2005-2009 Five Year Implimentation Plan

For the Merged Earthquake Recovery and Reconstruction Project and Eastside Business Improvement Project REDEVELOPMENT AGENCY OF THE CITY OF SANTA CRUZ ADOPTED BY RESOLUTION NO... It is p

For the Merged Earthquake Recovery and Reconstruction Project and Eastside Business

Improvement Project

REDEVELOPMENT AGENCY OF THE CITY OF SANTA CRUZ

ADOPTED BY RESOLUTION NO 1269

Table of Contents

TABLE OF CONTENTS 2

TABLES 4

INTRODUCTION I PURPOSE OF IMPLEMENTATION PLAN 5

II LEGISLATIVE REQUIREMENTS 5

III PLAN PREPARATION AND ADOPTION PROCESS 5

IV PLANNING PROCESS 6

V PLANNING AND POLICY BASIS 6

A Downtown Recovery Plan 6

B General Plan 6

C Eastside Business Area Improvement Plan 6

D Beach Area Specific Plan 7

E Mission Street Corridor Design Plan 7

F Housing Element 7

G Economic Development Strategy 7

VI CONTENTS OF THE PLAN 7

AGENCY ACCOMPLISHMENTS 2000-2004 9

I ECONOMIC DEVELOPMENT 9

A Merged Project Area 9

B Eastside Project Area 11

II AFFORDABLE HOUSING 12

ECONOMIC DEVELOPMENT 15

I INTRODUCTION 15

II ECONOMIC DEVELOPMENT FIVE YEAR GOALS AND OBJECTIVES 15

A Economic Development Goals General Plan/Merged Earthquake Recovery and Reconstruction Project 15

B Economic Development Goals Economic Development Strategy 17

C Merged Earthquake Recovery and Reconstruction Project Goals Downtown Recovery Plan 19

D Merged Earthquake Recovery and Reconstruction Project Goals Beach/South of Laurel 21

E Merged Earthquake Recovery and Reconstruction Project Goals Mission Street Corridor Design Plan 22

Redevelopment Plan 23

G Eastside Business Improvement Project Goals Eastside Business Area Improvement Plan 23

H Eastside Business Improvement Project Goals Redevelopment Plan 24

III AGENCY PROGRAMS TO ADDRESS PROJECT CONDITIONS 24

A Downtown Recovery and Reconstruction 24

B Eastside Improvement Programs 26

C Beach and South of Laurel Programs 26

D Industrial Development and Technology Information Design and Development Programs 27

E Economic Development Program 27

F Infrastructure Improvement Projects 28

IV FINANCIAL MECHANISMS AND AGENCY OBLIGATIONS 30

A Redevelopment Financing Mechanism 30

B Merged Project 30

C Eastside Project 31

D Agency Resources 31

V ESTIMATED PROGRAM EXPENDITURES 34

VI SUMMARY .35

AFFORDABLE HOUSING 36

I INTRODUCTION 36

II HOUSING PROGRAMS AND HOUSING PRODUCTION PLAN 37

A Background 37

B Current City Programs 41

C Proposed Programs 41

III INCLUSIONARY HOUSING 53

A Definition/Background 53

B Merged Earthquake Recovery and Reconstruction Project – 1990-2004 54

IV REPLACEMENT HOUSING 68

A Introduction 68

B Legal Requirements 68

C Compliance with Health and Safety Code Section 334135 - Replacement Housing Plan

69

Table I Summary of Relationship of Redevelopment Conditions

of Blight and Agency Programs 29Table II Five-Year Implementation Plan

Estimated Program ExpendituresJanuary 1, 2005 – December 31, 2009 35Table III Estimated Number of Affordable Units

Five-Year Affordable Housing Plan Implementation Plan2005-2014 52

Table IV Five-Year Affordable Housing Implementation Plan

Estimated Number of Units Assisted by Income Category2005-2014 53

Table V Inclusionary Requirement – New Residential (Single-Family &

Multi-Family) Units Within Redevelopment Project Areas 62Table VI Inclusionary Requirement –Rehabilitated Multi-Family Units Within

Redevelopment Project Areas (Substantial Rehabilitation) 65

The Implementation Plan is the Redevelopment Agency’s policy statement as to the type of projects and programs it intends to undertake over the five year period 2005-2009 It is

prepared to assist the Agency in setting priorities and allocating resources during this period forredevelopment activities within its two redevelopment project areas, the Eastside Business Improvement (Eastside Project) and the Merged Earthquake Recovery and Reconstruction (Merged Project) Project Areas The Implementation Plan provides an explanation of how the goals, objectives, programs and expenditures for the next five years will promote revitalization, eliminate blight, foster economic development and develop affordable housing The Plan is dynamic in nature and, as time passes, adjustments can be made to reflect changing project

conditions or other factors, which affect the five-year goals and objectives

AB 1290 and SB 732 were enacted by the California Legislature in 1993 and 1994 respectively,

as a comprehensive reform of the California Redevelopment Law (CRL) and established

regulations which required each redevelopment agency to adopt an Implementation Plan no later than December 31, 1994, and to update the plan every five years

Implementation Plans are required to contain four elements:

1 A description of the redevelopment agency’s goals and objectives, including housing related goals and objectives for the redevelopment project area

2 A description of the programs and expenditures proposed for the next five years

3 An explanation of how these goals, objectives, programs and expenditures will eliminate blight within the project area

4 An explanation of how the housing-related goals, objectives, programs and expenditures, including the use of housing set-aside funds and an annual housing program, will

implement State affordable housing requirements and replacement housing requirements

The City of Santa Cruz Redevelopment Agency adopted its first Five-Year Implementation Plan onOctober 18, 1994 for the period January 1, 1995 through December 31, 1999 A mid-term review

of the Implementation Plan was conducted by the Agency on October 14, 1997 and a public hearing was held on January 13, 1998 to consider new program opportunities for inclusion in the Implementation Plan A second Five-Year Implementation Plan was adopted on December 7, 1999for the period January 1, 2000 through December 31, 2004, with its mid-term review public hearing held on April 8, 2003

The Implementation Plan has been prepared to include the Affordable Housing Plan

requirements for redevelopment agencies enacted by AB 315 in 1992 and AB 637 in 2001 and

to meet the requirements of the California Redevelopment Law per AB 1290, SB 372, AB 315 and AB 637

IV PLANNING PROCESS

In order to receive public input into the programs and projects for updating the Implementation Plan and to make recommendations to the Redevelopment Agency on the re-adoption of the 1994-

