Los Angeles is known as a city that is hostile to big box retail stores a Home Depot got slapped down in the San Fernando Valley a couple of weeks ago but now L.A. is starting to court big box stores in hopes they build in the city.

Mayor Antonio Villaraigosa’s office is to release a plan in the next few weeks that will focus on ways to lure retailers, especially big boxes. Villaraigosa has met with the chiefs of Home Depot and Costco.

The reason for the apparent turnaround: Other cities are making off with much of the bounty of sales taxes that big box stores create.

“We are the big 800 pound gorilla,” Robert “Bud” Ovrom, the deputy mayor of commercial and residential development, said

of the city of Los Angeles. But Ovrom notes nearby cities are getting more sales taxes. “L.A. has a very anemic situation in terms of sales taxes,” he said.

Los Angeles brought in $111 in sales tax revenue per capita in the city’s 2007 fiscal year that ended in June. Other cities in L.A. County brought in an average of 21 percent more.

Some cities brought in a lot more. Beverly Hills got $715 per capita, El Segundo got $654 and Culver City got $446, according to a draft of the report.

If the city could raise its per capita sales tax revenue to the county average, it would generate $92 million almost enough to erase the city’s current structural deficit of $95 million.

The problem is that Los Angeles has a long history of snubbing big box stores, which are generally defined as having at least 60,000 square feet and sitting in the middle of a sea of asphalt. Some big boxes are much bigger. Wal-Mart supercenters can run up to more than 200,000 square feet. They are rare in the county; Villaraigosa’s plan stops short of calling for Wal-Mart supercenters.

But even non-Wal-Mart big boxes can run into trouble.

“L.A. isn’t big box friendly at all, for a few reasons,” said Larry Kosmont, the president and chief executive of Kosmont Cos., which advises public agencies and private corporations on economic development. “The neighborhoods are well organized and they don’t want a Best Buy or a Home Depot. They are on big box alert.”

After opposition from local activists to a Home Depot in Sunland-Tujunga, the City Council earlier this month voted to revoke the company’s building permits and forced it to jump through new bureaucratic hoops.

Councilwoman Wendy Greuel, who represents the area where the Home Depot was attempting to build, was part of the opposition.

“Home Depot chose not to follow the rules,” she said. However, Greuel says she doesn’t oppose big box stores in general as long as they are done in a “smart manner.”

“Traffic is the biggest issue facing the city of L.A. and we have to address how big boxes are designed to ensure there is enough parking.”

In fact, traffic is the common denominator in L.A. when it comes to opposition to big box stores, said Kosmont.

The Sherman Oaks Home Owners Association brought the city to court because the Planning Commission changed the plans to increase a Best Buy store’s scale, thereby increasing the traffic, said Richard Close, the president of the association.

“Ventura Boulevard is gridlocked now and we believe the Best Buy will make problems worse,” Close said.

After four years of struggle against the store, the Best Buy will open this week.

“We recognize that the city makes a lot of sales tax on the stores,” he said. “The question is not should we have them, but where. We see big box stores attempting to go into neighborhoods though they are really regional facilities.”

Less traffic?

Villaraigosa’s office is turning the argument around, in a way. It is saying that residents won’t have to drive a long distance to shop if there’s a big box in their neighborhood.

“If you put shopping closer to where people live, you reduce traffic,” Ovrom said. “These people who say the store generates more traffic, they go shopping someplace else. If you live in North Hollywood, you go shop in Burbank or Glendale so you are driving a further distance.”

As stores are installed, traffic mitigation measures will be put into place including added signals and left turn pockets, he said.

Villaraigosa said in an e-mail: “Retail stores like Costco provide good paying jobs to Los Angeles residents and bring in waves of tax revenue.”

Ovrom has been talking to neighborhood groups in Pacoima where a Costco store is planned. So far, he said, local residents and groups have been generally supportive of the retail space but are concerned about a gas station that is installed with every Costco.

“The jobs are very attractive,” said Josh Stehlik, an attorney at Neighborhood Legal Services. “We hoped to have outdoor seating with a fountain which isn’t as plausible with a Costco-size gas station.”

Historically, big box stores haven’t been flexible in changing their store format by adding a second level or sharing parking lots to accommodate the community.

In fact, the crowded landscape of Los Angeles is problem for big box stores that want to develop here, said Kosmont.

“It is just hard to find large enough locations to put them on,” he said.

That’s one of the reasons Issaquah,Wash.-based Costco hasn’t been quick to develop within city limits, said Jim Sinegal, the co-founder and chief executive of the company, who met with Villaraigosa about two months ago about expansion in the city.

An average Costco sits on about 15 acres, requires a building that is about 150,000 square feet and has 750 to 800 parking stalls, he said.

“It is hard to find land, but it is also hard in Seattle, San Diego, and San Francisco,” said Sinegal. “It isn’t going to be easy, but that’s why they call it work.”

Costco has 13 stores in Los Angeles County; only four are within L.A. city limits.

“The stores surrounding Los Angeles are very successful,” said Sinegal. “In my conversation with (Villaraigosa), he said he very much wanted to have our business in Los Angeles. It is a great market for us. Generally speaking we are welcomed into communities. We want to be a good neighbor and be as palatable as we can.”

The mayor’s draft report said the stores will be targeted in under-serviced areas. East L.A., which is usually hurt by sales to Alhambra and Monterey Park; South L.A., which loses business to Carson and Culver City; and downtown, which is hurt by Glendale, will be some of the main targets, Ovrom said.

Ovrom said financial incentives will be available for big boxes on a case-by-case basis. Most likely stores in areas like South L.A. and the Central Valley would be eligible for financial aid.

Big box stores don’t face universal opposition. Some neighborhoods, such as South Los Angeles, with high unemployment would like to see box stores in the area.

“We don’t feel the same as the rest of Los Angeles,” said Henry Broomfield, chairman of the Watts Neighborhood Council.

“When I go to other neighborhood councils, they are more concerned about traffic and mom and pop businesses being shut down, but we don’t have those concerns. Our kids can’t get work so we would make it a holiday if they opened a big store.”