The Silicon Valley Voice

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City Desk: March18, 2015

Most Vulnerable Citizens Paying for RDA Dissolution

When the State Legislature shut down California's redevelopment program, they also shut down a third of Santa Clara's affordable housing programs, according to the City Housing program overview at last week's Council meeting.

These programs served Santa Clara's most vulnerable residents: homeless housing and support services, affordable shared housing programs, emergency rental assistance for people in danger of eviction, housing for special needs populations, foreclosure prevention, accessibility modifications for low income residents, and first–time and below–market homebuyer programs.

They were shut down because in Santa Clara, as throughout California, program money came from mandated 20 percent set–asides of Redevelopment Agency (RDA) tax increment – the property tax increase from redevelopment projects – which provided $1 billion annually for affordable housing in California.

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RDA money provided up–front funding for construction, filled gaps in a low–income housing tax credits and tax–exempt bond issues, and helped developers assemble land parcels and perform environmental reviews. Using RDA money for gap funding also enabled lower rents.

Now, four years after shuttering RDAs, California's housing affordability crisis is getting noticed in Sacramento.

Last month California Assembly Speaker Toni Atkins (D–San Diego) introduced legislation to increase both tax credits and state funding for affordable housing. And next year the National Housing Trust Fund will resume providing housing block grants after an eight–year hiatus caused by bankruptcy and reorganization of federally guaranteed mortgage backers Fannie Mae and Freddie Mac.

In January, State Treasurer John Chiang launched a six–month study to identify administrative, legislative and public–private partnership affordable housing solutions. As part of his statewide road trip, Chiang will be speaking at the Housing Trust Silicon Valley's (www.housingtrustsv.org) 2015 Investor Briefing on April 17 at the Santa Clara Convention Center.

As State Controller, Chiang published a 2010 audit that helped push RDA shutdown by highlighting exceptional cases of RDA financial malfeasance, such as Bell's siphoning $1 million in affordable housing money into public officials' slush funds.

Billboard Contract Raises Questions, Illustrates Council Process Problems

At last Monday's study session, the City Council discussed forming a governance committee tasked with documenting Council policies and procedures. The need for this was made clear when several Council members said they didn't know what the process was for developing Council Meeting agendas.

The following night's Council meeting agenda provided more evidence of that need, in an item lodged in the consent calendar (routine items on an agenda grouped together and passed in a single motion) to approve a 25–year contract with AllVision LLC to “manage real estate assets for opportunities to maximize revenue from digital outdoor advertising” –digital billboard advertising.

No one explained why something as perennially controversial as billboards was in the Consent Calendar to begin with, and the fact that the day before the meeting, the Council got a letter from the company that lost the bid, TR Advisors, challenging AllVision's financial analysis, made the Consent Calendar placement seem even more questionable.

TRA contends that AllVision's proposal would mean $4 million less for the City over 25 years. This was because TRA's fee was 20 percent of revenues for a five–year term – during which it would decline – while AllVision's fee was a steady 30 percent of revenue for 25 years. City staff disputed TRA's analysis, but the agenda report didn't provide a comparison.

Last year, Santa Clara's marketing committee recommendedmore strategic use of billboard advertising, and using turnkey billboard advertising management, consulting, and construction services. No record shows that the committee reviewed any specific vendor proposals. The billboard plan was on the November 7 Council Study Session agenda, and the Council authorized staff to proceed with an RFP. A single digital billboard is estimated to bring in $500,000 a year.

Tuesday night, Mayor Jamie Matthews asked if the letter made the item a protest hearing, which was not on the agenda, and thus discussion would be a violation of the Brown Act. The City Attorney said it wasn't “formally” but could be interpreted that way. Matthews then moved to continue the item so it “could be agendized properly.” This passed on a 4–3 vote.

Further questions about the wisdom of a fast decision about the billboard contract were raised by a February 9 letter to the City from the California State Outdoor Advertising Association (not included in the agenda packet) expressing its “concerns” about AllVision's business model; which the CSOAA said was based on an illegal conflict of interest because AllVision is both the consultant recommending a plan, and the contractor bidding on the job (the company is also an outdoor advertising company, not just a consultant or contractor). Neither AllVision nor TR Associates belongs to the CSOAA.

The CSOAA letter included a copy of a November 15 personal letter from Santa Clarita City Council Member, TimBen Boydston, to the Santa Ana City Council describing a dispute over a billboard plan in Santa Clarita. The proposal, made by the LA Metropolitan Transit Authority and AllVision, called for replacing 118 billboard faces on MTA–owned land in Santa Clarita with three large, two–sided electronic billboards near the freeway.

From the start, the issue of new billboards was contentious. “Repeated attempts by the public to examine and have input on the proposal were rejected out of hand,” wrote Boydston. When other billboard companies asked for the opportunity to make competing offers, “The offers were ignored.” Santa Clarita'sCouncil approved the contract, 3–1.

Opponents launched a referendum campaign overthe MTA/AllVision plan; with the “Yes on S” campaign financed by individuals and businesses closely linked to AllVision's management, according investigative reporter Mike Devlin at SantaClaritaValley.com.

AllVision sent “blockers” to stop signature–gathering, three of whom were arrested for trespassing by the Santa Clarita Valley Sheriff's Dept., which identified the men as “blockers,” according to reports in Santa Clarita news outlets. The MTA launched an investigation, and requested AllVision to “cease involvement in any activity that disrupts petition gathering.” The “No on S” campaign collected over 11,000 signatures in a month, and the billboard plan was defeated 56 to 44 percent.

Buena Park's City Council voted against a deal with AllVision in January 2014, because they questioned AllVision's expense reimbursement, revenue sharing model, and the soundness of the financial projections, according to the Orange County Register. In December, Santa Ana's City Council voted to continue a proposed contract with AllVision “indefinitely.”

AllVision and TR Advisors submitted bids, according to the March 10 agenda report, and AllVision was recommended. “Staff is aware of controversies related to All Vision's [sic] similar work with another municipality (City of Santa Clarita), but our review of that dispute fails to indicate any wrongdoing, malfeasance, or violation of law resulting from that city's and All Vision'scontractual relationship,” says the agenda report.

Requiescat in Pace

The March 10 Council meeting adjourned in memory of long–time Santa Clara Pony baseball coach Lee Jones.

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