Despite a recent state Supreme Court decision backing Gov. Jerry Brown’s effort to dismantle redevelopment agencies and thereby threatening the Orange County Great Park’s primary funding source, the Irvine City Council’s Democratic majority is confident that something can be done to save the funding without drastic measures.
But that is not how Republican Councilman Jeffrey Lalloway feels.
“We have to take immediate corrective action to dramatically cut spending on public relations, staff and outside consultants at the Great Park,” Lalloway said at last week’s City Council meeting. “This is common sense. We are like a family whose top breadwinner has lost his or her job. This is the time for quick action.”
Lalloway proposed that the city manager devise a cost-cutting plan and alternative fundraising ideas. But his proposal was defeated in a 3-2 vote, with Mayor Sukhee Kang and council members Larry Agran and Beth Krom voting no.
The vote was expected. The Democratic majority, widely seen as lead by Agran, has steadfastly supported Great Park spending while the Republican minority has generally been highly critical.
Lalloway’s move last week was his most direct challenge to park spending since he was elected in 2010.
Republicans have for years insisted that the park is wasting money on a massive public relations effort when the park hardly exists. The Democratic council majority says the critics are naysayers who want to see the park defeated for political purposes.
“To just assume that’s [elimination of redevelopment] going to be the end of the world and just stop everything right there? That is the wrong approach, and we want to be more positive,” Kang said.
The 1,300-acre metropolitan park is by far Orange County’s largest redevelopment project. Master designer Ken Smith envisioned, among other amenities, a canyon, a wildlife corridor and a man-made lake.
Construction of the park has been dependent upon revenue generated by the adjacent development of nearly 5,000 homes. The plan, a typical redevelopment agency strategy, was to fund the park with tax increments, the increase in property tax revenue resulting from the housing development.
But now this funding stream, which was estimated at $1.4 billion, could be gone. City officials have maintained that this money is protected, and members of the state Legislature are seeking a solution. Park leaders haven’t proposed solid alternatives should redevelopment revenue disappear.
“I think we’re OK, and how we proceed with what tools and at what pace is a conversation that will continue to unfold,” said Krom, who is also chairwoman of the park’s board of directors.
Other questions remain unanswered in light of the court’s decision, including the fate of 35 acres that are the centerpiece of one of the park’s financing plans. In 2007, the city sold the land to the redevelopment agency for $134 million at 9 percent interest, which would ultimately cost an estimated $831 million over 40 years. The debt qualified the redevelopment agency to receive property tax increments.
But as part of a statewide scramble to protect redevelopment assets last year, Irvine’s redevelopment agency transferred the property back to the city. Sources familiar with the deal say the transfer could be voided by the Supreme Court’s decision and the land could be seized by the state. The massive debt to the city could also remain unpaid.
Despite the uncertain circumstances, council members voted Tuesday night to move forward with a sweeping set of construction plans, including new soccer fields, a visitors center pavilion and a community garden.
“I don’t want to live in an uncertain world,” Kang said. “Right now we have a plan in place, and we’re moving forward, not backwards.”
Lalloway opposed the move and said a review was needed before going forward with more spending. “I want all plans reviewed until we determine where we are, what is critical spending and where our next money is coming from. It’s the responsible thing to do,” Lalloway said.
The park’s leadership has been heavily criticized for spending millions on no-bid contracts.
None has received more attention than Forde and Mollrich’s $100,000-per-month public relations contract. In addition, the park spends millions on around 18 public relations staffers and consultants, according to Lalloway.
“We are spending unnecessary amounts on a variety of unnecessary projects like public relations. We have somewhere around 18 staff and consultants working on public relations for a public construction project,” Lalloway said. “That amount needs to be studied, among other items, to determine if it’s necessary in light of the elimination of redevelopment in California.”
Kang says he isn’t opposed to Lalloway’s proposal to review park spending; he just thinks it was the wrong time and place to ask for it.
“In a couple of months, the budget for the Great Park will be coming up, and we will have plenty of time to discuss it at that time. I believe that’s the right venue and right time to discuss it,” Kang said.