In July, Gary Toebben became president and chief executive of the Los Angeles Area Chamber of Commerce, replacing Russell “Rusty” Hammer, who served five years but stepped down because of illness. Toebben is a veteran chamber executive, with stints at the Lawrence, Kan. chamber and, most recently, the Northern Kentucky Area Chamber of Commerce. He’s also served as president of the chamber executive associations of both Kansas and Nebraska, as well as chairman of the American Chamber of Commerce Executives. Toebben steps into the L.A. Chamber’s top role at a crucial time for L.A. businesses, as the L.A. City Council has put forward several proposals directly targeting business operations. Also, major initiatives are moving forward on control of the Los Angeles Unified School District and at the ports of Los Angeles and Long Beach, as well as Los Angeles International Airport. Toebben recently stopped by the Business Journal to discuss these and other topics.
Question: Why did you accept the post to head the L.A. chamber?
Answer:
I’m 58 years old. I have been a chamber executive for much of my adult life. I was looking for the last great challenge in the world of chamber management and this was the perfect opportunity.
Q: Are you planning any major changes in direction?
A:
We were headed in the right direction under Rusty Hammer before he became ill. Our membership was growing it still is our profile was higher and we were working with other chambers and business groups to forge a unified voice. Over the last year or so, some of that has been allowed to drift, and understandably so with the CEO incapacitated as Rusty was. I intend to reinvigorate these efforts.
Q:
What is your initial assessment of L.A’s business climate?
A:
There’s a huge population base to serve. And because of the wealth of this region, there are lots of business opportunities. We also have a great, creative talent base, thanks to our universities and to new groups of people constantly coming into the region. There’s also the airport that serves as the gateway to the Pacific Rim and our ports. All of these resources are the envy of every other city in the world.
Q:
Yes, but
A:
But we still do not tip our hat to business and value companies that are adding new jobs and do everything we can on a governmental level to embrace them and help them. The businesses here don’t get very many pats on the back for what they contribute to the overall well-being of our region. The result of this is that business is perceived as a bunch of bad guys. Yes, there may be some bad guys, but somebody has to talk about the jobs that are being created, the wealth that’s being created. In California, it is easy to forget that business is an important player.
Q:
Why do you think that is?
A:
There’s not a single unified voice speaking on behalf of business here. The moving or merging of major corporate headquarters from Los Angeles is a key reason. The challenge is to find a leader to unify the business community.
Q:
Is that the role you plan for the L.A. chamber?
A:
Yes. That’s one of our roles. We have to get all business on the same page on key issues for the region. Under Rusty Hammer, we began an effort of collaboration with other chambers and business groups, aimed at speaking with one voice on key issues. Unfortunately, when Rusty became ill, that program’s growth was stunted. We have to try again.
Q:
Along these lines, what’s your reaction to the Los Angeles City Council’s proposal to require the operators of hotels along Century Boulevard near Los Angeles International Airport to pay their workers a “living wage?”
A:
Our response is that this is a bad policy. It’s one thing for cities to dictate that those businesses receiving direct dollars from the city must pay a living wage. But the entire community benefits from LAX. When will this stop? Will the city try to apply this to every business that receives police and fire protection from the city? The city has no place stepping in and taking the place of normal processes of negotiations between management and employees. Here, the City Council has taken sides: When you have City Council members being arrested in support of the workers at the same time they are going to make a policy decision on this issue, it looks like they’ve already made their decision.
Q:
But the chamber has not been very outspoken in opposition to this issue.
A:
Oh, but we have opposed it. You notice that this issue wasn’t on the council agenda when it was originally scheduled. That’s because a number of different business parties spoke with the mayor and with key city officials and said that passing such a precedent-setting ordinance with no public debate was not giving business a fair shake. We said, “You’re on a slippery slope. Where is this going to end? This is sending a strong statement to the business community that when labor is not successful at the bargaining table, the city will bail them out.”
Q:
What is the chamber’s position on Mayor Antonio Villaraigosa’s move to assume more control over the Los Angeles Unified School District?
A:
We support the mayor’s plan. Education is such an important issue. Since it’s so difficult to bring people into the region because of the high cost of housing, companies have to rely on the workforce that’s already here. And when we as a business community look into the future and see such dismal graduation rates from high school, we’re very concerned. That’s our future workforce. I just returned from the mayor’s trade mission to Asia. Wherever we went, we found that those countries graduated nearly all students from high school. That’s who we’re competing against.
Q:
But won’t the mayor’s plan that’s now been signed into law just add another layer of bureaucracy?
A:
No. You will have a board of directors that has a mandate to make change. The school board members, once they get elected, just don’t seem to know what to do to change the course of the schools.
Q:
Is the School District just too big to govern?
A:
Yes, if you try to manage the district from the headquarters building right next to our offices; it’s too big. When you look at big multibillion dollar corporations, they try to manage as close to the customer as they can, breaking down into smaller components. The School District needs to be decentralized. I know efforts have been made in this direction, with the district superintendents. But more needs to be done; the district should be broken down into six or seven “mini-districts.”
Q:
Turning to another key issue, what’s your position on the plan to clean up pollution at the Ports of Los Angeles and Long Beach?
A:
We have some serious concerns about the plan put forward by the ports. Look, these ports have tripled in size in the last 15 years and are projected to double their container volumes again in the next 20 years. Yet there’s no recognition of this in the plan. There’s no provision for the ports to expand. Sure, it’s good to have a clean-up plan. But the ports need to grow, too. And that’s what Mayor Antonio Villaraigosa promised us: growing and greening. This plan is all green and no grow.
Q:
So what needs to be done?
A:
First, we need to add capacity to the ports beyond what’s already there. We should be able to add 70 percent capacity without further impact on the environment. Second, we need to move more and more cargo containers onto rail so we don’t have all these trucks clogging up our freeways. That’s what Burlington Northern’s proposed rail yard would do. We need to move on that without delay.
Q:
What about Los Angeles International Airport?
A:
First, let me say that it’s quite an achievement that after 15 years of planning, we are finally doing something with the Tom Bradley International Terminal. It’s long overdue. In Asia, the airport facilities are far superior than what we have at LAX. Just to have the mayor see these facilities was worth the trip. LAX is our gateway airport, and if it wants to continue to be a gateway, we have no choice but to expand it.
Q:
But Mayor Villaraigosa has said repeatedly that he does not want to expand the airport and has even said he intends to limit the number of gates. And even if he tried to expand the airport, the neighbors will tie it up in court for years.
A:
There are two ways to expand an airport: Expand the terminals and gates or have bigger runways so that bigger planes carrying more people can use the airport. If that means moving one of the runways a little closer to homes than it is now, then that’s what we need to do so that the whole region can benefit. As for the neighbors, my message is that on this issue, no one should be drawing a line in the sand. If we do that, it simply won’t work. If the neighbors will work with the mayor and with the business community, we can work something out that will benefit everyone.