1999 Implementation Plan, the Redevelopment Agency conducted a series of meetings with community organizations including housing providers and neighborhood organizations and

business groups

During 2003 and 2004 the Agency and City participated in several comprehensive economic and housing planning processes Each of these processes was highly participatory and resulted

in development of a wide range of housing and economic development recommendations The 2005-2009 Implementation Plan has incorporated these recommendations where appropriate and, as a result, a duplicative public participation process was not used in the development of the 2005-2009 Implementation Plan The documents which were developed as part of these planning processes include a new Housing Element to the General Plan and an Economic Development Strategy which will be used in the forthcoming General Plan Update Process A brief description of these planning documents and others used in the development of the previous Implementation Plans follows

The Downtown Recovery Plan, adopted on September 10, 1991, was prepared through the Vision Santa Cruz process and provides a framework for public and private actions related to the

rebuilding of downtown Santa Cruz after the 1989 Loma Prieta Earthquake As a specific plan, the Downtown Recovery Plan is limited to various policies and programs relating to the central commercial core of Santa Cruz The Downtown Recovery Plan has been extensively used by the Redevelopment Agency to assist it in guiding the activities of the Merged Earthquake Recovery and Reconstruction Project as it relates to downtown Santa Cruz

The General Plan was adopted in 1992 and establishes a broad range of economic development, housing, and land use policies, which are relevant to both the Eastside Business Improvement Project and Merged Earthquake Redevelopment Project Where appropriate, General Plan goals have been included in the Implementation Plan

C Eastside Business Area Improvement Plan (1996)

The Eastside Business Area Improvement Plan was adopted by the City Council on January 23,

1996 A citizen’s committee comprised of Eastside businesses, property owners and adjacent neighborhood residents prepared the document The Plan establishes a series of goals and

programs to ensure the continued vitality of the Eastside business area The Plan was developed specifically to provide the policy basis for the Eastside business area redevelopment project and,

as such, has been extensively relied upon in preparation of the Implementation Plan as it relates to the Eastside business area

D Beach Area Specific Plan (1998)

The Beach Area Specific Plan was adopted as part of the City's General Plan in 1980 This Plan was amended on October 23, 1998 Both Plans set forth a number of goals, policies and programs

to bring about the economic and social improvement of the beach area Since adoption of the 1980Beach Area Specific Plan, the City has implemented a large number of the recommended programs

of the Beach Area Plan A number of new programs and policies in this plan will be addressed in the 2005-2009 Implementation Plan for long-term Beach Area improvement

E Mission Street Corridor Design Plan (2002)

This Plan was prepared to complement the Mission Street widening and undergrounding projects and provide design guidelines for new development which will occur following these projects The Plan was prepared as part of the work of the Mission Street Widening Task Force and was part of a citizen participation process

The City’s Housing Element as approved by the Department of Housing and Community

Development in 2003 identifies the City’s housing needs and includes various goals, policies, programs and objectives to further the development, improvement and preservation of housing The Implementation Plan has incorporated those aspects of the Housing Element which set goals and objectives for affordable housing

G Economic Development Strategy (2004)

This report profiles the City’s economy and its relationship to City fiscal conditions The report contains various recommendations to address both near-term and longer-term economic

development issues within the City To initiate the process of implementing these

recommendations, the Implementation Plan contains various programs and projects which were recommended in the Strategy and would benefit the Agency’s two project areas

The Implementation Plan consists of the following sections:

 Introduction

 Accomplishments during the past five years

 Economic Development

 Affordable Housing

AGENCY ACCOMPLISHMENTS 2000-2004

This section provides brief descriptions of a few of the public and private improvements supported

or implemented by the Redevelopment Agency during the past five years (2000-2004) These projects cover a wide range of developments from commercial development to affordable housing

A Merged Project Area

Theatre Del Mar - The Agency purchased the closed Theatre Del Mar in June of 2001 from United

Artist Theatre Group The Redevelopment Agency then leased the theatre to a local partnership consisting of George Ow and Barry Swenson Builder, local developers/property owners who took the project on as a community service The Swenson/Ow Partnership in turn subleased the theatre

to the owners of the popular art cinema house, the Nickelodeon Theatre, located downtown on Lincoln Street The Redevelopment Agency/City, Swenson/Ow, and Nickelodeon Theatre shared

in the responsibilities and costs of remodeling the old theatre

The Theatre Del Mar was opened to the public in February 2002 and a Gala Grand Opening was held on March 2, 2002 featuring a screening of the film China Clipper, the first film shown

at the theatre in 1936 The film's lead actress, Beverly Roberts, was on hand for the festivities

Mission Street Widening Project - This project encompassed the widening of State Route

#1/Mission Street from Chestnut to Swift Streets and widened the road by creating two lanes ineach direction between Chestnut and Swift Streets and left-turn lanes at signalized

intersections Construction began in the spring of 2000 and was completed during the spring of

2002 As part of this major construction project the Agency staffed a Public Information Center and a 24-hour hot line providing project activity information to the public, coordinating community issues with construction crews and working with Mission Street businesses to mitigate the construction impacts The Agency is also providing financial support for the undergrounding phase of this project and was well as coordinating the planting of streets along Mission Street

Downtown Alley Projects - In 1994 the Redevelopment Agency began the implementation of

the Downtown Alley Walk Plan with the drafting of the Alley Walk Concept Plan It was recognized in the plan that the downtown alleys played a significant role for businesses and pedestrians in the downtown In addition, the alleys in Santa Cruz have a rich history During the last ten years there have been a series of alley projects which have resulted in transforming the downtown alley system into a web of new commercial store fronts and pleasant spaces

Theatre Del Mar Reopened 2002 Theatre Del Mar 1936

During 2000-2004 the Agency completed three alley projects Birch Lane, Fraser Lewis Lane and Maple Alley.

University Town Center - This project was completed in 2000 and represented a major new

commercial development to anchor the Pacific/Cathcart section of downtown The project contains commercial uses on the ground floor and the offices of the University California Extension onthe upper floors The Agency sold the project developer an adjacent Agency owned lot to assist in assembling a site for the University Town Center

Storefront Improvement Program - This program began in 1994 as a pilot program and has

since been expanded to provide assistance to businesses in both the Merged and Eastside

Projects and particularly in those areas where major public improvement projects were being completed i.e Mission Street and River Street Since its inception it

has assisted over 250 businesses

in both project areas Theprogram provides exterior designadvice to businesses and

commercial property owners andgrant funding to implement the new painting and other façadeimprovements This program has had a marked effect in the upgrading of storefront

appearances along Mission and River Streets, in the Downtown, Seabright/Murray and

Ocean/Barson areas and along River and Coral Streets During the 2000-2004 period, 40 storefront projects were completed in these areas with 20 projects now in progress

Graffiti Abatement - The Agency began sponsoring the Graffiti Free Santa Cruz in 2002

administered by the Santa Cruz Volunteer Center The mission of Graffiti Free Santa Cruz is,

