Grow southeast, Fresno. Tax-sharing deal sets course for city’s next housing push | Opinion
What do government officials and college students have in common?
Both groups can show surprising urgency when faced with a deadline.
For the better part of five years, Fresno County and the City of Fresno demonstrated no particular haste to renew their tax-sharing agreement for new development – even though every plot of land slated for annexation into the city limits since the previous one expired had to be individually negotiated. Multiple housing projects (both infill and on the outskirts) were either delayed or stalled as a result.
Now, both municipalities are in a mad dash to get a deal approved before Santa slides down the chimney. After the lengthy stalemate, why now? And what’s the rush?
First to take up the mantle was the Fresno City Council. During a Dec. 13 special meeting called with scant notice, council members voted 6-1 to approve a Memorandum of Understanding with the county that will set the course for the city’s growth over the next 15 years.
Fresno County is expected to add its stamp Friday, in another special meeting, after Tuesday’s anticipated vote by the Board of Supervisors got pushed back 72 hours due to the threat of litigation over insufficient public review.
Fresno City Council President Annalisa Perea, who helped negotiate the new agreement, called it “a game-changer” in the city’s effort to generate more housing.
“While we have made great progress when it comes to housing and providing additional homeless resources, we are not building housing at the rate in which we need to properly serve our residents in our city at every income level,” Perea said.
Broadly speaking, the new tax-sharing agreement computes more favorably for the city than the previous one. That’s particularly true if and when Fresno moves ahead with the Southeast Development Area (SEDA for short), where 45,000 rooftops are envisioned for nearly 9,000 acres of rural dwellings and farms mainly east of Temperance Avenue.
Under the old deal, Fresno County received 62% of the property tax revenues from newly annexed developments while the City of Fresno got 38%. After complaining their share didn’t cover the costs of providing roads, utilities and emergency services, city leaders let it expire in August 2020.
The new agreement gives the City of Fresno a 51/49 majority share for SEDA, while Fresno County gets a 60/40 majority share for other undeveloped areas within the city’s sphere of influence (largely west of 99).
Arias: Southeast growth ‘incentivized’
From these pie charts the conclusion is clear enough: Fresno’s next great suburban frontier lies to the southeast because that’s where the city gets a larger slice of property taxes that comprise 40% of the general fund.
“This feels to me not like a tax-sharing agreement but more a sprawl-sharing agreement in that the City is essentially being incentivized to sprawl to the east while leaving behind some of the already developed and approved plans in the northwest and southwest,” said Fresno City Councilmember Miguel Arias, who cast the lone dissenting vote.
Arias was also the only city elected to publicly question the necessity of a special meeting and obvious hurry to get a deal done.
Fresno Mayor Jerry Dyer attempted to renegotiate a tax-sharing agreement in 2021 during the initial months of his administration. Those talks broke down – rather abruptly – when the former County Administrative Officer described the city as a financial “drag” on the county, according to multiple people in the room.
During the Dec. 13 special meeting, Dyer said “the political environment was different then than it is today” and described the latest negotiations as a “time-consuming and expedited process” during which multiple versions of the agreement were passed between the two parties “in a single day as of late.”
Why the rush? It seems fairly obvious county officials didn’t want this to drag into January when two-fifths of the Board of Supervisors get replaced by Fresno council members who may influence (from the county’s perspective) a worse deal than what can be struck now.
“It’s that old saying, elections have consequences,” said Luis Chavez, who will move from City Hall to the Hall of Records alongside colleague Garry Bredefeld. “I think myself and Councilmember Bredefeld winning our elections set the stage for more collaborative efforts. We hope to continue that.”
SEDA cost concerns remain
It is important to note, and multiple council members took pains to point out, the new tax-sharing agreement does not automatically pave the way for SEDA. That will require separate discussion. Nor will it cover the infrastructure costs and ongoing services for a planned mega-development several times larger than Madera County offerings Riverstone and Tesoro Viejo.
“For those with concerns about SEDA, this doesn’t change those concerns that we can’t pay for it,” Councilmember Nelson Esparza said.
How much will it cost to bring city-standard water and sewer lines, plus electricity and improved roads, to 9,000 undeveloped acres between Fresno and Sanger?
Arias, during the Dec. 13 meeting, floated a range between $500 million and $4 billion. Fresno City Manager Georgeanne White said a more specific figure would be released to the public within 90 days.
Before Fresno can grow in any direction, the city must first address deficiencies in its environmental review process for new construction as mandated by a state appellate judge. But the new tax-sharing agreement makes abundantly clear where suburbia is headed next.
This story was originally published December 18, 2024 at 1:44 PM.
