East Palo Alto Redevelopment Agency (EPARA) is a component for financial reporting purposes of the City of East Palo Alto (City of EPA). The EPARA was established by an act of the City Council in July 1990. Prior Grand Juries were concerned with the source and increasing amount of funds required by the EPARA as "start-up" funds for the Gateway 101 Retail Center. In response to this concern, the 1999 Grand Jury has investigated the financial status of this program.

Several parcels of the Gateway 101 Retail Center development were sold with escrows closing in December 1998. Building construction and store openings for the Home Depot, Office Depot and Good Guys were completed by the summer of 1999. Additional sites are under construction or under contract at the time of this report.

Adjacent to the Gateway 101 Retail Center, the University Square Housing development of 219 new single-family and 129 multi-family units is in the site development phase. The model homes are under construction. This development has partially relieved the shortage of funds noted by prior Grand Juries. A multi-million dollar bond issue is intended to provide funds to repay the City of EPA, County of San Mateo, Sequoia High School District and Ravenswood City School District for advances and loans made by them. Part of this plan is a guarantee for repayment of these bonds during the initial years by the Packard Foundation. The City of EPA is contained within a 2.5 square mile area and has a limited population base which has limited its tax revenues in the past. The new development will provide an additional source of sales tax income and, eventually, additional property tax income.

The University Circle project on the west side of Highway 101 is near implementation, with plans to develop 15,000 square feet of retail space, a 230-room hotel, three six story office buildings and an amphitheater using developer financing.

The Ravenswood Industrial project is a long-term project to enlarge the present industrial area as well as provide a city center.

The City Council of the City of EPA and the Board of Directors of EPARA have been successful in obtaining assistance for financial and site planning from professional organizations and foundations and have listened to community input in the preparation of future planning.

Recommendation 35

The San Mateo County 1999 Grand Jury recommends that the San Mateo County 2000 Grand Jury continues to monitor the progress of the planned developments by the East Palo Alto Redevelopment Agency.