Not So Fast! Five Things That Need to Change to Make EIFDs Work Better for California Cities

Image courtesy of the American Planning Association

Image courtesy of the American Planning Association

Despite a lot of recent talk about Enhanced Infrastructure Financing Districts (EIFDs), no EIFDs have been formed yet. Before the first EIFDs are created, I hope we can improve the legislation. How, you ask? Here are five ways I’d change EIFDs today:

1.    No mandatory meetings with taxing agencies. The law requires you to meet with your local taxing agencies as part of the process of formation, even if you have no interest or desire for them to participate. For the sake of streamlining, this requirement should be dropped.

2.    Don’t make us send the plan to the entire district prior to formation. An EIFD plan will be a beast of a document – including an EIR, financing plan, and infrastructure program. It seems ridiculous to kill a few hundred trees, burden the backs of our mail carriers, and rival the phone book as the thickest document to be tossed in the recycling bin.

3.    Compel certain special districts to participate. There are exceptions, but a number of special districts see their property tax cash as supplemental funds to offset charges for services. Sacramento needs to take a hard look at the property taxes that some of these districts collect and compel the wealthier ones to participate at some minimum level.

4.    Reduce administrative duties, even centralize them. If you want to provide a tool that works, make it easy to administer. We estimate that each EIFD will cost at least $100,000 a year to administer, which will likely be more than the cash flow in the first few years.  Most cities don’t have that – Sacramento could reduce this cost by simplifying or even centralizing administration.

5.    Eliminate the CEQA review requirement.  Many projects will require project-based CEQA reviews or are covered through some program-level CEQA review. CEQA for financing projects never really made sense – and this should be dropped before it’s even started here.

Written by Jim Simon, a Principal at RSG