Rail may temporarily cost Fresno Co. governments tax revenues

The Fresno BeeJuly 10, 2012 

Fresno County governments stand to lose $2.8 million a year in property tax revenue after the state finishes buying land for high-speed rail, a new analysis says.

The drop in tax revenue, though, is expected to be temporary.

Assuming the rail project proceeds as planned, Fresno County Assessor Paul Dictos anticipates that property values will rise as new homes and businesses take shape near the line -- in possibly 15 or 20 years. That, in turn, will generate additional property tax revenue.

"This will more than make up for the loss," Dictos said Tuesday. "But we have to wait, and we can't be sure for how long."

The California High-Speed Rail Authority is expected to buy 5,800 acres in Fresno County to create a thoroughfare for trains that will make the proposed 520-mile trip between San Francisco and Anaheim, according to the Assessor's Office.

The 5,800 acres, which would be tax exempt, would reduce the county's total tax base by about half a percent, or $281 million, the assessor estimates.

The resulting loss in property tax revenue would be spread among cities, special districts and the county government.

The county's share of the reduction is projected to be about $390,000 annually.

County Administrative Officer John Navarrette says it's too soon to worry. With the project's timetable in flux, he's not expecting any immediate problems. And, he's counting on future gains in property taxes to offset initial losses.

Several developments could serve to boost property tax revenues. A train station in downtown Fresno would likely attract neighboring shops, restaurants and other businesses. A proposed rail maintenance yard in the county would lure related industries.

"Anytime you build this type of infrastructure, you're going to take out homes and businesses," said Supervisor Henry Perea, referring to recent county freeway projects, such as Highway 180. But "you have the value added of businesses that relocate and property values going up."

The state also plans to sell back much of the land it buys, which means property will return to the tax roll, according to the assessor. Rail officials need only a narrow corridor for the rail line, in most places, but in order to create that corridor, they often must buy much larger parcels.

Rail officials expect to buy property and break ground on the first 130-mile stretch of the project, between Chowchilla and Bakersfield, late this year or early next year.

The reporter can be reached at (559) 441-6679, kalexander@fresnobee.com or @KurtisInValley on Twitter.

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