Downtown L.A. has a well-chronicled problem: Nobody lives there. Without permanent residents it's impossible to create a thriving central community, because the place simply empties out after business hours and on weekends.
Fortunately, it's a problem that seems easy to solve, especially given the city's burning demand for affordable multifamily housing you just build more. But that's where the city's politics and history step in to make a seemingly simple fix into a minefield.
And this is one minefield that needs to be cleared as soon as possible.
Developers are seldom willing to build apartments downtown without public assistance, in the form of tax breaks, infrastructure improvements or direct subsidies. Further, it's virtually impossible to build in such a highly developed area without buying existing structures and tearing them down. For large projects that is an extremely difficult assignment, because property must be assembled from a diverse group of owners some of whom may not be willing to sell at a reasonable price.
The Community Redevelopment Agency exists to help solve all these problems. Through its eminent domain power, it can force recalcitrant property owners in areas in need of an economic boost to sell. It can also provide financial assistance to developers, making the money back by collecting extra property taxes on the more-valuable new structures. But the CRA is hampered by outdated 25-year-old laws, a bureaucracy that until recently has been bloated and rudderless, and the recession of the mid-1990s that is still putting the clamps on its finances.
As far as downtown is concerned, the most serious of these problems is the cap of $750 million in funding that was placed on the CRA's Central Business District in the mid-1970s. Because the CRA is about to reach this cap, the agency is effectively barred from involvement in any more large downtown projects. There is, however, a solution in sight.
This fall or winter, the CRA is expected to reach its $750 million cap. At that point, it could simply close the Central Business District project area, pay off the bonds, and start up a new downtown redevelopment area. Yet a political fight is brewing that might block such a desirable move.
The CRA is a deeply troubled agency that has proven all but unable to fund itself; last year, it asked the City Council for $9 million a year in general fund money just to keep existing work going, after slashing its own staff from 350 to 190. The agency's ongoing money problems prompted an attempt by the council early last year to simply take over, naming itself the CRA's board.
While that council coup did not occur, it seems doubtful that the council will allow the CRA to create a whole new downtown redevelopment area, especially given that it is already taking on a gigantic new redevelopment area in the northeast San Fernando Valley. Yet that is precisely what needs to happen if the billions of dollars being invested into current and planned downtown projects is ever to pay off.
There is no quick and easy fix to the CRA's problems, though there are encouraging signs for the future. Rising property values should help ease its financial troubles, and new Administrator Jerry Scharlin has been getting generally high marks for putting the organization's house in order.
What is needed now is a comprehensive study of the downtown areas most in need of improvement, followed by an effective plan for putting together a new redevelopment area. After that, financial problems or not, serious efforts must be made to continue the CRA's mission in downtown L.A.
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