that it had suffered from the diversion of local property tax revenues to its redevelopment agency.

But San Leandro Unified School District Trustee Mike Katz-Lacabe said he isn’t sure how the numbers will shake out locally.

For instance, he said the city’s redevelopment agency contributed about $2 million to the construction of the gym at the new 9th grade campus.

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