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City to study feasibility of redevelopment expansion
Targeted areas could be source of new tax revenue
By Daniel Hindin
Sunnyvale City Council on July 26 authorized a study to amend the city's present redevelopment plan and expand the original project area.
The study will include a spectrum of sites for possible redevelopment, with emphasis on areas in north Sunnyvale.
"Most of these areas were already studied as possible redevelopment areas in the early '90s," said Mary Bradley, Sunnyvale's director of finance. "A lot of them won't be in the final redevelopment plan, but it doesn't cost much to include them in the study, so we might as well look at them all."
The study will cost the city $100,000, which Bradley considers small change compared to the amount of money involved in these properties.
The largest single area targeted in the study includes a large L-shaped area bordered by Fair Oaks and Mathilda avenues to the east and west and Caribbean Drive and Highway 101 to the north and south. This area is surrounded on three sides by the light rail. It is just to the east of many high-tech businesses that employ thousands of workers.
Moffett Field also is located in the vicinity of the study. Moffett could have as many as 15,000 new workers within the next few years should proposed expansion and redevelopment plans of NASA/Ames Research Center officials come to pass.
City officials say creating new businesses in the area could greatly decrease potential traffic problems caused by the influx of new workers. Local high-tech workers, employees at the new 797,000 square-foot Yahoo headquarters currently under construction, and future NASA/Ames Research Center employees will all work within a half-mile walk from this potential commercial center. For those employees who don't want to make the walk, officials say the center would be just two stops away by light rail.
However, none of the areas in the study can be added to the redevelopment plan unless they are found in sufficient conditions of blight, Bradley said. "We can't just add them to the plan because it would be good for the city."
Another purpose of the study is to evaluate the potential of increased tax revenues that can be collected during the life of the redevelopment project.
According to Bradley, the limit on taxes collected was set at $118 million in 1986, as part of an amendment to the original 1975 redevelopment plan. This limit, however, was based on no new construction in the downtown area. If the limit is not increased, Bradley said, the city of Sunnyvale stands to incur a large debt.
"Sunnyvale already has a current debt because of the town center mall project in the 1970s," says Bradley. The debts are expected to be paid back through taxes that the city collects. However, Bradley says, if the city does not increase the amount they can collect in taxes, the debt would have to be paid back from the city's general fund. An action like this could take away from many other spending plans the city has in its current budget, she said.
Another way the city can increase revenue is to reinstate its eminent domain authority on nonresidential properties, which expired in 1999. "This means that the city can purchase private, commercial property from business owners in order to collect more taxes," says Bradley. "The owners don't mind because they receive substantial tax benefits." Despite the potential for reinstating the powers of eminent domain, Bradley emphasizes, "the city has never used this power and it's highly unlikely that we will use it in the future."
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Sunnyvale, California Since 1994
