The only way Vern Loyola knows how to describe his experience with a redevelopment agency is to relate it to his early years as a student."It reminds me of when I was in school and there always was a big bully who would come and push you around," he said.
Loyola is a partner in a 44-year-old poultry processing business that was condemned recently to make way for a hospital expansion included in an RDA project.
Several of his South Salt Lake neighbors were affected, too. They say they were running profitable businesses before the redevelopment agency stepped in, first made an offer to purchase their businesses, then condemned them - further examples of how the original intent of city RDAs - to improve, or "redevelop" truly blighted areas - has often not been followed in actual practice.
"It's like this," Loyola said, describing his ordeal. "It's like if I went to you and said I wanted your home because I needed to build a hospital. You figure your house is worth $80,000, and I offer you $20,000 and say if you don't take the offer, I'll condemn you.
"I wish I had the big money behind me. Then I'd say, `Put your hospital somewhere else. We're going to expand, instead.' "
The South Salt Lake business owners are not alone in their contempt for redevelopment agencies.
In West Jordan, residents fought last year to keep their aging homes that were targeted by an RDA.
In Salt Lake County's Union Fort area, residents are threatening to incorporate as a city, partly because they don't want the county's redevelopment agency to have its way.
In Salt Lake City, Bob Nelson, the owner of a downtown magazine shop, has become a champion for redevelopment fighters. He endured years of legal battles to keep his business, despite being condemned and watching neighboring businesses vacate all around him.
Finally, he won. The city eventually bought him out for $2 million.
School districts, too, have joined RDA opponents because property-tax incentives granted to businesses by RDAs mean substantial loss of revenue for education.
The wave of anti-redevelopment sentiment has spread even to the state's remote regions. In the tiny town of Hyrum in Cache County, City Council members were surprised in November when a group of residents confronted them and demanded citizens be allowed to vote on a proposal to form a redevelopment agency.
This year, the chorus of complaints is being heard by state lawmakers. They are expected to pass laws that significantly change the way redevelopment agencies function. (Details on B2)
Created in the 1960s to battle urban decay and blight, redevelopment agencies have the authority to purchase sections of land that meet the blighted designation, freeze property-tax rates on that property and offer the land for little or nothing to businesses.
The new developments are intended to increase the value of the formerly blighted land so substantially that eventually it will mean an increase in property taxes, and the agencies use the extra property taxes paid by the new businesses to cover the costs.
In theory, school districts, counties and other governments that rely on property taxes will benefit once those costs are paid and the new businesses are adding more taxes into the till.
But those governments complain that the benefits never come. According to a legislative audit released in 1991, redevelopment agencies take an average of just under 20 years to retire debt.
By then, opponents claim, inflation has claimed most of the benefits and whatever was built is old and obsolete.
Redevelopment officials argue that the new development wouldn't have occurred without their help, and that schools, therefore, have lost nothing. They say the agencies make it easier to attract businesses that wouldn't come on their own, and everyone benefits from the jobs that are created.
Redevelopment opponents counter that development, in a free market, will happen naturally when market forces are right. And, in some cases, existing companies take advantage of RDA incentives to close tax-generating businesses and merely relocate.
It's an argument as old as redevelopment agencies themselves. But even some redevelopment officials concede it's time to build bridges across the gulf separating local noncity taxing entities and the agencies.
Alice Steiner, director of the Salt Lake City Redevelopment Agency, said she supports a measure that would require her to get approval from a committee of school, county, city and legislative officials before proceeding with a project.
"The level of information and the committee in and of itself would accomplish a lot," she said.
But Steiner and other redevelopment officials bristle at a bill proposed by Rep. Reese Hunter, R-Salt Lake, that would take away the agencies' power to condemn property.
"Every time we try to do something without eminent domain (the power to condemn), it is expensive to the taxpayers," she said, adding that people tend to take advantage of governments, thinking they have a lot of money.
Hunter's bill, she said, would be a transfer of wealth "from the public to people who haven't been maintaining their property." Hunter's bill is only one to be considered by the Legislature this session. A more detailed measure has been developed by a committee that studied RDA issues extensively.
Bob Bacon, who runs a small video and broadcast supply company in South Salt Lake, disagrees strongly with Steiner's assessment. His property was condemned, even though Bacon said it isn't blighted.
"No government has the right to steal from property owners," he said.
Reese, who has failed to get sufficient support for similar bills in the past, said he thinks redevelopment agencies have strayed far from their original purpose - restoring blighted neighborhoods. He said Utah has little need for that.
"I see some old houses here, but I don't see what you have in large cities elsewhere in the country," he said. "They've used this (redevelopment) for everything, including the Jazz arena.
"You have government and politicians determining development, rather than nature. Sooner or later, you'll get hurt. I'm a firm believer in the laws of nature and in supply and demand. When we interpose greed, then we pay for it."
But while Hunter's bill may not pass, lawmakers likely will make it tougher for agencies to prove an area is blighted. In the past, some agencies, such as one in Park City, have carried the definition of blight so far they condemned farmland.
Lawmakers also are likely to establish separate rules for agencies promoting economic development as opposed to redevelopment.
A bill sponsored by Rep. Kevin Garn, R-Layton, would remove the option for pursuing condemnation in cases where RDA development is judged to be purely for economic development, not redevelopment of run-down areas. It would also make it tougher to declare eminent domain in cases of redevelopment. But some power of condemnation is likely to remain. And that means controversies will continue.
In South Salt Lake, the fight likely will end up in court.
Business owners there said they would have sold their properties had the redevelopment agency offered them what they considered a fair price.
Jonnalyne Walker, director of South Salt Lake's Redevelopment Agency, said she had to condemn the businesses because the agencies have only seven years to use condemnation powers after starting a project. Time was running out.
She said the condemnations were done as a precaution. She intends to continue negotiating with Bacon, Loyola and the others for a fair purchase price.
But the business owners are determined not to back down. They have hired attorney Craig Adamson, one of the attorneys who helped defend several downtown Salt Lake merchants, including Nelson, the magazine shop owner.
Adamson said he has a solution for redevelopment agencies. Instead of buying out property owners, the agencies should move them to a new property, paying all the costs.
"Some of these people are living in small houses," he said. "You give them money, but it's not enough so they can move to a new place. Heaven knows how many of them will end up on public assistance."
Not everyone is angry about their experience with redevelopment agencies. Sometimes, agencies make everyone happy while revitalizing neighborhoods.
In Magna, the Salt Lake County Redevelopment Agency offered loans of up to $20,000 or more to business owners who wanted to improve the looks of their property in the town's decaying center. If the owners keep the place for at least three more years, the loan will be forgiven.
Mike Retford, chairman of Magna Community Council, said the program has changed not only the way downtown Magna looks, but the image many people have of the place. New facades are up. Street lights reminiscent of the early 20th century are in place.
Most of the buildings that were boarded shut a few years ago now are open. A few of them were torn down. A mini-park was built, another one is planned, and parking has replaced some of the buildings.
"Of all the redevelopment projects, this is a classic example of taking Main Street and turning it around," he said. "We haven't seen a huge economic impact so far, but we're coming around."
But the county's agency didn't have to condemn anyone's property. As long as redevelopment areas have to move people, they will have enemies.
"We have immense powers that have to be used very carefully," said Walker, head of South Salt Lake's agency. "We will always be under criticism, because we are dealing with people's property rights.
"But you have to look at the betterment of the whole community."