CRA/LA revenues come from property “tax increment,” a portion of the property taxes collected in a redevelopment project following the date of project adoption. Property tax increment is the increase, or increment, in the amount of property tax that is the result of the positive effects of redevelopment. State law requires that 20% of the tax increment be deposited into a Housing Trust Fund for low- and moderate-income housing. CRA/LA has increased its contribution to 25%. In projects adopted after January 1, 1994, approximately another 20% of the tax increment is returned to other taxing entities, including the County, City, School District and Community College District. In some pre-1994 redevelopment project areas, there are also agreements that provide some incremental tax funds to be returned to other taxing entities.
The CRA/LA does not set tax rates or collect taxes; those functions remain with the County for properties within or outside redevelopment areas. The CRA/LA also obtains grants from a variety of sources, including the City’s Community Development Block Grant (CDBG) allocations, federal Economic Development Administration (EDA) programs, the Los Angeles County Metropolitan Transportation Authority (MTA) “Call for Projects,” and bond programs such as Propositions A, C and K for transportation and parks projects.