Mayor Jerry Dyer, Fresno leaders must overcome new threat to downtown revitalization | Opinion

Remember the childhood game of lining up dominoes, then pushing one over and having the rest all fall down in a cascading blur?

Unfortunately, Fresno Mayor Jerry Dyer just experienced a real-life domino effect, and it is no laughing matter.

The first domino to fall is the state budget. Gov. Newsom and the Legislature are now trying to figure out how to plug a multibillion-dollar deficit in California’s budget for the next fiscal year. Newsom pegs the deficit at $26.7 billion; AP reports it is closer to $45 billion, given spending decisions already made.

As a result of that shortfall, the state is trimming spending wherever possible. Here is where the next domino falls for Fresno: The governor had originally awarded the city $250 million to pay for downtown revitalization. Already in hand is $50 million. But Newsom just told Dyer that he is now deferring $200 million of that allocation for two years. The news hit Dyer hard.

“This delay in funding, coupled with prolonged street closures from high-speed rail construction, is devastating our downtown and Chinatown revitalization efforts,” Dyer said when announcing the funding delay.

Opinion

Dyer told Bee staff writer Tim Sheehan that a one-year delay had originally been announced, and the city was able to absorb that change.

“But I was shocked to hear there would be the possibility of a second year of it being deferred,” he told Sheehan. “The reason is we had ramped up our hiring for our Capital Projects Department, and we have a lot of things in motion in terms of planning and pending contracts. Now those things are possibly going to have to be put on hold, which means we can’t continue with construction.”

Unfortunately, until either Fresno develops significant revenue to pay for projects on its own — an unlikely prospect, given the city’s economic mix — or the state changes how it collects taxes, which also seems a longshot — the yo-yo effect of state budgeting will continue. Yo-yos and dominoes are fun for kids, but not elected leaders like Dyer.

Downtown funding takes hit

The state budget swings up and down because a large share of tax revenue comes from California’s wealthiest residents. When their investments suffer downturns, tax revenues fall and so does the state budget. That, in turn, hurts cities counting on help from Sacramento to pay for local projects.

Los Angeles Times columnist George Skelton reported how capital-gains taxes on the state’s rich made up 25% of all the personal income taxes collected in 2021. A year later, capital gains fell to just 13% of total personal income taxes. That represented an $18 billion drop in capital-gains revenues.

Taxes of a different kind are what city leaders like Dyer hope to get more of from a revitalized downtown.

Dyer wants 10,000 people to live downtown — 3,000 do so now. He believes those residents would then inspire the opening of new restaurants, breweries, bars and shops. Property and sales taxes would be generated, and the new businesses would also lure visitors from elsewhere in the city back to downtown, leading to even more sales and tax generation.

But nothing of significance can be accomplished until boring but important work gets done. Fresno’s water and sewer lines downtown are too old to handle the stresses new development would bring. In some spots, the lines are 100 years old.

Replacing utility lines is expensive and beyond the wherewithal of private builders, which is why downtown has been stuck without much new development.

Dyer’s ‘forever’ investment put off

Perhaps Fresno leaders can turn to Rep. Jim Costa, the Democrat in Congress who represents the city. Maybe there is money remaining from the $1 trillion infrastructure act promoted by President Biden and passed on a bipartisan basis in Congress in 2021. Or there might be other revenues more suited for what Fresno needs.

It is easy to get discouraged, given the new delay in funding. After all, money not in one’s bank account can be grabbed by someone else.

There is also the reality that the costs of materials and labor steadily increase over time.

Newsom’s announcement just over a year ago to devote $250 million to help Fresno rebuild its infrastructure was characterized by Dyer as “an investment that will transform the downtown area forever.”

A year later, that forever seems that much farther off.

What cannot be in short supply is political will. Dyer and the City Council must remain steadfast in improving downtown and in holding the governor to his promise for funding. As Dyer has often said, Fresno’s future vitality is at stake.