A little less than a year ago, I asked First Deputy Mayor Austin Beutner to lead a newly revitalized business team with one unequivocal goal in mind: create jobs for hard-working Angelenos in the city of Los Angeles. And one business and one policy at time, my Office of Economic and Business Policy has been doing just that by leveraging every resource at our disposal to attract businesses and the jobs that come with them. We have been untangling decades of red tape and burdensome policies that were impeding economic progress in our city to create a more business-friendly climate in Los Angeles.
Now, the results are in: Our efforts are working. Claremont McKenna recently released its internationally recognized Kosmont-Rose Institute study on the costliest cities to do business in the United States. Last year, we were in the top 10 and this year we are no longer on this list. What a difference a year makes!
The Kosmont-Rose study serves as concrete validation of our progress and acknowledges our steady stream of policy successes as a major contributing factor in our improved ranking.
Larry Kosmont, president and chief executive of Kosmont Cos., a development services firm that co-sponsors the report, publicly supported our innovative economic initiatives when he said, “I think L.A. has actually made some progress for a big city. They are identifying the right tasks and they seem reasonably focused on it. I think that’s a way for L.A. to become selectively competitive. To me, that’s a move in the right direction.”
The work of my Office of Economic and Business Policy serves as a national model for how a city can change its course and emerge from the recession, as the study recommends, “leaner, smarter and friendlier to the businesses that keep the lights on at City Hall.”
With our momentum heading in the right direction, if we maintain our focus, I believe we will secure L.A.’s place as one of the most business-friendly cities in the country. After all, we have already seen a dramatic change in the culture of how we do business in Los Angeles.
Over the past nine months, there has been an avalanche of policy successes that are producing real results for our economy. When we expanded the State Enterprise Zones – maximizing our land’s economic value, and giving tax breaks to businesses and workers – we retained and created more than 4,000 jobs and are projected to create 15,000 jobs in five years in the San Fernando Valley alone.
When we proposed and signed the Internet Business Tax Ordinance, we kept Shopzilla and other influential Internet businesses – and the countless well-paying jobs that come with them – in Los Angeles.
We also created and implemented the Business Tax Holiday that is estimated by a USC Marshall School of Business study to create 55,000 jobs from companies moving to Los Angeles and generating new revenue for our city.
Also, for the first time in the history of City Hall, we created a small-business services team that is devoted solely to fighting for the interests of small businesses. This team will connect small businesses with the resources they need to survive and flourish in the city of Los Angeles. We put this team together because small businesses are our city’s economic engine – comprising more than 90 percent of all our businesses. We have more small businesses than any other city in the country, and are committed to keeping those businesses here and helping them thrive.
Our latest innovative policy initiative is the Local Preference Ordinance that will give a competitive advantage to local companies when they are competing for government contracts. This ordinance will help ensure that more procurement dollars are spent directly in the city of Los Angeles. Currently, of the $1 billion allocated for government contracts, only $180 million goes back to local businesses. This is not enough and has to change; we must seize the opportunity to stimulate the local economy and create jobs, and the Local Preference Ordinance will help us do this.
Change is not going to happen overnight, but if we work together, we can improve the economic vitality of our city for generations to come. Together, we can build a city that offers a highly competitive operating environment in which businesses can thrive and that will in turn create more jobs for hard-working Angelenos. The Kosmont-Rose study shows that this is within our reach. By harnessing the momentum of our pro-jobs and pro-business agenda, Los Angeles can continue flourishing as the creative and innovative capital of the world.
Antonio Villaraigosa has been mayor of Los Angeles since 2005.
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