With the end of local redevelopment two years ago, Gov. Brown’s administration has proposed to broaden existing authority (known as Infrastructure Financing Districts, or IFD) of local agencies when considering infrastructure finance and economic development. That proposal relies on the growth of only a small portion of the local property tax that is allocated to the city that creates the IFD. Statewide, cities see about 11 percent of the allocated property taxes. For such a critical function, such limited resources simply doesn’t cut it. A small tax base will result in a small amount of taxes collected, it’s simple math.
In light of this, the California Economic Summit proposed the following to bolster this new authority:
- Allow the IFD to take advantage of the growth on all of the property tax that is generated within the district. In some cases this will double the resources available to the district;
- Broaden the tools currently available to other local agencies including assessments on property that benefit from the infrastructure investment;
- Allow the revenue that is not pledged for indebtedness to be used for the maintenance and operation within the district.
You can read the testimony submitted to the Senate Budget and Fiscal Review Committee in full below.
Fred Silva is the Senior Fiscal Policy Advisor at California Forward