When California eliminated local redevelopment agencies last year, there was one little agency – sitting in the shadows of the Capitol – it skipped.

The Capitol Area Development Authority, a state and city redevelopment enterprise, was spared because its authorizing legislation is separate from the now-defunct state redevelopment law.

But, it now turns out, CADA is not immune to state budget woes. Following a 2011 gubernatorial directive, CADA officials this month will unveil a 12-year plan to largely close down the agency's development operations and sell off a handful of state properties around the Capitol. The proceeds would go to the state general fund.

CADA officials say they hope their agency will remain useful as a manager of affordable housing projects in the Capitol area, and that it might find ways to continue supporting development.

"The challenge for CADA is to make sure the (redevelopment) goals and objectives are maintained" for the still-emerging South Capitol neighborhood, said Wendy Saunders, who will take over April 1 as CADA executive director. Saunders, a former economic development director for the city of Sacramento, lauded the 35-year-old development agency for methodically bringing the neighborhood back to life as a live-work area.

CADA was formed by the state and city of Sacramento in the late 1970s to redevelop empty and blighted state-owned land around the Capitol, and also to add affordable housing for state and downtown workers.

The self-sustaining agency has funded projects through revenues from its rental properties. As redevelopment agencies once did, it also is able to capture a share of increased property taxes in its development area to fund projects. The agency has sold or granted state property to private developers, as well.

"CADA has done a fabulous job of knitting together the fabric of downtown Sacramento," Saunders said. "It has become a model of sustainable development that I think the Governor's Office ought to be bragging about nationwide.

"They brought in workforce housing for every income level, and they brought retail to the core when no one was doing that."

The CADA zone is a roughly rectangular area bounded by L, S, Fifth and 20th streets. It's now home to a Safeway complex, restaurants, nightclubs, apartments, loft housing and new streetscapes.

CADA is self-financed, mainly through rental and tax increment income. It manages 210 affordable apartment units it built or helped finance, and has developed 136 other affordable units managed by other entities.

The agency is working with developers on an artists' lofts-style project on R Street at 11th Street that will offer 86 affordable apartments and about 30 market-rate units. It also has a project under way at 16th and O streets that will provide 84 market-rate units.

The CADA plan, to be unveiled at a public forum March 22, will indicate how many more affordable housing units and other development projects the agency hopes to build or finance before its development days come to a close.

CADA officials said they also will reveal which of their current properties they propose for sale, and which they hope to keep. CADA officials say they do not have an estimate yet of the value of those properties.

"This is just a snapshot of what we think we can do," CADA board chairwoman Ann Bailey said. "We have tried to put together a plan that is real. We'll see what people think of it."

Under its originating legislation, the agency is scheduled to dissolve entirely in 2042, officials said.

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