Redevelopment Agency’s Debt Limit Tentatively Raised

ALHAMBRA — The Alhambra City Council on Tuesday tentatively approved increasing the city redevelopment agency’s bond limit tenfold to $400 million.

At a 2 1/2-hour redevelopment hearing last week, residents opposed plans to increase the debt limit, saying that the city will not be able to pay off its current debt until the next century.

In discussing the council’s decision, Vice Mayor Boyd G. Condie said Alhambra’s Redevelopment Agency had already borrowed up to its current limit of $40 million. That limit was set more than 20 years ago, he said, and the city has to make plans for development into the 21st Century.

“This is like trying to estimate the mortgage you need to buy a house in 2015,” Condie said.

“This doesn’t mean we’re going to launch some $100-million project,” said Michael A. Martin, the city’s deputy redevelopment director. The decision raises the cap on debt owed on municipal bonds that finance redevelopment but does not actually increase the current amount of bonds from $40 million, he said. New bond issues would still have to be approved by the council.

Martin said the city will not be able to increase the actual amount of borrowing for several years because by law it must have enough redevelopment funds from property taxes in the redevelopment area to cover the debt payments.

The redevelopment area covers most of Main Street and all neighborhoods north of Mission Road to the east and west of Fremont Avenue.

The council approved the bond-limit decision 3 to 0. With the exception of Condie, four of the five council members declared conflicts of interest at last week’s hearing because they either own businesses or are landlords in the redevelopment area.

Under the state law governing fair political practices, Mary Louise Bunker and Michael Blanco’s names were drawn from a hat, allowing them to vote with Condie so a quorum of three members could make a decision.

The ordinance will get a final reading in two weeks.

The council also gave preliminary approval Tuesday to extension of its powers of eminent domain along Main Street.

Residents at last week’s hearing also expressed fears that their houses might be seized by the city to make way for new businesses.

Condie said the city was not expanding its eminent domain powers, but merely renewing powers that had expired in July.

City officials noted that only two buildings, both businesses, had been the subject of eminent domain proceedings in the last dozen years.