“To maintain the natural beauty of our city by preventing and removing graffiti through

community involvement, eradication, education and enforcement.” The Agency administers a

24 hour hot line through which Santa Cruz residents can report graffiti attacks to support this mission Agency and Volunteer Center staff make every effort to remove graffiti within 48 hours and gang graffiti in 24 hours Over 146 Santa Cruz residents participate in various graffiti abatement programs through this program

Business Assistance - During the 2000-2004 period the Agency continued a wide variety of

business assistance activities including the publication of a downtown promotion brochure

“Experience Downtown Santa Cruz”; maintenance of two bi-monthly space available flyers for commercial/industrial and downtown office space, and an interactive web page at

www.ci.santa-cruz.ca.us/ra

B Eastside Project Area

Rio Theater - The historic Rio Theater,

which is one of the significant landmarks onthe Eastside closed to the public in 1999 and there was fear in the community that

$60,000 loan and storefront improvement grant to the new owner of the theater and it re-openedlate in the summer of 2001 The loan agreement specifies that the theater continue to be

operated as a theater venue for seven years These funds have provided the owner with

resources to invest enough so that the theater has become a venue for community groups and performances The loan and grant funds are being used to assist in interior and exterior

improvements to the building

Auto Dealer Retention - One of the major goals of the Eastside Business Improvement Plan is

to retain and promote the Eastside auto dealers These dealers are both major employers in the City and significantly contribute to City sales tax

revenues During the 2000-2004 time period the

Agency assisted the owners of North Bay Ford in

purchasing the property on which they operate their

business The Agency also assisted in the abandonment

of the southern 120 feet of Marnell Alley to help

consolidate property then owned by RV’s of Merritt

This property is now owned by Santa Cruz Nissan

Dodge

Eastside Triangle Intersection Plan - Agency staff

worked with the Eastside business and residential community to obtain input on a series of engineering design options, which were developed to examine alternate traffic patterns at the Soquel/Water/Morrissey Intersection The traffic engineering firm of Fehr and Peers was retained to assist in this process in developingthe design alternatives and prepare an initial analysis of their traffic impact These designs were incorporated into the consideration of the Soquel Bike Lane Project and are being included in the citywide traffic master plan

Eastside Storefront Program - The Eastside Storefront program was initiated by the Agency in

1994 and since its inception 67 storefronts have been improved along the Soquel Avenue and Water Street Eastside business corridor The program provides a combination of design

assistance andgrants to locallyowned businesses

During the

2000-2004

timeframe10

additionalprojectswere completed As can now be seen, the visual impression one experiences while driving along Soquel Avenue or Water Street is of a vibrant small scale commercial area.This can, to a certain extent, be attributed to the efforts of the Agency, business owners and the assistance provided through the Storefront Program

Affordable housing was a top Agency priority during the 2000-2004 period Responding to the need for increasing the community’s supply of affordable housing, the Agency provided

significant support to four projects which dramatically increased the community’s supply of affordable housing These projects are the 48-unit Nueva Vista affordable housing project at 136 Leibrandt Avenue, 113 units of housing at 1010 Pacific Avenue, 206 housing units at 1280 Shaffer Road and 37 units of affordable senior housing at 211 Gault Street The Agency also purchased and donated property to help facilitate the construction of a 27-unit emergency family shelter at 745 River Street for 27 households

1010 Pacific Avenue 43 very low and moderate rental units 70 market rate rental units

1280 Shaffer Road 83 low and very low rental units123 market rate rental units

136 Leibrandt Avenue 47 low and very low rental units – replacement of substandard non-affordable housing units

1 moderate

211 Gault Street Senior Project 37 low-income units

745 River Street Family Shelter 27 emergency housing household units

Total

190 low and very low rental units

47 replacement affordable units

193 market rate rental

These projects required a substantial and continued commitment of the Agency and its staff As

an example, the Nueva Vista Project was several years in the planning stages A few of the required Agency activities on this project alone are highlighted below:

 The Agency provided either a relocation payment or temporary relocation housing for each of the tenants in the existing 136 Leibrandt Avenue units Twenty-three

households were temporarily relocated during the construction of the new project The

1043 Water Street Before 1043 Water Street After

relocate themselves and not return to the project The Agency complied with the Uniform

Relocation Act requirements in the process

 The Agency approved a security agreement guaranteeing a Section 108

Loan with the U.S Department of Housing and Urban Development for construction costs of the

Beach Flats Community Center at the Nueva Vista Project

 The Agency and City entered into a cooperation agreement through which

the Agency funded City storm drain improvements needed for the project

Each of these projects also has its own unique design

The change in the living environment of the residents of 136 Leibrandt Avenue is clearly

shown in the following before and after photos of that project

The Agency continued funding during the 2000-2004 period to the Santa Cruz County

Community Action Board for the Emergency Rental/Mortgage Assistance which works to

prevent eviction from rental units or mortgage foreclosures of low- and moderate-income

persons or families During this period the program assisted 448 households with 1,145

persons The Agency also funded the Tenant Based Assistance/Security Deposit Program

211 Gault Street Senior Housing 1280 Shaffer Road Market & Affordable

136 Leibrandt Prior Substandard Housing 136 Leibrandt after Replacement Project

which provides the security deposit and last month's rent so persons in transitional housing or homeless can secure permanent housing This program is administered by the Santa Cruz County Housing Authority and over the last five years has assisted 135 households Both programs require City residency.

ECONOMIC DEVELOPMENT

This is the Economic Development Section of the Implementation Plan for the Merged Earthquake Recovery and Reconstruction and Eastside Business Improvement Project Areas As required in California Redevelopment Law, Health and Safety Code Section 33940(a), the Implementation Plan contains specific goals and objectives and specific projects and expenditures for each project area A description is also presented of how the goals, objectives, projects and expenditures will eliminate blight within each project area

Section 33490(a)(1) of California Community Redevelopment Law states that the Implementation Plan shall contain specific goals and objectives for each of the Agency’s project areas The

following section sets forth the goals and objectives for the Merged Earthquake Recovery and Reconstruction Project and Eastside Business Improvement Project Goals and objectives have been derived from the previously mentioned planning documents as well as through the review and hearing process, which took place in preparation for this document Table EP-I provides a matrix linking each of these goals and objectives to the project blight conditions they will assist in alleviating The goals and objectives for the Low- and Moderate-Income Housing Program are set forth in Section C of this Implementation Plan

A Economic Development Goals - General Plan/Merged Earthquake Recovery and

Reconstruction Project

1 Foster economic development programs that provide diverse opportunities for stable,

meaningful work at livable pay, meets retail and service needs of residents and visitors, creates a strong municipal tax base, preserves environmental quality, and enhances the character and quality of community life

