L.A. Council locks up $1 billon in redevelopment money that the governor wants for state budget

Worried that state lawmakers will soon sign off on Gov. Jerry Brown's plan to shutter redevelopment agencies to help balance the state budget, the Los Angeles City Council voted Tuesday to tie up more than $1 billion in redevelopment money.

On the same day that voters were going to the polls to fill seven open council seats, the council approved a series of property transfers, financial commitments, housing loans and consulting contracts favored by Mayor Antonio Villaraigosa's appointees at the Community Redevelopment Agency.

Councilman Herb Wesson urged his colleagues to safeguard the money before state lawmakers act on Brown’s proposal. “What we are attempting to do is protect assets that are valuable to us,” he said. “If we do not act and they do, we will regret it.”

Councilman Paul Koretz voiced doubts, asking redevelopment officials if they were rushing to spend the money. And Councilman Paul Krekorian complained that he and his colleagues had been given too little time -- less than 24 hours -- to digest dozens of complicated financial proposals.

"I haven't had any opportunity whatsoever to start to get up to speed on this and consider this -- and frankly, none of us have," said Krekorian, who along Councilman Greig Smith voted against the transfer of funds.

Tuesday's debate was the latest in the ongoing political struggle being waged cross the state. Supporters of the city’s redevelopment agency, including nonprofit groups and affordable apartment developers, said it should continue its mission of using property tax revenues to provide homes and amenities to low-income neighborhoods.

Critics said too many of the city’s redevelopment projects were financial giveaways to politically connected businesses. They argued that redevelopment deprives schools and hospitals across the state of scarce tax revenue.

“What you're doing is protecting a slush fund for the wealthy, and that's a crime," said Ron Kaye, a former newspaper editor who is now an organizer with L.A. Clean Sweep, which is trying to elect newcomers to five council seats.

The meeting occurred one day after state Controller John Chiang released an audit stating that several redevelopment agencies lack oversight and use affordable housing money in improper ways. But employees of the redevelopment agency, some of them fighting back tears, told council members that they had worked hard to try to improve blighted neighborhoods.

Councilman Richard Alarcon said redevelopment had cleaned up contaminated sites and created hundreds of housing units in his district. But he agreed that Brown was succeeding in a campaign to make redevelopment agencies "a bogeyman" in the eyes of taxpayers.

The council allocated up to $930 million for scores of projects recommended by the redevelopment agency. That money would, among other things, preserve $35,000 available for security cameras in Reseda, $1.6 million for the renovation of a shopping center in North Hollywood and $50 million for a proposed skyscraper on Grand Avenue in downtown Los Angeles, according to a report submitted Monday to the council.

In a series of other votes, the council moved another $103 million, including loans for affordable housing projects and an extension of existing contracts with up to 19 law firms.

Kelly Martin, a lawyer for the redevelopment agency, described Brown's proposal as "unnecessarily punitive" and said the city would respond with a lawsuit.

"We will surely challenge it, as will others around the state," she said.

-- David Zahniser at Los Angeles City Hall

Comments

[Think123]

Funny, how these councilpeople, including Mr. Wessonoil, deems it his money or the city's money. This is taxpayer money fellas and gals. Using it to grease the palms of your supporters (aka union thug labor and developers) is just not right. How about giving some of it back to those who paid the taxes? Of course, you'd think they'd do something stupid like buy food and pay bills. Its not your money, just remember that. The schools would be better off with it than your scams and schemes to line pockets of those who don't deserve it.

[Get Planted]

Sleazy, sleazy, sleazy. That's like a wife or husband hiding their assets during divorce proceedings, and should be just as illegal.

This will do nothing to help Los Angeles, it will merely enrich a few sleazy developers. It does, however, make it more difficalt for the State to resolve its financial difficulties.

Let's find out which City Councilmembers voted for this and lets

THROW THE BUMBS OUT!

[jr]

This was a smart move by the city. Why would you give up money in your control and give it to the state unless the state can be trusted to make the best use of the money.....oh yeah the prison guards need a raise.

[mvjr]

take it alway jerry brown city hall they all are crooks

[James Andrews]

Lock the money up and then ask the taxpayers to vote for higher taxes. ARE THEY NUTS?

[dcompton]

Who is going to share in the sacrifices necessary to get the State back on track? The answer from the LA city council is "the other guy". What's new?

[Anonymous Citizen and off duty LAPD cop.]

The City is in the middle of an unjustifed financial crisis. They furloughed civilian employees at their discreition and have not promoted, cut overtime, and going after public safety employee pensions, meanwhile there is a billion dollars in a City Account known as the CRA Funds. This money can be used as an enticement for business people to invest in our city, but these investors continually get reduced taxes, free building permits, and we wonder why the revenues must always be balanced on the backs of the Angelinos who pay trash, water, etc.....enough is enough City Leaders!

[Paul Espinoza]

It's not too late to get your fingers in the billion dollar pie! The way Los Angeles spends money without oversight leads one to surmise that the developers were behind this all the way.

Moonbeam's not going to get my graft money! I've connived enough and that's worth at least 25% without anything to show for it!

[Ricky Bobby]

This is exactly why these on the council need to go. You have 15 minutes left to vote!

[Miki Jackson]

Let the lawsuits begin.

This meeting was not a legal meeting. Everything done there may well be reversed by an inevitable lawsuit/s.

They wound up having to do this so half a**ed because they held the first CRA meeting without obeying the Brown Act. Caught in the act by community activists they had to re-do the CRA meeting Monday. By then they got wind of the deal with Yaroslavsky and feared Brown could freeze the money this Thursday - so the clock was ticking. Even though today was election day and there was push back from Council, there was no choice - they had to do it today, with or without the legal niceties. It became a renegade "special meeting". Real special.

CRA employees showed up, their jobs are on the line. The deals cut by CRA honchos hung the rest of the workers out to dry. You could say their jobs were "eminent domained for private gain" by the CRA. Workers took it in the chops again.

So now we proceed to the modern LA Bleak House of attorney enrichment. CRA mastermind attorney Murray Kane has already gotten a jump on this by getting $700,000 of that CRA money, for his legal "services". You see, the lawyers win no matter what. It's only us suckers who lose.

[steve rodriguez]

While Chinese cities build, build and build, Los Angeles shows no growth or progress!

[Fred]

"The council allocated up to $930 million for scores of projects recommended by the redevelopment agency. That money would, among other things, preserve $35,000 available for security cameras in Reseda, $1.6 million for the renovation of a shopping center in North Hollywood and $50 million for a proposed skyscraper on Grand Avenue in downtown Los Angeles, according to a report submitted Monday to the council."

Wow, how utterly short sighted. And what a waste of money. 1.6 million for renovating a shopping center? Really? shouldn't the shopping center owners be doing that? a 50 million dollar skyscraper for who, for what?

And more affordable housing loans and law firm contracts. Great, spend spend spend because if you don't, you'll lose the money.

Everything I've read seems like a waste of money and tax payer dollars.

[Lezlyee]

Immediately after last years budget was "Revenue Gapped", I saw it with my own two eyes and ears, the City got rid of the Furniture Fund as recommended by the Mayor, reluctently -- then renamed it something else.. to fool the public.

Then when I saw the same 10 million Trolly request on the CRA_LA list, I sensed a moral issue, a conscience effort after prior failures. I think a trolly would be great. However, these ventures make money but the money is never refunded to its Citizens .. profit is made by investing public tax dollars with private contractors, business and realestate owners, to build maintain and operate (consumer products and services). On top of which another tax subsidary is provided by the City as other incentives at tax payer costs.