New! Downtown Master Plan RFP

The City of Lake Elsinore's Redevelopment Agency (RDA) is one of the most important tools your public officials have in improving our fair City.

In the past 20 years, the RDA has paved streets and sidewalks, beautified neighborhoods, and even built a baseball stadium, our beloved Diamond.

However, those past 20 years have not come without challenges. A few questionable decisions and some unfortunate economic problems hampered the Agency in reaching its goals.

Now, with a new management team, a new RDA Board of Directors, and a much improved financial outlook the Agency has a very bright future and can truly start achieving great things.

From the proposed Civic Center in the downtown area to road beautification projects to providing new and improving existing housing stock, the new RDA will play a key role in making our already wonderful City a truly special place to live, work, and play.

Thank you for you time. If you have any questions, please do not hesitate to contact me (Thomas Buckley ) or RDA staff (Steven McCarty). Additionally, general questions or comments may be sent to rda@lake-elsinore.org.

Rising property values and growth have enabled the RDA to meet its annual debt obligations from past projects. The RDA's mission is to support affordable housing and new redevelopment projects.

Vision and Purpose of the RDA [top]
Our Vision:
The Lake Elsinore Redevelopment Agency exists to add value to our community through project area improvements that set high standards, improve public safety, and enhance our quality of life, in accordance with California Redevelopment Law.

Purpose of Redevelopment:

• Encourage new housing, commercial and businesses to locate within already developed areas.
• Help reduce crime.
• Remove blight by revitalizing neglected or underperforming areas.
• Improve public infrastructure and facilities.
• Promote affordable, low to moderate income housing.
• Promote "inward" investment instead of outward growth.

What is redevelopment?
Redevelopment is a process authorized in 1952 under California law to assist local governments in revitalizing blighted areas in their communities. Redevelopment may involve public infrastructure replacement, urban renewal projects or other programs to promote economic recovery and revitalization.

How is redevelopment paid for?
The key to financing redevelopment projects is tax increment. "Increment" is a portion of property tax revenue that grows as a result of redevelopment. The amount of tax increment within a Redevelopment Project Area is calculated using base property values and formulas. The increase in total taxable property value above the base year is "increment". As property values increase due to redevelopment projects, tax revenue from redevelopment increases. Increment is the portion of additional tax revenue that is returned to the Redevelopment Agency. Increment benefits the community by capturing tax revenue that can be used for a variety of redevelopment improvements.

Who controls redevelopment?
Keeping tax increment for local redevelopment requires creation of a Redevelopment Agency and adoption of a local Redevelopment Plan. A City's governing body may create a Redevelopment Agency under California Community Redevelopment Law. The Lake Elsinore Redevelopment Agency was created in 1980.

What is "blight"?
By law, redevelopment revenue can only be used in areas that suffer from adverse physical and economic conditions. So called "blight" is legally defined further under redevelopment law. Redevelopment Project Areas are specific zones that meet legally defined criteria for redevelopment. The City's existing Redevelopment Project Areas are shown in the map above.

Who authorizes redevelopment projects?
Redevelopment projects are defined and approved by the Redevelopment Agency, which uses redevelopment revenue to pay for renovations, new construction or revitalization of under-performing areas. As shown at left, the City's RDA has approved several successful projects to improve the City since 1980.

RDA Board of Directors [top]
By law, the Redevelopment Agency is legally and financially separate from the City of Lake Elsinore. As in other cities, it is common for the City Council to serve dual roles as the RDA Board of Directors. The City Manager serves as the RDA's Executive Director. The RDA officers include Chairman, Vice-Chairman and Executive Director.
The current RDA Board of Directors includes:

• Thomas Buckley, Chairman
• Bob Schiffner, vice chair
• Daryl Hickman
• Genie Kelley
• Robert "Bob" Magee

An ad hoc citizen's committee was formed in 2003 to develop policy and program recommendations. Members include Harvey Ryan-Chairman and Ron Hewison.

RDA projects [top]
The RDA projects summarized below have made a huge difference in improving the quality of life and safety of our city.

Lakeshore Drive Bridge

Lakeshore Drive Bridge used to be an old two-lane structure on decaying wood pilings, vulnerable to being washed out by storm runoff on the San Jacinto River. In the mid 90s, the RDA completed a full multi-lane bridge replacement to ensure one of the City's busiest arterial thoroughfares, Lakeshore Drive, could withstand heavy storm runoff and seismic activity.

Amber Ridge Sewer System

In the late 80s, the RDA and EVMWD teamed up to provide sewer service to a neighborhood of nearly 200 homes that was experiencing septic system problems. The RDA and EVMWD also offered incentives for residents to hook up at a reduced rate. Street resurfacing and striping completed the project. Today, homeowners are realizing higher property values, in part, because the RDA was in a position to help fund the sewer system to modernize and improve this neighborhood.

Diamond Stadium

Lake Elsinore would be less distinctive without the attraction of professional baseball at The Diamond. The stadium is a "proof of concept" that a top flight entertainment venue does add value to our City's image as a recreation and tourism destination. The popularity of the Lake Elsinore Storm, affiliated with the San Diego Padres, has added to the City's bragging rights.

Historic Downtown Main Street

Before 1988, downtown Lake Elsinore was fading. The vacancy rate was high and Main Street businesses were in serious decline. Crime was a problem downtown and citizens felt unsafe there at night. Today, Historic Downtown Lake Elsinore is thriving and offers great new restaurants, antique and boutique shopping, successful businesses and professional services. The Historic '20s architecture has been renovated and preserved, along with new landscaping, streets, sidewalks, curbs and gutters, street trees, brick planters, public parking lots, period lighting and sidewalk bollards and sign posts. Business owners have taken advantage of RDA loans to install new storefront awnings and signs. The night scene is thriving and visitors downtown feel safe. Historic Main Street is one of the RDA's most successful revitalization projects.

