A dispute between merchants of Olvera Street and the city commission that manages it – one of L.A.’s best-known tourist attractions – has gotten so hot that the city is sending in a mediator to try to cool things down.

The conflict centers on the El Pueblo de Los Angeles Historical Monument Commission’s decision to sharply increase rents for 61 merchants on the city-owned Olvera Street. The rent increases, effective April 1, ranged from 150 percent to 400 percent. Many businesses are refusing to pay the increases.

The mediator, former Judge Dennis Choate with Irvine-based ADR Services Inc., was brought in at the request of Councilman Jose Huizar, whose district includes Olvera Street. Choate will meet with merchant representatives and city officials next week.

Forty-three tenants have ignored the rent increases and have been paying their previous rent amounts, meaning the city is collecting $72,000 less each month than it says it’s owed.

The merchants say the rent increases are too steep and that they cannot afford to pay them because their revenue has fallen due to the recession.

“This would eat up all our profits and then some,” said Vivien Bonzo, owner of La Golondrina Café and president of the Olvera Street Merchants Association. Bonzo’s new monthly rent is $10,726, but she’s been paying slightly more than half that.

But Robert Adrande, general manager of the El Pueblo Historical Monument Commission, said the rent increases are both necessary for the district – which includes Olvera Street and five museums and parking lots – and overdue. He said that most tenants’ rents have not been raised since 1999.

A city controller’s audit in 2009 year found that rents averaged about $1.35 per square foot, while market rates for nearby parcels were as high as $6.50.

“My task as general manager was to bring leases forward to make us financially solvent so that we’re not reliant on the general fund,” Adrande said.

The merchants also have complained about last year’s increases in parking rates at a city lot closest to Olvera Street.

Bonzo said that customer traffic at her restaurant and at other shops fell sharply as a result and has not recovered. She said the merchants want the parking rates discussed in the mediation talks, though it was not clear whether Choate will include the topic.

Adrande disputed Bonzo’s contention that the parking rates have cut into customer traffic. He said that visitor counts to the entire historical monument complex have increased in recent months.

Huizar intervened in the dispute when Olvera Street merchants told him they hadn’t received sufficient notice about the rent hikes.

“I saw there was a need for more input from businesses on Olvera Street,” he said. “That’s why I requested the city engage a mediator.”