Judge to Decide Legality of San Marcos Project

A Vista Superior Court judge is expected to rule today on the legality of a San Marcos redevelopment project predicted to generate tens of millions of dollars for the city but being challenged on grounds that two neighborhoods within the area are not blighted, as is required by state law.

The plaintiff is Jack Leach, an Escondido resident and businessman, who argued that the city erred when it included in the redevelopment the area around the new Cal State San Marcos campus and an area around the proposed trash-to-energy plant.

Neither area is physically or economically blighted, Leach maintains, and should be removed from redevelopment plans.

John Morris, an attorney for the city, argued Tuesday before Judge Terry O’Rourke that both areas are considered economically blighted by the city because of the extensive financial commitments faced by the city in making the area developable.

But Leach’s attorney, Jeanne MacKinnon, countered that because a $250-million trash plant is planned for one of the redevelopment areas and the new state university is already under construction at the second, neither area should be considered economically blighted.

Leach said he has pursued the lawsuit since 1985 because of his concern that, given redevelopment financing techniques, county taxpayers as a whole will be penalized as San Marcos reaps the financial benefits.

State redevelopment laws allow a city to declare an area in need of redevelopment if it meets certain “blight” criteria, and then to sell investment bonds to finance improvements.

The bonds are repaid as that area’s property value increases, and the additional tax revenue generated by those public improvements and the subsequent private development is returned to the redevelopment agency instead of being diverted to other taxing agencies, such as local school districts and the county.

Leach is a longstanding opponent of the proposed trash-to-energy plant in San Marcos, but said the intention of the lawsuit is not necessarily to try to derail plans for that facility.

Rather, he said, his opposition is because the two redevelopment areas are expected to generate about $60 million in new property tax revenues that will be funneled to the city of San Marcos over the next 25 years or so. He feels that much of that money should be allowed to flow instead to county and school coffers.

City officials argue, on the other hand, that the area will not develop as planned without the city’s help with the installation of streets, sewers and other public works that would be paid for by redevelopment funds.

“The lack of sufficient infrastructure constitutes blight,” said Morris. “The land can be vacant and still be blighted if the property is economically unattractive to developers. That area can’t be developed without redevelopment funds.”

But MacKinnon argued that development plans are already under way for both neighborhoods, absent the assistance of the redevelopment agency, and that the city’s inclusion of the two neighborhoods is intended to allow the city to capture property tax revenues at the expense of other public agencies.

San Marcos has plans to redevelop 1,800 acres altogether, of which about a third are in the two neighborhoods being challenged by Leach. He is not contesting two other redevelopment project areas.

O’Rourke said he expects to reach his decision today.