Agency Objective: Continue selected recruitment and retention activities of

manufacturing and high tech firms, which provide livable wage employment

Agency Objective: Continue to work with developing software firms and develop a

program for assisting the growth of firms through technical and/or financial assistance

Agency Objective: Continue business information and assistance program

Agency Objective: Establish light manufacturing incubator space

Agency Objective: Develop an Agency revolving loan fund for small business start up

and expansion

Agency Objective: Continue advocacy role on public policies, which impact existing

businesses and employment in the City

Agency Objective: Network with Silicon Valley organizations and with local high-tech

companies to determine current need and other issues of a public/private concern

Agency Objective: Encourage the development and expansion of minority-owned and

minority-served businesses

2 Enhance Santa Cruz's role as a specialty retail and service center within the region and

retain and expand the existing retail and service base

Agency Objective: Identify retailers which will complement the existing retail base and

develop projects/programs to assist in their location within the City

of Santa Cruz

Agency Objective: Assist existing retailers with expansion, advisory services and other

activities, which generate additional retail opportunities and employment

3 Encourage the development of a diverse industrial base that is socially beneficial,

non-polluting, and non-depletive of natural ecosystems and provides jobs for Santa Cruz workers

Agency Objective: Continue to provide information and assistance for industries,

which provide livable wages and wish to locate in Santa Cruz

Agency Objective: Continue to work with manufacturing groups to identify specific

areas where public and private cooperation can assist existing manufacturers to meet new requirements or other activities which lead to new employment opportunities and the retention of existing businesses

Agency Objective: Identify specific activities of government which can meet needs of

industries

Agency Objective: Identify specific industries which may be attracted to Santa Cruz

because of the assets that UCSC brings to the community together with the quality of life assets and provide assistance to such identified industries to locate in Santa Cruz

Agency Objective: Identify and assist research and manufacturing opportunities, which

arise as a result of the Monterey Bay National Marine Sanctuary designation

Agency Objective: Assist in public infrastructure, installation, construction and

reconstruction

4 Encourage the growth of off-season and off-peak tourism by enhancing the City's potential

to attract tourists through urban design improvements, promotion, and development of visitor attractions and provision of a variety of overnight accommodations

Agency Objective: Increase promotion of Santa Cruz Wharf as a year round visitor

recreational location

Agency Objective: Assist in the development of a conference hotel facility

Agency Objective: Continue to explore opportunities to develop an additional full

service hotel in the beach area

Agency Objective: Construct habitat, pedestrian and bicycle improvements associated

with San Lorenzo River Design Plan to enhance access from downtown to the beach area

Agency Objective: Continue infrastructure, transportation and street projects which

link downtown and the beach area to increase off-season tourismfor both areas

Agency Objective: Identify and assist establishment of specialty retail businesses

which serve community and tourist needs

5 Promote revitalization of the Downtown Central Business District as the City's center for

commerce, office, culture, entertainment and dining, and mixed-use residential

Agency Objective: Implement recommendations of the Downtown Recovery Plan

Agency Objective: Continue activities designed to recruit new retail and assist

expansion of existing retailers in the downtown area

Agency Objective: Continue to implement San Lorenzo River Design Plan to ensure the

flood safety of downtown Santa Cruz, improve the river habitat and eliminate flood insurance requirements

B Economic Development Goals — Economic Development Strategy

1 A Welcoming City - Tourism

Agency Objective: Actively pursue and support a Beach Area conference hotel

Agency Objective: Work with developers and the lodging industry to diversity local

accommodations with upscale boutique facilities, all-suite or extended stay, and a larger conference center/meeting facility

Agency Objective: Create a hotel façade improvement program Explore potential

funding sources such as Redevelopment grants or loans, CDBG funds or Planning Department fee incentives

Agency Objective: Promote and support Santa Cruz as an ecotourism and cultural

tourism destination

2. A Place of Innovation – Technology and Manufacturing

Agency Objective: Work with UCSC in order to encourage the development and

retention of new technology in Santa Cruz through the development

of technology incubator facilities and other support ventures

Agency Objective: Identify partnerships and funding sources for Green and Eco

development proposals

3. A Creative Community – Arts, Culture and Entertainment Strategies

Agency Objective: Develop financial incentives for new or expanding arts, culture, and

entertainment businesses and ventures to assist with start up and expansion costs

Agency Objective: Continue to promote the location and start-up of retail and working

galleries in its key economic centers, specifically the Central Business District (Downtown), the Eastside, Mission Street, and the Tannery Arts Center as well as other areas

Agency Objective: Encourage the involvement of the Santa Cruz arts community in the

support of arts related economic development

4. A Unique Shopping Experience – Retail Strategies

Agency Objective: Expand its focus on business recruitment, retention and marketing

with the retention of an Economic Development Coordinator

Agency Objective: Establish a Business Recognition Program that acknowledges

businesses that contribute significantly to the local economy and community

Agency Objective: Develop a signage program to provide better links between

geographical retail areas and to connect visitors with transportation options and parking structures

C Merged Earthquake Recovery and Reconstruction Project Goals — Downtown

Recovery Plan

1 Preserve and enhance the distinctive scale and character of downtown Santa Cruz.

Agency Objective: Facilitate development which adheres to the design parameters of

the Downtown Recovery Plan

2 Improve Pacific Avenue as the downtown's major public gathering place, and as a viable

retailing street

Agency Objective: Continue to promote cultural events in downtown

Agency Objective: Continue to recruit unique and complementary businesses for

kiosks

Agency Objective: Continue downtown hospitality guide program and undertake other

programs to improve public safety in the downtown commercial and adjacent residential areas

Agency Objective: Continue to seek development of performing arts center in

downtown

3 Introduce streetscape improvements on other downtown streets to improve one's sense of

arrival and the cohesiveness of the district

Agency Objective: Continue to implement downtown alley plan and its alley

improvements, sidewalk and lighting improvements, consolidated trash enclosure, undergrounding of public utilities and other amenities where feasible

Agency Objective: Extend streetscape improvements to North Pacific Avenue, North

River Street and Pacific Avenue side streets

Agency Objective: Improve landscaping and layout of downtown public parking lots

Agency Objective: Improve maintenance of vacant, privately owned lots along Pacific

Avenue

4 Concentrate and intensify office development within the downtown.

Agency Objective: Continue to implement a variety of financial assistance programs to

encourage development of office space to offset downtown locational cost disadvantages

Agency Objective: Develop programs to encourage out-bound city and county

commuters to work in downtown

5. Improve vehicular circulation patterns in a way that conveys a feeling of convenience and orientation, and that reinforces the pedestrian character of the downtown