Many other projects made possible by the RDA include:

• Lake Elsinore Outlet Center
• Lake Elsinore City Center (Wal Mart)
• Lake Management/Levee contribution
• Collier Avenue Improvements
• San Jacinto Bridge retrofit
• Graham Street public parking lot
• Mission Trail rehabilitation
• San Jacinto River Channel Improvement
• Cultural Center Conversion/Rehabilitation

RDA Goals and Benefits [top]
The RDA's overall goal is to revitalize underperforming areas of the City, raising overall value to the community. Below highlights key goals and strategies recommended by the RDA Committee and approved by the RDA Board.

Goal: Implement a cost-saving loan repayment schedule between the RDA and the City.

Background: As a result of the California recession in the early 90s, the RDA borrowed from the City to repay bond holders. Today, the RDA is in a healthy position to repay its loan obligation to the City. The RDA Board recently approved a new payback schedule over a 34 year period at a low interest rate just 1% above the City's average annual interest rate.

Benefit: Locking in a low interest rate and long-term repayment schedule will save the RDA money and guarantees that the General Fund will be fully repaid.

Goal: Provide increased public information about RDA projects, improvement plans, powers and governance.

Background: Direct mailers, a web site home page and public outreach will be used to raise the visibility of the RDA among citizens and businesses.

Benefit: Timely information about the RDA's role in adding value to our City will be more accessible to the public.

Goal: Protect the RDA's fair share of property tax revenue in Project Area 1 by removing the limitations on the original revenue cap. This is not a tax increase.

Background: Property tax increment is the portion of property taxes the RDA gets to keep for local use. Property tax increment is allocated to the RDA according to formulas and valuations established at the time a Project Area is created. As property tax values increase, some Project Areas with older, limited caps may not get to keep the excess revenue they generate.

Benefit: By raising the cap in Project Area 1, the RDA will receive millions of dollars in future years that can be invested in improvement projects in our community.

Goal: Adopt a repayment schedule for the RDA's 20% housing requirement.

Background: Redevelopment Agencies are mandated to set aside 20% of annual property tax revenue to support low and moderate income housing goals. Years ago, the City's RDA obtained Court approval to borrow against this set-aside to cover other RDA debt obligations. These funds are tracked and intended to be return to the Housing Fund over time.

Benefit: Revenue growth over debt requirements means more money for low and moderate income housing.

Project Areas [top]
An RDA project area, defined in a Redevelopment Plan, represents captured revenue or tax increment. There are three existing project areas within Lake Elsinore:

• Project Area 1 (original), 0.48 Square Miles
• Project Area 1, (Amendment), 2.57 square miles
• Project Area 2, 7.68 Square Miles
• Project Area 3, 5.57 Square Miles

Within these areas, the RDA has the authority to dedicate tax increment and incur indebtedness in order to construct redevelopment projects or offer other qualified RDA programs.

But volatile economic conditions beyond an RDA's control, or excess spending, can upset the balance. When either happens, the RDA may not always have the ability to meet its debt obligations. This happened to the Lake Elsinore Redevelopment Agency during the recession in the early 1990s.

When the recession hit during the RDA's most ambitious decade, the '90s, the RDA's total debt exceeded income for the first time. Loans to the RDA from the City and a private bank were needed to repay bond holders.

Today, the RDA is financially healthy again, due to rising property values and economic growth. The RDA is currently able to meet all its debt obligations. However, the RDA's debt obligation is long term. For this reason, refinancing RDA debt can significantly reduce the cost of borrowing. Just like a homeowner who refinances a mortgage, the RDA can refinance debt by issuing bonds when interest rates are more favorable. The RDA has successfully saved millions of dollars through debt restructuring.

One looming threat to RDA revenue is from the state of California. For two years in a row, the State of California has begun to reduce RDA tax increment to cities because of its budget deficit. This is harmful to cities that count on RDA revenue to construct redevelopment projects or meet debt obligations. Despite this threat, the Lake Elsinore RDA has used conservative and prudent budgeting as a cushion against the State's confiscatory policies.

Glossary of Terms [top]

Assessed Value (AV):

The amount used by the county tax assessor to value real property for tax purposes.

Blighted Areas:

Areas and/or structures of a community that constitute either physical, social, or economic liabilities requiring redevelopment in the interest of the community.

Eminent Domain:

Authority of a government agency to acquire property for public purposes (condemnation). The Lake Elsinore RDA does not presently have condemnation authority.

Infrastructure:

Public improvements which support development, including street lighting, sewers, flood control facilities, water lines, gas lines, telephone lines, etc.

Project Area:

The area which is designated in the redevelopment plan for redevelopment and revitalization.

Property Tax:

The amount of tax that property owners pay on the value of their property. The tax is calculated by multiplying the assessed value of the property by the tax rate, which is one percent (1%) plus any voter approved increase.

Redevelopment Plan:

Plan for revitalization and redevelopment of land within the project area in order to eliminate blight and remedy the conditions which cause it.

Tax Increment:

The increase in property taxes within the redevelopment project area that result from increases in the project area assessed value that exceeds the base year assessed year value.

For More Information [top]
Questions or comments about the Redevelopment Agency may be e-mailed to rda@lake-elsinore.org