Springs could tap $200 million
County officials to raise the revenue cap on
Sonoma Valley Redevelopment Area
Tim Omarzu
Sonoma Valley Sun
“A passage of opportunity and prosperity.”
That’s the metaphorical message that artist Oliverio Quezada said he wants to convey at the Springs gateway arch on Highway 12 near the McDonald’s fast-food restaurant.
Sonoma County is paying the ceramic artist $35,000 in redevelopment money to decorate the landmark, which has sat unadorned for years.
The finishing touches that Quezada proposes to install include tiles made by schoolchildren and a small pyramid of turquoise-blue ceramic spheres atop a four-foot column.
But the artist’s “opportunity and prosperity” metaphor is apt.
Despite its reputation as Sonoma’s down-at-heels neighbor, the Springs has a huge potential line of credit.
About $200 million worth.
That’s the amount of redevelopment money that the county could raise in the Springs to fund just about any bricks-and-mortar capital improvement you can think of. For example, county officials have kicked around the idea of spending redevelopment money on such things as creating a public plaza near the Sonoma Mission Inn and building a healthcare clinic.
At the same April 5 meeting that county officials talked with Quezada about arch art, they also considered increasing the amount of Springs redevelopment money to help fund construction of long-awaited sidewalks along Highway 12.
The money’s source: You, new property owner
Where’s all this potential redevelopment money coming from?
You – if you bought a home recently inside the 323-acre Sonoma Valley Redevelopment Area, which runs along Highway 12 for two miles north of Sonoma.
Most of the property tax paid by new homeowners there goes to redevelopment coffers.
To understand why that is, think of redevelopment money as the cream that floats as the top layer on a bucket of milk freshly milked from a cow.
The Sonoma Valley Redevelopment Area was established in 1984. At that date, competing taxing entities, including the school district, the Valley of the Moon Fire District, and the Marin Sonoma mosquito-abatement district, had their tax revenue frozen.
Since then, the “increment,” or the additional property tax revenue – the cream on top of the tax bucket – has gone to the redevelopment district.
With property values skyrocketing since the late ‘90s, that’s meant lots of revenue.
The redevelopment area generated just over $15.5 million as of June 30, 2006, said a county report.
And county officials estimate that sometime in 2008, the redevelopment area will reach its revenue cap of $20 million. In other words, it’ll run out of money then.
Raising the revenue cap
So county officials want to increase the revenue cap to keep the redevelopment area alive.
But they haven’t yet decided what the new cap will be.
“We are in the very, very initial stages of this,” said Kathleen Kane, executive director of the Sonoma County Community Development Commission.
But officials have developed some numbers to play with.
If property values keep climbing the way they have, the redevelopment area could have $100 million in revenue by 2025. Or, if the county sold redevelopment bonds, it could have a whopping $218 million to spend, because the county could collect redevelopment money until 2035 to repay the bonds.
“Based on current projections of tax increment revenue for the (redevelopment area) it appears that a total of $100 million could accrue through the end of the Redevelopment Plan’s effective life… and a total of $219 million could accrue through the end of the Redevelopment Plan’s debt repayment period,” said a draft plan to increase the revenue cap.
Will pay for sidewalks
The need for Highway 12 sidewalks got the county to start thinking about raising the revenue cap.
The county has about $6 million set aside in savings to build the sidewalks.
But some disturbing news came about a year ago, when the county’s department of public works updated the estimates and figured that sidewalk construction will cost close to $13 million.
“That’s when we realized that we’re going to have to raise the cap to get that project done,” Kane said.
“We’ll use the $6 million that we have (saved) to pay for the first phase,” of sidewalk construction on Highway 12 south of Boyes Boulevard, Kane said.
In the meantime, the county will go through the steps to increase the revenue cap, a process it hopes to have wrapped up by July of 2008.
How high will the revenue cap go?
Will the county lavish $100 million, or $200 million, in improvements on the Springs?
Or will the cap get set at some lesser amount?
Boris Sztorch, Sonoma County Redevelopment Manager said, “I’m not even going to take a guess. It could range up to $100 million, It’s going to be based upon projects that are identified over the next year to year-and-a-half or are in the pipeline.”
If the increment doesn’t get funneled into redevelopment, it would revert to the county’s general fund and also get spread around among the other taxing entities.
“You can do a lot with less than $100 million,” Kane said.
The Sonoma County Board of Supervisors is expected to set the revenue cap sometime between now and the summer of 2008.
• The Sonoma Valley Redevelopment Advisory Committee, which gives non-binding advice to the Sonoma County Supervisors about how to spend redevelopment money, meets at 6:30 p.m. at on the first Tuesday of the month at the Boys and Girls Club Valley of the Moon.