Agency Objective: Continue extension of Streetscape Improvements to Pacific Avenue

side streets

6. Provide convenient and accessible parking in the downtown

Agency Objective: Develop increased public off-street parking for the south of Cathcart

Street area

Agency Objective: Develop a Church Street parking structure

Agency Objective: Assist in enhancement and landscaping of existing off street parking

lot

7. Maintain and enhance the existing system of bike routes within the downtown

8. Provide for the efficient operation of transit in the downtown to reduce the impacts of the automobile and reinforce the pedestrian environment

Agency Objective: Ensure continuation of co-location of Greyhound and transit district

terminals

Agency Objective: Require membership in Santa Cruz Transportation Management

Agency as a condition of agency assistance

9. Strengthen pedestrian and bicycle access to, and movement within, the downtown

Agency Objective: Provide friendly and easy-access bicycle, pedestrian and shuttle

linkages between beach/tourism areas, downtown and the Tannery site

10 Coordinate with existing property owners to resolve problems of exposed garbage areas

through centralized garbage facilities

Agency Objective: Continue development of joint trash collection facilities and

management agreements in downtown

D Merged Earthquake Recovery and Reconstruction Project Goals - Beach/South of

Laurel

1. Implement public/private projects which demonstrate public/private commitments to economic development and infrastructure improvements in Beach and South of Laurel Area

Agency Objective: Develop and implement public/private partnership to assist in

development of a full service hotel

Agency Objective: Provide incentives to existing motels/businesses in the Beach and

South of Laurel area to upgrade their properties

2. Develop plans and projects which redirect beach oriented parking through expanded publicparking sites and improve pedestrian and bicycle accessibility, safety and circulation in the Beach Area

Agency Objective: Explore feasibility of a summer beach trolley system utilizing

existing Santa Cruz Big Tree Railway of-way or other of-way

rights-Agency Objective: Improve pedestrian access, safety and lighting of pedestrian

crossing on Southern Pacific San Lorenzo River Bridge

3. Improve existing and develop new programs which deter crime and improve public safety

Agency Objective: Seek additional funding to increase effectiveness of existing youth

employment programs to ensure proper outreach to beach area youths

4. Improve marketing activities which promote Santa Cruz Beach Area as a "complete" tourist destination

Agency Objective: Assist in increasing management and promotion activities of Santa

Cruz Municipal Wharf

Agency Objective: Assist in sponsorship of cultural, recreational and educational

activities which promote the Santa Cruz Beach Area as a complete recreational destination

Agency Objective: Provide project management and other assistance in the

development of the Monterey Bay Marine Sanctuary Exploration Center

Agency Objective: Develop activities/facilities which make linkage between the Santa

Cruz Beach Area and Monterey Bay Marine Sanctuary

5. Undertake selected infrastructure improvements with improved access to and within Beach/South of Laurel Area

Agency Objective: Continue project management of Corps of Engineers San Lorenzo

River Flood Control and Restoration Project

Agency Objective: Ensure reconstruction of Laurel Street Extension to include

extension of River Levee Beach and Pedestrian Path connection to Riverside Avenue Bridge

Agency Objective: Undertake analysis of public improvements necessary in the greater

beach area and Beach Flats including alley improvements, sidewalk and lighting improvements, consolidated trash enclosure,

undergrounding of public utilities and other neighborhood amenitiesand install where feasible

Agency Objective: Explore feasibility of the Small Business Administration funding

and other financial sources to initiate upgrading of selected beach area visitor lodging and retail serving facilities

6. Undertake projects to improve the gateways to the project area

Agency Objective: Improve the Mission Street entrance to the project area

E Merged Earthquake Recovery and Reconstruction Project Goals

Mission Street Corridor Design Plan

1. Participate in the preparation of a Mission Street Corridor Plan

Agency Objective: Assist in the implementation of the various projects and programs

adopted as part of the Corridor Design Plan for Mission Street

2. Assist in the Mission Street Improvement Project

Agency Objective: Coordinate the public information and outreach programs to

minimize the neighborhood and business area impact of the Mission Street Improvement Project

Agency Objective: Continue Mission Street Façade Improvement Project

F Merged Earthquake Recovery and Reconstruction Project Goals

-Redevelopment Plan

1. To strengthen the economic base of the Merged Project Area through various programs to promote the reconstruction and reestablishment of businesses dislocated or destroyed by the October 17, 1989 Loma Prieta earthquake, to otherwise improve existing businesses and to attract new businesses

2. To assemble land into parcels suitable for modern, integrated development with improved pedestrian and vehicular circulation in the Merged Project Area

3. To provide opportunities for participation by owners and tenants in the revitalization of their properties

G Eastside Business Improvement Project Goals - Eastside Business Area Improvement

Plan

1. Develop a design program, which provides common facade and building design themes for improving visual aesthetics, while retaining the individual character of the area

Agency Objective: Continue Storefront Improvement Program

2. Establish a coordinated strategy for circulation, parking, and streetscape improvements

Agency Objective: Implement plans adopted for the improvements of

Soquel/Morrissey/Water Streets and Benito/Doyle intersections

Agency Objective: Maintain three lane street option for Soquel Avenue Corridor

between Branciforte and Seabright Avenue, described as option 3A

in Eastside Business Improvement Plan

Agency Objective: Initiate development of streetscape plan for section of Soquel

Avenue from North Branciforte Avenue to Seabright Avenue if threelane street option is maintained after one year test

Agency Objective: Acquire and develop additional public off street parking

Agency Objective: Initiate design of utilities undergrounding overhead utilities for the

Water Street and Soquel Avenues

3. Develop a strategy for improving physical and design linkages between the east and west portions of the project area.

Agency Objective: Utilize retail sales information to identify additional retail uses to

serve the Eastside Area

4. Assist in the recruitment and retention of retail business for Eastside Area

Agency Objective: Provide assistance to business to insure their retention or

establishment

Agency Objective: Continue activities to address social problems before they become

intrusive on a daily basis for business, residents and property owners

H Eastside Business Improvement Project Goals - Redevelopment Plan

1. To strengthen the economic base of the Project Area and existing businesses through promotion activities, market studies, and other activities which are deemed necessary to accomplish the purposes of this Plan and to stimulate employment and economic growth

2. To assemble land into parcels suitable for modern, integrated development with improved pedestrian and vehicular circulation in the Project Area

3. To provide opportunities for participation by owners and tenants in the revitalization of their properties

4. To improve the aesthetics of the streetscape through the installation of street trees, facade improvements, undergrounding of utilities and other coordinated beautification activities

