LOS ANGELES (CNS) - A Los Angeles City Council committee today approved the framework of a policy to govern the funding and operation of resident-financed districts to pay for community projects in specific neighborhoods.
The policy reviewed by the council's Budget and Finance Committee would oversee enhanced infrastructure financing districts, or EIFDs, which are intended to finance local projects in select communities.
Under the framework, money for such districts would be raised by redirecting a portion of homeowners' property taxes to the proposed projects, such as waterway improvements or development of low-income housing.
Officials from the city's Chief Legislative Analyst office said the districts would not actually increase people's property taxes, but a slice of the annual increase in property taxes would be placed into an independent fund governed by a five-person board -- three mayor-appointed council members and two members of the public appointed by the council. The oversight board would be called the public finance authority.
In 2015, Councilmen Mike Bonin and Curren Price filed motions to establish EIFDs, one aimed at funding improvements in the Los Angeles River and the other to pay for specific projects in Venice. Creating such a district would need the approval of property owners in the affected area.
"We still have multiple steps to take before the policy is finalized, any particular district is created and before any of the projects are studied and analyzed. This is only the framework policy," said Councilman Paul Krekorian, who chairs the council's Budget and Finance Committee. "What we're voting on doesn't even apply to the (Los Angeles) River project. This is a citywide policy that we're enacting, and everything else will be a separate action that will be taken consistent (with the policy)."
Krekorian said he wants to see how such districts would affect the city's tax revenue, since it would divert some funds to district projects.
Los Angeles County could be a partner in some of the districts, and CLA officials said cooperation with the county could be taken into consideration during feasibility studies.
"The whole idea, the intent of the state law, was to be able to do careful planning and sound investment for projects that otherwise would not come into reality," Councilman Mitch O'Farrell said at the committee meeting.
"I know for the Los Angeles River, that's certainly a concern. We know what we want to do, but we need more than (patchwork funding)."
When asked about how much certain districts would be able to fund, CLA officials said that would be revealed in feasibility studies.
The proposed policy will have to be reviewed by the full City Council.
Rocio Rivas, president of the Historic Highland Park Neighborhood Council, said the local council formally opposed proposed financing mechanisms of the Los Angeles River project, since there was no detailed EIFD policy, boundary map, a list of proposed projects and has not been subject to a public hearing.