Community Redevelopment Agency of the City of Banning

In 2007 the redevelopment agency floated a bond issue that netted approximately $24 million to fund projects in the redevelopment area. The official statement listed three general categories of planned expenditures: revitalization of downtown, economic incentives and public improvements. Little specificity was included in the official statement. Investigation revealed that the redevelopment agency board had not formulated detailed, prioritized plans for the use of the proceeds.

Testimony revealed that the city’s and the redevelopment agency’s planning and project implementation have been hampered by key employee turnover. Since 2008, three city managers have left, and a fourth is scheduled to begin work in February 2010. Since 2004 five community development directors/consultants have come and gone, and the sixth is now in place. Since 2004, four redevelopment managers have left, and the fifth is now in place. Additional investigation revealed that allegations of micro-managing have been leveled against members of the city council/redevelopment agency board.

One of the programs of the redevelopment agency is called Façade Improvement. Property owners are given grants or forgivable loans to improve the exteriors of their buildings in the project area. It was found that the redevelopment agency board has committed funds for improving the appearance of vacant, unrented property while ongoing businesses are made to wait for assistance.

Onsite visits and sworn testimony revealed East Banning to be a blighted area in need of priority attention from the redevelopment agency. There is a paucity of sidewalks, streetlights and parks. Old furniture is strewn about the neighborhood; trash and weeds are plentiful. Aside from some low-income housing expenditures, the redevelopment agency has neglected this blighted area of the city.

Redevelopment agencies are required by law to prepare five-year plans. The 2004-2009 Banning plan notes the need for an additional staff person to assist the one agency employee devoted exclusively to redevelopment. Deadlines have been missed, and programs and contracts have not been monitored and administered adequately. Without the additional person or the hiring of outside consultants, the plan notes, “it is not probable that the agency will be able to implement the programs and projects in the time periods identified herein.” 2

In July 2009, the redevelopment agency bought property in the western side of the city without acquiring its own independent certified appraisal. Witnesses testified that the price paid, $1,200,000, was above market value. Since the purchase, the redevelopment agency board has budgeted an additional $800,000 to make the property more desireable.

On August 4, 2005 the city council voted to give the Alliance $10,000. In the course of the next four years, the city council and the same people acting as the redevelopment agency board voted to give the Alliance a total of $806,503.08 in public funds for a variety of uses (see appendix for a breakdown on the funds). On August 21, 2006, the first and largest contract between the redevelopment agency and the Alliance was approved for $343,000 over a two-year period. While this contract called for the Alliance to stage arts and cultural events, it also required the Alliance to perform specific redevelopment activities. The following redevelopment activities were never performed: development of a downtown Property-Based Improvement District (PBID) and a campaign to market Banning with advertising on billboards, radio, television and infomercials.

The first two contracts, covering the period between 2006 and 2009, followed the same format. The Alliance was given a check for the total at the beginning of the each contract year. The agreements contained no means to measure success or failure of the efforts by the Alliance, and they contained no criteria to determine whether the obligations were indeed fulfilled.

An examination of the relationship between the Alliance and the redevelopment agency revealed a willingness by the board to fund the group without any measure of accountability, without measures of success or failure and without demands for return of funds not spent on contractual obligations. No other outside organization in Banning has been treated this way by the board of the redevelopment agency. 3