As you know Cerritos got its start from the dairy farms. When the 605 Freeway was first opened I remember looking down on cows on the east side of the freeway in the South Street area. Practically the whole city was put into a Redevelopment Project Area when the property tax base was cow pastures. Thus, almost all of the city's portion of the property tax increase goes to the Redevelopment Agency, not to the General Fund. Remember, it is the cities' General Fund that pays for the fire and police services, and the multitude of other public services cities must provide. The Redevelopment Agency, on the other hand, uses its "income" as incentive to lure new businesses to town by one sort of subsidy or another-land value writedown, off-site improvements, direct building subsidy, reduced parking requirements, etc.
It should be noted that many of these new businesses are in direct competition with businesses already in town, perhaps some of long standing. The old or existing business gets nothing except a new competitor that can sell for less or make more profit because of the subsidy from the Redevelopment Agency.
The usual argument to counter this giveaway is that the new subsidized business brings in new sales taxes for the General Fund. This is true on its face, but not true in practice. While it is illegal to directly rebate sales taxes to stores now, a cute way around this law is to say "an amount equal to the new sales taxes generated." Many Redevelopment deals made today give to the carpetbagger of choice in lieu rebates of an amount equal to the newly generated sales taxes.
This was the deal when Stonewood enclosed their mall and is now in most redevelopment deals. So these wonderful new revitalization projects not only give away the property taxes to rich, usually out-of-town developers as incentive subsidies, but also give away the new sales tax equivalent that would have gone to the General Fund that supports the city services.
It should also be pointed out that this diversion of taxes in Redevelopment Project Areas also diverts money away from K-12 schools. School budgets are divided into two main categories--operating expenses and capital expenses.
The operating expenses are made up of teacher salaries, light maintenance and general overhead. The amount of money diverted from the property taxes for Redevelopment projects is backfilled (made up) by the state. One might think this money is free, but obviously it is not. It's generated from your state taxes. So you are paying for your schools twice-once on your property tax bill (which is then diverted) and once on your income tax bill.
The capital side of the school budget is for new buildings and major rehabilitation. This money is not made up by the state which is why our schools have fallen into disrepair and more bond measures are required. As contrasted to Redevelopment bonding which requires only a majority vote of the Redevelopment Agency (usually the councilmembers), the two-thirds vote necessary for school bonds is very hard to get. This leaves the school buildings on the short side while the fat cat developers walk off with the golden eggs.