Eminent Domain Report

Redevelopment agencies (RDAs) have held a rather infamous position in California history.  While originally created to address urban decay (aka “blight”), generally speaking, RDAs developed into entities that wielded the power of eminent domain to designate large areas of property “blighted,” acquire the property, and then hand it off to private developers.  The RDAs were motivated to engage in this behavior because they captured the increases in property tax revenues that resulted from the increase in property values caused by the urban renewal projects. This resulted in a reallocation of funds from other recipients, most notably schools.  Ultimately, opposition to such practices prevailed and RDAs were abolished in 2011.

Since that time, there have been various legislative efforts to revive parts of the original RDAs, but without the characteristics that ultimately lead to their abolishment.  For example, cities now have the ability to create Enhanced Infrastructure Finance Districts or Community Revitalization and Investment Authorities.  But, these entities cannot use the power of eminent domain or divert funding from schools.

Recently, a bill has been proposed in the California Assembly that would seek to reinstate RDAs to nearly their original power.  Assembly Bill 1476, which would be known as the Community Redevelopment Law of 2023, includes many of the characteristics of the original RDAs.  For example, these new RDAs would have the power of eminent domain.  Proposed Section 100631 of Government Code states: “An agency may … acquire real property by eminent domain to be used in a redevelopment project. Property already devoted to a public use may be acquired by the agency through eminent domain, but the agency shall not acquire property of a public body without the consent of that public body.”

Given California’s history with RDAs, it will be interesting to see how AB 1476 counters the critiques raised against the original RDAs.  Particularly, by including the power of eminent domain in the structure of the newly proposed RDAs, AB 1476 will likely face much of the same opposition and criticism raised against the original RDAs.  

AB 1476 was re-referred to the Committee on Appropriations on April 27, 2023 and, since then, it looks like it may not have made it out of the Appropriations Committee.  We will be following the status of AB 1476 to see if it, or any other bills related to RDAs, make any headway.