To meet the goals and objectives set forth in this plan, the Agency has developed and will develop

a number of programs and projects These programs are categorized below Table I shows the linkages between each of these programs and the project conditions which they address and Table

II shows the estimated 2005-2009 expenditures on these programs

A Downtown Recovery and Reconstruction

The Redevelopment Agency has undertaken a comprehensive set of programs to bring about the post Loma Prieta Earthquake reconstruction and recovery of the City's downtown area

Components of these programs and activities include:

Programs Designed to Eliminate Structural Blight

Facade and Mural Programs

Cooperative Trash Collection Project

Parking Deficiency Fee Assistance Program

Programs Designed to Eliminate Non-Structural Blight

Infrastructure Improvements (sewer, water, storm drain)

Pacific Avenue, Front Street and Side Streets Streetscape

Planter Strip Program

San Lorenzo River Levee Improvement and Beautification

Retail Advisory Services for Recruitment and Retention Program

River Street Improvement Project

Mission Hill Stairs

Programs Designed To Improve Socio Economic Conditions

Downtown Outreach Program

Cooperative Retail Management

Space Available Flyer

Cinemaplex Projects

Software Recruitment Assistance Program

Anchor Tenant Recruitment Assistance Program

Additional programs and projects include the following,

Programs Designed to Eliminate Structural Blight

Utility System Undergrounding

Seabright/Murray Façade Improvement Program

Historic Walls and Stairways

Mission Street Façade Improvement Program

Tannery Arts Center Project

Programs Designed to Eliminate Non-Structural Blight

South of Cathcart Public Parking Program

Bicycle Parking Improvement Programs

North River Street Streetscape Improvements

Pacific Avenue, Front, Cedar and Center Streets and Side Streets Streetscape Improvements

River Access Improvements

Mission Street Undergrounding Assistance

Mission Street Parking and Circulation Improvements

Parking Lot 12 Reconstruction (Metro Center)

Front Street Parking Lot

Streetscape Plan for Front Street

Performing arts venue

Loan to Parking District for Soquel Garage Commercial Space ImprovementsImprovements for public parking in the Town Clock area

Programs Designed to Improve Socio-Economic Conditions

Land Assemblage Assistance Program

Mission Street Business Retention Program

Graffiti Removal Program

Mural Program

Several programs have been implemented to assist in the improvement and revitalization of the Eastside business area These programs include the Storefront Improvement Program, Promotion Program, and Eastside Parking Program Additionally, a number of infrastructure improvement programs will be undertaken utilizing Redevelopment Agency, state and federal funding to bring about necessary street and intersection changes

Programs Designed to Eliminate Structural Blight

Soquel Avenue Utility Undergrounding Program

Storefront Improvement Program

Programs Designed to Eliminate Non-Structural Blight

Acquire and develop additional off street public parking

Restriping of Soquel Avenue between Branciforte and Seabright Avenue –three traffic lanes and two bicycle lanes

Planning and construction of intersection improvements at the Soquel/Benito/Doyle and Soquel/Water/Morrissey intersections

Soquel Avenue Streetscape Plan (Ocean Street to Morrissey Blvd.)

Preliminary Engineering Analysis Soquel/Water/Morrissey Blvd

Intersection Improvement

Programs Designed to Improve Socio Economic Conditions

Retail Promotion Program

Facilitation of Auto Dealership Development

Land Assemblage Assistance Program

Initiate a streetscape plan and improvement project

Graffiti Removal Program

Mural Program

C Beach and South of Laurel Programs

Programs designed to improve the economic and residential condition in the beach area range fromsmall incremental projects to development and planning for major economic improvement The timeframe for many of the proposed projects extends well beyond that of the Implementation Plan.However, the following projects are feasible within the five-year time frame and will be

undertaken by the Agency as part of its beach-related activities Funding for these projects will befrom multiple sources and not limited to tax increment financing

Programs Designed to Eliminate Structural Blight

Motel Reconstruction/Rehabilitation Project

Motel Facade Improvement Program

Development of additional public parking

Beach Area Parking/Commercial Structure

Conference Center Project

Extension of Beach Street promenade improvements to Third Street

Establishment of off-street parking district

Beach Area Streetscape Projects

Programs Designed to Improve Socio Economic Conditions

Youth Employment and Recreation Programs

Retail Promotion Program

Hotel Development Project

Beach Flats public improvements projects

D Industrial Development and Technology Information Design and Development

Programs

The Agency's efforts to enhance the City's industrial base consist of programs ranging from infrastructure improvements to assisting in industrial development bond financing The Agency inpast years undertook a telework center feasibility analysis and determined it was not feasible However, Agency staff continues to actively work to attract and work with existing technology businesses to grow within the City In recent years, Santa Cruz has become an attractive location

to startup businesses in the area of design and development of technology information systems The Agency will assist these emerging businesses over the next five years The Agency will also look for opportunities to assist its businesses in the same manner as it assisted Harmony Foods in

1997 providing financial assistance for new equipment to facilitate retention in the community The Agency will explore Agency-assisted programs and other activities necessary to encourage cottage and incubator business One possible program in this area will be a joint venture with UCSC to determine the feasibility of establishing a business incubator in the former Texas

Instruments building which was recently purchased by UCSC If feasible the Agency will providethe leadership in implementing the program

The Agency will also utilize the City’s Industrial Development Authority which has the ability to issue industrial development tax-exempt bond assistance in the financing of local businesses Wilson Plumbing and Bonny Doon Winery have in past years been assisted with tax exempt financing for the facilities for these businesses As other opportunities arise, the Agency will assist additional local firms One of the important priorities for the Agency working, in

cooperation with the City, is to insure the retention of the existing industrial zoned land for future development opportunities

A significant commitment of staff time was made by the Agency to business recruitment and retention activities Firms assisted range from local corporations as Harmony Foods to small businesses such as Compass Rose and a number of office tenants who are being assisted in remaining/locating in the downtown area through parking deficiency fee assistance It is hard to quantify the impact of these efforts but, to date, Agency assistance has resulted in the creation of several hundred jobs The majority of these are at a livable wage New programs now under consideration include a wide variety of efforts as follows:

Programs Designed to Eliminate Structural Blight

Development of live/work space

Programs Designed to Improve Socio Economic Conditions

Wharf promotion program

First-time homebuyer programs to assist in retention of local businesses impacted by the high cost of housing

Improved business sales data analysis

Small business development and retail counseling and financial assistance

Business Retention Program

Business Incubator Project

Programs to utilize and retain industrial zoned land

F Infrastructure Improvement Projects

The Agency has taken the lead in the management of a number of major infrastructure

improvement projects in the City These include the San Lorenzo River Project and the Mission Street Improvement Project The Agency will continue to provide assistance in this program primarily through developing financing sources and in specific cases providing gap financing or other financial assistance An Agency objective is to seek the undergrounding of utility lines as part of future projects wherever feasible Programs under consideration include:

