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What to Build, What to Bond

By Frank Gruber

May 11, 2009
-- Tomorrow night, the Santa Monica City Council will revisit the question of which capital projects, of more than a billion dollars' worth of proposals, should receive funding from about $300 million that will be available from the City's earthquake redevelopment project.

Decisions like this attract a lot of attention, not to mention advocacy.  Partisans of a plan to rebuild much of the Santa Monica High School campus with recreational facilities available for joint-use by the general public are calling for the council to direct much of the redevelopment money to their approximately $230 million plan. ("LETTERS -- Joint Use Offers Unique Opportunity," may 5, 2009)

City staff, in its staff reports for the meeting (there are two of them, both available by way of the meeting agenda, has responded by recommending an allocation of $46 million to the Samohi plan, plus possibly another $25 million for parking.

Meanwhile, residents of the Pico Neighborhood want a branch library, perhaps as part of a neighborhood center. ("LETTERS -- Give Pico Its fair Share," May 8, 2009)   Staff recommends building the new library, but has deferred to the council the question whether to build it at Virginia Avenue Park for $12.8 million or at a site to be acquired on Pico Boulevard for a total cost estimated at around $30 million.

The City Council will also have to factor into its calculations estimates about what can be planned in time for the issuance of the bonds.  As I wrote a few weeks ago, the City has a tight timeframe in which to plan its own projects -- about three years. ("What I Say -- Shovel and Bond Ready in 28 Months? " April 21, 2009)

It's no coincidence, therefore, that tonight, even before the council has decided on any priorities, the planning department is hosting a community workshop to discuss planning possibilities for downtown and the Civic Center in the context of the expected arrival of Expo rail by 2015. 

Staff has recommended that most of the redevelopment money -- $199 million dollars of a total of $273 million -- be allocated for downtown projects or in the Civic Center area.

If the City is going to have any chance to use the money for its projects, it's going to have to design them fast.

The council also needs to factor in to its decisions the future costs of operating and maintaining whatever the City builds.  It's wonderful to invest in public goods, but it ultimately takes a productive local economy to pay for our enjoyment of those goods, and sometimes in Santa Monica people who want the public goods don't want the development that will generate the revenues to pay for them.

For various reasons, I do not expect final decisions to be made tomorrow night.  The council doesn't have all the information it would need.  Notably a parking study that the staff has commissioned won't be available until later this spring, and staff is recommending that significant amounts of bond money -- $53 million (plus $17 million of parking authority money) -- should be spent on parking.

The issue of how to leverage the redevelopment money is also unclear.  In the staff reports, some projects are identified as able to attract funds from other sources, but until the projects are planned and budgeted, it will be hard to know what money will be available.

One big question about leveraging involves the Samohi projects -- City staff in its original staff report said that the projects could be leveraged, but in an attachment to the supplemental staff report, the projects are listed as having no leveraging opportunities. 

This seems crucial.  The proponents of the Samohi projects may hope to get some more funding from the City, but do they expect to receive the entire $230 million from a redevelopment pot that is unlikely to exceed $300 million?

The council needs to imagine what they would be doing if after the earthquake the City had not established the redevelopment district.  The City needs to treat the earthquake redevelopment funds -- a windfall that comes from money that would otherwise go to state and county budgets for education and social services -- as special.

Even if there were no redevelopment district, Expo rail would be coming to Santa Monica, and the streets around the terminus at Fourth and Colorado, as well as those around the two other stations in Santa Monica, would need to be redesigned and rebuilt.  Staff is correct that these projects are of paramount importance -- but should they be paid for with $20.9 million of earthquake redevelopment money?

Doesn't Santa Monica generate enough money from the downtown already to bond these projects?  Or what about an assessment district?  Or county, state and federal transit funds?

What about the $28 million staff is suggesting be spent on land for new parking structures downtown?  Do we need more parking downtown?  I know, we're waiting for the results of the survey, but what if the City charged market rates for parking?  (Note how much more it costs to park in privately owned buildings and in private parking lots than it does in the City's structures.)  Subsidized parking attracts more motorists, causing more traffic congestion.  The whole idea behind Expo is to get people out of their cars -- why do the opposite by subsidizing parking?

To put it another way -- should money be taken away from education and social services to subsidize parking for shoppers in downtown Santa Monica?

Similarly, is it right to spend redevelopment money to renovate the Civic Auditorium?  Except for the school district's annual "Stairway to the Stars" programs, and a handful of Santa Monica Symphony concerts, what's so "civic" about it?  How would a future public/private partnership make it more so?

Should we use redevelopment money to synchronize traffic lights, as staff suggests?

On the other hand, many other projects staff is asking the council to fund will have great benefits, not only locally, but regionally.  Yes, some of those are on the Samohi campus, but the two parks proposed for either end of the Civic Center will be invaluable, as will most of the other projects proposed for the rest of the city.

The City needs to proceed with planning the projects it wants to build, but more thought is going to have to go into how to fund them.


Meeting details:

The workshop mentioned above on downtown and Civic Center projects will take place this evening at the Civic Auditorium's East Wing, from 6:30 to 9:00.  Staff is asking people to RSVP so that enough refreshments can be provided.  To do so, and for more information, go to or call 310 458 8341.


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