It has been a very difficult year for much of the world, and the City of Redondo Beach was no exception.
The coronavirus pandemic required us to act quickly to adjust operations to ensure uninterrupted delivery of essential services while maintaining the health and safety of City staff. Much of the City’s planned and routine work was upended as we redirected our efforts to assist our businesses through this crisis by issuing special grants and developing accommodations for outdoor services like dining and fitness facilities.
As a consequence of Safer at Home orders, we also relaxed parking regulations for both residents and businesses alike and suspended street cleaning for a period of time.
As of this writing the pandemic is worsening, and we continue to reassess all of the above and more.
Due to significant interruptions to City revenue as a result of the pandemic, the City was forced to adopt an amended budget with a forecasted $8 million reduction (approximately 8%) in annual revenue. Most of the decrease in revenue was the result of declining Transient Occupancy Tax (hotel bed tax), which is entirely dependent on the number of hotel stays in Redondo Beach.
These receipts were reduced from $9 million last year, to less than $3 million this year. Sales tax also decreased by $1 million. The loss of these important revenue sources has resulted in a significant strain on the City’s budget.
To balance the budget, the City took the difficult action to freeze, temporarily defund or eliminate 30 full-time positions that were left unfilled — roughly 7% of the City’s total workforce. Additionally, the City deferred the purchase or upgrade of certain scheduled vehicle and information technology equipment and utilized available capital reserve funds.
The City specifically avoided using its typical economic contingency and pension reserve funds to balance this year’s budget so we could ensure a financial cushion for next year, as it is expected it will take at least two years for City revenues to fully recover from the impacts of the pandemic.
Capital improvement and redevelopment
One budgetary bright spot this past year was the City’s continued investment in capital improvement projects.
The City completed 20 projects for a total expenditures of approximately $21 million — one of the largest annual expenditures in our history (it should be noted that roughly 90% of those expenditures are from State and County funding sources). Some of the completed projects include the resurfacing of Inglewood Avenue, the new Veterans Park playground and fitness court, as well as smaller projects like the Main Library elevator.
Many residents are interested in the progress of the redevelopment of the Galleria, a 1.6 million-square-foot project that was approved in January 2019. I reached-out just this week to John Alderson, executive vice president for QIC, the owner of the South Bay Galleria, to discuss their plans, and his response was as follows: “We are well into architectural design and are planning for a phased approach. It is important that we maintain flexibility, especially in this COVID environment. We expect to break ground in January 2022 to redefine the gateway to Redondo Beach. Expect a complete remodel of the existing mall while we implement hotel, office and residential uses concurrently.”
This is great news, and because of an appeal of the project by Redondo resident Doug Boswell, the City Council required, as a condition of approval, 20% of their residential development be low-income affordable units, more public open space, a skate park, and $2 million for upgrades to Artesia Boulevard. If successful, this new development will become an important upgrade to our town, as well as a major source of revenue growth for the City.
AES power plant saga
The future of the AES power plant property saw a roller coaster ride this year.
The new owner of the AES power plant offered to sell half of the 50-acre AES power plant site to the City for public uses for $2 million per acre after remediation. The City immediately began writing grants and conducting outreach to various agencies to raise these funds.
Within a few months, Redondo Beach was awarded a $4.8 million grant by the California Natural Resources Agency to jump start acquisition of a portion of the property, and the State Coastal Conservancy set aside $500,000 in grants to support planning services for 25-acres of land including property located under the SCE power lines that run from the AES Plant to our border with the City of Torrance. These power lines will be coming down when the plant is permanently retired.
In addition, the Los Angeles County Board of Supervisors voted unanimously to move forward with forming a special financing district for this site, which will divert significant property tax revenue from the County back to the City for development of public amenities, including restoration of on-site wetlands and coastal open space.
Unfortunately, despite a valiant fight mounted by the City, the residents and every nearby agency, the California Water Resources Control Board allowed for one-year extension for operation of the AES power plant, which was due to retire at the end of this year.
As a result of this extension, and the possibility of more, the new owner of the power plant site withdrew his previous offer to sell 25-acres to the City for public uses due to the very financially lucrative prospect of continued extensions to operate the power plant.
This saga is to be continued, including litigation of a lawsuit the City filed jointly with the City of Hermosa Beach against the California Water Board for violations of the California Environmental Quality Act when making this decision.
Regardless, we are hopeful the power plant extension will only be for one year, and redevelopment of this site will again be under consideration. Thanks to Measure DD and our City Charter, any rezoning of this site for uses other than public utility or park will require a public vote per our City Charter.
Residential development and homelessness
Your State legislature has spent the last three years passing bills to strip local communities of their control over how much residential development gets built and where. SB902 was one such bill that would have nullified the requirement for voter approval of any rezoning of the AES site. I was a designated opposition speaker to this bill, and it was later pulled from consideration.
SB1120 would have required cities all over California to split single-family parcels into two. Coupled with new State laws mandating two accessory dwelling units on single-family lots, this bill would have rezoned our single-family neighborhoods from one to six on a lot. Along with many other cities in California, we plan to continue to fight the centralized land-use planning efforts coming from Sacramento.
Homelessness and affordability challenges continue, and Redondo Beach has responded with numerous efforts including construction of 15 temporary housing Pallet shelters and other services to get people in need off the streets and back on their feet.
The City has a dedicated frontline homeless outreach counselor and instituted the first outdoor homeless court in the County. As mentioned above, we required 20% of the 300 new apartment units as a condition of approval for the Galleria redevelopment.
The State should be working collaboratively with cities to respond to the affordability crisis, not taking a broad brush to the entire State of California with new housing legislation that is insensitive to local impacts.
Harbor development and public safety
The Harbor and Pier have been in a holding pattern due to the numerous lawsuits filed by Redondo Beach Waterfront LLC., but we are starting to press forward.
Parking structure maintenance continues, and the Harbor Commission will soon be developing a Recreational and Amenities Plan will define, among other things, where the new sport fishing pier and boat ramp will be. This time we will ensure recreation is the center of harbor revitalization.
The coronavirus has accentuated how critical harbor recreational uses are to the City. While many recreational facilities were shut down, residents and visitors flocked to the harbor to boat, kayak, and SUP — excellent socially-distanced activities.
Our most important services are our fire and police.
Both departments have continued to provide top-notch services under extreme pressure from the pandemic, as well as personnel reductions to balance our budget. They labored through Safer at Home orders, curfews and great uncertainty.
Don’t hesitate to just simply thank them on the street when you see them. It’s their job, but all of our front-line workers deserve our respect and appreciation for persevering through this difficult and dangerous time.
In closing, vaccines are rolling out and we can now see a light at the end of this pandemic tunnel — but the tunnel is still very dark. As of this writing, our hospitals are hitting new records daily of COVID-19 patients sick enough to be hospitalized. Most are now in the 20 to 49-year-old demographic.
The holidays are here and according to frontline staff at our local hospitals (who are extremely overworked), holiday gatherings are the main cause of this deadly surge.
I wrap-up this year-end message with the best of wishes for a fulfilling holiday season and New Year, but also with this Japanese haiku from a Redondo resident. Hopefully it saves some lives.
We isolate now
So that when we gather again
No one is missing