HomeMy Public PortalAbout15) 9C Economic Redevelopment OrdDATE: May 15, 2012
AGENDA
ITEM 9.C.
MANAGEMENT SERVICES DEPARTMENT
MEMORANDUM
TO: Honorable Mayor and City Council
FROM: Jose E. Pulido, City Manar
By: Brian Haworth, Assists o e City Manager
SUBJECT: Economic Development Ordinance
RECOMMENDATION:
It is recommended that the City Council hold the first reading of Ordinance No. 12-955,
which establishes the City's economic development authorities, and schedules time for the
second reading and adoption of the Ordinance.
BACKGROUND:
1. The City of Temple City ("City') is a charter city, operating under the City Charter
("Charter") adopted in 1971. Section 400 of the Charter gives the City the power to
regulate over all "municipal affairs" within the city.
That same year, the now defunct Temple City Community Redevelopment Agency
("Agency") was enacted as a key economic development tool to realize a variety of
commercial developments and infrastructure improvements in the vicinity of
Rosemead Blvd. at Las Tunas Dr. The enhanced tax revenues provided by such
activities allowed the City to maintain a balanced budget, while providing a high level
of service to the community.
2. On June 28, 2011 and as part of the State Budget approval process, the Senate and
Assembly passed the Redevelopment Restructuring Act otherwise known as
Assembly Bills ("AB") x1 26 and x1 27. AB x1 26 eliminates redevelopment
agencies, while AB x1 27 provides an opportunity for cities to make voluntary
payments (to the State) so as to continue redevelopment activities.
3. On December 29, 2011, the California Supreme Court ("Court") announced its
decision in CRA v. Matosantos, which upheld AB x1 26 — the redevelopment
elimination bill — and struck down AB x1 27 allowing agencies to continue operations
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after making voluntary payments. The Court's ruling was a tremendous blow to local
economic advancement as it eliminated over 400 redevelopment agencies statewide
effective February 1, 2012.
4. At a March 8, 2012 study session, the City Council ("Council") reviewed a draft
ordinance, which if enacted, would allow for expenditure of City funds for economic
development purposes. The proposed language gives the City authority to acquire
land, provide financial assistance to developers, rehabilitate properties and
undertake other activities — most of which were previously under purview of the
former Agency.
ANALYSIS:
The City's Charter allows the Council to legislate over any municipal affair to the full
extent permitted by the California Constitution. Specifically, Section 400 of the Charter
reads in relevant part that the City: "shall have the power to make and enforce all
ordinances and regulations in respect to municipal affairs, subject only to such
restrictions and limitations as may be provided in this charter, and in the constitution of
the state of California."
Economic development is a municipal affair, as demonstrated by the clear benefit to the
Temple City community arising out of the increased revenues attributable to increased
property taxes and increased sales taxes associated with successful economic
development. The decision to utilize City resources and funds to further those efforts is
also a municipal affair, and within scope of the Council's legislative authority.
Council adoption of Ordinance No. 12-955 ("Ordinance") would add Chapter 10
[Economic Development] to Title 9 of the Temple City Municipal Code (Attachment "A").
The language of the Ordinance sets forth powers and obligations authorizing the City to
engage in and continue those economic development activities that were previously
under the purview of the former Agency.
The City's powers under the Ordinance differ in significant ways from the economic
development powers of the former Agency. First, the City's powers currently lack a
designated funding source (i.e., tax increment). Second, there is no separate and
legally distinct government agency carrying out the economic development activities,
but rather the City itself. But what the Ordinance does provide is a legal framework as
to how the Council can allocate current City resources to economic development, and
what City staff may be directed to do with those resources in undertaking economic
development activities.
The Ordinance identifies a number of authorized economic development activities,
including but not limited to:
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• Acquiring and disposing of property (including eminent domain when necessary);
• Conducting site preparation work (i.e., demolition, clearing and remediation);
• Using City property for economic development purposes;
• Making improvements on private property;
• Pursuing public and private financial assistance;
• Providing financial assistance on commercial and housing projects; and
• Issuing debt for key initiatives.
If approved by the Council after a second reading based on tonight's first reading, staff
anticipates that the Ordinance would take effect July 6, 2012. This action is timely as it
would provide the momentum to establish an economic development program in line
with the City's FY 2012-13 budget adoption process. Further, as the redevelopment
wind -down process continues, it is likely that the State Legislature will eventually create
funding mechanisms for local economic development. The City would be poised to
immediately take advantage of those mechanisms by having an economic development
ordinance already in place.
CONCLUSION:
Adoption of the Ordinance would set forth a framework to stimulate economic growth,
invigorate the city's business sector, revitalize neighborhoods and generate new tax
revenues.
FISCAL IMPACT:
There is no direct financial impact associated with adopting the Ordinance. Funding
requests for specific economic development initiatives will be presented for Council
consideration on a case-by-case basis or as part of the City's annual budget process.
