The Los Angeles Community Development Bank, the centerpiece of city efforts to revitalize depressed communities after the 1992 riots, could be forced to close if a radical restructuring now underway fails, according to a government report and city officials.
Although new management has aggressively worked to reverse the bank's flagging fortunes, a new report by he Community Development Department indicates that early mistakes have taken a toll that could jeopardize the survival of the bank.
Battered by litigation and a devastating $24 million loss when its largest loan soured, the federally funded bank has nearly depleted its loan loss reserves and administrative funds. To keep making substantial loans, it must reshape itself dramatically to attract at least $25 million in capital, expected to come mainly from private lenders and investors, the report states.
Cable Issue Tops Lobbying List
Access to cable television lines and the huge development at Playa Vista were the top lobbying issues at Los Angeles City Hall during the first four months of 2000, according to a report by the city's Ethics Commission.
Nearly $250,000 in lobbying fees was spent in the hope of influencing the decision on whether or not to require cable television franchise holders to open their lines to Internet providers. AT & T; was the top spender on the issue, reporting $163,991 paid to five lobbying firms during the period.
Meanwhile, the developer of the Playa Vista project spent $165,000 on lobbying efforts directed at facilitating construction of a planned community on 1,087 acres near Marina del Rey. The city last year approved spending $45 million in bond proceeds to help fund the project's low-income housing component.
However, the council's Budget and Finance Committee recently delayed a decision on committing $135 million in Mello-Roos bond financing until more reports could be provided on methane gas discovered at the site.
Gemstar Eyeing Acquisitions
After announcing a 91 percent increase in profits during its most recent fiscal quarter, Gemstar International Group Ltd. said it would be interested in a "transaction" with TiVo Inc., which sells a device to digitally record TV shows.
Henry Yuen, Gemstar's chairman and chief executive, said he hadn't made a formal offer to buy TiVo, which has a market value of $733.6 million. TiVo officials said they appreciated the interest but no deal is in the works.
Pasadena-based Gemstar, which produces VCR Plus television software, is in the process of buying TV Guide Inc. for $9.2 billion and also intends to spend as much as $1 billion to buy small stakes in interactive-TV providers over the next two to three years, said Yuen.
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