Programs Designed to Eliminate Non-Structural Blight

Arterial intersection improvements throughout project areas

Utility undergrounding throughout project areas

Street and public stairway lights

Sidewalk Reconstruction

Infrastructure Improvements (sewer, water, stormdrain)

Wharf Signage Program

Downtown Parking Lot Landscaping and Alley Improvement Projects

Mission Street Underground District

Summary

As a final point of review the following chart indicates how the Agency’s programs assist in the alleviation of project conditions (blight) in the Merged Earthquake Recovery and Reconstruction Project and the Eastside Business Improvement Project

Inadequate Public Improvements,

Facilities and Utilities

Traffic Circulation Deficiency

Socio Economic Conditions

Social Maladjustment (Crime,

X= Blighting Conditions Addressed By Program

A Redevelopment Financing Mechanism

Establishment of a redevelopment project area creates the ability of a Redevelopment Agency to utilize "tax increment funds" to assist in financing the project area improvements The year in which a redevelopment project area is adopted, the current assessed valuations of property and buildings within the project area, is designated as the "base year." After plan adoption, all of the taxes paid to various governmental entities on this "base year" go, as they always have, to the various cities, counties, school districts and other taxing entities Any increase in the assessed value over this "base year" of a project area, and the property taxes which result from this

increased valuation, become the source of "tax increment revenue" for the Redevelopment Agency.Both the Merged Project and Eastside Project area receive tax increment revenue Of the

increment revenues available to the Agency, 75% is available for capital/project funding and 25% for low- and moderate-income housing This section of the plan will provide information on the Redevelopment Agency’s financial resources and obligations and a projection of the resources available for projects over the 2005-2009 timeframe

Pass-Through Agreement

The Merged Redevelopment Project has a pass-through agreement with the County of Santa Cruz and Santa Cruz City Schools These agreements specify that approximately 25.2% of the Merged Project Area tax increment revenue be passed through to the County of Santa Cruz

In 1990 and 1991 the City loaned the Redevelopment Agency the funds necessary to initiate earthquake recovery activities Each year the Agency repays principal and interest on this loan The Education Relief Augmentation Fund (ERAF) was established by the State of California and requires redevelopment agencies throughout the state to return tax increment revenues to a special fund to assist California schools The Merged project will continue to contribute into this fund until FY 2006 The Merged Project is also repaying loans to the City which it made to the Agency

post-to assist in the development of the Gateway Center as well as the bonds discussed below

The Agency must also annually meet the payments obligated by issuance of a Tax Increment Revenue Bond in 1989 which was refunded in 1996 and 2004 Bond proceeds were originally used to finance the U.S Army Corps of Engineers Feasibility Study, Riverside Avenue Bridge Design and other Agency activities In 1994, the Agency used a portion of a 1990 Certificate of Participation to help pay the local share of costs for the Beach Street Promenade Project and the Harvey West Pool Building Reconstruction These bonds were refunded in 2004 and will be discussed later in this report

Since the merger of the North Mall Public Improvement Project and the San Lorenzo Safety andBeautification Project into the Merged Earthquake Recovery and Reconstruction Project, a number

of commitments have been made which require annual funding These obligations are outlined inthe Agency’s Annual Budget

v) Administration, Planning, Legal & Financial

The Redevelopment Agency funds its administration and planning activities through tax incrementrevenues Funding pays for personnel costs, supplies, services and other needs necessary to operate the Agency

vi) City Service Costs

accounting to insurance coverage Each year, the Agency must pay the City for these particular costs.

C Eastside Project

The Eastside Redevelopment Project has pass-through agreements with both the County of Santa Cruz and Santa Cruz City Schools These agreements specify that 25.2% of the Eastside project area tax increment revenue be passed through to the County of Santa Cruz and 11.8% of the project tax increment revenue be passed through the Santa Cruz City Schools

The Eastside project will continue to contribute to the State ERAF fund until FY 2006

The City advanced funds to initiate preparation of the Eastside Business Area Plan and other activities designed to implement the Eastside Business Improvement Project Each year payments must be made from Eastside tax increment revenues to repay the principal and interest on this loan

Since the 1990 adoptions of the Eastside Business Improvement Project, a number of commitmentshave been made which require annual funding These obligations include purchase of the property

at 1111 Soquel Avenue and other forms of annually recurring commitments and our outlined in the Agency’s Annual Budget

i) Tax Increment Revenues

Available tax increment revenue is a function of the difference between the total of previous pass through agreements, mandatory commitments, annual costs, project commitments, and available tax increment funding During the 2000-2004 time period a number of events had both positive and negative impacts on available Agency financial resources

ii) Property Valuation Trend (Positive)

Tax increment revenues are influenced by a variety of factors ranging from Agency activities to the general economic conditions within the project area and the greater regional economic market Real estate values increased substantially during the 2000-2004 timeframe This has led to higher valued properties that, when sold, result in increased property tax bills During the 2000-2004 timeframe the valuation of the Merged Project area increased by $174 million or 17.4% Since it isimpossible to tell if this trend will continue, the most prudent course to take in planning

expenditures for the Implementation Plan will be to minimize any assumed revenues which might result from increases in overall assessed valuation This revenue approach has been used as part

of the budget review process in past years and is adjusted annually when actual revenues are known

iii) Property Valuation Trend (Negative)

The Texas Instruments plant located in the Merged Project Area was the single largest assessed value in Santa Cruz County by a large margin Unfortunately, the plant was closed in 2001 and since that time the assessed value of the property has dropped from $125 million to $18 million, a decrease of $107 million The property was purchased in 2004 by the University of California Santa Cruz and is now off the tax roll

iv) State of California Education Relief Augmentation Fund (Negative)

The ERAF Fund was established by the State of California and requires redevelopment agencies throughout the state to return tax increment revenues to a special fund to assist California schools The Redevelopment Agency has been required to pay into this fund an increasing amount of Agency Revenues to help off set the State’s financial deficit Agencies have been told that the ERAF payments will end in FY 2005-06 However, until that time, it is not possible to determine

if in fact these payments will end or simply be decreased

v) Santa Ana Unified School District vs Orange County (Negative)

In past years when the City adopted its redevelopment projects, State Health and Safety Code Section 33676 allowed local school districts to adopt a resolution electing to allocate their share of the annual Proposition 13 two percent (2%) inflationary increase in assessed

valuations Since few of the local districts passed the necessary resolutions, they were not allocated this increase in assessed valuations