ATTACHMENT:
A. Ordinance No. 12-955
Attachment A
ORDINANCE NO. 12-955
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMPLE CITY,
CALIFORNIA, ADDING CHAPTER 10 [ECONOMIC DEVELOPMENT] TO TITLE 9
OF THE TEMPLE CITY MUNICIPAL CODE AUTHORIZING THE EXPENDITURE
OF CITY FUNDS FOR ECONOMIC DEVELOPMENT PURPOSES
THE CITY COUNCIL OF THE CITY OF TEMPLE CITY HEREBY ORDAINS AS FOLLOWS:
SECTION 1: Findings. The City Council hereby makes the following findings:
A. The City of Temple City is a charter city, and the City Council is vested with the
power to make and enforce ordinances and regulations with respect to all municipal affairs
by Article XI, § 5 of the California Constitution and the City Charter.
B. Fiscal policies and decisions on the expenditure of City funds are municipal affairs,
and the City may adopt ordinances and regulations pertaining to how City funds may be
expended provided that such ordinance or regulation is consistent with the City's charter.
C. Article XI, § 7 of the California Constitution also vests in the City the power to
make and enforce within its limits ordinances and regulations that promote the public health
and welfare that are not in conflict with general laws.
D. The California Supreme Court has interpreted Article XI, § 7 to authorize local
ordinances and regulations that "promote the economic welfare, public convenience, and
general prosperity of the community," (Miller v. Bd. of Pub. Works (1925) 195 Cal. 477).
E. The City Council desires to clarify that economic growth and development within
the City aids in the promotion of the health and welfare of the inhabitants of the City and is a
general benefit to them by and through the provision of improved housing options, improved
retail and commercial options, improved dining options, and an improved tax base that aids
the City in providing municipal services to the residents.
F. The City Council desires to further clarify that the use of City funds for economic
development activities is a proper use of City funds because economic development is a
municipal affair with a clear benefit to the inhabitants of the City.
G. The City Council wishes to authorize City staff to carry out economic development
activity for the benefit of the City and its inhabitants.
SECTION 2: Addition of Chapter 10 to Title 9. Chapter 10 [Economic Development]
is hereby added to Title 9 of the Temple City Municipal Code to read as follows:
"Chapter 10 Economic Development
The City of Temple City shall undertake economic development activities, including but not
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limited to those enumerated in this Chapter, for the purpose of promoting the general health
and welfare, the economic welfare, the public convenience and general prosperity of the
inhabitants of the City. The economic development activities authorized by this Chapter
accomplish these purposes and are municipal affairs.
2951: AUTHORIZED ACTIVITIES
In order that the purpose of this Chapter be accomplished, the City Council, or the City
Manager or his designee if directed or delegated to by the City Council, is authorized to
perform the following activities:
A. Purchase, lease, obtain option upon, acquire by gift, grant, bequest, devise, or
otherwise, any real or personal property, any interest in property, and any improvements on
it, including repurchase of developed property previously owned by the City;
B. Acquire real property by eminent domain if the acquisition of the real property is
found by the City Council to be a public purpose as defined by California law;
C. Dispose of real and personal property for fair market value, or for less than fair
market value of the property so long as the disposition is found to aid in the purposes of this
Chapter;
D. Provide for site preparation work, including but not limited to demolition, clearing,
and hazardous substance remediation, for private developments;
E. Insure, rent, manage, operate, repair, and clear real property owned by the City;
F. Rehabilitate, alter, construct buildings on, or otherwise improve real property in
anticipation of disposal or long-term lease of the property to a private or public entity;
G. Acquire, demolish, repair, and replace buildings or other improvements damaged
or destroyed due to a state or nationally declared emergency;
H. Accept financial assistance from public or private sources for the purpose of
engaging in economic development activities;
I. Provide financial assistance in the form of grants, loans, payments of insurance
premiums, tax rebates, or other assistance to assist in the attraction or retention of
commercial and industrial activity in the City;
J. Provide financial assistance in the form of grants, loans, payments of insurance
premiums, tax rebates, or other assistance to assist in the attraction or retention of multi-
family housing development to the City;
K. Take such other action as the City Council finds necessary and appropriate to
encourage economic development within the City for the purposes of this Chapter."
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SECTION 3: Severability. The City Council hereby declares that, should any
provision, section, subsection, paragraph, sentence, clause, phrase, or word of this
Ordinance or any part thereof, be rendered or declared invalid or unconstitutional by any
final court action in a court of competent jurisdiction or by reason of any preemptive
legislation, such decision or action shall not affect the validity of the remaining section or
portions of the Ordinance or part thereof. The City Council hereby declares that it would
have independently adopted the remaining provisions, sections, subsections, paragraphs,
sentences, clauses, phrases, or words of this Ordinance irrespective of the fact that any one
or more provisions, sections, subsections, paragraphs, sentences, clauses, phrases, or
words may be declared invalid or unconstitutional.
SECTION 4: Publication. The City Clerk shall certify to the passage and adoption of
this Ordinance and to its approval by the Mayor and shall cause the same to be published
according to law.
PASSED, APPROVED, AND ADOPTED this day of 2012.
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City Clerk
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MAYOR
APPROVED AS TO FORM:
City Attorney
I, of the City of Temple City, hereby certify that the foregoing
Ordinance No. 12-955 was introduced at the regular meeting of the City Council of the City
of Temple City held on the 15th day of May 2012, and was duly passed, approved and
adopted by said Council at the regular meeting held on May 15, 2012 by the following vote:
AYES:
NOES:
ABSENT:
City Clerk
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