SM redevelopment panel fuels road projects

SAN MARCOS -- The city's redevelopment agency will contribute $9 million or so to road projects next year -- the latest infusion from what in many ways has become the city's economic engine, officials say.

Since the first of the city's three redevelopment areas was established 21 years ago, City Manager Rick Gittings estimates that redevelopment revenues have paid for some $300 million in local road improvements. Without that money, "we would be a series of two-lane blacktops," he said.

Mayor Corky Smith, who was a councilman when the first redevelopment area was established in the core of the city in 1983, said the city would be different in other ways, too. He said he can't imagine that the city could have found the $54 million to build a new civic center in 1994 or could have lured Cal State San Marcos without the promise of road improvements that redevelopment money paid for. But it did.

"The whole thing goes back to redevelopment," he said, referring to the university.

Today, 65 percent of the city is in a redevelopment area. Two more areas were added in 1985 and 1989, one of which is scattered throughout the city and one which is primarily in the city's southern and western areas.

Typically, redevelopment agencies are established to revitalize blighted areas. Once a redevelopment area is established, the city receives a bigger chunk of property taxes levied on new buildings.

For instance, the city receives 7.5 cents for every dollar of property tax levied. However, in San Marcos' redevelopment areas, that number jumps to between 50 to 67 cents on every dollar. Those extra pennies have generated millions of dollars for the city, which must share some proceeds with the San Marcos Unified School District.

In the 2004-05 fiscal year, the city expects to generate $43 million in revenues from its three redevelopment areas, which essentially encompass two-thirds of the city. The city's draft redevelopment budget for the fiscal year, which starts July 1, estimates the agency's spending will be around $30 million, most of which will go toward repaying bonds the city used to finance other projects.

So why the $13 million difference between spending and earnings? It's only on paper, Gittings said. The draft budget doesn't include transfers to the city's capital improvements projects budget, which is a seven-year plan to improve roads, parks and other public facilities.

The capital improvements projects budget is still being drafted, and a rough copy should be ready late next week.

However, Gittings said that there will be roughly a 10 percent reserve in the redevelopment budget, leaving roughly $8 million or $9 million left to transfer to the capital improvements budget to pay for road improvements. The city could use more for road improvements by having a smaller reserve, Gittings said. If there is a shortfall in the capital improvements budget, Gittings said, redevelopment money is usually tapped to bridge the gap.

Some of the major projects starting next year that could benefit from redevelopment money include a 2.4-mile extension of Twin Oaks Valley Road, the widening of South Santa Fe Avenue and the construction of an interchange at Highway 78 and Las Posas Road.