The Santa Ana Unified School District v Orange County Development Agency case found a school district could not waive its obligation under Section 33676 of the Health and Safety Code due to the failure to adopt a resolution pursuant to the provisions of Section 33676, and therefore could pass the necessary resolution to receive the 2% annual growth after a project area had been adopted Since this case was decided, all eligible local school districts have filed with the Agency the necessary resolution to receive its proportional share of the 2% annual growth in the Agency’s project areas assessed value The school districts affected by the Santa Ana case include the Santa Cruz City Schools, Cabrillo College and the County Office of Education In calculating the initial payments fiscal year 2001-02 was set as the base year withthe initial payments beginning in fiscal year 2002-03 State Law requires that these funds be used only for capital improvements and the districts are prohibited from using them for

operating expenses

The affect of this court decision case will be to decrease the potential annual growth in Agency tax increment revenues by approximately one percent per year The projected payments during the 2005-2009 timeframe are shown below and assume an annual Proposition 13 two percent increase in property valuations

Fiscal Year Merged Project School

agreements with the County through which the property tax revenues normally received by theCounty without the adoption of a redevelopment project would continue to be received by the County

Property tax revenues are collected by the County as follows:

1 Annual property taxes which are paid each December 10 and April 10

2 Supplemental property tax payments which are paid by the purchasers of property during the tax year which reflect any increase in the property’s assessed valuation after the purchase of the property For example, if a property is currently assessed at

$200,000 and it is sold on April 1 for $400,000 there is a resultant property tax assessed value increase on the $200,000 increase and as a result additional taxes are owed from April 1 to the remainder of the tax year i.e December 31st

Since the adoption of the Agency’s first redevelopment project area in 1984, the County has kept its portion of the annual property tax revenues, as provided by the Agency/County pass-through agreements, but has disbursed to the Agency any supplemental payments received

On April 9, 2003, the County Auditor informed the City of Santa Cruz City Redevelopment Agency and all other redevelopment agencies in the County that it had developed a software system to separately account for supplemental property tax payments and would henceforth start to retain the County’s share of supplemental tax revenues The letter further stated that the County intended to recover its share of the supplemental property tax payments already disbursed to the Agency since July 1999

Since this notification the County has kept its share, approximately 25%, of all supplemental property tax payments and the Agency through negotiations agreed to repay the County

$125,470 in 2004 and 2005 for the County’s share of supplemental property taxes paid to the Agency since 1999 In turn, the County agreed to return to the Agency in each of these years

$25,000 for deposit into the Agency’s Low- and Moderate-Income Housing Fund

Since it is not possible to predict the amount of supplemental property taxes paid each year it isnot known what the exact future impact of this County action will be except that less revenues will be forthcoming to the Agency For example in FY 2001, during the height of real estate transactions in the Agency received approximately $400,000 in supplemental property tax payments, with the County action the Agency at that time would have received $100,000 less insupplemental property tax payments

vii) SB39X — Emergency Redevelopment Legislation (Negative)

The financial framework for the Merged Earthquake Recovery and Reconstruction Project was established through state legislation (SB39X) passed in 1990 This legislation mandated that the Redevelopment Agency not utilize the County of Santa Cruz portion of the tax increment

generated by the Merged Earthquake Recovery and Reconstruction Project The legislation also adjusted the base year valuations of the existing redevelopment project areas to compensate for theloss in assessed valuation due to the demolition and destruction of buildings as a result of the Loma Prieta Earthquake A sunset period was established for this base year valuations through a formula utilizing the Consumer Price Index Consistent with the requirements of SB39X, the Agency executed an agreement with the County of Santa Cruz through which the County of SantaCruz portion of all future tax increments (25%) are returned to the County of Santa Cruz The

sunset provision was reached for the first project area in 1995 and since then the earthquake adjustment has been gradually eliminated and will be completely eliminated by 2005 and 2006 When the sunset period is eliminated the Agency will no longer receive the additional $130,000 in annual tax increment revenues provided through this adjustment.

viii) Property Tax Appeals (Negative)

Each year various property owners file tax appeals contesting the valuation of their property In most cases these cases are settled in a manner which does not dramatically affect Agency finances.However, with real estate prices at all time record highs it is probable that an unexpected

downturn in real estate values could lead to a larger number of appeals This issue is speculative

at this point; however the recent successful appeal by the Santa Cruz Seaside Company shows the potential adverse property tax appeals can have on Agency finances In this case the property tax valuation of the Boardwalk was decreased by approximately $19 million which translates into a loss of Agency tax increment revenues of $142,000

ix) Grants and Leveraging Mechanisms (Positive)

As an independent governing body, the Redevelopment Agency has the ability to apply for and receive grants and other forms of financial assistance from other governmental and private entities.Following the Loma Prieta Earthquake, the City of Santa Cruz Redevelopment Agency

aggressively pursued a wide variety of grant funding for both the Agency and City projects Since

1989, the Redevelopment Agency has received 12 grants amounting to $4.5 million to fund

projects ranging from the Cedar/Locust Parking Structure to the Tannery Reuse Project The Agency since 2000 has also received $5.2 million in grants and Flood Control Subvention Programreimbursements from the State of California for the San Lorenzo River Safety and Environmental Restoration Project

Given the new limits on available tax increment financing the Redevelopment Agency will

continue to aggressively seek financial assistance during future years

The following budget has been prepared in light of the numerous decreases in the Agency’s financial capability over the last five years and the probability of slower future revenue growth The program expenditures below are for new and continuing project expenditures exclusive of debt service for existing bonds, owner participation agreements and other Agency financial

agreements The listed program expenditures are current estimates and may vary depending on actions or events not known at the time of the Implementation Plan preparation Future variations will not require a plan amendment

Table II

Five-Year Implementation Plan

Estimated Program Expenditures

January 1, 2005 - December 31, 2009

Economic Development1 $100,000 $100,000 $100,000 $100,000 $100,000Mission Street Project 150,000 150,000 150,000 150,000 150,000Downtown Recovery &

Reconstruction2 325,000 175,000 175,000 175,000 175,000Eastside Improvement2 30,000 30,000 100,000 100,000 100,000

1) Administrative/Legal/Planning/Financial costs only

2) Includes obligations for various infrastructure and public improvement projects in these

categories and includes Downtown Recovery and Reconstruction projects

The Economic Development Section of the Implementation Plan for the City of Santa Cruz

Redevelopment Agency describes the various programs and projects which are proposed to be undertaken during the next five years to assist in the alleviation of project conditions (blight) existing in the Merged Earthquake Recovery and Reconstruction Project and the Eastside BusinessImprovement Project These programs and projects, however undertaken, are recommended with the understanding that circumstances and situations constantly change For this reason, the Implementation Plan will be reviewed periodically and amended to reflect changing priorities and situations