Los Angeles faces intersecting regional challenges: a humanitarian crisis on our streets, underfunded infrastructure and a nearly $1 billion budget deficit. At a time when public dollars are stretched thin and political will is being tested, we must turn to bold, innovative financing tools that allow us to meet these challenges head-on.
That’s why our coalition is urging the Los Angeles County Metropolitan Transportation Authority’s Board of Directors to advance the formation of an Enhanced Infrastructure Financing District (EIFD) to fund the undergrounding of Phase 2 of the Southeast Gateway Line – an investment that will not only deliver critical transit infrastructure but also serve as a powerful new tool to address the city’s fiscal and humanitarian crises.
The EIFD model is fundamentally different from traditional funding approaches. After redevelopment agencies were dissolved in 2012, Senate Bill 628 was passed two years later to establish EIFDs, which expand where tax increment can be captured from and what projects can be funded.
Subsequent legislation has only added to the ways EIFDs can be leveraged to address numerous public policy priorities. At its core, it signals a strategic alignment between the public and private sectors, centered around one clear principle: investing in communities equitably.
To date, EIFDs have been formed in nearly every major city in California. San Francisco is funding 2,600 housing units and 1.8 million square feet of commercial use at the Potrero Power Station. San Diego is financing the construction of a new sports arena and thousands of homes in the Midway District. And Sacramento is funding public infrastructure improvements for UC Davis’ new Aggie Square Innovation District. Transformative, regionally impactful projects with high price tags have now become possible.
How to use in L.A.
In L.A. County, EIFDs have been established in West Carson, La Verne and Palmdale, among other cities and unincorporated areas. Los Angeles, especially in this moment, needs to be next.
In this case, the City of Los Angeles identifies the Arts District – along the Alameda Corridor – as a high-priority redevelopment zone. The private sector responds to that signal, channeling investment toward housing, infrastructure, and mixed-use development. In turn, the increased property tax revenues generated by that growth are reinvested – through the EIFD – into the very systems that uplift our communities: transit, housing and homelessness solutions.
At its core, an EIFD is not a subsidy or giveaway: it is a smart reinvestment strategy. By capturing the value created by development catalyzed by Phase 2 of the Southeast Gateway Line, we create a self-sustaining funding loop.
An Alameda Corridor EIFD equals infrastructure dollars that don’t have to come out of the city’s general fund. It generates capital to build a world-class transit line. And it invests directly in Skid Row housing and homelessness interventions. But most of all, an Alameda Corridor EIFD equals economic empowerment for residents who’ve long been cut off from opportunity.
L.A. at a turning point
Los Angeles is in a defining moment. We are three years out from hosting the world during the 2028 Olympic and Paralympic Games. Recent wildfires and our growing unhoused population have revealed the fragility of our systems. And our municipal budget faces serious headwinds.
Against this backdrop, the Southeast Gateway Line and the EIFD that supports it represent a new model – one where infrastructure builds more than transit; it builds fiscal resilience and economic inclusion.
The Alameda Corridor is uniquely positioned for this kind of value-capture strategy. It is home to vast, underutilized parcels – ready for transit-oriented development that does not displace residents. With the DTLA2040 Community Plan already approved, the groundwork is laid for dense, walkable, and inclusive growth.
By undergrounding the Southeast Gateway Line’s Phase 2 – from the Santa Monica Freeway to Union Station – we avoid the community disruption that often comes with above-grade alignments. Instead, we unlock a future of equitable access, increased safety, and high-quality design that benefits all Angelenos.
Our coalition, the Solutions Alameda Coalition, brings together labor, business, transit, social services and community groups. We may not always agree, but on this we are aligned: Forming an EIFD to fund the undergrounding of this line is not just good infrastructure policy – it’s good fiscal policy. It’s how we invest in a city that works for everyone, even in hard budget years.
The Metro Board has an opportunity this month to do something rare – deliver a project that strengthens our budget, serves the most vulnerable, and positions Los Angeles as a global model for equitable urban investment. Let’s seize it.
Ernesto Medrano is executive secretary of the LA/OC Building and Construction Trades Council; Amy Turk is chief executive of the Downtown Women’s Center; and Claudia Oliveria is president of the DTLA Chamber of Commerce. All three are board members of the Solutions Alameda Coalition.
