A property owner’s battle to gain access to the Hollywood Boulevard business improvement district has landed in court and on the floor of the General Assembly.

The matter could mean an era of more open business at BIDs, as well as spell the end of the Hollywood Entertainment District Property Owners’ Association.

The tussle started in 1998 when the property owners’ association, which runs the business improvement district, expanded the BID’s boundaries by 12 blocks and included the 5,000-square-foot Artisans Patio at 6727 Hollywood Blvd., owned by Aaron Epstein.

Epstein, generally a supporter of the district he credits with putting Hollywood Boulevard on the verge of a comeback, argued that his new $3,000 assessment meant he was being charged twice for street and sidewalk cleaning, since he was already paying an assessment to the Hollywood and Vine Assessment District for cleaning of the Walk of Fame. Epstein didn’t want to be charged by the Hollywood Entertainment District for sidewalk and graffiti-removal services.

But what really rankled Epstein was the district’s decision to award, without competitive bidding, a contract to Burke Executive Security & Investigations to patrol the 12-block area between McCadden Place and Gower Street.

BID board meetings are closed to the public, and while Epstein prevailed upon the association’s board to plead his case in person, the board told him that he could only attend if he agreed to leave the meeting after speaking his piece.

Epstein wrote letters to the board asking members to change their exclusive rule and open up their meetings. The board was not ready to change its rules, so Epstein sued.

The complaint was denied initially, but the California Court of Appeals for the Second District last month found that the property owners’ association is a legislative body and therefore subject to California’s Brown Act, which requires that when a majority of members of a public body meet, they must do so in public.

Since Epstein started making waves, the board has opened up its meetings to all BID members, but maintains that complete public inclusion is outside the scope of its purpose because property owners in the district assess themselves.

Epstein’s actions prompted former city Councilwoman Jackie Goldberg, now a state assemblywoman, to introduce legislation to better define the role of, and restrictions on, business improvement districts. That would, among other things, exempt the boards from the Brown Act. Goldberg could not be reached for comment last week.

The association is nearing the end of its initial five-year term, and Executive Director Kerry Morrison said it is petitioning the City Council for a two-year renewal. If Epstein’s legal challenge regarding public access to board meetings succeeds, new disclosure requirements would likely cause most association members to withdraw, essentially dissolving the organization, Morrison said.

Since the BID is enabled by city legislation, Morrison said, the City Attorney’s office had decided to take the appellate court’s decision to the state Supreme Court. The fate of the district could ride on whether the Supreme Court accepts the case and whether the Legislature approves Goldberg’s bill.

Also riding on those outcomes is roughly $110,000 in legal bills. The appellate court ordered the property owners’ association to reimburse Epstein for his legal costs, which he said amounted to $55,000. Morrison said the association has spent about the same amount.

More Property, Fewer People

The news didn’t seem to jibe last week.

Conexant Systems Inc., a semiconductor manufacturer headquartered in Newport Beach, spent $4.63 million to buy two parcels on Mitchell Road in Newbury Park, then turned around and announced it was laying off 1,500 employees.

Gwen Carlson, the company’s director of public relations, said the acquisitions were long-planned and part of a long-range strategy. There are no plans for the two parcels, which cover 2.5 acres next to Conexant’s wafer fabrication facility. On one of the parcels is a 43,600-square-foot industrial building, which Conexant bought for $3 million from the Stone Family Trust. The building’s tenant will stay, Carlson said, and Conexant will collect rental income until it decides its long-range plan.

Downtown Life

In more good news for downtown L.A., TrizecHahn Corp. has two new tenants for its 7th & Fig retail development at the Ernst & Young Plaza.

As people and businesses are increasingly considering downtown as a place to settle, there soon will be a new place to gorge on red meat and a nearby place to work it off.

Gold’s Gym and Arnie Morton’s of Chicago are the latest tenants to sign up at the 2.25 million-square-foot mixed-use project formerly known as Seventh Market Place in the one-time Citicorp Plaza.

Arnie Morton’s of Chicago is a part of the New York-based Morton’s Restaurant Group known for its large servings. Usually called Morton’s of Chicago, this restaurant will have a different name to distinguish it from Morton’s Restaurant, the Beverly Hills eatery owned by Peter Morton.

The Gold’s Gym location will be the third franchise for the Banos brothers of the San Fernando Valley. Angel and William Banos have Gold’s Gyms in North Hollywood and Hollywood. Their Cole Avenue location in Hollywood has a membership approaching 10,000, the most of any Gold’s Gym, according to publicist Silvie Bordeaux.

Bordeaux said the downtown location would be the first Gold’s Gym with a full-service spa and will feature Pilates (essentially yoga with fitness machines). Also planned for the gym, which is scheduled to open in September, are a pool and a boxing ring.

Gold’s Gym will pay slightly more than $2 per foot for the 34,000-square-foot space, Bordeaux said. With a 15-year lease, the deal’s value tops $1 million.

Morton’s Restaurant Group signed a 15-year deal for 8,730 square feet, according to Kristy Freedman, spokeswoman at the property. Cost per foot for the restaurant lease was not disclosed, but the company will spend $1.8 million to build out the space and plans to open this fall.

Freedman said the decision to locate downtown was based on the area’s active convention and hotel business, as well as the proliferation of high-end residential units.

Staff reporter Christopher Keough can be reached at (323) 549-5225 ext. 235 or at [email protected].